GRIDLEY CITY COUNCIL AGENDA: Regular Meeting of 1-16-24 Page 1 of 2 “Our purpose is to continuously enhance our community’s vitality and overall quality of life. We are committed to providing high quality, cost-effective municipal services and forming productive partnerships with our residents and regional organizations. We collectively develop, share, and are guided by a clear vision, values, and meaningful objectives.” The Public is encouraged to attend and participate in person. Comments from the public on agenda items will be accepted until 4 pm on January 16, 2024, via email to [email protected] or via the payment/document drop box at Gridley City Hall and will be conveyed to the Council for consideration.
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CALL TO ORDER - Mayor Farr
ROLL CALL
PLEDGE OF ALLEGIANCE – Councilmember Calderon
INVOCATION – None
PROCLAMATION – None
INTRODUCTION OF NEW OR PROMOTED EMPLOYEES
Swearing in of City Administrator Elisa Arteaga and Finance Director Martin Pineda COMMUNITY PARTICIPATION FORUM - Members of the public may address the City Council on matters not listed on the agenda. The City Council may not discuss nor take action on any community participation item brought forward by a member of the community. Comments are requested to be limited to three (3) minutes.
CONSENT AGENDA
1. City Council Minutes Dated December 18, 2023
2. December 2023 Expenditure Report
3. Reappointment of Planning Commissioners Ken Wolfe and Maria Espino
ITEMS FOR CONSIDERATION
Gridley City Council – Regular Meeting Agenda
Tuesday, January 16, 2024; 6:00 pm
Gridley City Hall, 685 Kentucky Street, Gridley, CA 95948 GRIDLEY CITY COUNCIL AGENDA: Regular Meeting of 1-16-24 Page 2 of 2
4. Resolution No. 2024-R-001: A Resolution of Gridley City Council Appointing Representatives and Alternate Representative for Northern California Cities Self Insurance Fund (NCCSIF)
5. Review and Approval of FY 20-21 Audit Reports
6. Reinvestment of Certificate of Deposit (CD)
CITY STAFF AND COUNCIL COMMITTEE REPORTS - Brief updates from City staff and brief reports on conferences, seminars, and meetings attended by the Mayor and City Council members, if any.
CITY ADMINISTRATOR REPORTS - Brief updates and reports on conferences, seminars, and meetings attended by the City Administrator, if any.
POTENTIAL FUTURE CITY COUNCIL ITEMS - (Appearing on the Agenda within 30-90 days):
CLOSED SESSION
7. Public Employment (GC: 54957) Position: Utility Director ADJOURNMENT – adjourning to a Regular meeting on February 5th, 2023.
NOTE 1: POSTING OF AGENDA- This agenda was posted on the public bulletin board at City Hall at or before 6:00 p.m., January 13th, 2024. This agenda along with all attachments is available for public viewing online at www.gridley.ca.us and at the Administration Counter in City Hall, 685 Kentucky Street, Gridley, CA.
NOTE 2: REGARDING UNSCHEDULED MATTERS – In accordance with state law, it shall be the policy of this Council that no action shall be taken on any item presented during the public forum or on unscheduled matters unless the Council, by majority vote, determines that an emergency situation exists, or, unless the Council by a two-thirds vote finds that the need to take action arose subsequent to the posting of this agenda.
Finance Policies 2/20/2024
Housing Element Review and Discussion 2/20/2024
Proposal for Shared Fire Department Mechanic 3/4/2024
GRIDLEY CITY COUNCIL MINUTES: Regular Meeting of 12-18-23 Page 1 of 4 “Our purpose is to continuously enhance our community’s vitality and overall quality of life. We are committed to providing high quality, cost-effective municipal services and forming productive partnerships with our residents and regional organizations. We collectively develop, share, and are guided by a clear vision, values, and meaningful objectives.”
CALL TO ORDER
Mayor Farr called the meeting to order at 6:00 pm.
ROLL CALL
Councilmembers
Present: Farr, Roberts, Sanchez
Absent: Caldero, Johnson
Arriving after roll call: None
Staff Present: Cliff Wagner, City Administrator
Rodney Harr, Police Chief
Landon Little, Deputy City Attorney
Ross Pippitt, Public Works Director
Jake Carter, Utility Director
Elisa Arteaga, Finance Director
Dave Harden, City Engineer
PLEDGE OF ALLEGIANCE
Councilmember Roberts led the Pledge of Allegiance.
INVOCATION
The invocation was led by Bishop Mclean, of the Church of Jesus Christ of Latter-day Saints.
PROCLAMATION – None
INTRODUCTION OF NEW EMPLOYEES
Police Chief Rodney Harr introduced the new Police Officer, Rollin Luntey.
RECOGNITION OF RETIRING CITY ADMINISTRATOR, CLIFF WAGNER AND RETIRING FIRE CHIEF,
SEAN NORMAN
Mayor Farr recognized the retirement of current Fire Chief, Sean Norman and our City Administrator, Cliff Wagner. Both Administrator Wagner and Chief Norman expressed gratitude Gridley City Council – Regular Meeting Minutes
Monday, December 18, 2023; 6:00 pm
Gridley City Hall, 685 Kentucky Street, Gridley, CA 95948 GRIDLEY CITY COUNCIL MINUTES: Regular Meeting of 12-18-23 Page 2 of 4 for the City, City Council and staff. Newly appointed staff were introduced at that time: Fire Chief Chip Fowler, City Administrator Elisa Arteaga, and Finance Director Martin Pineda.
Council adjourned to a brief recess for refreshments.
COMMUNITY PARTICIPATION FORUM
The forum was open, and seeing there was no one to speak, was closed.
CONSENT AGENDA
1. City Council Minutes Dated December 4th, 2023
2. Council Meeting Dates for 2024
Motion to approve the consent agenda was made by Councilmember Roberts, seconded by Councilmember Sanchez.
ROLL CALL VOTE
Ayes: Roberts, Sanchez, Farr
Motion carried, 3-0
ITEMS FOR CONSIDERATION
3. Resolution Nos. 2023-R-041 and 2023-R-042: Conduct a Public Hearing and Consider Water and Sewer Rate Adjustments
City Administrator Wagner addressed Council regarding the proposed increase that was tentatively approved at the September 14th regular meeting pending the Prop 218 requirements be met and pending confirmation that the City does not receive a majority vote against the rate adjustments. Administrator Wagner explained City staff implemented the Prop 218 process that requires a minimum 45-day notice be mailed to property owners and rate payers. City staff mailed 2,124 notices both in English and Spanish language that included the current and proposed rate schedules. A total of two protests were received. City Administrator Wagner respectfully requested that Resolution 2023-R-041 and Resolution 2023-R-042 be adopted, approving the proposed rate change.
Pat Coghlan submitted written comments and shared concerns of information being available to the public.
After a brief Council discussion, motion to approve the item was made by Councilmember Roberts, seconded by Councilmember Sanchez.
ROLL CALL VOTE
Ayes: Sanchez, Roberts, Farr
Motion carried, 3-0
GRIDLEY CITY COUNCIL MINUTES: Regular Meeting of 12-18-23 Page 3 of 4
4. Solid Wate Contract Extension
Christian Garcia of Waste Management presented a PowerPoint that highlighted important details of the proposed solid waste contract.
Councilmember Sanchez had questions for the Waste Management representatives as well for City staff. Pat Coghlan asked for clarification on how to register for discounted senior rates.
After discussion, a motion to approve the contract was made by Councilmember Roberts, seconded by Councilmember Sanchez.
ROLL CALL VOTE
Ayes: Sanchez, Roberts, Farr
Motion passed, 3-0
Administrator Wagner reminded Council and public that the Waste Management rate increase is also subject to Prop 218 noticing. This item is tentatively scheduled for the regular Council meeting of March 4th, 2024 after appropriate notice has been given to customers and property owners.
5. Bucket Truck – Terex TL60
Utility Director Jake Carter requested Council approve the purchase of a Terex TL60 bucket truck to replace their existing bucket truck.
Motion to approve was made by Councilmember Sanchez, seconded by Councilmember Roberts.
ROLL CALL VOTE
Ayes: Farr, Roberts, Sanchez
Motion passed, 3-0
CITY STAFF AND COUNCIL COMMITTEE REPORTS - None
CITY ADMINISTRATOR REPORTS
City Administrator Wagner reminded Council of the Holiday Party scheduled for December 19th.
Administrator Wagner also thanked Council for the opportunity to work for the City and with City Council.
POTENTIAL FUTURE CITY COUNCIL ITEMS - (Appearing on the Agenda within 30-90 days):
CLOSED SESSION - None
Proposal for Shared Fire Department Mechanic 1/15/2024
Finance Policies 1/15/2024
Housing Element Review and Discussion 1/15/2024
GRIDLEY CITY COUNCIL MINUTES: Regular Meeting of 12-18-23 Page 4 of 4
ADJOURNMENT
With no further items left to discuss, Mayor Farr adjourned to the next regular meeting on January 16th, 2024.
December 2023
Expenditure Report
Check Report
~`~~ ~ GrÍdley, CA By Check Number
.-,,j~j,.j, Date Range: 12/01/2023 - 12/31/2023
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Vendor Number Vendor Name Payment Date Payment Type Discount Amount Payment Amount Number Bank Code: General Checking-General Checking
TJK01 TJKM TRANSPORTATION CONSULTANTS 12/01/2023 Regular 0.00 8,082.85 975716 ACI01 ACI ENTERPRISES, INC. 12/04/2023 Regular 0.00 263.32 975720 EFF01 EFFICIENCY SERVICES GROUP, LLC 12/04/2023 Regular 0.00 3,580.00 975721 NCC01 NCCSIFFINANCIALSERVICES 12/04/2023 Regular 0.00 15,934.23 975722 PRE03 PREMIER ACCESS INSURANCE 12/04/2023 Regular 0.00 13,507.72 975723 STA01 STANDARD INSURANCE CO 12/04/2023 Regular 0.00 9,909.80 975724 VISO4 VISION SERVICE PLAN - (CA 12/04/2023 Regular 0.00 609.87 975725 ACC09 ACCULARM SECURITY SYSTEMS 12/08/2023 Regular 0.00 335.00 975726 ALL1S ALLIANT INSURANCE SERVICE 12/08/2023 Regular 0.00 SS1.00 975727 AND12 ANDES POOL SUPPLY 12/08/2023 Regular 0.00 164.97 975728 AS001 ANDREW STONE 12/08/2023 Regular 0.00 40.00 975729 ARA01 ARAMARK UNIFORM SERVICES 12/08/2023 Regular 0.00 16.99 975730 GALOS ASHLEYAYALA 12/08/2023 Regular 0.00 41.06 975731
ATT14 ATBeT 12/08/2023 Regular 0.00 30.85 975732
ATT14 AT&T 12/08/2023 Regular 0.00 30.85 975733
ATT14 AT&T 12/08/2023 Regular 0.00 252.75 975734
ATT14 AT&T 12/08/2023 Regular 0.00 1,046.77 975735
ATT0001 AT&T 12/08/2023 Regular 0.00 181.19 975736
AUT03 AUTO ZONE INC. 12/08/2023 Regular 0.00 18.90 975737 BEN11 BENNETT ENGINEERINGSERVI 12/08/2023 Regular 0.00 2,067.00 975738 ACE02 CANDELARIO ACE HARDWARE 12/08/2023 Regular 0.00 795.25 975739 **Void** 12/08/2023 Regular 0.00 0.00 975740
CA511 CASEY'S AUTO REPAIR 12/08/2023 Regular 0.00 955.83 975741 CDW02 CDW LLC 12/08/2023 Regular 0.00 1,071.62 975742
COL0001 COLANTUONO, HIGHSMITH & WHATLEY, PC 12/08/2023 Regular 0.00 25,151.90 975743 COM17 COMCAST 12/08/2023 Regular 0.00 158.53 975744
CRA01 CRANMER ENGINEERING 12/08/2023 Regular 0.00 345.00 975745 DAN03 DAN-GERINC 12/08/2023 Regular 0.00 335.46 975746
EFF01 EFFICIENCY SERVICES GROUP, LLC 12/08/2023 Regular 0.00 3,580.00 975747 FA502 FASTENAL 12/08/2023 Regular 0.00 137.96 975748
FAS0001 FASTRAK VIOLATION PROCESSING DEPT. 12/08/2023 Regular 0.00 17.50 975749 FGL01 FGL ENVIRONMENTAL, INC. 12/08/2023 Regular 0.00 475.00 975750 F0002 FOOTHILL FIRE PROTECTION, 12/08/2023 Regular 0.00 2,923.67 975751 GCS01 GCS ENVOIRONMENTAL EQUIP 12/08/2023 Regular 0.00 70.10 975752 GRI01 GRIDLEY COUNTRY FORD 12/08/2023 Regular 0.00 2,966.62 975753 H0003 HOUSING TOOLS LLC 12/08/2023 Regular 0.00 480.00 975754 KIM03 KIMBALL MIDWEST 12/08/2023 Regular 0.00 63.02 975755 KOE01 KOEFRAN INDUSTRIES 12/08/2023 Regular 0.00 225.00 975756 LAK01 LAKEVIEW PETROLEUM CO 12/08/2023 Regular 0.00 10,445.82 975757 SCH01 LESSCHWAB TIRE CENTER 12/08/2023 Regular 0.00 188.16 975758 LIG03 LIGHTBEAM POWER COMPANY G 12/08/2023 Regular 0.00 4,821.25 975759 GAR0001 LYNETTE GARTON 12/08/2023 Regular 0.00 30.00 975760 MAC01 MAC'S HARDWARE &RENTAL 12/08/2023 Regular 0.00 750.50 975761 MAN08 MANN, URRUTIA, NELSON, CP 12/08/2023 Regular 0.00 6,500.00 975762 ME502 MESSENGER PUBLISHING GROU 12/08/2023 Regular 0.00 620.00 975763 NCC01 NCCSIF FINANCIAL SERVICES 12/08/2023 Regular 0.00 5,835.00 975764 NOR11 Northern California Joint Pole Assoc. 12/08/2023 Regular 0.00 11.77 975765 NOR44 NORTHWEST PUBLIC POWER AS 12/08/2023 Regular 0.00 3,122.37 975766 OFF02 OFFICE DEPOT 12/08/2023 Regular 0.00 819.57 975767 ORE01 O'REILLYAUTOMOTIVE,INC. 12/08/2023 Regular 0.00 ZS.73 975768 PGE01 P G & E CO 12/08/2023 Regular 0.00 696.15 975769
PAC24 PACE SUPPLY 12/08/2023 Regular 0.00 63.66 975770
PIT01 PITNEY BOWES 12/08/2023 Regular 0.00 475.93 975771 PIT02 PITNEY BOWES INC 12/08/2023 Regular 0.00 2,000.QO 975772 ?/25/2Ci2~$ .?:~.`.i:47 ;~Nl i-'i3:ati'. . .,. ..
Check Report Date Range: l2/01/2023-12/31/2023
Vendor Number Vendor Name Payment Date Payment Type Discount Amount Payment Amount Number RICOl Rich, Fuidge, Bordsen &Gaylean, Inc. 12/08/2023 Regular 0.00 4,054.00 975773 ROA02 ROAD SAFE TRAFFIC SYSTEMS INC 12/08/2023 Regular 0.00 180.18 975774 RSGOl RSG INC. 12/08/2023 Regular 0.00 3,143.75 975775
STA01 STANDARD INSURANCE CO 12/08/2023 Regular 0.00 4,197.28 975776 ADV05 SUPERIOR CALIFORNIA OFFICE EQUIPMENT, IN 12/08/2023 Regular 0.00 2,888.43 975777 SWROl STATE WATER RESOURCES CONTROL BOARD 12/08/2023 Regular 0.00 31,399.00 975778 TER01 TEREX UTILITIES WEST 12/08/2023 Regular 0.00 2,671.80 975779 UP505 THE UPS STORE 12/08/2023 Regular 0.00 325.24 975780 TJKOl TJKM TRANSPORTATION CONSULTANTS 12/08/2023 Regular 0.00 2,614.84 975781 TRI01 TRI-CITY POWERED EQUIP 12/08/2023 Regular 0.00 157.72 975782 IMP01 U.S. BANK CORPORATE PAYMENT SYSTEMS 12/08/2023 Regular 0.00 27,982.11 975783 **Void** 12/08/2023 Regular 0.00 0.00 975784
**Void** 12/08/2023 Regular 0.00 0.00 975785
**Void** 12/08/2023 Regular 0.00 0.00 975786
**Void** 12/08/2023 Regular 0.00 0.00 975787
**Void** 12/08/2023 Regular 0.00 0.00 975788
**Void** 12/08/2023 Regular 0.00 0.00 475789
USBOS US BANK 12/08/2023 Regular 0.00 60.33 975790
US608 US BANK 12/08/2023 Regular 0.00 1,500.00 975791
US605 US BANK 12/08/2023 Regular 0.00 47.77 975792
USB05 US BANK 12/08/2023 Regular 0.00 298.09 975793
USA02 USA BLUEBOOK 12/08/2023 Regular 0.00 893.40 975794 VER02 VERIZON WIRELESS 12/08/2023 Regular 0.00 12.94 975795 VSM01 VICKI M SMITH 12/08/2023 Regular 0.00 125.00 975796 VI504 VISION SERVICE PLAN - (CA 12/08/2023 Regular 0.00 597.77 975797 DECO2 DECKER ENGINEERING SERVICES, LLC 12/14/2023 Regular 0.00 4,875.00 975798 ASI01 ADMINISTRATIVE SOLUTIONS 12/26/2023 Regular 0.00 2,762.50 975800 **Void** 12/26/2023 Regular 0.00 0.00 975801
ATT08 AT8cT 12/26/2023 Regular 0.00 31.43 975802
ATT08 AT&T 12/26/2023 Regular 0.00 31.43 975803
ATT08 AT&T 12/26/2023 Regular 0.00 63.82 975804
ATT08 AT&T 12/26/2023 Regular 0.00 63.82 975805
ATT08 AT&T 12/26/2023 Regular 0.00 31.43 975806
BIGOT BIG VALLEY AG SERVICES 12/26/2023 Regular 0.00 1,836.12 975807 BUTOl BUTTE AUTO PARTS 12/26/2023 Regular 0.00 391.21 975808 BUT49 BUTTE COUNTY DISTRICT ATT 12/26/2023 Regular 0.00 5,000.00 975809 ACE02 CANDELARIO ACE HARDWARE 12/26/2023 Regular 0.00 154.84 975810 CA511 CASEY'S AUTO REPAIR 12/26/2023 Regular 0.00 755.17 975811 CDW02 CDW LLC 12/26/2023 Regular 0.00 191.70 975812
WAG0001 CLIFFORD M. WAGNER 12/26/2023 Regular 0.00 325.00 975813 CLO01 CLOSE LUMBER INC 12/26/2023 Regular 0.00 354.20 975814 COM17 COMCAST 12/26/2023 Regular 0.00 169.07 975815
BIR02 DANNY BIRKHOLTZ 12/26/2023 Regular 0.00 78.18 975816 FGL01 FGL ENVIRONMENTAL, INC. 12/26/2023 Regular 0.00 340.00 975817 MACOl MAC'S HARDWARE &RENTAL 12/26/2023 Regular 0.00 316.28 975818 OFF02 OFFICE DEPOT 12/26/2023 Regular 0.00 361.78 975819 PGE01 P G 8c E CO 12/26/2023 Regular 0.00 638.93 975820 PAW02 Paws Clinic of Oroville 12/26/2023 Regular 0.00 1,020.00 975821 RIC01 Rich, Fuidge, Bordsen &Gaylean, Inc. 12/26/2023 Regular 0.00 2,940.75 975822 SYL02 SILVIA ELENA CORDERO 12/26/2023 Regular 0.00 2,540.00 975823 STA18 STATE OF CALIFORNIA 12/26/2023 Regular 0.00 66.00 975824 TRI01 TRI-CITY POWERED EQUIP 12/26/2023 Regular 0.00 34.83 975825 TYL01 TYLER TECHNOLOGIES, INC 12/26/2023 Regular 0.00 175.00 975826 USB05 US BANK 12/26/2023 Regular 0.00 60.31 975827
USBOS US BANK 12/26/2023 Regular 0.00 80.22 975828
USBOS US BANK 12/26/2023 Regular 0.00 149.00 975829
VER02 VERIZON WIRELESS 12/26/2023 Regular 0.00 1,944.65 975830 WHE02 WHEELER RANCH &FEED 12/26/2023 Regular 0.00 42.85 975831 AUT03 AUTO ZONE INC. 12/28/2023 Regular 0.00 145.80 975832 AZCOl AZCO 12/28/2023 Regular 0.00 713.16 975833
BECO2 BECK'S SHOES, INC. 12/28/2023 Regular 0.00 400.54 975834 i /f.i/2074 %:4~.i:~i'1 PM I'etJ:' 1. Oi Ci
Check Report Date Range: l2/01/2023-12/31/2023
Vendor Number Vendor Name Payment Date Payment Type Discount Amount Payment Amount Number BEN02 BEN TOILET RENTALS 12/28/2023 Regular 0.00 98.05 975835 KOP0001 BRANDY KOPP 12/28/2023 Regular 0.00 30.00 975836 BUT01 BUTTE AUTO PARTS ],2/28/2023 Regular 0.00 127.65 975837 ACE02 CANDELARIO ACE HARDWARE 12/28/2023 Regular 0.00 344.56 975838 CASll CASEY'S AUTO REPAIR 12/28/2023 Regular 0.00 39.75 975839 COM17 COMCAST 12/28/2023 Regular 0.00 377.92 975840
COR01 CORBINWILLITS SYSTEM, IN 12/28/2023 Regular 0.00 2,433.89 975841 EVE03 EVERBANK 12/28/2023 Regular 0.00 54.12 975842
EVE01 EVERGREEN JOB &SAFETY TRAINING, INC 12/28/2023 Regular 0.00 1,864.00 975843 GEN06 GENERAL PACIFIC, INC. 12/28/2023 Regular 0.00 2,336.36 975844 HDL02 HINDERLITER, DE LLAMAS &ASSOCIATES 12/28/2023 Regular 0.00 112.96 975845 HUSOl HUST BROTHERS 12/28/2023 Regular 0.00 86.97 975846 KIM03 KIMBALL MIDWEST 12/28/2023 Regular 0.00 289.46 975847 MAC0002 MACQUARIE EQUIPMENT CAPITAL INC. 12/28/2023 Regular 0.00 228.60 975848 MAC01 MAC'S HARDWARE &RENTAL 12/28/2023 Regular 0.00 78.82 975849 MCA601 MICHELLE CABLE 12/28/2023 Regular 0.00 45.00 975850 MIL02 MILBRADTVETHOSPITAL 12/28/2023 Regular 0.00 1,121.20 975851 NOR02 NORTHERN CALIF POWER AGCY 12/28/2023 Regular 0.00 227,771.00 975852 ONE02 ONESOURCE DISTRIBUTORS 12/28/2023 Regular 0.00 22.52 975853 BIG02 ORCHARD HOSPITAL 12/28/2023 Regular 0.00 555.00 975854 PGE01 P G & E CO 12/28/2023 Regular 0.00 2,157.45 975855 ROA02 ROAD SAFE TRAFFIC SYSTEMS INC 12/28/2023 Regular 0.00 64.62 975856 SOL04 SOLOMON CORPORATION 12/28/2023 Regular 0.00 1,689.51 975857 UP505 THE UPS STORE 12/28/2023 Regular 0.00 71.74 975858 TYLOl TYLER TECHNOLOGIES, INC 12/28/2023 Regular 0.00 1,100.00 975559 USBOS US BANK 12/28/2023 Regular 0.00 150.83 975860
USBOS US BANK 12/28/2023 Regular 0.00 47.77 975861
WHE02 WHEELER RANCH &FEED 12/28/2023 Regular 0.00 66.52 975862 YBA01 YBASHIRTS,INC 12/28/2023 Regular 0.00 646.40 975863 MIS07 MissionSquare - 303902 12/28/2023 Regular 0.00 7,614.08 975866 CAL70 CALIFORNIA CHOICE BENEFIT 12/20%2023 Bank Draft 0.00 23,951.93 DFT0002293 CAL70 CALIFORNIA CHOICE BENEFIT 12/20/2023 Bank Draft 0.00 23,951.86 DFT0002345 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/01/2023 Bank Draft 0.00 50.00 DFT0002404 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/01/2023 Bank Draft 0.00 1,177.54 DFT0002406 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/01/2023 Bank Draft 0.00 1,991.70 DFT0002407 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/01/2023 Bank Draft 0.00 2,373.00 DFT0002408 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/01/2023 Bank Draft 0.00 4,227.29 DFT0002409 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/01/2023 Bank Draft 0.00 4,960.79 DFT0002410 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/01/2023 Bank Draft 0.00 4,915.99 DFT0002411 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/01/2023 Bank Draft 0.00 2,626.92 DFT0002412 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/01/2023 Bank Draft 0.00 7,486.74 DFT0002413 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/01/2023 Bank Draft 0.00 2,479.86 DFT0002414 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/01/2023 Bank Draft 0.00 2,441.98 DFT0002415 INT07 INTERNAL REVENUE SERVICE 12/01/2023 Bank Draft 0.00 5,326.72 DFT0002416 INT07 INTERNAL REVENUE SERVICE 12/01/2023 Bank Draft 0.00 15,217.26 DFT0002417 INT07 INTERNAL REVENUE SERVICE 12/01/2023 Bank Draft 0.00 842.66 DFT0002418 EMP01 EMPLOYMENT DEVELOPMENT 12/01/2023 Bank Draft 0.00 6,148.91 DFT0002419 INT07 INTERNAL REVENUE SERVICE 12/01/2023 Bank Draft 0.00 365.00 DFT0002420 INT07 INTERNAL REVENUE SERVICE 12/01/2023 Bank Draft 0.00 553.54 DFT0002421 EMP01 EMPLOYMENT DEVELOPMENT 12/01/2023 Bank Draft 0.00 202.92 DFT0002422 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 51.00 DFT0002428 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 1,182.15 DFT0002430 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 1,999.51 DFT0002431 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 2,380.22 DFT0002432 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 4,240.16 DFT0002433 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 4,584.13 DFT0002434 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 4,542.74 DFT0002435 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 2,528.84 DFT0002436 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 7,207.21 DFT0002437 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 2,470.65 DFT0002438 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 2,432.91 DFT0002439 i/f3/?024 2:~5:47 PM Pa~r: 3 of' 6
Check Report Date Range: 12/01/2023 - 12/31/2023
Vendor Number Vendor Name Payment Date Payment Type Discount Amount Payment Amount Number INT07 INTERNAL REVENUE SERVICE 12/15/2023 Bank Draft 0.00 5,446.30 DFT0002440 INT07 INTERNAL REVENUE SERVICE 12/15/2023 Bank Draft 0.00 16,046.18 DFT0002441 INT07 INTERNAL REVENUE SERVICE 12/15/2023 Bank Draft 0.00 874.54 DFT0002442 EMPOl EMPLOYMENT DEVELOPMENT 12/15/2023 Bank Draft 0.00 6,494.53 DFT0002443 INT07 INTERNAL REVENUE SERVICE 12/15/2023 Bank Draft 0.00 373.82 DFT0002444 INT07 INTERNAL REVENUE SERVICE 12/15/2023 Bank Draft 0.00 990.40 DFT0002445 EMP01 EMPLOYMENT DEVELOPMENT 12/15/2023 Bank Draft 0.00 375.25 DFT0002446 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 385.81 DFT0002449 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/15/2023 Bank Draft 0.00 382.33 DFT0002450 INT07 INTERNAL REVENUE SERVICE 12/15/2023 Bank Draft 0.00 -84.88 DFT0002452 EMPO3 EMPLOYMENT DEVELOPMENT 12/15/2023 Bank Draft 0.00 -39.47 DFT0002453 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/28/2023 Bank Draft 0.00 51.00 DFT0002460 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/28/2023 Bank Draft 0.00 764.78 DFT0002461 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/28/2023 Bank Draft 0.00 1,293.57 DFT0002462 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/28/2023 Bank Draft 0.00 2,382.61 DFT0002463 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/28/2023 Bank Draft 0.00 4,244.42 DFT0002464 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/28/2023 Bank Draft 0.00 4,604.41 DFT0002465 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/28/2023 Bank Draft 0.00 4,562.81 DFT0002466 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/28/2023 Bank Draft 0.00 2,532.08 DFT0002467 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/28/2023 Bank Draft 0.00 7,216.44 DFT0002468 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/28/2023 Bank Draft 0.00 2,762.27 DFT0002469 CAL59 CALIFORNIA PUBLIC EMPLOYE 12/28/2023 Bank Draft 0.00 2,720.08 DFT0002470 INT07 INTERNAL REVENUE SERVICE 12/28/2023 Bank Draft 0.00 5,189.60 DFT0002471 INT07 INTERNAL REVENUE SERVICE 12/28/2023 Bank Draft 0.00 14,996.82 DFT0002472 INT07 INTERNAL REVENUE SERVICE 12/28/2023 Bank Draft 0.00 553.52 DFT0002473 EMP01 EMPLOYMENT DEVELOPMENT 12/28/2023 Bank Draft 0.00 6,063.94 DFT0002474 INT07 INTERNAL REVENUE SERVICE 12/28/2023 Bank Draft 0.00 219.94 DFT0002475 INT07 INTERNAL REVENUE SERVICE 12/28/2023 Bank Draft 0.00 770.25 DFT0002476 EMP01 EMPLOYMENT DEVELOPMENT 12/28/2023 Bank Draft 0.00 389.06 DFT0002477 Bank Code General Checking Summary
Payable Payment
Payment Type Count Count Discount Payment
Regular Checks 254 137 0.00 496,684.91
Manual Checks 0 0 0.00 0.00
Voided Checks 0 8 0.00 0.00
Bank Drafts 60 60 0.00 237,474.54
EFT's 0 0
_,,
0.00 0.00
- 314 205 0.00 734,159.45
:/2</2~~7~4 7:45:4Ï PNI F'r.3gE ~I G~ íi
Check Report
Vendor Number Vendor Name
Bank Code: Payroll-Payroll
AME29 American Fidelity Assuran
AME29 American Fidelity Assuran
AME30 AMERICAN FIDELITY ASSURAN
AME30 AMERICAN FIDELITY ASSURAN
BUT43 CHILD SUPPORT SRVCS.
BUT43 CHILD SUPPORT SRVCS.
GRI12 GRIDLEY POLICE
GRI12 GRIDLEY POLICE
IBE01 I.B. E.W. -LOCAL#1245
IBE01 I.B.E.W. -LOCAL #1245
MI507 Mission5quare - 303902
M1507 MissionSquare - 303902
AME29 American Fidelity Assuran
AME30 AMERICAN FIDELITY ASSURAN
BUT43 CHILD SUPPORT SRVCS.
GRI12 GRIDLEY POLICE
IBE01 I.B.E.W. -LOCAL#1245
Date Range: l2/01/2023-12/31/2023
Payment Date Payment Type Discount Amount Payment Amount Number 12/05/2023 Regular 0.00 -100.00 14894
12/05/2023 Regular 0.00 100.00 14894
12/05/2023 Regular 0.00 1,082.52 14895
12/05/2023 Regular 0.00 -1,082.52 14895
12/05/2023 Regular 0.00 -33230 14896
12/05/2023 Regular 0.00 332.30 14896
12/05/2023 Regular 0.00 -1,375.00 14897
12/05/2023 Regular 0.00 1,375.00 14897
12/05/2023 Regular 0.00 2,274.90 14898
12/05/2023 Regular 0.00 -2,274.90 14898
12/05/2023 Regular 0.00 -7,377.25 14899
12/05/2023 Regular 0.00 7,377.25 14899
12/28/2023 Regular 0.00 100.00 14938
12/28/2023 Regular 0.00 1,082.52 14939
12/28/2023 Regular 0.00 332.30 14940
12/28/2023 Regular 0.00 1,375.00 14941
12/28/2023 Regular 0.00 3,525.20 14942
Bank Code Payroll Summary
Payable Payment
Payment Type Count Count Discount Payment
Regular Checks 34 it 0.00 18,956.99
Manual Checks 0 0 0.00 0.00
Voided Checks 0 6 0.00 -12,541.97
Bank Drafts 0 0 0.00 0.00
EFT's 0 0 0.00 0.00
34 17 0.00 6,415.02
I /t?/202.4 :`: ~ 5:4 Ï I~M ('ag:' S <if C
Check Report Date Range: l2/01/2023-12/31/2023
All Bank Codes Check Summary
Payable Payment
Payment Type Count Count Discount Payment
Regular Checks 288 148 0.00 515,641.90
Manual Checks 0 0 0.00 0.00
Voided Checks 0 14 0.00 -12,541.97
Bank Drafts 60 60 0.00 237,474.54
EFT's 0 0 0.00 0.00
348 222 0.00 740,574.47
Fund Summary
Fund Name Period Amount
999 Cash Clearing 12/2023
__.
740,574.47
_
740,574.47
s/ïS,`7.02.4 7:45:47 ;~M Pt:3ge ~ or 6
City Council Agenda Item #3
Staff Report
Date: January 16, 2024
To: Mayor and City Council
From: Elisa Arteaga, City Administrator
Subject: Reappointment of Planning Commissioners
Recommendation
City staff respectfully recommends that the City Council make reappointments to Planning Commissioners Ken Wolfe and Maria Espino. No other letters of interest were received.
Financial Impact - None
Compliance with City Council Strategic Plan or Budget Goals The City Council and City staff are committed to providing effective leadership while providing quality cost effective local government services.
Attachments
Letter of Interest – Espino
Letter of Interest – Wolfe
X Regular
Special
Closed
Emergency
City of Gridley
685 Kentucky Street
Gridley, CA 95948
RE: Interest in continuing as part of Gridley Planning Commission team As current Chair of the Planning Commission, Farmer, Mother and an active member of the Gridley/Biggs community, I am asking that I be granted a new/continuing term on the Gridley Planning Commission team.
I take great pride in playing an active role in my community by representing those who are unable to take on such a role. I take my current position as Chair very seriously doing my best to keep an orderly well-informed meeting. I have always gone the extra mile to do my homework on each agenda item for myself and for my fellow commissioners. I have done my job at giving the public a voice in our meetings as well as out in the community. That being said, I believe it is also important to always look to improve my knowledge so that I can better serve my community. I have done this by attending 2 years of multi day training, as well as free training put on by the League of Cities. I also research what other cities are doing and continually try to better our own. One area I have done this extensively with is Parks and Recreation. I have worked with our engineer, Rec, Directors, and city staff to come up with the best parks for our community; obviously this is a project that is ongoing.
As a farmer, parent and a long time member of this community, I have great pride in the my city and want to leave it better than I found it. This means not just as a Planning Commissioner; because community means involvement. I take an active role as an educator and volunteer at my children’s school, as part of community events such as the Red Suspenders Day parade, light parade, and many other events and celebrations.
Although Planning commissioner is a part time job, I put a lot more into it and hope at the end of the day my community is better for it. I would like to continue in my role as a Planning Commissioner for the City of Gridley, and I look forward to serving my community to the best of my capability.
Sincerely,
Maria Espino
481 Macedo Rd.
Gridley CA.
714-414-6665
Kenneth Wolfe
January 1, 2024
CityCounsel,
First of all let me take the time to say thank you for giving me the opportunity to serve as a planning commissioner for the City of Gridley for the past several years. It has been a great opportunity and learning experience for me. When I first decided to serve on the Planning Commission I viewed it as an opportunity to help our community and be a part of the changes the community faces. I have no personal or political agenda in serving, but do so to help our community.
It has been great to be a part of shaping our town's future. I am proud of some of the projects that we have had a hand in approving. One project that I was very pleased to be a part of was the senior living on HWY 99. It is important to me to make sure our seniors have nice, affordable housing and I hope to see more projects like these in the future.
Another project that I was pleased to assist on was the new Savmor. What a beautiful addition to what was vacant land on HWY 99 and not having the freezers broken down often. I have also had the pleasure of helping in the future of housing developments within the city. I have learned a lot about zoning and the need to rezone to assist in future growth of the city. I think the City of Gridley is on a good path for the future and I am thankful to have had a part in it.
My term has come to an end as of the first of January 2024. I would like to submit my name to be considered for another term if you will have me? Whatever the future may hold, I am thankful for the opportunities I've been given and look forward to many more in the new year.
Thank You,
Ken Wolfe
City Council Agenda Item #4
Staff Report
Date: January 16, 2024
To: Mayor and City Council
From: Elisa Arteaga, City Administrator
Subject: Appointment of Northern California Cities Self Insurance Fund (NCCSIF) Representative and Alternate Representative
Recommendation
Staff respectfully requests the City Council approve Resolution 2024-R-001: A Resolution of the City Council of the City of Gridley appointing Representative and Alternate Representative for the Northern California Cities Self Insurance Fund” by reading of title only.
Background
The City of Gridley is a member of the Northern California Cities Self Insurance Fund (NCCSIF).
NCCSIF is a Joint Powers Authority formed in 1979, an association of twenty-two (22) municipalities joined together to protect resources by providing risk services, management, and programs. Within the structure of the organization there are regular meetings and committees (Executive, Risk Management and Claims) reviewing programs and voting on issues relating to the resources, coverages, and programs (General Liability, Workers’ Compensation, Crime/Bond, Property, Mobile Equipment, Auto Physical Damage, Employee Assistance & Training, Special Events, Vendor/Contractors). The city being a member of NCCSIF, a larger pool comprised of Northern California cities, allows for a mechanism to self-fund a layer of workers compensation. The city also has access to group purchases of excess insurances.
Generally, the Finance Director is the primary representative and, in the event, the primary representative cannot attend a meeting, his/her designee (Alternate Representative) will attend. Staff is recommending the appointment of Martin Pineda, Finance Director as the primary representative and re-appoint Jodi Molinari, Human Resource Manager as the Alternate Representative.
Financial Impact
Appointment is a formality required by the JPA, there are no fiscal impacts. All fiscal impacts are part of the budgetary process on a fiscal year basis.
Attachment
Resolution No. 2024-R-001
X Regular
Special
Closed
Emergency
RESOLUTION NO. 2024-R-001
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GRIDLEY APPOINTING REPRESENTATIVE
AND ALTERNATE REPRESENTATIVE FOR NORTHERN CALIFORNIA CITIES SELF INSURANCE FUND
WHEREAS, it is desirable and necessary to appoint agents for the City of Gridley to act for and in its behalf in the Northern California Cities Self Insurance Fund (NCCSIF) which provides insurance coverage for the City of Gridley.
WHEREAS, the City of Gridley Finance Director is the primary representative and it is required to have an alternate appointed;
NOW, THEREFORE, IT IS HEREBY RESOLVED, Martin Pineda, Finance Director is the City of Gridley Representative and Jodi Molinari, Human Resource Manager as Alternate Representative.
I HEREBY CERTIFY, that the foregoing resolution was introduced, passed and adopted by the City Council of the City of Gridley at a regular meeting held on the 16th day of January 2024, by the following vote:
AYES: COUNCILMEMBERS ________________________________
NOES: COUNCILMEMBERS ________________________________
ABSTAIN: COUNCILMEMBERS ________________________________ ABSENT: COUNCILMEMBERS ________________________________ APPROVED: MAYOR ________________________________
Mike Farr
ATTEST: CITY CLERK ________________________________
Elisa Arteaga
City Council Agenda Item #5
Staff Report
Date: January 16, 2024
To: Mayor and City Council
From: Martin Pineda, Finance Director
Subject: Request for Acceptance and Approval of FY 20-21 Audit Reports Recommendation
Staff respectfully requests that the Mayor and City Council accept the attached FY 20-21 Financial Statements & Independent Auditors Report, Single Audit and Successor Agency auditors reports for the City of Gridley.
Background
As previously reported to the City Council by Finance Management, the FY 20-21 audit reports have been delayed due to city staff turnover caused by COVID-19. Eide Bailly Accounting Service Staff has been assisting the department to date. Joint efforts have been taken in the last year for a major overview of past and current financial processes to include the following:
• Review and correct deficiencies in finance processes. • Implementation of new software systems (to address repeat findings). • Implementation of an internal closing fiscal year end process. • Review and reassignments in daily operations.
• Restructure staff to include cross training.
• Improving efficiency and new customer service procedures. • Provide direction to staff regarding expectations of daily operations, audit prep work, internal finance processes.
• Review of all finance policies and organize a list of policies requiring updates. • Grant training for staff, assigned schedule of tasks with timelines. • Implemented internal financial records review processes and approvals to include bank reconciliation.
• Review reporting procedures for the City Council and other government entities.
The Finance Department has received the financial audit for FY 20-21 and has reviewed the findings and recommendations made by our independent auditors. Finance staff concurs with findings and recommendations. Corrective efforts are currently under review by the entire Finance Team and some measures have been implemented. The new software financial system has new modules and control processes for inventory, timecard entry, accounts payable, bank reconciliation, capital fixed assets, project management and an array of new reports that will be fundamental in providing information during future audits. x Regular
Special
Closed
Emergency
The Finance Department Staff will continue to bring Council for future consideration, new and amended policies and procedures that will address previous repeat findings. These controls allow for review of supporting documentation and the ability to scan supporting documentation directly to finance entries. Finance Staff with the assistance of Eide Bailly has outlined an internal year end closing process checklist which will assist in meeting required deadlines, reconcile grant reporting, prepare reconciling schedules, and journal entries prior to audit review.
The FY 21-22 & 23-23 audit prework has begun and the entrance conference with the new auditing firm is scheduled. The Finance Department is currently at full staff and has been receiving extensive training regarding auditing prep work.
The city’s independent Auditor, Mann, Urrutia, Nelson CPAs & Associates firms will provide a verbal overview of the FY 20-21 financial audit reports.
Compliance with City Council Strategic Plan or Budget Goals The City Council and City staff are committed to providing the best possible financial practices and the highest possible transparency regarding all financial transactions.
Attachments:
City of Gridley FY 20-21 Financial Statements & Independent Auditors Report Single Audit
Successor Agency Auditors Reports
G
GRIDLEY
CITY OF GRIDLEY
FINANCIAL STATEMENTS
AND
INDEPENDENT AUDITOR'S REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
MUN CPAs, LLP
1760 Creekside Oaks Drive, Suite 160
Sacramento, California 95833
CITY OF GRIDLEY
FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2021
TABLE OF CONTENTS
Page
Independent Auditor's Report on Basic Financial Statements 1 - 2 Management's Discussion and Analysis 3 -11
Basic Financial Statements:
Government-wide Financial Statements
Statement of Net Position 12
Statement of Activities 13
Fund Financial Statements
Balance Sheet -Governmental Funds 14
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position 15 Statement of Revenues, Expenditures, and Changes in Fund Balances -Governmental Funds 16 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances to the Statement of Activities -Governmental Funds 17
Statement of Net Position -Proprietary Funds 18
Statement of Revenues, Expenses, and Changes in Net Position -Proprietary Funds 19 Statement of Cash Flows -Proprietary Funds 20 - 21
Statement of Fiduciary Net Position -Fiduciary Funds 22 Statement of Changes in Fiduciary Net Position -Fiduciary Funds 23 Notes to Basic Financial Statements 24 - 55
Required Supplementary Information
Budgetary Comparison Schedule -General Fund 56
Budgetary Comparison Schedule - 08-HOME-4987 Grant Fund 57 Budgetary Comparison Schedule -Block Grant Funds 58
Budgetary Comparison Schedule - Grant-Related Funds 59
Notes to Required Supplementary Information -Budgetary Accounting and Control 60 Schedule of the City's Proportionate Share of the Net Pension Liability 61 - 62 Schedule of Contributions to the Pension Plan 63 - 64
Schedule of Changes in the City's Total OPEB Liability and Related Ratios 65
CITY OF GRIDLEY
FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2021
TABLE OF CONTENTS
Page
Supplementary Information
Non-Major Governmental Funds:
Description of Non-major Funds
Combining Balance Sheet
C•~•~l
68-71
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 72 - 75 Non-Major Enterprise Funds:
Combing Statement of Net Position 76
Combining Statement of Revenues, Expenses, and Changes in Net Position 77 Combining Statement of Cash Flows 78
Private Purpose Trust Funds:
Combining Statement of Fiduciary Net Position 79
Combining Statement of Changes in Fiduciary Net Position 80 CustodiatFunds:
Combining Statement of Fiduciary Net Position 81
Combining Statement of Changes in Fiduciary Net Position 82 General Fund:
Combining Balance Sheet 83
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 84 M•U•N
INDEPENDENT AUDITOR'S REPORT
To the City Council of
the City of Gridley
Gridley, California
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Gridley (the City), as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the City's basic financial statements as listed in the Table of Contents.
Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Gridley, as of June 30, 2021, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Emphasis of Matter
Change in Accounting Principle
As described in Note 1 to the financial statements, in 2021, the City adopted new accounting guidance, GASB Statement No. 84, Fiduciary Activities. Our opinion is not modified with respect to this matter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management's discussion and analysis, budgetary comparison information, pension related schedules, and OPEB related schedules as listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the _United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Gridley's basic financial statements. The combining and individual nonmajor fund financial statements are presented for purposes of additional analysis and are not a required part of the basic financial statements.
The combining and individual nonmajor fund financial statements are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements are fairly stated in all material respects in relation to the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 5, 2023, on our consideration of the City of Gridley's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City of Gridley's internal control over financial reporting or on compliance.
That report is an integral part of an audit performed in accordance with GovernmentAuditing Standards in considering the City of Gridley's internal control over financial reporting and compliance. /1/I t/~t/ C ~,A~ s, ~ ~ ~
Sacramento, California
December 5, 2023
CITY OF GRIDLEY
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2021
This section of the City's Annual Financial Report presents a narrative overview and analysis of the City's financial activities for the fiscal year ended June 30, 2021. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in the City's financial statements, which follow this section.
FINANCIAL HIGHLIGHTS
• The assets and deferred outflows of resources of the City exceeded liabilities and deferred inflows of resources by $38,019,416 (net position). Of this amount, the City has an unrestricted balance of $14,333,655, $3,204,997 is restricted for special revenue programs, and $20,480,764 is the net investment in capital assets. • The City's total net position increased by approximately $3,799,604, from $34,219,812 to $38,019,416. • The Governmental fund balance (comprising all governmental funds) is $12,497,967 as of June 30, 2021.
OVERVIEW OF THE FINANCIAL STATEMENTS
The financial section of this report consists of five parts:
• Independent Auditor's Report;
• Management's Discussion and Analysis (this section);
• Basic Financial Statements that include:
• Government-Wide Financial Statements
• Fund Financial Statements
• Notes to Basic Financial Statements
• Required Supplementary Information
• Supplementary Information.
The basic financial statements include two kinds of statements that present different views of the City
GOVERNMENT-WIDE FINANCIAL STATEMENTS
The government-wide financial statements are desïgned to provide readers with a broad overview of the City's finances, in a manner similar to aprivate-sector business. These statements are presented on an "economic resources" measurement focus and the accrual basis of accounting.
The Statement of Net Position presents information on all the City's assets, deferred outflows of resources, liabilities, and deferred inflows of resources, with the difference between the components (assets and deferred outflows of resources, less liabilities and deferred inflows of resources) presented as "net position". Over time, increases or decreases in net position may serve as a useful indicator of the City's financial improvement or deterioration.
The Statement of Activities presents information showing how the government's net position changed during the past year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of the related cash flows (accrual basis of accounting). Thus, revenues and expenses are reported in this statement for some items that will result in cash flows in future fiscal periods (e.g., earned but unused vacation leave).
Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenue, "governmental activities", from other functions that are intended to recover all or a significant portion of their costs through users fees and charges, "business-type activities". The governmental activities of the City of Gridley include general government, public safety, streets and public works, community development, and parks and recreation. The business-type activities of the city are the electric, water, sewer, drainage, solid waste, and transit operations.
CITY OF GRIDLEY
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2021
FUND FINANCIAL STATEMENTS
A "fund" is a group of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The Gity of Gridley, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City of Gridley can be divided into three categories:
• Governmental Funds
• Proprietary Funds
• Fiduciary Funds
Governmental funds are used to account for essentially the same functions reported as "governmental activities" in the government-wide financial statements. However, unlike those statements, the focus in these statements is on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year.
This information may be useful in evaluating a government's near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government's near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.
The City of Gridley maintains several individual governmental funds organized according to their type (special revenue, debt service, etc). The fund financial statements provide detailed information about each of the City's most significant funds, called major funds. The concept of major funds, and the determination of which are major funds, was established by GASB Statement No. 34 as amended and replaces the concept of combining like funds and presenting them as one total. Instead, each major fund is presented individually, with all non-major funds summarized and presented in a single column. Supplementary schedules present the detail of these non-major funds. Major funds present the major activities of the City for the year, and may change from year to year as a result of changes in the pattern of the City's activities. Information is presented separately in the governmental funds balance sheet and in the governmental funds statement of revenues expenditures and changes in fund balances for the following major funds:
• General Fund
• OS-HOME-4987 Grant Fund
• Block Grants Fund
• Grant Related Funds
Data from the remaining nonmajor governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non major governmental funds is provided in the form of "combining statements" starting on page 68.
Proprietary funds are generally used to account for services for which the City charges customers. Proprietary funds provide the same type of information as shown in the government-wide financial statements, only in more detail. The City maintains one type of proprietary fund, consisting of enterprise funds, as described below.
Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for electric, water, sewer, drainage, solid waste, and transit operations.
Fiduciary funds are used to account far resources held for the benefit of parties outside the City. Since the resources of these funds are not available to support the City's own programs, they are not reflected in the government-wide financial statements.
Notes to the financial statements.
The notes provide additional information that is essential to a full understanding of the information provided in the governmentwide and fund financial statements.
CITY OF GRIDLEY
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2021
Required Supplementary Information
This report presents required supplementary information concerning the City of Gridley's progress in its obligation to provide pension and other post-employment benefits to its employees, and budgetary comparison information for the City's general fund and major special revenue funds.
Supplementary Information
This final section of the report includes combining and individual fund statements and schedules for the City's non-major funds, custodial funds, and general funds.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
This section of the Management Discussion and Analysis provides a comparison and review of governmental and businesstype activities for two fiscal years.
ANALYSIS OF NET POSITION
For the City, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $38.02 million in FY 2021.
Statement of Net Position
As of June 30, 2021 and 2020
(in thousands)
Governmental Activities Business-Type Activities Total Government Net- Net Net
2021 2020 Change 2021 2020 Change 2021 2020 Change
ASSETS
Current and other
assets $ 22,828 $ 20,156 $ 2,672 $ 13,987 $ 11,963 $ 2,024 $ 36,815 $ 32,119 $ 4,696 Capital assets 10.115 9,906 209 13,578 12,728 850 23.693 22.634 1.059 Total Assets 32,943 30,062 2,881 27,565 24.691 2.874 60.508 54,753 5.755
DEFERRED
OUTFLOWS OF
RESOURCES 3.002 3.606 (604) 2,113 2,596 (483) 5.115 6.202 (1.087)
LIABILITIES
Long-term liabilities 14,354 13,407 947 11,608 11,406 202 25,962 24,813 1,149 Other liabilities 600 640 (40) 826 534 292 1.426 1,174 252 Total Liabilities 14,954 14,047 907 12,434 11,940 494 27,388 25,987 1,401
DEFERRED
INFLOWS OF
RESOURCES (80j 261 (341) 296 365 (69) 216 626 (410)
NET POSITION
Net investment in
capital assets 10,115 9,906 209 10,365 8,477 1,888 20,480 18,383 2,097 Restricted 3,205 2,761 444 - - - 3,205 2,761 444
Unrestricted 7.751 6.693 1,058 6.583 6.505 78 14.334 13.198 1.136 Total Net
Position $ 2~ $ 19~3~60 $~1 711 $ 1 $ 14982 $ 1966 $ 38 019 $ 34 342 $ 5 CITY OF GRIDLEY
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2021
The City reported positive balances in all three categories of net position, as well as for its separate governmental and business-type activities. The primary components of the City's net position include:
The $20.48 million (53.9%) in net investment in capital assets (e.g., land, buildings, other improvements, construction in progress and equipment), less any outstanding related debt used to acquire these assets. The Gity uses these capital assets to provide services to the community; consequently, these assets are not available for future spending.
Although the City's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.
Restricted net position is comprised of $3.21 million (8.4%) in special revenue programs.
The remaining unrestricted balance is $14.33 million (37.7%) and may be used to meet the government's ongoing obligations to citizens and creditors.
Statement of Activities
For the Years Ended June 30, 2021 and 2020
{in thousands)
Governmental Activities Business-type Activities Total Government Net Net Net
2021 2020 Change 2021 2020 Change 2021 2020 Ghange
Revenues:
Program revenues
Charges for services $ 230 $ 415 $ (185) $ 13,165 $ 11,508 $ 1,657 $ 13,395 $ 11,923 $ 1,472 Operating grants and
contributions 2,444 1,602 842 96 230 (134) 2,540 1,832 708 Capital grants and
contributions - 104 (104) - - - 104 104
Total program revenues 2.674 2.121 553 13,261 11.738 1.523 15.935 13.859 2.076 General revenues
Property Taxes 667 517 150 - - - 667 517 150
Sales and use taxes 1,593 1,201 392 - - - 1,593 1,201 392 Motor vehicle and gas
tax 275 294 (19} - - - 275 294 (19)
Occupancy tax 43 36 7 - - - 43 36 7
Franchise tax 148 150 (2) - - - 148 150 (2)
Other revenues 171 134 37 7 25 (18) 178 159 19
Rental income 1,942 1,574 368 - - - 1,942 1,574 368
Interest earnings 13 97 (84) 8 91 183) 21 188 t167)
Total general revenues 4.852 4.003 849 15 116 101) 4.867 4.119 748 Total Revenues $ 7,526 $ 6.124 $ 1.402 $..13.276 $ 11.854 $ 1.422 $ 20,802 $ 17,978 $ 2.824 The governmental activities total revenues were $7.53 million and business-type activity revenues were $13.28 million for the year ended June 30, 2021. For governmental activities, this represented an increase of $1.40 million and for business-type activities this represented an increase of $1.42 million. The increase in governmental activities is due to additional grants earned and the FEMA site lease. The increase in business-type activities is due to higher usage and customer charges in the proprietary funds.
Program revenues include charges for services and grants and contributions. Program revenues provided $2.67 million (35.5%) for governmental activities and $13.26 million (99.9%} for business type activities.
General revenues include, among other things, taxes and intergovernmental revenues. General revenues provided $4.85 million (64.5%) for governmental activities and $15 thousand (0.1%) for business-type activities. The majority of general revenues came from property, sales, and other taxes and rental income. t:
Taxes 36.22%
Interest eaminc
" ~^0' ^~~tal income
2.27°!° Cther revenues
3.06°/ Charges for services
CITY OF GRIDLEY
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2021
The fiscal year ended June 30, 2021 revenues are reflected graphically as follows:
2021 Governmental Revenues
Governmental Funds FY 2020-21
3ZA/% Intergovemmental
The fiscal year ended June 30, 2020 revenues are reflected graphically as follows:
2020 Governmental Revenues
Governmental Funds FY 2019-20
2.19°I° Other revenues
6.78% Charcesforservices
Taxes 35.89%
~27.864~ In[ergovernmenta[
i8% Interest earnings
25.70% Rental income
7 CITY OF GRIDLEY
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2021
Statement of Activities
For the Years Ended June 30, 2021 and 2020
{in thousands)
Governmental Activities Business-type Activities Total Government Net Net Net
2021 2020 Change 2021 2020 Change 2021 2020 Change
Expenses:
Governmental activities
General government $ 351 $ 382 $ (31 } $ - $ - $ - $ 351 $ 382 $ (31) Public safety 5,132 5,497 (365) - - - 5,132 5,497 (365) Streets and public
works 1,079 1,593 (514} - - - 1,079 1,593 (514)
Community
development 237 450 (213) - - - 237 450 (213)
Parks and recreation 193 464 (271) - - - 193 464 (271)
Business-type activities
Electric - - - 6,625 6,187 438 6,625 6,187 438
Water - - - 1,272 1,168 104 1,272 1,168 104
Sewer - - - 1,997 1,914 83 1,997 1,914 83
Other - - - 117 230 (113) 117 230 113)
Total Expenses 6.992 8.386 (1.394) 10.011 9.499 512 17.003 17.885 (882) Excess (deficiency)
before transfers 534 í2,2s2) 2.796 3.265 2,355 910 3,799 93 3,706 Transfers
Transfers 1.190 1,200 (10) (1,190) S .200) 1 10 - -
Change in net position 1.724 1 062 2,786 2,075 1,155 920 3.799 93 3,706 Net position -beginning of
year 19,360 11,061 8,299 14,982 13,827 1,155 34,342 24,888 9,454 Restatement 13) 9.361 9 374) (1091 - 109} (122) 9.361 (9,483) Net position -beginning of
year, restated 19.347 20.422 1 075 14.873 13.827 1,046 34.220 34.249 29 Net position -end of year $ 21 ~+~ $ 19~ $ 1~ $1~6 948 $14~~82 $ 1,966 $ 38_019 $ 3~ $
EXPENSES
Expenses for the Gity totaled $17.00 million for the year ended June 30, 2021. Governmental activities incurred $6.99 million in expenses and business type activities incurred $10.01 million in expenses during the year. Governmental activities expenses were 38.24°/a funded by program revenues, with the remainder of the funding from general revenues and transfers. Business type activities expenses were 100% funded by program revenue.
D
General Government 5°!° 6% Parks and Recreation
c°~ r,...,..,,,.,~,., nevelopment
Public SafE
X19% Streets and Public Works
CITY OF GRIDLEY
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2021
The fiscal year ended June 30, 2021 expenses are reflected graphically as follows:
2021 Governmental Expenses
Governmental Funds FY 2020-2i
The fiscal year ended June 30, 2020 expenses are reflected graphically as follows:
2020 Governmental Expenses
Governmental Funds FY 2019-20
0 CITY OF GRIDLEY
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2021
FINANCIAL ANALYSIS OF THE CITY'S FUNDS
The City of Gridley uses fund accounting to segregate accounts for specific activities or objectives, including demonstrating finance-related legal compliance.
GOVERNMENTAL FUNDS
The focus of the City's governmental funds is to provide information on near term inflows, outflows and balances of resources that are available to provide services and capital project construction. In particular, unassigned fund balance may serve as a useful measure of a government's net spendable resources. At the end of FY 2020-21, the City's governmental funds reported combined fund balances of $12.50 million, an increase of $2.46 million in comparison with the prior fiscal year. The City has $3.33 million fund balances in non-spendable, restricted or committed to indicate that it is not available for new spending because it has been earmarked for prior year commitments and other specific requirements in accordance with GASB 54.
Further breakdown of these fund balances are found in Note 9 of the Financial Statements.
GENERAL FUND BUDGETARY HIGHLIGHTS
General fund revenues were $1.1 million higher than projected and expenditures were $1.7 million lower than projected resulting in a net positive variance of $2.8 million. The increase in revenues is primarily attributed to higher than projected taxes and assessments, intergovernmental revenues and charges for services. The decrease in expenditures is primarily attributed to savings in general government, streets and public works, and capital outlay expenditures.
CAPITAL ASSET AND DEBT ADMINISTRATION
CAPITAL ASSETS
Asset Tvpe
Governmental Activities
2021 2020
Business-type Activities Totals
2021 2020 2021 f~I1yP
Capítal assets, not
being depreciated:
Land
Construction in
Progress
Depreciable capítal
assets, net:
Infrastructure
Buildings and
improvements
Improvements
other than
buildings
Vehicles and
equipment
Capital assets,
net
~ 417,779 $ 417,779 $ 921,793 $ 921,793 $ 1,339,572 $ 1,339,572 588,859 - 1,408,328 47,441 1,997,187 47,441
4,227,212 4,497,728 3,787,267 3,949,331 8,014,479 8,447,059 1,210,087 1,322,996 224,819 249,773 1,434,906 1,572,769 2,271,840 2,402,115 5,203,963 5,561,017 7,475,803 7,963,132 1,399,661 1,265,030 2.032,156 1,998,946 3.431,817 3.263,976 $,10.115,438 $ 9~ $_ 13j,578.326 $ 12 ~,72~301 $ 23~693~ $ 22 ~-,63~ The City's investment in capital assets for its governmental and business type activities as of June 30, 2021, was $23.69 million (net of accumulated depreciation). This investment in capital assets includes: land, buildings, improvements other than buildings, equipment, and construction ín progress. The City's investment in capital assets, net of accumulated depreciation as reported on the Statement of Net Position for the fiscal year ended June 30, 2021 decreased by $(1.06) million.
For government wide financial statement presentation, all depreciable capital assets are depreciated from the acquisition date over their useful lives. Governmental fund financial statements record capital asset purchases as expenditures.
Additional information on the City of Gridley's capital assets can be found in Note 5 on pages 41 - 42 of this report. 10 CITY OF GRIDLEY
MANAGEMENT'S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2021
DEBT ADMINISTRATION
At the end of FY 2020-21, the City had long term liabilities of $0.32 million and $3.42 million for governmental activities and business-type activities, respectively. Additional information about the City's long term obligations can be found in Note 6 on pages 43 - 44 of this report.
Long Term Liabilities
Outstanding Balances
As of June 30, 2021
Governmental
Activities Business-type Activities
2021 2020 2021 2020
Totals
2021 2020
USDA Rural Development
Loan
USDA Rural Development
Loan- Waste Water
Treatment Plant
Compensated absences
Totals
- $ - $ 974,000 $1,008,000 $ 974,000 $ 1,008,000
- - 2,239,000 2,291,000 2,239,000 2,291,000
315.172 226.670 209.889 121,436 525,061 348,106
$c 315,172 $ 226,670 $ 3,422,889 $,3.420,436 $ 33 7~ $ 3 64_7 106
ECONOMIC FACTORS AND NEXT YEAR'S BUDGET
The City having witnessed and provided mutual aid during the unfortunate event of the 2018 Paradise Camp Fire, has continued to focus on effectively maintaining a hiring freeze, reducing discretionary spending, and working towards meeting the long-term goal of conservative spending in the General Fund. The City will continue to focus on long term goals as well as bring in infrastructure projects that provide funding mechanisms to further reduce costs.
REQUESTS FOR INFORMATION
This financial report is designed to provide a general overview of the City of Gridley's finances for all those with an interest in the government's finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the City of Gridley Finance Department at 685 Kentucky Street, Gridley, CA 95948, phone (530) 846-5695.
m
11,047,451 $
711,192
3,099
320,639
9,793,668
329,029
110,727
84, 534
426,868
1,006,638
9.108.800
10.115.438
32.942.645
11,116,841 ~
2,441,660
2, 352
720,859
(329,029)
26, 346
7, 765
2, 330,121
11,248,205
13.578, 326
27.565,120
22,164,292
3,152,852
5,451
320,639
720, 859
9,793,668
137, 073
92,299
426,868
3,336,759
20,357,005
23.693.764
60.507.765
1,473, 597 1, 004,139 2,477,736
1, 529.026 1,108, 561 2,637,587
3.002.623 2,112, 700 5.115,323
412,978 432,767 845,745
32, 756 32,756
24, 545 24, 545
19,100 5,001 24,101
350 202,699 203,049
134,677 71,305 205, 982
180,495 138,584 319,079
89,000 89, 000
3,124, 000 3,124,000
8,105,9$5 4,392,279 12,498,264
6.067.921 3, 953.153 10.021.074
14,954,262 12,433,333 27.387,595
(79.844) 295.921 216,077
CITY OF GRIDLEY
STATEMENT OF NET POSITION
JUNE 30, 2021
Governmental Business-type
Activities Activities Total
ASSETS
Cash and investments (Note 2)
Accounts receivable, net
Interest receivable
Taxes receivable
Inventory
Loans receivable (Note 3)
Internal balances
Due from other governments
Prepaid items
Advances to fiduciary fund (Note 4)
Capital assets (Note 5)
Non-depreciable
Depreciable, net
Total capital assets
Total Assets
DEFERRED OUTFLOWS OF RESOURCES
Related to net pension liability (Note 7)
Related to total OPEB liability (Note 8)
Total Deferred Outflows of Resources
LIABILITIES
Accounts payable and accrued expenses
Accrued payroll and benefits
Accrued interest payable
Unearned revenue
Deposits payable
Accrued compensated absences (Note 6):
Due within one year
Due in more than one year
Long-term liabilities (Note 6):
Due within one year
Due in more than one year
Net pension liability (Note 7}:
Due in more than one year
Total other postemployment benefits liability (Note 8):
Due in more than one year
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Related to net pension liability (Note 7)
NET POSITION
Net investment in capital assets 10,115,438 10,365,326 20,480,764 Restricted for:
Special revenue programs 3,204,997 - 3,204,997
Unrestricted 7.750.415 6.583.240 14.333.655
Total Net Position $ 21,070,850 $ 16.948.566 $ 38.019.416 See accompanying notes to the basic financial statements 12 CITY OF GRIDLEY
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30. 2021
Net (Expense) Revenue and Changes in Net
Program Revenues Position
Primary Government
Operating Capital BusinessCharges for Grants and Grants and Governmental type Functions/Programs Expenses Services Contributions Contributions Activities Activities Total
PRIMARY GOVERNMENT
Govemmental activities:
General government $ 350,795 $ 42,473 $ 588,619 $ - $ 280,297 $ - $ 280,297 Public safety 5,132,261 26,509 774,404 - (4,331,348) - (4,331,348) Streets and public works 1,078,931 - 733,742 - (345,189) - (345,189) Community development 236,569 124,868 347,353 - 235,652 - 235,652 Parks and recreation 192.852 35.780 10 (157.062) (157,062) Total govemmental activities 6.991.408 229.630 2.444.128 - (4,317,650) - (4.317.650) Business-type activities:
Electric 6,625,352 10,112,044 - - - 3,486,692 3,486,692 Water 1,271,575 1,392,457 - - - 120,882 120,882
Sewer 1,997,584 1,655,717 - - - (341,867) (341,867)
Other proprietary 116,646 5,088 95,500 - - (16,058) (16,058) Total business-type activities 10,011.157 13.165.306 95.500 - - 3.249.649 3.249.649 Total primary government $ 17,002,565 $ 13,394,936 $ 2,539,628 $ - (4,317,650) 3.249.649 (1,068,001) General revenues:
Property taxes 667,026 - 667,026
Sales and use taxes 1,592,896 - 1,592,896
Motor vehiGe and gas taxes 274,650 - 274,650
Occupancy tax 43,082 - 43,082
Frenchise tax 147,919 - 147,919
Other revenue 171,103 7,310 178,413
Rental income 1,941,865 - 1,941,865
Interest and investment earnings 13,499 8,255 21,754
Transfers (Note 4) 1.190.235 (1,190,235) -
Total general revenues and transfers 6.042.275 (1.174.670) 2.925.740 Change in net position 1,724,625 2,074,979 3,799,604
Net position -July 1, 2020 19,359,517 14,982,217 34,341,734 Prior period restatement (Note 15) (13.292) (108.630) (121.922) Net position -July 1, 2020, restated 19,346,225 14.873,587 34.219,812 Net position -June 30, 2021 $_ 21.070,850 $_ 16.948,566 $ 38 019 416 See accompanying notes to the basic financial statements. 13 CITY OF GRIDLEY
BALANCE SHEET
GOVERNMENTAL FUNDS
JUNE 30, 2021
08-HOME- Block Grant Other Total
General 4987 Grant Grants Related Governmental Governmental Fund Fund Fund Funds Funds Funds
ASSETS
Cash and investments $ 8,377,031 $ 3,791 $ 462,689 $ 314,226 $ 1,889,714 $ 11,047,451 Accounts receivable 525,221 - - 107,697 78,274 711,192
Interest receivable 2,146 1 169 154 629 3,099
Taxes receivable 310,367 - - - 10,272 320,639
Notes receivable - 5,000,000 2,694,404 2,099,264 - 9,793,668 Due from other funds 3,129,294 - - - 200,627 3,329,921
Due from other governments - - 70,388 18,097 22,242 110,727 Prepaid items 84,534 - - - - 84,534
Advances to fiduciary fund 176,868 - 250,000 - - 426.868 Total Assets $ 12 605 4, 61 $_ 5,0~ $ 3,477,650 $ 2 5~3_9~ $,~ 2.201 758 $ 25
LIABILITIES DEFERRED
INFLOWS OF RESOURCES
AND FUND BALANCES
(DEFICITS)
LIABILITIES
Accounts payable and accrued
liabilities $ 373,651 $ - $ 783 $ - $ 38,544 $ 412,978
Accrued payroll and benefits 32,755 - - - 1 32,756
Unearned revenue 19,100 - - - - 19,100
Deposits payable 350 - - - - 350
Due to other funds 3,000,892 3,000,892
Total Liabilities 425.856 783 3.039,437 3,466.076
DEFERRED INFLOWS OF
RESOURCES
Unavailable revenues -
housing loans/grants - 5.000,000 2.764,792 2,099.264 - 9,864,056
FUND BALANCES (DEFICITS)
Nonspendable 84,534 - - - - 84,534
Restricted - 3,792 712,075 440,174 2,048,956 3,204,997
Committed 40,519 - - - - 40,519
Assigned 3,947,824 - - - - 3,947,824
Unassigned 8.106,728 - - - (2,886,635) 5,220,093
Total Fund Balances
(Deficits) 12.179.605 3.792 712,075 440.174 (837,679) 12.497,967 Total Liabilities, Deferred
Inflows of Resources, and
Fund Balances (Deficits) $ 1212 6_5,_461 46 $ 5.003.792 $ 3.477,650 $ 2 539 438 $ 2 201 758 $ 25 See accompanying notes to the basic financial statements. 14 CITY OF GRIDLEY
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET POSITION
JUNE 30, 2021
$ 12,497,967
10,115,438
9, 793, 668
Total fund balances of governmental funds
Amounts reported for governmental activities in the Statement of Net Position are different because:
Capital assets used in governmental activities are not financial resources and therefore are not reported in governmental funds, net of accumulated depreciation of $11,564,956.
Certain notes, loans, and interest receivables are not available to pay for current period expenditures and therefore are offset by deferred inflows of resources in the governmental funds.
Amounts due from other governments earned but not collected within the period of availability to pay for current period expenditures and therefore are offset by deferred inflows of resources in the governmental funds.
Deferred outflows of resources related to changes in the net pension liability are not applicable to the current period
Deferred outflows of resources related to changes in the OPEB liability are not applicable to the current period
Long-term liabilities are not due in the current period and therefore are not reported in the governmental funds.
Compensated absences
Net pension liability
Total OPEB liability
Deferred inflows of resources related to changes in the net pension liability are not applicable to the current period
Net position of governmental activities
70, 388
1,473, 597
1, 529, 026
(315,172)
(8,105,985)
(6,067,921)
79.844
$ 21 070 850
See accompanying notes to the basic financial statements. 15 CITY OF GRIDLEY
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2021
08-HOME- Block Grant Other Total
General 4987 Grant Grants Related Governmental Governmental Fund Fund Fund Funds Funds Funds
REVENUES
Taxes and assessments
License, permits, and fees
Fines and forfeitures
Use of money and property
Program income
Intergovernmental
Charges for services
Recreation and event fees
Insurance proceeds
Other revenues
Total Revenues
EXPENDITURES
Current:
General administration
Public safety
Streets and public works
Community development
Parks and recreation
Capital outlay
Total Expenditures
Excess (Deficiency) of Revenues
over Expenditures
OTHER FINANCING SOURCES
( SESI U
$ 3,015,986 $ - $ - $ - $ 458,618 $ 3,474,604
69,996 - - - 70,127 140,123
7,226 - - - 12,037 19,263
1.5,256 2 856 406 1,404 17,924
- - 172,035 - - 172,035
2,102,998 - 265,558 748,391 - 3,116,947
607,726 - - - 31,527 639,253
17,075 - - - 1,080 18,155
3,641 - - - - 3,641
23.909 - - - 1.591 25.500
5.863.813 2 438.449 748.797 576.384 7,627,445
102,763 - - - - 102,763
4,015,101 - - - 2,325 4,017,426
294,407 - - - 901,118 1,195,525
153,457 - 179,952 - 201,020 534,429
131,409 - - - 29,429 160,838
262,345 73.085 9.802 345.232
4.959,482 179.952 73.085 1.143,694 6.356.213
904,331 2 258.497 675.712 (567,310) 1,271,232
Transfers in 1,579,341 - - - 267 1,579,608
Transfers out (267) - - (389.105) (1) (389,373)
Total Other Financing
Sources (Uses) 1.579.074 - - (389.105) 266 1.190,235
Net Change in Fund Balances
(Deficits) 2.483.405 2 258.497 286.607 (567.044) 2.461,467 Fund Balances (Deficits) -July 1,
2020 9,754,680 3,790 453,578 153,567 (315,823) 10,049,792 Prior Period Adjustment (Note 15) (58,480) - - - 45.188 (13,292) Fund Balances (Deficits} -July 1,
2020, restated 9,696.200 3.790 453.578 153.567 (270.635) 10,036,500 Fund Balances (Deficits) -
June 30, 2021 $ 12,179,605 $ 3 792 $ 712 075 $ 440 174 $ (837,679) $ 12,497,967 See accompanying notes to the basic financial statements. 16 CITY OF GRIDLEY
RECONCILIATION OF THE
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
TO THE STATEMENT OF ACTIVITIES -GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2021
Reconciliation of the change in fund balances -total governmental funds to the change in net position of governmental activities:
Net change in fund balances -total governmental funds
Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the cost of those assets are capitalized and allocated over their estimated useful lives and reported as depreciation expense.
Capital asset purchases
Depreciation expense
Some revenues reported in the Statement of Activities will not be collected for several months after the City's year-end and do not provide current financial resources and therefore are not reported as revenues in the governmental funds.
Receipts of payments and disbursements of funds related to notes and loans receivable are reported as revenue and expenditures, respectively, in governmental funds, but an increase and decrease, respectively, in notes receivable in the Statement of Net Position.
Loan program receipts
Loans made during the year
$ 2,461,467
907, 589
(697,799)
70, 388
(118,217}
325, 676
Some expenses reported in the Statement of Activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds.
Accrued compensated absences (88,502)
Pension expense related to deferred outflows and inflows of resources (929,952) Other postemployment benefits (206,025)
Change in net position of governmental activities $ 1,724 625 See accompanying notes to the basic financial statements. 17 CITY OF GRIDLEY
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
JUNE 30, 2021
Business-type Activities -Enterprise Funds
Other
Enterprise
Electric Water Sewer Funds Totals
ASSETS
Current Assets
Cash and investments $ 4,474,153 $ 2,186,728 $ 4,079,736 $ 376,224 $ 11,116,841 Accounts receivable, net 2,082,026 199,131 160,126 377 2,441,660 Interest receivable 790 533 997 32 2,352
Prepaid items 7,765 - - - 7,765
Inventory 650,096 68,779 1,984 - 720,859
Due from other governments 26.346 - - - 26.346
Total Current Assets 7.241,176 2.455,171 4.242.843 376.633 14.315,823 Capital Assets
Non-depreciable 900,433 99,853 1,329,835 - 2,330,121
Depreciable, net 2,639,265 2.728,238 5.860,797 19.905 11,248,205 Total Capital Assets 3.539,698 2,828,091 7.190,632 19.905 13,578.326 Total Assets 10.780,874 5.283,262 11.433,475 396.538 27,894,149
DEFERRED OUTFLOWS OF RESOURCES
Related to net pension liability 520,393 215,837 219,158 48,751 1,004,139 Related to OPEB liability 538.799 289.500 280.262 - 1.108,561 Total Deferred Outflows of Resources 1,059,192 505.337 499.420 48.751 2,112,700
LIABILITIES
Current Liabilities
Accounts payable 97,464 74,725 153,995 378 326,562
Accrued expenses 62,149 16,605 24,045 3,406 106,205
Accrued interest payable - - 24,545 - 24,545
Deposits payable 202,699 - - - 202,699
Due to other funds - - - 329,029 329,029
Unearned revenue - - - 5,001 5,001
Compensated absences -current 41,217 13,071 17,017 - 71,305 Long-term liabilities -current - - 89.000 - 89.000
Total Current Liabilities 403,529 104.401 308.602 337,814 1,154,346 Non-Current Liabilities
Compensated absences 5,601 45,906 55,951 31,126 138,584 Long-term liabilities -non-current - - 3,124,000 - 3,124,000 Net pension liability 2,305,472 917,711 937,773 231,323 4,392,279 Total OPEB obligation 1.684,484 1.134,333 1.134.336 - 3,953.153 Total Non-Current Liabilities 3,995,557 2,097,950 5.252,060 262.449 11,608,016 Total Liabilities 4.399,086 2,202,351 5.560,662 600.263 12,762,362
DEFERRED INFLOWS OF RESOURCES
Related to net pension liability 153,649 67.578 67.282 7.412 295.921 NET POSITION:
Net investment in capital assets 3,539,698 2,828,091 3,977,632 19,905 10,365,326 Unrestricted 3.747,633 690.579 2,327.319 (182,291) 6,583.240 Total Net Position $ 7 2 $ 33 518 670 67 $__ 6,3® $ 16 ~ ( 2 386 ,) $ 16,9 4 See accompanying notes to the basic financial statements. 18 1,785,605 643,631 759,660 103,095 3,291,991
573,553 202,713 310,077 5,084 1,091,427
283,657
3,373,812
52,614
360, 075
196.036
6,625, 352
3.487, 022
24,860 (28,235) 482 280,764
432 76,776 - 3,451,020
21,918 95,039 443 170,014
173,633 168,365 906 702,979
- 26,570 - 26,570
204,388 500,543 6,636 907,603
1.271.575 1.908.795 116.646 9,922.368
123.617 (252,712) (12,179) 3.345,748
CITY OF GRIDLEY
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2021
Business-type Activities -Enterprise Funds
Other
Enterprise
Electric Water Sewer Funds Totals
OPERATING REVENUES
Charges for services $ 10,112,044 $ 1,392,457 $ 1,655,717 $ 5,088 $ 13,165,306 Intergovernmental revenues - - - 95,500 95,500
Other revenue 330 2.735 366 3.879 7,310
Total Operating Revenue 10,112,374 1,395,192 1,656,083 104,467 13,268,116
OPERATING EXPENSES
Salaries and benefits
Materials, supplies, and
operational expenses
Repairs and maintenance
Power and utilities
Contractual services
Administration
Miscellaneous
Depreciation and amortization
Total Operating Expenses
Operating Income (Loss)
NON-OPERATING REVENUES
(EXPENSES)
Interest income
Interest expense
Total Non-Operating
Revenues (Expenses)
Income (Loss) Before Transfers
TRANSFERS
Transfers in
Transfers out
Total Transfers
Change in net position
Net Position -July 1, 2020
Prior Period Adjustment (Note 15)
Net Position -July 1, 2020, restated
Net Position -June 30, 2021
5,320 2,247 654 34 8,255
- - (88,789) - (88,789)
5.320 2,247 (88,135) 34 (80,534)
3,492,342 125,864 (340,847) (12,145) 3,265,214
- - 209,765 - 209,765
(1,400,000) - - - (1,400,000)
(1,400.000) - 209.,765 - (1,190,235)
2,092,342 125,864 (131,082) {12,145) 2,074,979
5,194,989 3,392,806 6,436,033 (41,611) 14,982,217
- - - (108,630) (108,630)
5,194,989 3,392,806 6,436,033 (150,241) 14,873,587
$_ 7,287,331 $_ 3,518,670 $_ 6,304,951 $ (162,386) $ 16 948 566 See accompanying notes to the basic financial statements. 19 CITY OF GRIDLEY
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2021
Business-type Activities -Enterprise Funds
Other
Enterprise
Electric Water Sewer Funds Totals
CASH FLOWS FROM OPERATING
ACTIVITIES
Cash received from customers $ 8,614,196 $ 1,196,061 $ 1,495,957 $ 104,090 $ 11,410,304 Cash paid to suppliers (4,683,272) (338,162) (539,078) (7,123) (5,567,635) Cash paid to employees (1,463,451) (449,981) (562.934) (74.507) (2,550,873) Net Cash Provided by Operating
Activities 2.467.473 407.918 393.945 22.460 3.291,796
CASH FLOWS FROM NONCAPITAL FINANCING
ACTIVITIES
Due from (to) other funds - - - 220,399 220,399
Transfers (to) from other funds (1,400,000) - 209,765 - (1,190,235} Net Cash Provided by (Used for)
Non-Capital Financing
Activities (1,400.000) - 209.765 220,399 (969.836}
CASH FLOWS FROM CAPITAL
AND RELATED FINANCING
ACTIVITIES
Gain on disposal of capital assets - - (3,034) - (3,034) Acquisition of capital assets (348,176) (145,422) (1,260,996) - (1,754,594) Principal paid on capital debt - - (86,000) - (86,000)
Interest paid on capital debt - (89,483) - (89,483)
Net Cash Used for Capital and
Related Financing Activities (348,176) (145.422) (1.439,513} - (1,933,111}
CASH FLOWS FROM INVESTING
ACTIVITIES
Interest and dividends 6.449 3,989 6.555 208 17.201
Net Cash Provided by Investing
Activities 6,449 3,989 6,555 208 17.201
Net Increase (Decrease) in Cash and
Cash Equivalents 725,746 266,485 (829,248) 243,067 406,050 Cash and Cash Equivalents -
July 1, 2020 3,748,407 1.920.243 4.908,984 133.157 10,710,791 Cash and Cash Equivalents -
June 30, 2021 $ 4.474.153 $ 2~ $ 44736 $ 376,224 $ 11,116,841 See accompanying notes to the basic financial statements. 20 CITY OF GRIDLEY
STATEMENT OF CASH FLOWS (continued)
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2021
Business-type Activities -Enterprise Funds
Other
Enterprise
Electric Water Sewer Funds Totals
RECONCILIATION OF OPERATING
INCOME (LOSS) TO NET CASH
PROVIDED BY OPERATING
ACTIVITIES:
Operating Income (Loss)
Adjustments to reconcile operating
income (loss) to net cash provided
by operating activities:
Depreciation
Pension expense
OPEB expense
Changes in assets and liabilities:
(Increase) decrease in:
Accounts receivable
Inventory
Prepaid expenses
Increase (decrease) in:
Accounts payable
Deposits payable
Accrued expenses
Compensated absences
Net Cash Provided by Operating
Activities
$ 3,487,022 $ 123,617 $ (252,712) $ (12,179) $ 3,345,748 196,036 204,388 500,543 6,636 907,603
10,764 3,624 4,200 4,231 22,819
306,178 154,131 163,370 - 623,679
(1,508,722) (199,131) (160,126) (377) (1,868,356)
(100,187) 13,540 (78) - (86,725)
(4,326) 3,439 - - (887)
64,952 68.,415 109,592 (208) 242,751
10, 544 - - - 10, 544
(17,854) 5,175 21,038 (2,192) 6,167
23.066 30.720 8,118 26,549 88.453
$-- 2~ $~ $,,.,.,_ .393.945 $~ $-- 3
See accompanying notes to the basic financial statements. 21 CITY OF GRIDLEY
STATEMENT OF FIDUCIARY NET POSITION
FIDUCIARY FUNDS
JUNE 30, 2021
ASSETS
Cash and investments
Restricted cash and investments
Interest receivable
Capital assets, non-depreciable
Total Assets
LIABILITIES
Accounts payable and other liabilities
Interest payable
Advances from the City
long-term liabilities
Total Liabilities
NET POSITION
Held in trust for private purposes
Restricted for individuals, organizations, and other governments Total Net Position
Private
Purpose Trust Custodial
Fund Funds
$ 732,329 $ 63
381, 393 -
4 -
1.302.116 -
2.415.842 63
136 -
258,271 -
426, 868 -
4.230.242
4.915.517
(2,499,675) -
63 $ (2,499.675) $~__~
See accompanying notes to the basic financial statements. 22 CITY OF GRID~EY
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FIDUCIARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2021
Private
Purpose Trust Custodial
Fund Funds
ADDITIONS
Property taxes $ 580,609 $ -
Interest income 6,816 2
Total Additions 587,425 2
DEDUCTIONS
Professional services - 496
Administrative expense 36,037 -
Interest costs 287, 095
Total Deductions 323,132 496
Changes in Fiduciary Net Position 264,293 (494)
Fiduciary Net Position -July 1, 2020, Restated (2,763,968) 557 Fiduciary Net Position -June 30, 2021 $ (2~) $ 63
See accompanying notes to the basic financial statements. 23 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of Gridley (the "City") is a municipal corporation organized under the constitution and laws of the State of California.
The City operates under aCouncil-Administrator form of government and provides the following services: public safety (police, fire, and animal regulation}, street, sanitation, transportation and social services, recreation, public improvements, planning and zoning, water, sewer, electrical, and general administrative services.
The voters of the City give authority and responsibility for operations to the City Council. The City Council has the authority to employ administrative and support personnel to carry out its directives. The primary method used to monitor the performance of the City's management is the financial budget, which is adopted annually by the City Council.
A. The Reporting Entity
The accompanying basic financial statements present the financial activities of the City along with the financial activities of its blended component unit, which is an entity for which the City is financially accountable. Together these entities comprise the primary government for reporting purposes. Although it is a separate legal entity, the blended component unit is in substance part of the City's operations and is reported as an integral part of the City's financial statements. The City's component unit, which is described below, is blended.
Gridley Public Financino Authorit
The Gridley Public Financing Authority (the "Authority"}, established February 4, 2008, is a joint powers authority created by the City of Gridley and the former Gridley Redevelopment Agency. The creation of the Authority is authorized under the MarksRoos Local Bond Pooling Act of 1985, constituting Article 4, Chapter 5, Division 7, Title 1 (commencing with Section 6584) of the California Government Code. The City and the Authority are separate legal entities. For financial reporting purposes, the Authority is reported as a part of the City's operations because the five (5) members of the City Council also act as the governing body of the Authority. The purpose of the Authority is to assist in the financing of public capital improvements. No separate financial statements are issued for the Authority.
B. Basis of Presentation
The City's basic financial statements are prepared in conformity with accounting principles generally accepted in the United States of America. The Governmental Accounting Standards Board (GASB) is the acknowledged standard setting body for establishing accounting and financial reporting standards followed by governmental entities in the United States of America.
These standards require that the financial statements described below be presented.
Government-wide Financial Statements
The Statement of Net Position and Statement of Activities display information about the reporting government as a whole. They include the activities of the overall City government except for fiduciary activities. Eliminations have been made to minimize the double counting of internal service activities. The City's net position is reported in three parts -net investment in capital assets; restricted net position; and unrestricted net position. The Gity first utilizes restricted resources to finance qualifying activities.
Governmental activities generally are financed through taxes, intergovernmental revenues, and other nonexchange revenues.
Business-type activities are financed in part by fees charged to external parties for goods or services.
The Statement of Activities presents a comparison between direct expenses and program revenues for each function of the City's governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Program revenues include (a) charges paid by the recipients of goods or services offered by the program, (b) grants and contributions that are restricted to meeting the operational needs of a particular program and {c) fees, grants and contributions that are restricted to financing the acquisition or construction of capital assets. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. 24 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Fund Financial Statements:
The fund financial statements provide information about the City's funds, including fiduciary funds and blended component units. Each fund is accounted for by providing a separate set of self-balancing accounts that constitute its assets, deferred outflows of resources, liabilities, deferred inflows of resources, net position, revenues and expenditureslexpenses. Funds are organized into three major categories: governmental, proprietary, and fiduciary. An emphasis is placed on major funds within the governmental and proprietary categories with each major fund displayed in a separate column. A fund is considered major if it is the primary operating fund of the City or meets the following criteria:
a. Total assets and deferred outflows of resources, liabilities and deferred inflow of resources, revenues or expenditures/expenses of that individual governmental or enterprise fund are at least 10 percent of the corresponding total for all funds of that category or type; and
b. Total assets and deferred outflows of resources, liabilities and deferred inflows of resources, revenues, or expenditures/expenses of the individual governmental fund or enterprise fund are at least 5 percent of the corresponding total for all governmental and enterprise funds combined.
All remaining governmental and enterprise funds are aggregated and reported as nonmajor funds in a single column, regardless of their fund type.
The fund types of the financial reporting entity are described below:
Governmental Funds
General Fund -The General Fund is the general operating fund of the City and is always classified as a major fund. It is used to account for all activities except those legally or administratively required to be accounted for in other funds.
Special Revenue Funds -Special Revenue Funds are used to account for the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than debt service or capital projects.
Proprietary Funds
Enterprise Funds -Enterprise Funds are used to account for business-like activities provided to the general public. These activities are financed primarily by user charges and the measurement of financial activity focuses on net income measurement similar to the private sector.
Fiduciary Funds (not included in government-wide statements) Private-Purpose Trust Funds - Private-Purpose Trust Funds are used to report all other trust arrangements under which principal and income benefit individuals, private organizations, or other governments.
Custodial Funds -Custodial Funds are used to report fiduciary activities that are not required to be reported in pension (and other employee benefit) trust funds, investment trust funds, or private-purpose trust funds. 25 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Major Funds
The City reported the following major governmental funds in the accompanying financial statements General Fund -This is the City's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. For the City, the general fund includes such activities such as public safety, public ways and facilities, parks and recreation services, and economic development services.
OS-HOME-4987 Grant Fund -The 08-HOME-4987 Grant Fund is a special revenue fund used to account for the activities of the U.S. Department of Housing and Urban Development Block Grant.
Block Grants Fund -The block grants fund is a Community Development Block Grant {CDBG} Revolving Loan program and Economic Development Block Grant (EDBG} Program. The City participates in this federally funded program that is utilized to fund housing activities, community facilities and public service projects serving lower income private parties and businesses.
Eligible activities include funding housing activities (single/multi-family) rehabilitation, rental housing acquisition, homeownership assistance, or new construction. Interest may vary depending on the loan terms and interest may be deferred until the related property is refinanced or sold. The repayment of the loans results in program income, which is deposited into the Housing Rehabilitation Revolving loan fund (RLF) program for public benefit projects, general administration, and program delivery functions (preapproved ratios to the funds loaned).
Grant Related Funds -These special revenue funds house grants which have requirements for their own tracking mechanisms.
In the case of Fiscal Year 2020-21, approximately eighteen sub-funds fell into this category. They were mostly grants from the State of California (transportation, planning, and COPS grants). All funds in this category have requirements to remain segregated from other City funds.
The City reports the following major proprietary funds in the accompanying financial statements:
Electric Fund -The electric fund is used to account for the activities of the City's electric generation and distribution operations.
Water Fund -The water fund is used to account for the activities of the City's water treatment and distribution operations.
Sewer Fund -The sewer fund is used to account for the activities of the City's sewage collection and treatment operations The City also reports the following fund types:
Private-Purpose Trust Funds -These funds include the Main Trust and Successor Agency. The Main Trust Fund is used to account for trust arrangements where the balances and activity benefit individuals and organizations other than the City. The Successor Agency fund was created as a result of the State order to dissolve California Redevelopment Agencies. As the Successor Agency, this fund is used to track the activity by the Oversight Board and the Department of Finance to dissolve the Agency.
Custodial Funds -The City administers two custodial funds, the Gridley Bid fund and the Hospital JPA Administration fund.
C. Measurement Focus and Basis of Accounting
Measurement focus is a term used to describe "which" transactions are recorded within the various financial statements. Basis of accounting refers to "when" revenues and expenditures or expenses are recognized in the accounts and reported in the financial statements regardless of the measurement focus applied. 26 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Measurement Focus
On the government-wide Statement of Net Position and the Statement of Activities, both governmental and business-type activities are presented using the economic resources measurement focus as defined in item "b" below.
In the fund financial statements, the "current financial resources" measurement focus or the "economic resources" measurement focus is used as appropriate:
a. All governmental funds are accounted for using a "current financial resources" measurement focus. With this measurement focus, only current assets and deferred outflows of resources, and current liabilities and deferred inflows of resources, generally are included on their balance sheets. Their operating statements present sources and uses of available spendable financial resources during a given period. These funds use fund balance as their measure of available spendable financial resources at the end of the period. b. All proprietary funds utilize an "economic resources" measurement focus. The accounting objectives of this measurement focus are the determination of operating income, changes in net position (or cost recovery), financial position, and cash flows. All assets and deferred outflows of resources, and all liabilities and deferred inflows of resources (whether current or noncurrent) associated with the operation of these funds are reported. Proprietary fund equity is classified as net position.
c. Fiduciary funds use the "economic resources" measurement focus and the accrual basis of accounting.
Basis of Accounting
In the government-wide Statement of Net Position and Statement of Activities, both governmental and business-type activities are presented using the accrual basis of accounting. Under the accrual basis of accounting, revenues are recognized when earned and expenses are recorded when the liability is incurred or economic asset is used. Revenues, expenses, gains, losses, assets and liabilities resulting from exchange and exchange-like transactions are recognized when the exchange takes place.
In the fund financial statements, governmental funds are presented on the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recognized when "measurable and available." Measurable means knowing or being able to reasonably estimate the amount. Available means collectible within the current period or soon enough thereafter to pay current liabilities. The City defines available to be within 60 days of year-end. Expenditures (including capital outlay) are recorded when the related fund liability is incurred, except for general obligation bond principal and interest which are reported when due. Governmental capital asset acquisitions are reported as expenditures in governmental funds. Proceeds from governmental long-term liabilities and acquisitions under capital leases are reported as other financing sources.
Those revenues susceptible to accrual include taxes, intergovernmental revenues, interest and charges for services. Certain indirect costs are included in program expenses reported for individual functions and activíties.
Grant revenues are recognized in the fiscal year in which all eligibility requirements are met. Under the terms of grant agreements, the City may fund certain programs with a combination of cost-reimbursement grants, categorical block grants, and general revenues. Thus, both restricted and unrestricted net position are available to finance program expenditures. The City's policy is to first apply restricted grant resources to such programs, followed by general revenues if necessary.
All proprietary funds utilize the accrual basis of accounting. Under the accrual basis of accounting, revenues are recognized when earned and expenses are recorded when the liability is incurred or economic asset is used. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal operations. The principal operating revenues of the enterprise funds are charges to customers for sales and services. Operating expenses for enterprise funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. When both restricted and unrestricted resources are available for use, ít is the City's policy to use restricted resources first, then unrestricted resources as they are needed.
27 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Property Taxes
The County of Butte levies, bills, and collects property taxes and special assessments for the City. Property taxes levied are recorded as revenue when received, in the fiscal year of levy, due to the adoption of the "alternate method of property tax distribution", known as the Teeter Plan, by the City and the County of Butte. The Teeter Plan authorizes the Auditor/Controller of the County of Butte to allocate 100% of the secured property taxes billed, but not yet paid. The County of Butte remits tax monies to the City in three installments as follows:
50% remitted in December
45% remitted in April
5% remitted in June
Tax collections are the responsibility of the County Tax Collector. Taxes and assessments on secured and utility rolls which constitute a lien against the property, may be paid in two installments; the first is due November 1 of the fiscal year and is delinquent if not paid by December 10; and the second is due on March 1 of the fiscal year and is delinquent if not paid by April
10. Unsecured personal property taxes do not constitute a lien against real property unless the tax becomes delinquent.
Payment must be made in one installment, which is delinquent if not paid by August 31 of the fiscal year. Significant penalties are imposed by the County for late payment.
Property valuations are established by the Assessor of the County of Butte for the secured and unsecured property tax rolls.
Under the provisions of Article XIIIA of the State Constitution, properties are assessed at 100% of purchase price or value in 1978 whichever is later. From this base assessment, subsequent annual increases in valuation are limited to a maximum of 2 percent. However, increases to full value are allowed for properly improvements or upon change in ownership. Personal property is excluded from these limitations, and is subject to annual reappraisal.
Tax levy dates are attached annually on January 1 preceding the fiscal year for which the taxes are levied. The fiscal year begins July 1 and ends June 30 of the following year. Taxes are levied on both real and unsecured personal property, as it exists at that time. Liens against real estate, as well as the tax on personal property, are not relieved by subsequent renewal or change in ownership.
E. Cash and Investments
The City pools the cash of all funds, except for monies deposited with fiscal agents in accordance with related bond indentures.
The cash and investments balance in each fund represents that fund's equity share of the City's cash and investment pool. As the City places no restrictions on the deposit or withdrawal of a particular fund's equity in the pool, the pool operates like a demand deposit account for the participating funds.
Interest income earned on pooled cash and investments is allocated monthly to the various funds based on month-end balances and is adjusted at fiscal year-end. Interest income on restricted cash and investments with fiscal agents is credited directly to the related fund.
The City's investments are carried at fair value. The fair value of equity and debt securities is determined based on sales prices or bid-and-asked quotations from SEC-registered securities exchanges or NASDAQ dealers. LAIF determines the fair value of their portfolio quarterly and reports a factor to the City; the City applies that factor to convert its share of LAIF from amortized cost to fair value. This amount is included in cash and cash equivalents in the balance sheet of the governmental funds.
Changes in fair value are allocated to each participating fund.
For purposes of the statement of cash flows, the City has defined cash and cash equivalents to be change and petty cash funds, equity in the City's cash and investment pool, and restricted non-pooled investments with initial maturities of three months or less.
28 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) F. Accounts and Interest Receivables
In the government-wide statements, receivables consist of all revenues earned at year-end and not yet received. Receivables are recorded in the financial statements net of any allowance for doubtful accounts if applicable, and estimated refunds due.
Major receivable balances for the governmental activities include sales and use taxes, franchise taxes, grants, police fines and other fees. Federal and state grants are considered receivable and accrued as revenue when reimbursable costs are incurred.
Business-type activities report utilities and interest earnings as their major receivables.
In the fund financial statements, material receivables in governmental funds include revenue accruals such as sales tax, franchise tax, and grants and other similar intergovernmental revenues since they are usually both measurable and available.
Nonexchange transactions collectible but not available are recorded as deferred inflows of resources in the fund financial statements in accordance with modified accrual, but not deferred in the government-wide financial statements in accordance with the accrual basis. Interest and investment earnings are recorded when earned only if paid within 60 days since they would be considered both measurable and available. Long-term loans in governmental funds are treated as expenditures in the year advanced and as revenues in the year repayment is measurable and available. Loans receivable are recorded in the fund statements, but are recorded as deferred inflows of resources to indicate they do not represent current financial resources.
Proprietary fund material receivables consist of all revenues earned at year-end and not yet received. Utility accounts receivable and interest earnings compose the majority of proprietary fund receivables.
G. Prepaid Expenses and Inventory
Inventories are stated at cost (average cost per unit) for governmental and proprietary funds. The cost is recorded as an expenditure/expense in the funds at the time individual inventory items are consumed, rather than purchased. Inventories of governmental funds are offset by nonspendable fund balance to indicate they do not constitute resources available for future appropriation.
Prepaid items are also recognized under the consumption method. Payments to vendors that reflect costs applicable to future accounting periods are recorded as prepaid items in both government-wide and fund financial statements.
H. Capital Assets
The accounting treatment over property, plant and equipment depends on whether the assets are used in governmental fund operations or proprietary fund operations and whether they are reported in the government-wide or fund financial statements.
Government-wide Statements
In the government-wide financial statements, infrastructure with an aggregate cost of $25,000 or more and land, buildings, machinery, vehicles, and equipment with a cost of $5,000 or more and a useful life of two years are capitalized. All capital assets are valued at historical cost, or estimated historical cost if actual is unavailable, except for donated capital assets which are recorded at their acquisition value at the date of donation. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend the asset lives are not capitalized. Improvements are capitalized and depreciated over the remaining useful lives of the related capital assets, as applicable.
Depreciation of all exhaustible capital assets is recorded as an allocated expense in the Statement of Activities, with accumulated depreciation reflected in the Statement of Net Position. Depreciation is provided over the assets' estimated useful lives using the straight-line method of depreciation. The range of estimated useful lives by type of asset is as follows:
Infrastructure and buildings 20 - 50 years
Improvements 10 - 30 years
Equipment and vehicles 3 - 20 years
Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of debt financed capital assets of business-type activities is included as part of the capitalized value of the asset constructed, net of interest earned on the invested proceeds over the same period. 29 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Fund Financial Statements
In the fund financial statements, capital assets used in governmental fund operations are accounted for as capital outlay expenditures of the governmental fund upon acquisition. Capital assets used ín proprietary fund operations are accounted for the same as in the government-wide statements.
I. Compensated Absences
Compensated absences comprise unused vacation leave and compensatory time off, which are accrued as earned. Employees may accumulate sick leave without limits. The City's liability for compensated absences is recorded in the government-wide Statement of Net Position for governmental funds and the Statement of Net Position for proprietary funds as appropriate. A liability is calculated for all the costs of compensated absences based upon benefits earned by employees in the current period for which there is a probability of payment at termination. The salary and related payroll costs are those in effect at June 30, 2021. Accumulated unpaid vacation and sick pay are accrued when earned. In addition, those employees who have reached the age of retirement may cash out sick leave upon retirement. The liability has been calculated using the vesting method, in which leave amounts for both employees who currently are eligible to receive termination payments and other employees who are expected to become eligible in the future to receive such payments upon termination are included. In December of each year, management personnel are allowed to convert unused sick leave earned within the previous 12 months, in excess of 9 days, to vacation. The general fund and enterprise funds are used to liquidate compensated absences. The sick leave balance as of June 30, 2021 was $232,823 and is included in the compensated absences liability.
J. Long Term Liabilities
In the government-wide financial statements and the proprietary fund types in the fund financial statements, long-term liabilities, and other long term obligations are reported as liabilities ín the applicable governmental activities, business-type activities, or proprietary fund type statement of net position. Initial issue bond premiums and discounts, are deferred and amortized over the life of the bonds using the straight-line method. The difference between the reacquisition price of refunding bonds and the net carrying amount of refunded debt (deferred amount on refunding) is amortized over the shorter of the lives of the refunding debt or remaining life of the refunded debt. Bond issuance costs, except for insurance, are expensed in the period incurred.
Amortization of bond premiums or discounts, issuance costs, and deferred amounts on refunding is included in interest expense.
In the fund financial statements, governmental fund types recognize bond premiums, discounts, and issuance costs during the period issued. The face amount of debt issued is reported as other financing sources. Premiums received are reported as other financing sources, while discounts are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.
K. Pensions
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the City's California Public Employees' Retirement System (Ca1PERS) plan (the "Plan") and additions to/deductions from the Plan's fiduciary net position have been determined on the same basis as they are reported by CaIPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
L. Other Postemployment Benefits (OPEB}
For the purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the City's plan (OPEB Plan) and additions to/deductions from the OPEB Plan's fiduciary net position have been determined on the same basis. For this purpose, benefit payments are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value.
Generally accepted accounting principles require that the reported results must pertain to liabilities and asset information with certain defined timeframe's. For this report, the following timeframe's are used:
Valuation Date July 1, 2019
Measurement Date June 30, 2021
Measurement Period July 1, 2020 to June 30, 2021
30 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) M. Deferred Outflowsilnflow of Resources
In addition to assets, the statement of net position or balance sheet will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net assets that applies to a future periods) and so will not be recognized as an outflow of resources (expense/expenditure) until then.
In addition to liabilities, the statement of net position or balance sheet will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net assets that applies to a future periods) and so will not be recognized as an inflow of resources (revenue) until that time.
N. Interfund Transactions
Interfund transactions are reflected as either loans, services provided, reimbursements, or transfers. Loans are reported as receivables and payables as appropriate, are subject to elimination upon consolidation and are referred to as either "due to/from other funds" (i.e., the current portion of interfund loans) or "advances to/from other funds" (i.e., the noncurrent portion of interfund loans). Any residual balances outstanding between the governmental activities and the business-type activities are reported in the government-wide financial statements as "internal balances". Advances between funds, as reported in the fund financial statements, are offset by a nonspendable fund balance in applicable governmental funds to indicate that they are not available for appropriation and are not available financial resources.
Services provided, deemed to be at market or near market rates, are treated as revenues and expenditures/expenses.
Reimbursements are when one fund incurs a cost, charges the appropriate benefiting fund, and reduces its related cost as a reimbursement. All other interfund transactions are treated as transfers. Transfers between governmental or proprietary funds are netted as part of the reconciliation to the government-wide presentation, O. Equity Classifications
Government-wide Statements
Net position is the excess of all the City's assets and deferred outflows of resources over all its liabilities and deferred inflows of resources, regardless of fund. Netposition is divided into three categories. These categories apply only to net position, which is determined at the Government-wide level, and are described below:
a. Net investment in capital assets -Consists of capital assets including restricted capital assets, net of accumulated depreciation and reduced by the outstanding balances of any bonds, mortgages, notes or other borrowings that are attributable to the acquisition, construction, or improvement of those assets. b. Restricted net position -Consists of net position wíth constraints placed on the use either by (1) external groups such as creditors, grantors, contributors, or laws or regulations of other governments; or (2) law through constitutional provisions or enabling legislation.
c. Unrestricted net position -All other net position that does not meet the definition of "restricted" or "net investment in capital assets."
Fund Statements
The governmental fund financial statements present fund balances based on classifications that comprise a hierarchy that is based primarily on the extent to which the City is bound to honor constraints on the specific purposes for which amounts in the respective governmental funds can be spent. The classifications used in the governmental fund financial statements are as follows:
a. Nonspendable -Amounts that cannot be spent because they are either (a) not in spendable form or (b) legally or contractually required to be maintained intact.
b. Restricted -Amounts that are restricted for specific purposes when constraints placed on the use of resources are either (a) externally imposed by creditors, grantors, contributors, laws, or regulations of other govemments; or (b) imposed by law through constitutional provisions or enabling legislation. 31 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) c. Committed -Amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of the government's highest level ofdecision-making authority. d. Assigned -Amounts that are constrained by the City Council's intent to be used for specific purposes, but are neither restricted or committed.
e. Unassigned -Amounts representing the residual classification for the general fund or any other fund with a negative fund balance.
Further detail about the City's fund balance classification is described in Note 9.
P. Use of Estimates
The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from these estimates.
Q. Implementation of Government Accountíng Standards Board Statements Effective July 1, 2020, the City implemented the following accounting and financial reporting standards:
Governmental Accounting Standards Board Statement No. 84 In January 2017, GASB issued Statement No. 84, Fiduciary Activities. This Statement establishes criteria for identifying fiduciary activities of all state and local governments. Additionally, this Statement describes four fiduciary funds that should be reported, as well as provides for recognition of a liability to the beneficiaries in a fiduciary fund when an event has occurred that compels the government to disburse fiduciary resources. The Cíty adopted this accounting guídance for its June 30, 2021 year-end.
Governmental Accounting Standards Board Statement No. 90 In August 2018, GASB issued Statement No. 90, Majority Eguity Interests an amendment of GASB Statements No. 74 and 69.
The purpose of this Statement is to improve the consistency and comparability of reporting a government's majority equity interest in a legally separate organization and to improve the relevance of financial statement information for certain component units. The new standard clarifies the difference between a majority equity interest reported as an investment and majority equity interest reported as a component unit of the governmental entity. The City adopted this accounting guidance for ít June 30, 2021 year-end.
R. Future Governmental Accounting Standards Board Statements These statements are not effective until July 1, 2021 or later. The City has not determined the effects on the financial statements.
Governmental Accountino Standards Board Statement No. 87 In June 2017, GASB issued Statement No. 87, Leases. This Statement (1) increases the usefulness of governments' financial statements by requiring recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract; and (2) establishes a single model for lease accounting based on the foundational principle that leases are financings of the right to use an underlying asset. Additionally, 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, thereby enhancing the relevance and consistency of information about governments' leasing activities. The City has not determined what impact, ïf any, this pronouncement will have on the financial statements. Application of this statement is effective for the City's fiscal year ending June 30, 2022.
32 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Governmental Accountina Standards Board Statement No. 89 In June 2018, GASB issued Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period.
This statement requires interest costs incurred before the end of a construction period to be recorded as an expenditure in the applicable period. As a result, interest cost incurred before the end of a construction period will not be included in the historical cost of a capital asset reported in a business-type activity or enterprise fund. The City has not determined what impact, if any, this pronouncement will have on the financial statements. Application of this statement is effective for the City's fiscal year ending June 30, 2022.
Governmental Accountina Standards Board Statement No. 91 In May 2019, GASB issued Statement No. 91, Conduit Debt Obligations. The primary objectives of this Statement are to provide a single method of reporting conduit debt obligations by issuers and eliminate diversity in practice associated with (1) commitments extended by issuers, (2) arrangements associated with conduit debt obligations, and (3) related note disclosures.
This Statement achieves those objectives by clarifying the existing definition of a conduit debt obligation; establishing that a conduit debt obligation is not a liability of the issuer; establishing standards for accounting and financial reporting of additional commitments and voluntary commitments extended by issuers and arrangements associated with conduit debt obligations; and improving required note disclosures. The City has not determined what impact, if any, this pronouncement will have on the financial statements. Application of this statement is effective for the City's fiscal year ending June 30, 2023.
Governmental Accountina Standards Board Statement No. 92 In January 2020, GASB issued Statement No. 92, Omnibus 2020. The primary objectives of this Statement are to enhance comparability in accounting and financial reporting and to improve the consistency of authoritative literature by addressing practice issues that have been identified during implementation and application of certain GASB Statements. The City has not determined what impact, if any, this pronouncement will have on the financial statements. Application of this statement is effective for the City's fiscal year ending June 30, 2022.
Governmental Accountina Standards Board Statement No. 93 In March 2020, GASB issued Statement No. 93, Replacement of Interbank Offered Rates. The primary objective of this Statement is to address accounting and financial reporting implications that result from the replacement of an interbank offered rate (IBOR). The City has not determined what impact, if any, this pronouncement will have on the financial statements. The removal of LIBOR as an appropriate benchmark interest rate is effective for the City's fiscal year ending June 30, 2022. All other requirements of this statement are effective for the City's fiscal year ending June 30, 2022.
Governmental Accountina Standards Board Statement No. 94 In March 2020, GASB issued Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements. The primary objective of this Statement is to improve financial reporting by addressing issues related to publicprivate and public-public partnership arrangements (PPPs). A PPP is an arrangement in which a government (the transferor) contracts with an operator (a governmental or nongovernmental entity) to provide public services by conveyïng control of the right to operate or use a nonfinancial asset, such as infrastructure or other capital asset (the underlying PPP asset), for a period of time in an exchange or exchange-like transaction. This Statement also provides guidance for accounting and financial reporting for availability payment arrangements (APAs). AnAPAis an arrangement in which a government compensates an operator for services that may include designing, constructing, financing, maintaining, or operating an underlying nonfinancial asset for a period of time in an exchange or exchange-like transaction. The City has not determined what impact, if any, this pronouncement will have on the financial statements. The requirements of this statement are effective for the City's fiscal year ending June 30, 2023.
Governmental Accountina Standards Board Statement No. 96 In May 2020, GASB issued Statement No. 96, Subscription-Based Information Technology Arrangements.This Statement provides guidance on the accounting and financial reporting for subscription-based information technology arrangements (SBITAs) for governments, defines a SBITA, establishes that a SBITA results in a right-to-use subscription asset-an intangible asset-and a corresponding liability, provides the capitalization criteria for outlays other than subscription payments, including implementation costs of a SBITA, and requires note disclosures regarding a SBITA.. The City has not determined what impact, if any, this pronouncement will have on the financial statements. The requirements of this statement are effective for the City's fiscal year ending June 30, 2023.
33 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Governmental Accounting Standards Board Statement No. 97 In June 2020, GASB issued Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans an Amendment of GASB Statements No. 14 and No. 84, and a Supersession of GASB Statement No. 32. The primary objectives of this Statement are to (1) increase consistency and comparability related to the reporting of fiduciary component units in circumstances in which a partial component unit does not have a governing board and the primary government performs the duties that a governing board typically would perform; (2) mitigate costs associated with the reporting of certain defined contribution pension plans, defined contribution other postemployment benefit (OPEB) plans (other employee benefit plans) as fiduciary component units in fiduciary fund financial statements; and (3) enhance the relevance, consistency, and comparability of the accounting and financial reporting for Internal Revenue Code (IRC) Section 457 deferred compensation plans (Section 457 plans) that meet the definition of a pension plan and for benefits provided through those plans. The City has not determined what impact, if any, this pronouncement will have on the financial statements. The requirements of this statement related to the accounting and financial reporting for Section 457 plans are effective for the City's fiscal year ending June 30, 2022.
Governmental Accounting Standards Board Statement No. 99 In April 2022, GASB issued Statement No. 99, Omnibus 2022. The primary objectives of this Statement are to enhance comparability in accounting and financial reporting and to improve the consistency of authoritative literature by addressing {1) practice issues that have been identified during implementation and application of certain GASB Statements and (2) accounting and financial reporting for financial guarantees. The Cíty has not determined what impact, if any, this pronouncement will have on the financial statements. The requirements of this statement related to leases, PPPs and SBITAs are effective for the City's fiscal year ending June 30, 2023 and the requirements related to financial guarantees and the classification and reporting of derivative instruments within the scope of Statement 53 are effective for the City's fiscal year ending June 30, 2024.
Governmental Accounting Standards Board Statement No. 100 In June 2022, GASB issued Statement No. 100 Accounting Changes and Error Corrections - An Amendment of GASB Statement No. 62. The primary objective of this Statement is to enhance accounting and financial reporting requirements for accounting changes and error corrections to provide more understandable, reliable, relevant, consistent, and comparable information for making decisions or assessing accountability. The requirements of this statement are effective for the City's fiscal year ending June 30, 2024.
Governmental Accounting Standards Board Statement No. 101 In June 2022, GASB issued Statement No. 101 Compensated Absences.. The primary objective of this Statement is to better meet the information needs of financial statement users by updating the recognition and measurement guidance for compensated absences by aligning the recognition and measurement guidance under a unified model and amending certain previously required disclosures. The requirements of this statement are effective for the City's fiscal year ending June 30, 2025.
NOTE 2: CASH AND INVESTMENTS
Cash and investments as of June 30, 2021 were classified in the accompanying financial statements as follows:
Cash and Restricted Cash
Investments and Investments Total
Governmental activities $ 11,047,451 $ - $ 11,047,451
Business-type activities 11.116,841 - 11.116,841
Total government-wide cash and investments 22.164.292 22.164.292 Fiduciary activities 732.392 381.393 1.113,785
Total cash and investments $__ 2 $381,393 $ 2~3 278 _077 34 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 2: CASH AND INVESTMENTS (CONTINUED)
Cash and investments were carried at fair value as of June 30, 2021 and consisted of the following:
Cash on hand $ 560
Cash in banks 16,214,349
Total cash 16.214,909
Local Agency Investment Fund (LAIF) 6,681,775
California Asset Management Program (CAMP) 381,393
Total investments 7,063,168
Total cash and investments $ 23,278,077
Authorized Investments of the City
The table below identifies the investment types that are authorized by the City's investment policy. This table does not address investments of debt proceeds held by bond trustees that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City's investment policy.
Maximum Maximum
Maximum Percentage of Investment in one
Authorized Investment Type Maturity Portfolio Issuer
Local Agency Bonds
U.S. Treasury Obligations
State Obligations - CA And Others
CA Local Agency Obligations
U.S. Agency Obligations
Banker's Acceptances
Commercial Paper -Select Agencies
Commercial Paper -Other Agencies
Negotiable Certificates of Deposit
CD Placement Service
Repurchase Agreements
Reverse Repurchase Agreements and Securities
Lending Agreements
Medium-Term Notes
Mutual Funds and Money Market Mutual Funds
Collateralized Bank Deposits
Mortgage Pass -Through Securities
BanklTime Deposits
County Pooled Investment Funds
Joint Powers Authority Pool
Local Agency Investment Fund (LAIF)
Voluntary Investment Program Fund
5 years None 10%
5 years None None
5 years None None
5 years None None
5 years None None
180 days 40% 30%
270 days 25% 10%
270 days 40% 10%
5 years 30% 30%
5 years 30% 30%
1 year None 10%
92 days 20% 10%
5 years 30% 10%
N/A 20% 10%
5 years None None
5 years 20% None
5 years None None
N/A None None
N/A None None
N/A None $75 million/account
N/A None None
The City complies with the provisions of California Government Code (or the City's investment policy, where more restrictive) pertaining to the types of investments held, institutions in which deposits were made and security requirements. The City will continue to monitor compliance with applicable statues pertaining to public deposits and investments. 35 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 2: CASH AND INVESTMENTS (CONTINUED)
Investments Authorized by Debt Agreements
Investment of debt proceeds held by bond trustees are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City's investment policy. The table below identifies the investment types that are authorized by bond trustees. The table also identifies certain provisions of these debt agreements that address interest rate risk, credit risk, and concentration of credit risk.
Maximum Maximum
Maximum Percentage of Investment in one
Authorized Investment Type Maturity Portfolio Issuer
Local agency bonds None None None
U.S. Treasury obligations None None None
U.S. Agency securities None None None
Banker's acceptances 365 days None None
Commercial paper 270 days None None
Federal Funds 365 days None None
Unsecured Certificates of Deposit 365 days None None
Time Deposits 365 days None None
Cash Sweep Accounts None None None
Money market funds N/A None None
Mortgage-backed securities None None None
Local Agency Investment Fund (ERIE) N/A None $75 million/account Investment Valuation
The City measures and records its investments using fair value measurement guidelines established by generally accepted accounting principles. These guidelines recognize athree-tiered fair value hierarchy, as follows:
Level 1: Quoted prices for identical investments in active markets; Level 2: Observable inputs other than quoted market prices; and, Level 3: Unobservable inputs
Investments are measured at fair value on a recurring basis. Recurring fair value measurements are those that Governmental Accounting Standards Board (GASB) Statements require or permit in the statement of net position at the end of each reporting period.
The City's position in external investment pools is in itself regarded as a type of investment and looking through to the underlying investments of the pool is not appropriate.
At June 30, 2021, the Cíty had the following recurring fair value measurements:
Investments
Local Agency Investment Fund
Held by bond trustee:
Investment pool (CAMP)
Total Investments
Fair Value Measurements Using
Level 1 Inputs Level 2 inputs Level 3 inputs Fair Value - $ - $ - $ 6,681,775
_ 381.393
$ $ $~ $ 7 0~63~ 168
K1:
CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 2: CASH AND INVESTMENTS (CONTINUED)
Disclosure 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's interest rate risk is mitigated 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.
Information about the sensitivity of the fair values of the City's investments (including investments held by bond trustee) to market rate fluctuations is provided by the following table that shows the distribution of the City's investments by maturity as of June 30, 2021:
Remaining Maturity
12 months or
less 1-5 years Fair Value
Local Agency Investment Fund $ 6,681,775 $ - $ 6,681,775 Held by bond trustee:
Investment pool (CAMP) 381.393 _ 381,393
$ 7,063,168 $ - $ 7,063,168
Investments with Fair Values Highly Sensitive to Interest Rate Fluctuations The City had no investments (including investments held by bond trustees) that were highly sensitive to interest rate fluctuations as of June 30, 2021.
Disclosures Relating to Credit Risk
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 investment policy, or debt agreements, and the actual rating as of the fiscal year for each investment type.
Rating as of Fiscal Year End
Total S&P Moody's N/A
Local Agency Investment Fund $ 6,681,775 Not rated
Held by bond trustee:
Investment pool (CAMP) 381,393 AAAm
$ 7063 1,68
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 collateral securities that are in the possession of an outside party. Custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g. broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the City 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 government unit). The market value of the pledged securities in the collateral pool must equal at least 110°l0 of the total amount deposited by the public agencies. California law also allows financial institutions to secure City's deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits. 37 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 2: CASH AND INVESTMENTS (CONTINUED)
As of June 30, 2021, the carrying amount of the City's deposits was $16,214,349 and bank balances were $16,056,395, of which $750,000 was insured.
Investment in State Investment Pool
The City ís a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by the California Government Code under the oversight of the Treasurer of the State of California. This fund is not registered with the Securities and Exchange Commission as an investment company, but is required to invest according to California Government Code.
Participants in the pool include voluntary and involuntary participants, such as special districts and school districts for which there are legal provisions regarding their investments. The Local Investment Advisory Board (Board) has oversight responsibility for LAIF. The Board consists of five members designated by State Statute. 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 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 is recorded on an amortized cost basis.
Allocation of Interest Income Among Funds
Interest income from pooled investments is allocated to those funds which are required by law or administrative action to receive interest. Interest is allocated monthly based on the ending cash balances of the previous month ïn each fund receiving interest.
NOTE 3: LOANS RECEIVABLE
The following is a summary of loans receivable at June 30, 2021:
Balance Additions/ Balance
Governmental Activities July 1, 2020 Adjustments Retirements June 30, 2021 Governmental Funds
Home program $ 7,791,817 $ - $ (6,904) $ 7,784,913
CalHome program 19,264 - - 19,264
CDBG program 1.775,128 325,676 (111,313) 1,989,491
Total Loans Receivable $ 9,586,209 $ 325 676 $ 1118,217) $ 9 793 668 Balance Retirements/ Balance
Fiduciary July 1, 2020 Additions Adjustments June 30, 2021 Construction Loan $ 678,000 $ - $ - $ 678,000
Less Allowance for Loans Receivable
Total Loans Receivable, net
1678,000) _ (678,000)
$ - $ - $ - $ -
The City participates in the Home Investment Partnerships (HOME) program, the Community Development Block Grant (CDBG} Revolving Loan program and the CalHome program. Under these programs, grants or loans are provided under favorable terms to homeowners, developers, or businesses who agree to spend these funds in accordance with the City's terms.
The balance of the loans receivable have been offset in the governmental fund financial statements by deferred inflows of resources as they are not deemed measurable and available within 60 days. In the government-wide financial statements, the loans are not offset in accordance with the accrual basis of accounting. 38 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 4: INTERFUND TRANSACTIONS
Interfund Receivables/Parables
Interfund long-term advances due after one year at June 30, 2021 were as follows:
Advances to Advances from Description Amount
Successor Agency Block Grant Fund Reimbursement agreement $ 250,000 Successor Agency General Fund RDA loan 176,868
Total Interfund ReceivableslPayables $ 426,868
Reimbursement agreement -Pursuant to Resolution No. 2003.RDA-05, the former Redevelopment Agency agreed to reimburse the City of Gridley for infrastructure improvements within the Agency's industrial park up to $250,000. No interest accrues on the amount due to the City.
The Successor Agency agreed to reimburse the City's General Fund for the formation of the RDA in the amount of $176,868.
Repayment is to be made as funds are available. No interest accrues on the amount due to the City.
The composition of Interfund balances as of June 30, 2021 was as follows:
Payable Fund Receivable Fund
Non-Major Governmental Funds
SB 325 General Fund
Recreation Related Fund General Fund
Gas Tax Fund General Fund
Traffic Safety Fund General Fund
Planning and Development General Fund
Solid Waste -Recreation General Fund
Description
Temporary pooled cash adjustment
Temporary pooled cash adjustment
Temporary pooled cash adjustment
Temporary pooled cash adjustment
Temporary pooled cash adjustment
Temporary pooled cash adjustment
Amount
$ 116,963
1,410,503
354,906
74,688
986,186
57,646
3.000,892
128,402
200,627
Total Non-Major Governmental Funds
Non-Major Proprietary Fund
Senior Taxi Fund General Fund Temporary borrowing
Senior Taxi Fund SB 325 Fund Temporary borrowing
Total Non-Major Proprietary Funds 329,029
Total Interfund PayableslReceivables $ 33 3
39 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 4: INTERFUND TRANSACTIONS (CONTINUED)
Interfund Transfers to/from Other Funds
Transfers between funds during the fiscal year ended June 30, 2021 were as follows:
Transfer From Transfer To Description of Transfer Amount Governmental Funds
Maior Governmental Funds
General Fund Public Financing Authority To close fund $ 258 General Fund 04-STBG-1961 To close fund 9
Grant-Related Funds Sewer Fund Feather River Crossing 209,765 Grant-Related Funds General Fund City Operations 144,340 Grant-Related Funds General Fund Police Operations 35.000 Total Major Governmental Funds 389.372
Non-Maior Governmental Funds
05-PTAA-1446 General Fund To close fund 1
Total Non-Major Governmental Funds 1
Enterprise Funds
Electric fund General Fund Unfunded City operations 1.400.000 Total Enterprise Funds 1,400.000
Total Interfund Transfers $__ 1,7
Intra-Fund Transfers between Funds
The following table represents intra-fund transfers made during the fiscal year ended June 30, 2021:
Transfer From Transfer To Description of Transfer Amount General Fund GF Reserve Fund General fund reserve policy $ 855,917 Total General Fund Intra-Fund Transfers $855 917
Intra-fund transfers are not presented on the Statement of Revenues, Expenses, and Changes in Net Position for the governmental funds as they are presented on a net basis. However, the Combining Schedule of Revenues, Expenditures, and Changes in Fun Balance for the General Fund on pages presents both intra-fund transfers and Interfund transfers.
Qi7
CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 5: CAPITAL ASSETS
Governmental actïvities:
Capital assets not being depreciated
Land
Construction-i n-progress
Total capital assets not being depreciated
Capital assets being depreciated
Infrastructure
Buildings and improvements
Improvements other than buildings
Vehicles and equipment
Total capital assets being depreciated
Less accumulated depreciation
Infrastructure
Buildings and improvements
Improvements other than buildings
Vehicles and equipment
Total accumulated depreciation
Total capital assets being depreciated, net
Total capital assets, net
Balance at Balance at
July 1, 2020 Additions Retirements June 30, 2021
$ 417,779 $ - $ - $ 417,779
588,859 588.859
417,779 588,859 1,006,638
7,999,087 - - 7,999,087
3,654,840 - - 3,654,840
3,383,815 - - 3,383,815
5,455,725 318,730 (138,441) 5.636,014
20,493,467 318,730 (138,441) 20,673,756
(3,501,359) (270,516) - (3,771,875)
(2,331,844) (112,909) - (2,444,753)
(981,700) (130,275) - (1,111,975)
(4,190,695) (184,099) 138.441 (4,236,353)
(11,005,598} (697,799) 138.441 (11,564,956)
9,487,869 (379,069) - 9.108,800
$ 9 905 648 $7_90 $~ $ 10 115 438
Depreciation was charged to functions of the City's governmental activitíes based on their usage of the related assets as follows:
General Government $ 74,024
Public Safety 160,570
Streets and Public Works 340,586
Parks and Recreation 122.619
Total governmental activities depreciation expense $ 697 799 41 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 5: CAPITAL ASSETS (CONTINUED)
Business-type activities:
Capital assets not being depreciated
Land
Construction-in-progress
Total capital assets not being depreciated
Capital assets being depreciated
Infrastructure
Buildings and improvements
Improvements other than buildings
Vehicles and equipment
Total capital assets being depreciated
Less accumulated depreciation
Infrastructure
Buildings and improvements
Improvements other than buildings
Vehicles and equipment
Total accumulated depreciation
Total capital assets being depreciated, net
Total capital assets, net
Balance at Transfers) Balance at
July 1, 2020 Additions Retirements Adjustments June 30, 2021 $ 921,793 $ - $ - $ - $ 921,793
47.441 1.383.272 (22,385) 1,408,328
969.234 1.383,272 - (22,385) 2.330.121
6,340,384 - - - 6,340,384
1,139,545 - - - 1,139,545
9,093,499 - - 28,589 9,122,088
7.331,604 371.322 (24,234) 20.925 7.699,617
23.905.032 371.322 (24.234) 49.514 24.301,634
(2,391,053) (162,064) - - (2,553,117)
(889,772) (24,954) - - (914,726)
(3,532,482) (385,643) - - (3,918,125)
(5.332.658) (334.942) 21.949 (21,810) (5,667.461}
(12,145.965) (907,603) 21.949 (21.810) (13,053,429)
11.759.067 (536.281) (2,285) 27.704 11,248,205
$__ 12~ $ 846.991 $ 2 285 $~ $~ 13,578,326
Depreciation expense was charged to functions/programs of the City's business-type activities as follows:
Electricity $ 196,036
Water 204,388
Sewer 500, 543
Other enterprise 6.636
Total business-type activities depreciation expense $ 9 42 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 6: LONG-TERM LIABILITIES
The following is a summary of changes in the City's long-term liabilities for the fiscal year ended June 30, 2021:
Business-type activities:
USDA Rural Development Loan
USDA Rural Development Loan
Compensated Absences
Total Business-type activities
A. Business-type Activities
USDA Rural Development Loans
Balance at Balance Current
July 1, 2020 Additions Reductions June 30, 2021 Portion $ 226.670 $ 93.400 $ (4,898) $ 315.172 $ 134.677
$~ 226,670 $ 93,400 $ (4,898) $- 315.172 $ 1
Balance at Balance Current
July 1, 2020 Additions Reductions June 30, 2021 Portion $ 1,008,000 $ - $ (34,000) $ 974,000 $ 35,000
2,291,000 - (52,000) 2,239,000 54,000
121.436 88,453 209,889 71.305
$ 3,420,436 $ 88,453 $ (86,000) $ 3,422,889 $ 160,305
Governmental activities:
Compensated absences
Total Governmental activities
On February 12, 2001, the City of Gridley executed along-term loan agreement with the United States Department of Agriculture (USDA) Rural Development. The purpose of this loan was to repay the interim sewer project financing provided by U.S. Bank. The interim financing repayment total consisted of $1,478,141 in principal and $9,529 in accrued interest. Interest on the new loan, at the rate of 3.250%, is payable semiannually. Annual principal payments, ranging from $18,670 to $65,000, are also required. This loan will be completely repaid on September 1, 2040. This loan is secured by the revenues of the City's sewer fund. As of June 30, 2021, the balance on the loan is $974,000.
On April 15, 2009, the City of Gridley entered into a loanlgrant agreement with USDA Rural Development. The purpose of this agreement is for the rehabilitation and upgrade of the City's existing wastewater treatment plant. The agreement consists of a loan of $3,100,000 with a subsequent grant of $1,000,000. Interest, at the rate of 2.500%, is payable annually. This loan will be completely repaid on April 1, 2050. As of June 30, 2021, the balance on the loan is $2,239,000.
Business-Tvoe Long-Term Liabilities Amortisation
USDA Rural Development Loan
For the Year
Ending June 30 Principal Interest Total
2022
2023
2024
2025
2026
2027 - 2031
2032 - 2036
2037 - 2041
$ 35,000
36, 000
38, 000
39,000
40, 000
221, 000
260, 000
305, 000
$ 31,086
29, 933
28,730
27,479
26,195
110, 256
71,208
25.431
$ 66,086
65, 933
66,730
66,479
66,195
331, 256
331, 208
330.431
Total $ $ $ 1 324 318
43 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 6: LONG-TERM LIABILITES (CONTINUED)
USDA Rural Development Loan
For the Year
Ending June 30 Principal Interest Total
2022
2023
2024
2025
2026
2027 - 2031
2032 - 2036
2037 - 2041
2042 - 2046
2047 - 2050
~ 54,000
55,000
56, 000
58, 000
59,000
319, 000
361, 000
410,000
462, 000
405.000
55,975
54,625
53,250
51, 850
50,400
229,050
187,150
139,625
85,850
25, 375
~ 109,975
109,625
109, 250
109, 850
109,400
548,050
548,150
549,625
547,850
430, 375
Total $ 2~ $~ $_ 3
NOTE 7: DEFINED BENEFIT PENSION PLAN
A. General Information about the Pensions Plan
Plan Description
All qualified permanent and probationary employees are eligible to participate in the Public Agency Cost-Sharing MultipleEmployer Defined Benefit Pension Plan {Plan) administered by the California Public Employees' Retirement System (CaIPERS). The Plan consists of individual rate plans (benefit tiers) within a safety risk pool (police and fire) and a miscellaneous risk pool (all other.) Plan assets may be used to pay benefits for any employer rate plan of the safety and miscellaneous pools. Accordingly, rate plans within the safety or miscellaneous pools are not separate plans under GASB Statement No. 68. Individual employers may sponsor more than one rate plan in the miscellaneous or safety risk pools. The City sponsors five rate plans (three miscellaneous and two safety). Benefit provisions under the Plan are established by State statute and City resolution. CaIPERS issues publicly available reports that include a full description of the pension plan regarding benefit provisions, assumptions and membership information that can be found on the CaIPERS website.
Benefits Provided
CaIPERS 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 (age 52 for Miscellaneous Plan members if membership date is on or after January 1, 2013) with statutorily reduced benefits. All members are eligible for nonduty disabilíty benefits after 5 years of service. The death benefit is one of the following: the Specïal Death Benefit (Safety only), 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. 44 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 7: DEFINED BENEFIT PENSION PLAN (CONTINUED)
The Plan's provisions and benefits in effect at June 30, 2021, are summarized as follows:
Miscellaneous Safety
Tier 1 Tier II PEPRA Tier 1 PEPRA
Prior to Prior to On or after Prior to On or after
Hire Date January 1, 2013 January 1, 2013 January 1, 2013 January 1, 2013 January 1, 2013 Benefit Formula 2% @ 55 2% @ 55 2% @ 62 3% @ 50 2.7% @ 57 Benefit Vesting Schedule 5 years service 5 years service 5 years service 5 years service 5 years service Benefit Payments Monthly for life Monthly. for life Monthly for life Monthly for life Monthly for life Retirement Age 55 55 62 50 57
Monthly Benefits, as a % of
Eligible Compensation 2% 2% 2% 3% 2%
Required Employee
Contribution Rates 7.00% 7.00% 6.25% 9.00% 11.50%
Required Employer
Contribution Rates* 53.00% 53.00% 8.12% 54.51 % 14.72%
*The employer contribution rate is the sum of the Plan's employer normal cost rate plus the employer unfunded accrued liability.
Contributions
Section 20814(c) of the California Public Employees' Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. Funding contributions for the Plan are determined annually on an actuarial basis as of June 30 by CaIPERS. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. The City's contributions to the Plan for the year ended June 30, 2021 were $1,294,223.
B. Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions As of June 30, 2021, the City reported a net pension liability for its proportionate share of the net pension liability of the Plan of $12.,498,264.
The City's net pension liability for the Plan is measured as the proportionate share of the net pension liability. The net pension liability of the Plan is measured as of June 30, 2020, and the total pension liability for the Plan used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2019 rolled forward to June 30, 2020 using standard update procedures. The City's proportion of the net pension liability was based on a projection of the City's long-term share of contributions to the pension plan relative to the projected contributions of all participating employers, actuarially determined.
The City's proportionate share of the net pension liability for the Plan as of June 30, 2019 and 2020 was as follows:
Proportion -June 30, 2019 0.11476
Proportion -June 30, 2020 0.11478
Change -Increase (Decrease) 0.00002
45 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 7: DEFINED BENEFIT PENSION PLAN (CONTINUED)
For the year ended June 30, 2021, the City recognized pension expense of $1,635,130. At June 30, 2021, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
Deferred Deferred
Outflows of Inflows of
Resources Resources
Pension contributions subsequent to the measurement date $ 1,294,223 $ Difference between actual contributions made by employer and the employer's proportionate share of the risk pool's total contribution 39,912 {55,893) Differences between actual and expected experience 769,578 - Changes in assumptions - (70,659)
Adjustment due to differences in proportions 41,650 {89,525) Net differences between projected and actual earnings on plan investments 332.373 Total $ 2,477,736 $ (216,077)
$1,294,223 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2022. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:
Fiscal Year
Ending June 30,
2022 $ 116,234
2023 389,739
2024 293,226
2025 168.237
Total $ 967.436
Actuarial Assumptions
The total pension liabilities in the June 30, 2019 actuarial valuations were determined using the following actuarial assumptions:
Valuation Date
Measurement Date
Actuarial Cost Method
Actuarial Assumptions:
Discount Rate
Inflation
Salary Increases
Investment Rate of Return
Mortality (1)
Post Retirement Benefit Increase
June 30, 2019
June 30, 2020
Entry-Age Normal Cost Method
7.15%
2.50%
Varies by Entry Age and Service
7.15% net of pension plan investment expenses; includes inflation
Derived using GaIPERS membership data for all funds
Contract COLA up to 2.50% until purchasing power
protection allowance floor on purchasing power applies,
2.50% thereafter
(1) The mortality table used was developed based on CaIPERS' specific data. The table includes 15 years of mortality improvements using Society of Actuaries 90 percent of scale MP 2016. For more details on this table, please refer to the December 2017 CaIPERS Experience Study Report (based on CaIPERS demographic data from 1997 to 2015) available on CaIPERS website.
Other significant actuarial assumptions used in the June 30, 2019 valuation were based on the results of the actuarial experience study for the fiscal years 1997 to 2015, including updates to salary increase, mortality and retirement rates. 46 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 7: DEFINED BENEFIT PENSION PLAN (CONTINUED)
Changes in Assumptions
For the measurement period June 30, 2021, there were no changes in assumptions.
Discount Rate
The discount rate used to measure the total pension liability was 7.15 percent. 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.
Long-term Expected Rate of Return
The long-term expected rate of return on pension plan investments was determined using abuilding-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, CaIPERS took into account both short-term and long-term market return expectations as well as the expected pension fund (PERF) cash flows. Using historical returns of all of the funds' asset classes (which includes the agent plan and two cost-sharing plans or PERF A, B, and C funds), expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using abuilding-block approach.
Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each PERF 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.
The table below reflects long-term expected real rates of return by asset class. The rates of return were calculated using the capital market assumptions applied to determine the discount rate and asset allocation. The target allocation shown was adopted by the Board effective on December 19, 2017.
Assumed Asset Real Return Real Return
Asset Class Allocation Years 1-10 (a) Years 11+ (b)
Global Equity 50.0% 4.80% 5.98%
Fixed Income 28.0% 1.00% 2.62%
Inflation Assets 0.0% 0.77% 1.81
Private Equity 8.0% 6.30% 7.23%
Real Assets 13.0% 3.75% 4.93%
Liquidity 1.0% 0.00% (0.92%)
Total 100.0%
(a) An expected inflation of 2.00% used for this períod (b) An expected inflation of 2.92% used for this period 47 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 7: DEFINED BENEFIT PENSION PLAN (CONTINUED)
Sensitivity of the Proportionate Share of the Net Pension Liability to Chanoes in the Discount Rate The following presents the City's proportionate share of the net pension liability for the Plan as of the measurement date, calculated using the discount rate for the Plan, as well as what the City's proportionate share of 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:
Discount Rate -1% Current Discount Rate Discount Rate +1% Net Pension Liability (6.15%) (7.15%) (8.15%)
Net Pension Liability $ 17,385,503. $ 12,498,264 $ 8.453,938 Pension Plan Fiduciary Net Position
Detailed information about the pension plan's fiduciary net position is available in the separately issued Ca1PERS financial reports.
NOTE 8: OTHER POST EMPLOYMENT BENEFITS (OPEB)
Description of the Plan
The City sponsors and administers asingle-employer health care plan for its employees. The plan provides medical, dental, and vision coverage. Medical coverage is provided through CaIPERS under the Public Employees' Medical and Hospital Care Act (PEMHCA), also referred to asPERSHealth. The City sets its contrïbution rates for health insurance on behalf of active employees according to the PEMHCA statutory minimum. The amounts are indexed (increased) in all future years according to the rate of medical inflation. The excess of the designated City contribution for healthcare (the second highest premium available in the 95948 zip code area) over the PEMHCA statutory minimum is contributed to a Cafeteria Plan and the employee may elect to have some or all of this excess contributed on his or her behalf to Ca1PERS as an "employee contribution" towards healthcare benefits. As the City 's OPEB benefits are administered by City personnel, no separate financial statements are issued.
Management employees are subject toPERS'"100/90 State Contribution Formula" under which the City's contribution is determined based upon the weighted average of the four most popular medical plan options under PEMHCA, as announced each year by Ca1PERS.
The City offers the same medical plans to its retirees as to its active employees, with the general exception that upon reaching age 65 and becoming eligible for Medicare, the retiree must join one of the Medicare Supplement coverage's offered under PEMHCA.
Employees become eligible to retire under PEMHCA and receive City-paid healthcare benefits upon attainment of age 50 and 5 years of coveredPERSservice, or by attaining qualifying disability retirement status. The City's contribution on behalf of all non-Management retirees is based onPERS'"Unequal Contribution Method" and equals 5% of the statutory minimum ($40 per month for 2018) multiplied by the number of years the City has participated in PEMHCA.
Management retirees receive a City contribution according to a vested percentage of the "100/90 State Contribution Formula" applicable to Management employees (this is not available for Management employees hired after December 31, 2012). The percentage is 50% after 10 years of service, increased by 5% per year to 100% after 20 years of service. Management employees first hired or promoted to a management position after 2005 are automatically subject to this formula; those hired or promoted in 2005 or before may elect to be covered under this option.
The City pays a 0.45% of premium administrative charge on behalf of all active employees and retirees. 48 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 8: OTHER POST EMPLOYMENT BENEFITS (CONTINUED)
Employees covered
As of the July 1, 2019 actuarial valuation, the following current and former employees were covered by the benefit terms under the plan.
Active employees
Inactive employees currently receiving benefits
Total 13
Contributions
The City's policy is to fully fund the annual required contribution, which is determined by an actuary. The City makes the contributions on behalf of the participants. For the fiscal year ended June 30, 2021, the City paid contributions of $84,534. No assets are accumulated in a trust that meets all of the criteria in GASB Statement No. 75, paragraph 4.
Total OPEB Liability
The City's total OPEB liability ("NOL") was measured as of June 30, 2021 and the total OPEB liability used to calculate the total OPEB liability was determined by an actuarial valuation dated July 1, 2019 based on the following actuarial methods and assumptions.
Discount Rate 2.21
Year 1 inflation 4.50
Year 2 inflation 9.50
Ultimate inflation rate 5.00
Salary increases per annum 2.00
Healthcare trend rates
2020 4.50
2021 9.50
Decrement 0.50
Ultimate Trend 5.00
Year Ultimate Trend is Reached 2030
Mortality rates SOA RP-2014 Total Dataset Mortality with Scale MP-2019 (Base Rate 2006)
Discount Rate
The discount rate was based on the index provided by Bond Buyer 20-Bond General Obligation Index based on the 20 year AA municipal bond rate as of June 30, 2020.
Changes in Assumptions
In 2021, there were no changes in assumptions.
49 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 8: OTHER POST EMPLOYMENT BENEFITS (CONTINUED)
Changes in the Total OPEB liability
Total OPEB
Liability
OPEB Liability Balance at July 1, 2020 $ 9,654,441
Service cost 165,106
Interest 211,318
Adjustment 74,743
Benefit Payments (84,534?
Net change during 2020-21 366.633
Balance at June 30, 2021 $ 1.0,021,074
Sensitivity of the Total OPEB Liability to Changes in the Discount Rate The following table presents the Total OPEB Liability of the City, calculated using 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:
Current
1%Decrease Discount Rate 1%Increase
1.21 % 2.21 % 3.21
Total OPEB Liability $ 12 127 785 $ 10 021 074 $ 8 138 354 Sensitivity of the Total OPEB Liability to Changes in the Health Gare Cost Trend Rates The following presents the total OPEB liability of the City, calculated using the healthcare cost trend rate that is one percentage-point lower or one percentage-point higher than the current rate, for measurement period ended June 30, 2021:
Total OPEB Liability
Current
Healthcare
Cost Trend
1 %Decrease Rate 1 %Increase
3.50% 4.50% 5.50%
$ 7936,831 $ 10021 074 $ 12433 099
50 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 8: OTHER POST EMPLOYMENT BENEFITS (CONTINUED)
Recognition of Deferred Outflows and Deferred Inflows of Resources Gains and losses related to changes in total OPEB liability are recognized in OPEB expense systematically over time. Amounts are first recognized in OPEB expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to OPEB and are recognized in future OPEB expense.
Deferred Deferred
Outflows of Inflows of
Resources Resources
Differences between actual and expected experience $ 1,266,034 $ Changes in assumptions 1,371,553
Total $, _ 2,637,587 $~
Amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized as OPEB expense as follows:
Measurement Period Ended
June 30,
2022 $ 1,148,494
2023 1,148,494
2024 340, 599
OPEB Expense
For the fiscal year ended June 30, 2021, the City recognized OPEB expense of $1,524,918.
NOTE 9: FUND BALANCE
As prescribed by GASB Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions, 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. This statement provides more clearly defined fund balance categories to make the nature and extent of the constraints placed on a government's fund balance more transparent.
When expenditures are incurred for purposes for which both restricted and unrestricted (commítted, assigned, or unassigned) fund balances are available, the City's policy is to first apply restricted fund balance. When expenditures are incurred for purposes for which committed, assigned, or unassigned fund balances are available, the City's policy is to first apply committed fund balance, then assigned fund balance, and finally unassigned fund balance. 51 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 9: FUND BALANCE (CONTINUED)
As of June 30, 2021, fund balances were distributed as follows:
Non-Major
08-HOME-4987 Block Grants Grant Related Governmental
General Fund Grant Fund Fund Funds Funds Total
Nonspendable:
Prepaid items $ 84,534 $ - $ - $ - $ - $ 84,534
Restricted:
Redevelopment - - - - 885,079 885,079
Grants - 3,792 712,075 440,174 467,104 1,623,145
Taxes &fees - - - - 654,486 654,486
Capital projects - - - - 39,990 39,990
Contributions - - - - 2,297 2,297
Committed:
Infrastructure
reserve 40,519 - - - - 40,519
Assigned:
Bond reserve 1,140,514 - - - - 1,140,514
Sick payout
reserve 176,498 - - - - 176,498
Equipment
replacement 2,493,415 - - - - 2,493,415
Building
maintenance 137,397 - - - - 137,397
Unassigned 8.106,728 - - - (2,886,635) 5.220.093
Total $ 12,179,605 $~3
.
792 $ 712,075 $ 440,174 $ f8~37.679) $ 12
Fund Balance/Net Position Deficits
As of June 30, 2021, the following funds had a deficit
Fund Balance Net Position
Fund Deficit Deficit
Traffic Safety $ 58,857 $ -
Planning and Development 1,003,201 -
Solid Waste -Recreation 57,646 -
Gas Tax 355,430 -
Recreation Related 1,411,501 -
Senior Taxi Fund 166,077
$ 2 886 635 $ 166,077
The fund deficits were a result of expenditures incurred in advance of receipt of revenue and will be eliminated through future revenues.
52 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 10: RISK MANAGEMENT
The City is a member of the Northern California Cities Self Insurance Fund (NCCSIF) along with twenty other northern California cities. The NCCSIF is a joint powers authority (JPA) organized in accordance with Article 1, Chapter 5, Division 7, Title 1 of the California Government Fund Programs. The purpose is to create a common pool of funds to be used to meet obligations of the parties to provide workers' compensation benefits for their employees and to provide excess liability insurance. The NCCSIF provides claims processing, administrative services, risk management services, and actuarial studies.
A member from each city governs the NCCSIF. The City Council members do not have significant oversight responsibility, since they evenly share all factors of responsibility with the other cities. The City does not retain the risk of loss. However, ultimate liability for payment of claims and insurance premiums resides with member cities. The NCCSIF is empowered to make supplemental assessments as needed to eliminate deficit positions of member cities. If the JPA become insolvent, the City is responsible only to the extent of any deficiency in its equity balance. The audited financial statements of the JPA are available at the NCCSIF's office.
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. The City provides property, liability, and worker's compensation insurance through Northern California Cities Self Insurance Fund a public entity risk pool currently operating as a common risk management and insurance program for several Northern California municipalities. Annual deposits are paid by member cities and are adjusted retrospectively to cover costs.
The NCCSIF establishes claims liabilities based on estimates of the ultimate cost of claims (including future claims settlement expenses) that have been reported but not settled, plus estimates of claims that have been incurred but not reported. Because actual claims costs depend on various factors, the claims liabilities are recomputed periodically using a variety of actuarial and statistical techniques to produce current estimates that reflect recent settlements, claim frequency, and other economic and social factors. A provision of inflation is implicit in the calculation of estimated future claims costs. Adjustments to claims liabilities are charged or credited to expense in the periods in which they are made.
The City's insurance coverage and the respective coverage providers are as follows:
Amount Coverage Provider Payment
General Liability:
$0 - $50,000
$50,001 - $450,000
$450,001 - $40,000,000
Workers' Compensation
$0 - $100,000
$100,001 - $400,000
$400,001 -statutory
Self-insured
Northern California Cities Self Insurance Fund
California Joint Powers Risk Management
Authority
Selt-insured
Northern California Cities Self Insurance Fund
CSAC-EIA
Banking layer
Shared risk
Shared risk (to $5 mil, excess
insurance after that)
Banking layer
Shared risk
Shared risk and Excess Insurance
Property insurance -The City's standard deductible ís $5,000 for coverage. The coverage limit for fiscal year 2021 was $1,000,000,000 blanket real and personal property.
Performance and Public Employee Dishonesty Bonds -The City has $25,000 in performance bond coverage for the City Clerk, $100,000 performance bond coverage for the City Treasurer, and $3,000,000 in coverage for public employee dishonesty with a deductible of $5,000.
53 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 11: EXCESS EXPENDITURES AND TRANSFERS OVER APPROPRIATIONS The following funds incurred expenditures and/or transfers in excess of appropriations in the following amounts for the year ended June 30, 2021:
Excess
Fund Expenditures
Block Grant Funds $ 175,605
Grant Related Funds $ 372,539
These deficits were a result of expenditures incurred in advance of receipt of revenue and will be eliminated through future revenues and expenditure reductions.
NOTE 12: RELATED ORGANIZATIONS
The City is a member of various joint powers authorities that provide goods or services to the City and other authority members.
The City does not have sufficient authority, influence or accountability aver these entities to incorporate them in this annual report. Additionally, the City has determined that it has no ongoing financial interest or responsibility for any of these organizations. The names and general functions of these joint powers are as follows:
Northern California Power Agencv (NCPA)
Membership consists of 12 municipal electric utilities, one Rural Electric Cooperative, an irrigation district, and a public utility district. The NCPA is generally empowered to purchase, generate, transmit, distribute, and sell electrical energy. Members participate in the projects of NCPA on an elective basis. A Commission comprised of one representative for each member governs the NCPA.
The City is currently involved in several hydroelectric, geothermal, and other energy-related projects as a member of this agency. The NCPA is financed by contributions from member cities, government grants, and debt. The City is committed to provide substantial additional financial support for its portion of the actions and projects of the NCPA.
The NCPA holds certain funds under a separate member custodial agreement -the general operating reserve. The purpose of the reserve is to allow members to fund all, or a portion, of the contingent liabilities that the NCPA faces at any given time, while providing the individual member with the flexibility to draw upon their part of the reserve, as each member individually deems appropriate. The NCPA requires agency members to maintain at least 90% of the annual general operating reserve. The calculated reserve amount for June 30, 2021 is $143,884, 90% of the reserve amount totals $129,496. The Cíty has maintained the required reserve amount during the fiscal year ending 2021. Due to the nature of the reserve held by NCPA, payments made to the reserve are expensed as purchased power. The financial statements are available online at www.ncpa.com.
Transmission Agencv of Northern California (TANG)
Members include eleven cities, one electric co-op, two irrigation districts, and one public utility district. The Agency was created to provide electric transmission or other facilities, including real property and rights of way, for the use of its members. A Commission comprised of one representative appointed by each member governs the Agency. The Cíty has authorized its participation in the project up to 1 % of the total. The financial statements are available online at http://tanc.us/financials.html.
NOTE 13: DEFERRED COMPENSATION
The City of Gridley offers its employees a deferred compensation plan created in accordance with Internal Revenue Gode Section 457. The plan, available to all full-time Gíty employees, permits employees to defer a portion of their salary until future years. Participation in the plan is optional. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. The assets and liabilities of these plans have been excluded from the accompanying financial statements.
54 CITY OF GRIDLEY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 14: CONTINGENCIES AND COMMITMENTS
Litigation
The City is party to various claims, legal actions and complaints that arise in the normal operation of business. Management and the City's legal counsel believe that there are no material loss contingencies that would have a material adverse impact on the financial position of the City. One of the pending lawsuits relates to transfers of funds from the City's utility enterprise fund to the City General fund.
Grants
The City participates in various federal and state assisted grant programs. These programs are subject to compliance audits by the grantors or their representatives. Such audits could result in a request for reimbursement for expenses disallowed under the terms and conditions of the agreements. The amount, if any, of expenditures which may be disallowed by the granting agencies cannot be determined at this time although the City expects such amounts, if any, to be immaterial.
Public Health Emergency
The World Health Organization declared the worldwide coronavirus (COVID-19) outbreak a public health emergency on January 30, 2020 and officially declared it as a pandemic as of March 11, 2020. Management has performed an evaluation of certain financial statement line items such as investments, accounts receivable, accounts payable, and accrued expenses to determine whether valuation or impairment adjustments should be made. Management has determined that the amounts reported on the financial statements are properly valued as of June 30, 2021.
NOTE 15: PRIOR PERIOD ADJUSTMENTS AND CHANGE IN ACCOUNTING PRINCIPLE Change in Accounting Principle
As a result of implementing GASB Statement No. 84, Fiduciary Activities, beginning net position of custodial funds has been restated to $557. Prior to GASB Statement No. 84, custodial funds (previously, agency funds) only reported assets and liabilities and reported no net position or measurement of results of operations.
Prior Period Adjustments
During the year ending June 30, 2021, the City restated beginning net position to correct an error in accounts receivable and interfund borrowing. The cumulative effect of the errors was recorded as an adjustment to beginning net position as follows:
As Previously
Opinion Unit Account Reported Restatement Restated
Governmental Activities Net Position $ 19,359,517 $ (13,292) $ 19,346,225 Business-type Activities Net Position 14,982,217 (108,630) 14,873,587 In addition, the City made the following prior period adjustments in the fund financial statements:
Fund Description of Restatement Amount
Governmental Funds
General Fund Correction of receivables $ (58,480)
Other Governmental Funds Correction of receivables (70,361) Other Governmental Funds Correction of interfund borrowing 115,549 Total Governmental Fund Balance Restatement $~)
Proprietary Funds
Other Enterprise Funds Correction of interfund borrowing $ (108,630) Total Proprietary Fund Net Position Restatement $ (108,630) 55 REQUIRED SUPPLEMENTARY INFORMATION
CITY OF GRIDLEY
GENERAL FUND
BUDGETARY COMPARISON SCHEDULE
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
2020 - 2021
Budgeted Amounts
Variance
with Final
Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES
Taxes and assessments
License, permits, and fees
Fines and forfeitures
Use of money and property
Program income
Intergovernmental
Charges for services
Recreation and event fees
Insurance proceeds
Other revenues
Total Revenues
EXPENDITURES
Current:
General administration
Public safety
Streets and public works
Community development
Parks and recreation
Capital Outlay
Total Expenditures
Excess (deficiency) of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Totai Other Financing Sources (Uses)
Net change in fund balance
Fund balance -July 1, 2020
Prior Period Adjustment (Note 15)
Fund balance -July 1, 2020, restated
Fund balance -June 30, 2021
$ 2,664,249 $ 2,664,249 $ 3,015,986 $ 351,737
43,942 43,942 69,996 26,054
14,723 14,723 7,226 (7,497)
59,805 59,805 15,256 (44,549)
172 172 - (172)
1,705,110 1,705,110 2,102,998 397,888
165,836 165,836 607,726 441,890
70,090 70,090 17,075 (53,015)
2,915 2,915 3,641 726
3.945 3,945 23,909 19,964
4,730,787 4,730,787 5,863,813 1,133,026
679,573 679,573 102,763 576,810
4,028,903 4,028,903 4,015,101 13,802
567,419 567,419 294,407 273,012
25,606 25,606 153,457 (127,851)
178,589 178,589 131,409 47,180
1.225,608 1,225,608 262.345 963.263
6.705,698 6,705,698 4.959,482 1.746,216
(1,974,911) (1,974,911) 904.331 2.879,242
1,435,000 1,435, 000 1, 579, 341 144, 341
- (267) (267)
1.435,000 1.435,000 1, 579, 074 144, 074
$ (539,9 $ 5~ 39~) 2,483,405 $_ 3,0
9,754,680
(58,480)
9.696,200
$ 12 179 605
See notes to the required supplementary information.
56 CITY OF GRIDLEY
08-HOME-4987 GRANT -SPECIAL REVENUE FUND
BUDGETARY COMPARISON SCHEDULE
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
2020 - 2021
Budgeted Amounts
Variance
with Final
Budget
Actual Positive
Original Final* Amounts (Negative)
REVENUES
Use of money and property
Total Revenues
Total Expenditures
Net change in fund balance
$ - $ - $ 2 $ 2
$ - $ - $ 2 $ 2
$~ $~ 2 $~
Fund balance -July 1, 2020 3.790
Fund balance -June 30, 2021 $~,
* The Cíty did not adopt a budget for the 08-HOME-4987 Grant Fund for the year ended June 30, 2021.
See notes to the required supplementary information.
57 CITY OF GRIDLEY
BLOCK GRANT FUNDS -SPECIAL REVENUE FUND
BUDGETARY COMPARISON SCHEDULE
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
2020 - 2021
Budgeted Amounts
Variance
with Final
Budget
Actual Positive
Original Final Amounts (Negative)
$ - $ - $ 856 $ 856
55,739 55,739 172,035 116,296
- - 265.558 265.558
55.739 55,739 438,449 382,710
REVENUES
Use of money and property
Program income
Intergovernmental
Total Revenues
EXPENDITURES
Current:
Community development
Total Expenditures
Net change in fund balance
Fund balance -July 1, 2020
Fund balance -June 30, 2021
4,347 4,347
4,347 4,347
$ 51392 $ 51392
179.952 (175,605)
179,952 (175,605)
258,497 $_ 207,105
453, 578
$ 712,075
See notes to the required supplementary information.
58 CITY OF GRIDLEY
GRANT RELATED FUNDS -SPECIAL REVENUE FUND
BUDGETARY COMPARISON SCHEDULE
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
2020 - 2021
Budgeted Amounts
Variance
with Final
Budget
Actual Positive
Original Final Amounts (Negative)
REVENUES
.Use of money and property
Intergovernmental
Total Revenues
EXPENDITURES
Current:
Public safety
Capital outlay
Total Expenditures
Excess (deficiency) of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Transfers out
Total Other Financing Sources (Uses)
Net change in fund balance
Fund balance -July 1, 2020
Fund balance -June 30, 2021
$ 788 $ 788 $ 406 $ (382)
130.743 130.743 748, 391 617.648
131.531 131.531 748.797 617.266
833 833 - 833
53.818 53.818 73.085 (19,267)
54,651 54.651 73.085 (18,434)
76,880 76.880 675.712 598.832
35.000 (35.000) (389,105) (354,105)
35.000 (35.000) (389.105) (354,105)
111.880 $_880 286,607 $ 2
153, 567
$ 440 174
See notes to the required supplementary information.
59 CITY OF GRIDLEY
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
BUDGETARY ACCOUNTING AND CONTROL
FOR THE YEAR ENDED JUNE 30, 2021
The City Council establishes budgets for all governmental funds on a basis consistent with Generally Accepted Accounting Principles, with the exception of capital projects which are budgeted on a project length basis. Appropriations, except open project appropriations and unexpended grant appropriations, lapse at the end of each fiscal year. The budgetary data is prepared on the modified accrual basis consistent with the related "actual" amounts.
Department heads submit a proposed budget to the City Administrator. The City Administrator submits a proposed budget to the City Council for the following year beginning July 1. The preliminary budget may or may not be amended by the City Council after public hearings are held and is adopted by City Council resolution prior to July 1 in accordance with the municipal code.
The City Council may amend the budget by motion during the fiscal year. The City Administrator is authorized to transfer budgeted amounts within an object or purpose within any department. However, the City Council must approve revisions that alter the total expenditures of any department. Budgetary control is legally maintained at the fund level.
Expenditures may not legally exceed appropriations at the fund level, which is the legal level of control. Supplemental appropriations, which increase appropriations, may be made during the fiscal year. All budget amounts presented in the accompanying financial statements have been adjusted for legally authorized revisions of the annual budgets during the year.
Amounts represent the original budgeted amounts and all supplemental appropriations.
CITY OF GRIDLEY
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF THE CITY'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY Prepared for the City's Miscellaneous and Safety Plan, Cost Sharing Defined Benefit Pension Plan As of June 30
Last 10 Years*
Measurement Period
2020 2019 2018 2017
Proportion of the net pension liability
Proportionate share of the net pension liability
Covered payroll
Proportionate share of the net pension liability as a
percentage of covered payroll
Plan fiduciary net position as a percentage of the
total pension liability
Notes to Schedule:
0.11478 % 0.11476 % 0.11472 % 0.11218
$ 12,498,264 $ 11,758,898 $ 11,054,726 $ 11,125,054
$ 4,428,698 $ 3,112,973 $ 3,406,797 $ 3,365,579
282.21 % 377.74 324.49 % 330.55
75.10 % 75.30 73.$9 % 73.29
Changes in assumptions - In 2020 and 2019, there weré no changes in assumptions. In 2018, assumptions for individual salary increases and overall payroll growth are reduced from 3.00 percent to 2.75 percent. In 2017, the discount rate was lowered 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. * Schedule is intended to show information for ten years. Fiscal year 2015 was the 1st year of implementation, therefore only seven years are shown. Additional years' information will be displayed as it becomes available. m
CITY OF GRIDLEY
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF THE CITY'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY (CONTINUED) Prepared for the City's Miscellaneous and Safety Plan, Cost Sharing Defined Benefit Pension Plan As of June 30
Last 10 Years'
Measurement Period
2016 2015 2014
Proportion of the net pension liability 0.11162 % 0.12004 % 0.12501 Proportionate share of the net pension liability $ 9,658,560 $ 8,238,421 $ 7,778,821 Covered payroll $ 3,283,720 $ 3,173,477 $ 3,173,477
Proportionate share of the net pension liability as a
percentage of covered payroll 294.13 % 259.60 % 245.12
Plan fiduciary net position as a percentage of the
total pension liability 74.06 % 78.40 % 79.82
62 CITY OF GRIDLEY
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS TO THE PENSION PLAN
Prepared for the City's Miscellaneous and Cost Sharing Plan, Cost Sharing Defined Benefit Pension Plan
As of June 30
Last 10 Years*
Fiscal Year-End
2021 2020 2019 2018
Contractually required contribution {actuarially determined) $ 1,294,223 $ 1,128,141 $ 1,023,639 $ 947,355 Contributions in relation to the actuarially determined contributions 1.294.223 1.128.141 1.023,639 947,355
Contribution deficiency (excess) $~ $ - $~ $
Covered payroll $ 4,042,512 $ 4,428,698 $ 3,112,973 $ 3,406,797 Contributions as a percentage of
covered payroll 32.02 % 25.47 % 32.88 % 27.81
* Schedule is intended to show information for ten years. Fiscal year 2015 was the 1st year of implementation, therefore only seven years are shown. Additional years' information wí11 be displayed as it becomes available. 63 CITY OF GRIDLEY
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS TO THE PENSION PLAN (CONTINUED) Prepared for the City's Miscellaneous and Cost Sharing Plan, Cost Sharing Defined Benefit Pension Plan
As of June 30
Last 10 Years*
Fiscal Year-End
2017 2016 2015
Contractually required contribution (actuarially determined) $ 866,010 $ 701,624 $ 676,873 Contributions in relation to the actuarially determined contributions
Contribution deficiency (excess)
Covered payroll
Contributions as a percentage of
covered payroll
866.010 701,624 706,315
$~ $ - $_ 2~ 9 442)
$ 3,365,579 $ 3,283,720 $ 3,173,477
25.73 % 21.37 % 22.26
64 CITY OF GRIDLEY
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE CITY'S TOTAL OPEB LIABILITY AND RELATED RATIOS For the Measurement Periods Ended June 30
Last 10 Years"
Measurement Period
2021 2020 2019 2018
$ 165,106 $ 171,325 $ 12,650 $ 12,401
211,318 206,796 159,756 158,069
- 2,456,638 - -
- 2,401,492 16,042 21,513
74, 743 - - -
(84,534) (161.908) (141.637) (148,050)
366,633 5,074,343 46,811 43,933
9,654,441 4,580,098 4,533,287 4.489,354
$ 10~ $~, 9,654,441_ $ 44~ $ 4,533,287
$ 842,742 $ 826,218 $ 2,780,632 $ 2,726,110
11.89% 11.69% 1.65% 1.66%
Total OPEB liability
Service cost
Interest
Assumption changes
Difference between actual and expected
experience
Adjustment
Benefit payments
Net change in total OPEB liability
Total OPEB liability, beginning
Total OPEB liability, ending
Covered employee payroll
City's total OPEB liability as a percentage of
covered-employee payroll
Notes to Schedule:
Changes in assumptions - In 2021, there were no changes in assumptions. In 2020, the discount rate was changed from
3.58% to 2.21%, the trend rate was adjusted to reflect actual experience, mortality assumptions changed from SOA RP-2014 Total Dataset Mortality with Scale MP-2017 (Base Rate 2006) to SOA RP-2014 Total Dataset Mortality with Scale MP-2019 (Base Rate 2006) and retirement and termination assumptions were changed to reflect rates used by CaIPERS.
Schedule is intended to show information for ten years. Fiscal year 2018 was the first year of implementation, therefore only four years are shown. Additional years' information will be displayed as it becomes available. 65 SUPPLEMENTARY INFORMATION
NON-MAJOR GOVERNMENTAL FUNDS
The following funds are reported in total on the Governmental Fund Financial Statements under the column Other Governmental Funds.
SPECIAL REVENUE FUNDS
FEMA Reserve
This fund is used to account for the FEMA lease revenue.
General Impact Fee
The source of funding is a portion of the impact fees on new developments calculated in the City Fee Schedule. This fund is used for the CIP project per council approval.
Development Agreement Fee
The source of revenue is a portion of the impact fees on new developments calculated in a City fee schedule. The funds will be appropriated for CIP projects upon council approval.
M. Vierra Park
This fund is used to account for the grant funding for the development of M. Vierra Park.
Public Financing Authority
The Council members are the officers of the Public Financing Authority. It was established to review and authorize the issuance of bonds.. The fund has de minimis activities.
SB 325
This fund is used to account for receipts and expenditures of monies apportioned for street and road sweeping, repairs, maintenance and other street projects under the street and highway code 2105, 2016, 2107 and 2107.5 of the State of California.
SB 1
This fund is used to account for receipts and expenditures of gas tax funds for road repair and maintenance under the California rehab program.
Traffic Safety
This fund is used to account for receipts of motor vehicle-fines and forfeitures expended for traffic projects.
Railroad Maintenance
This fund is used to account for expenses related to repairs for the railroad and intersecting streets.
Public Safety Augmentation
This fund is used to account for receipts and expenditure related to safety expenses.
Planning and Develooment
This fund ís used to account for the City's participation in the Community Development Block Grant programs, which provides loans to rehab low income housing and First Time home buyers (generally low income).
Solid Waste -Recreation
This fund is used for purchasing beverage trash containers located throughout the City right-of--way and public parks.
Gas Tax
This fund is used to account for receipts and expenditures of monies apportioned for street and road sweeping, repairs, maintenance and other street projects under the street and highway code 2105, 2016, 2107 and 2107.5 of the State of California.
Butte Interagency Narcotics Task Force (BINTF)
This fund is used to account for the contribution of funds and service to BINTF.
C:1i~
NON-MAJOR GOVERNMENTAL FUNDS
Maintenance Districts
The funds are used to account for the receipts and expenditures of four districts within the City limit. The assessment of districts is the source of funding.
04-STBG-1961
This fund is used to account for CDBG rehab projects.
05-PTAA-1446
This fund is used to account for Planning and Technical Assistance Grant projects (Visitors Center and Electrical Distribution Studies).
Police Explorer
The fund ís used to pay the expenditures related to youth program. Donations and fund raising is the source of funding.
K-9 -Donations &Expenses
The fund is used to account for City donation's and expenses.
Recreation Related
The fund is used to pay the expenditures related to recreational activities funded through the annual budget. 67 CITY OF GRIDLEY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
JUNE 30, 2021
Special Revenue Funds
Development Public
FEMA General Agreement M. Vierra Financing
Reserve Impact Fee Fee Park Authority
ASSETS
Cash and investments
Accounts receivable
Interest receivable
Taxes receivable
Due from other funds
Due from other governments
Total Assets
LIABILITIES AND FUND BALANCES
(DEFICITS)
LIABILITIES:
Accounts payable
Accrued payroll and benefits
Due to other funds
Total Liabilities
FUND BALANCES (DEFICITS):
Restricted
Unassigned
Total Fund Balances
(Deficits)
Total Liabilities and Fund
Balances (Deficits)
$ 466,971 $ 734,801 $ 11,932 $ 28,934 $ -
133 208 3 7 -
$ 4~~ $ 735.009 $_ 11.935 $ $~~
467,104 735,009 11,935 28,941 -
467,104 735.009 11.935 28.941
$ 467,104 $ 7~ $ 11.935 $ $~~
~
CITY OF GRIDLEY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET (continued)
JUNE 30, 2021
Special Revenue Funds
Railroad Public Safety
SB 325 SB 1 Traffic Safety Maintenance Augmentation
$ - $ 357,886 $ 17,347 $ 11,046 $ 114,197
76,387 - 1,887 - -
9 102 - 3 29
- - 1,381 - 2,785
200,627 - - - -
- 22.242 - - -
$ 277,023 $! 380,230 $, 20,615 $~ $ 117,011
$ 6,970 $ - $ 4,784 $
116.963 74,688
123,933 79.,472
- $ -
153,090 380,230 - 11,049 117,011
- - (58,857) - -
153.090 380.230 (58.857) 11,049 117.011
$__ 2~ $ 3~ $ 20,615 $~ $ 117,011
ASSETS
Cash and investments
Accounts receivable
Interest receivable
Taxes receivable
Due from other funds
Due from other governments
Total Assets
LIABILITIES AND FUND BALANCES
(DEFICITS)
LIABILITIES:
Accounts payable
Accrued payroll and benefits
Due to other funds
Total Liabilities
FUND BALANCES (DEFICITS):
Restricted
Unassigned
Total Fund Balances
(Deficits)
Total Liabilities and Fund
Balances (Deficits)
,•
CITY OF GRIDLEY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET (continued)
JUNE 30, 2021
Special Revenue Funds
Butte
Interagency
Planning and Solid Waste - Narcotics Maintenance
Development Recreation Gas Tax Task Force Districts
ASSETS
Cash and investments $ - $ - $ - $ 4,155 $ 140,149
Accounts receivable - - - - -
Interest receivable - - 79 - 55
Taxes receivable - - 4,214 - 1,892
Due from other funds - - - - -
Due from other governments - - - - -
Total Assets $~ $ $~ $ $„~~,142,096
LIABILITIES AND FUND BALANCES
f DEFICITS)
LIABILITIES
Accounts payable $ 17,015 $ - $ 4,817 $ - $ 3,960
Accrued payroll and benefits - - - - 1
Due to other funds 986,186 57,646 354.906
Total Liabilities 1,003,201 57.646 359.723 3.961
FUND BALANCES (DEFICITS):
Restricted - - - 4,155 138,135
Unassigned (1,003,201) (57.646) (355.430) - -
Total Fund Balances
(Deficits) (1,003,201) (57,646) (355.430) 4.155 138.135 Total Liabilities and Fund
Balances (Deficits) $~ $_____~ $~2~ $ 4,155 $ 1
70 CITY OF GRIDLEY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET (continued)
JUNE 30, 2021
Special Revenue Funds
K-9 Total
Donations Non-major
04-STBG- 05-PTAA- Police & Recreation Governmental
1961 1446 Explorer Expenses Related Funds
ASSETS
Cash and investments $ - $ - $ 653 $ 1,643 $ - $ 1,889,714 Accounts receivable - - - - - 78,274
Interest receivable - - - 1 - 629
Taxes receivable - - - - - 10,272
Due from other funds - - - - - 200,627
Due from other governments - - - 22.242
Total Assets $ - $~ $ 653 $,^ 1,644 $ - $~ 2.201,758
LIABILITIES AND FUND
BALANCES (DEFICITS)
LIABILITIES
Accounts payable $ - $ - $ - $ - $ 998 $ 38,544
Accrued payroll and benefits - - - - - 1
Due to other funds - - - - 1,410,503 3,000,892
Total Liabilities - - - - 1,411,501 3,039,437
FUND BALANCES (DEFICITS)
Restricted - - 653 1,644 - 2,048,956
Unassigned - - - - (1,411,501) (2,886,635)
Total Fund Balances
(Deficits) - 653 1,644 (1,411,501) (837,679)
Total Liabilities and Fund
Balances (Deficits) $~ $~ $ 653 $,~ 1,644 $ - $ 2
71 CITY OF GRIDLEY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES FOR THE YEAR ENDED JUNE 30, 2021
Special Revenue Funds
Development Public
FEMA General Agreement M. Viers Financing
Reserve Impact Fee Fee Park Authority
REVENUES
Taxes and assessments $ - $ - $ - $ - $ -
L.icenses, permits, and fees - - - - -
Fines and forfeitures - - - - -
Use of money and property 354 626 8 19 -
Charges for services - 32,460 - - -
Contributions - - - - -
Other revenue
Total Revenues 354 33.086 8 19
EXPENDITURES
Current:
Public safety - - - - -
Streets and public works - - - - -
Community development - - - - -
Parks and recreation - - - - -
Capital outlay - 20 - - -
Total Expenditures - 20 - - -
Excess (Deficiency) of Revenues over
Expenditures 354 33,066 8 19 -
OTHER FINANCING SOURCES tUSESI
Transfers in - - - - 258
Transfers out
Total Other Financing Sources
(Uses) - - - - 258
Net change in fund balances 354 33.066 8 19 258
Fund balances (deficits} -
July 1, 2020 466,750 701,943 11,927 28,922 (258)
Prior period adjustment (Note 15) - - - -
Fund balances -July 1, 2020,
restated 466.750 701.943 11,927 28.922 f258)
Fund balances (deficits) -
June 30, 2021 $ 4~~ $ 7 $~ $ 28.941 $~
72 CITY OF GRIDLEY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES (continued) FOR THE YEAR ENDED JUNE 30, 2021
Special Revenue Funds
Railroad Public Safety
SB 325 SB 1 Traffic Safety Maintenance Augmentation
REVENUES
Taxes and assessments $ 183,968 $ 122,058 $ - $ - $ -
Licenses, permits, and fees - - - - 24,442
Fines and forfeitures - - 12,037 - -
Use of money and property (816) 566 - 8 173
Charges for services - - - - -
Contributions - - - - -
Otherrevenue
Total Revenues 183,152 122,624 12,037 8 24,615
EXPENDITURES
Current:
Public safety - - - - -
Streets and public works 449,720 - 20,989 - -
Community development - - - - -
Parks and recreation - - - - -
Capital outlay 6,476 - - - -
Total Expenditures 456,196 - 20.989 - -
Excess (Deficiency) of Revenues over
Expenditures (273,044)- 122,624 (8,9521 8 24.615
OTHER FINANCING SOURCES (USES)
Transfers in - - - - -
Transfers out
Total Other Financing Sources
(Uses) - - - - -
Net change in fund balances (273,044) 122,624 (8,952) 8 24.615 Fund balances (deficits) -
July 1, 2020 310,585 247,508 (49,905) 11,041 92,396
Prior period adjustment (Note 15) 115.549 10.098 - -
Fund balances -July 1, 2020,
restated 426,134 257,606 f49,905) 11,041 92.396
Fund balances (deficits) -
June 30, 2021 $ 153,090 $ 3~2~30 $, (58,857) $ _ 11,049 $ 117,011 73 CITY OF GRIDI.EY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES (continued) FOR THE YEAR ENDED JUNE 30, 2021
Special Revenue Funds
Butte
Interagency
Planning and Solid Waste - Narcotics Maintenance
Development Recreation Gas Tax Task Force Districts
REVENUES
Taxes and assessments $ - $ - $ 152,592 $ - $ -
Licenses, permits, and fees 28,050 - - - -
Fines and forfeitures - - - - -
Use of money and property 1 - 251 - 216
Charges for services - - - - -
Contributions - - - - -
Other revenue
Total Revenues 28.051 152.843 216
EXPENDITURES
Current:
Public safety - - - - -
Streets and public works - - 297,506 - 132,903
Community development 201,020 - - - -
Parks and recreation - - - - -
Capital outlay - - 3.306 - -
Total Expenditures 201,020 - 300,812 - 132.903
Excess (Deficiency) of Revenues over
Expenditures (172,969) - (147.969) - (132,687)
OTHER FINANCING SOURCES (USES)
Transfers in - - - - -
Transfers out
Total Other Financing Sources
(Uses) - - - -
Net change in fund balances (172,969) - (147.969) - (132,687) Fund balances (deficits) -
July 1, 2020 (830,232) (57,646) (127,002) 4,155 270,822 Prior period adjustment (Note 15) - - (80,459) -
Fund balances -July 1, 2020,
restated (830,232) (57,646) (207,461) 4.155 270.822
Fund balances (deficits) -
June 30, 2021 $ 1 003 201) $~) $ 355430 $4,155. $ 138,135 74 CITY OF GRIDLEY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES (continued) FOR THE YEAR ENDED JUNE 30, 2021
REVENUES
Taxes and assessments
Licenses, permits, and fees
Fines and forfeitures
Use of money and property
Charges for services
Contributions
Other revenue
Total Revenues
EXPENDITURES
Current:
Public safety
Streets and public works
Community development
Parks and recreation
Capital outlay
Total Expenditures
Excess (Deficiency) of Revenues
over Expenditures
OTHER FINANCING SOURCES
jSES) U
Transfers in
Transfers out
Total Other Financing
Sources (Uses)
Net change in fund balances
Fund balances (deficits) -
July 1, 2020
Prior period adjustment (Note 15)
Fund balances -July 1, 2020,
restated
Fund balances (deficits) -
June 30, 2021
Special Revenue Funds
Total
K-9 Non-major
04-STBG- 05-PTAA- Police Donations Recreation Governmental 1961 1446 Explorer &Expense Related Funds
$ - $ - $ - $ - $ - $ 458,618
- - - - 17,635 70,127
- - - - - 12,037
- - (2) (1) 1 1,404
- - - (933) - 31,527
- - - - 1,080 1,080
- - - 1.200 391 1.591
(2) 266 19,107 576,384
2,325 - 2,325
- - 901,118
- - 201,020
- 29,429 29,429
- - 9.802
2,325 29.429 1.143,694
_ - (2) (2,059) (10,322) (567,310)
9 - - - - 267
- ~) - - - (1)
9 _~) - - - 266
9 ~1) (2) 2 059) (10,322) (567,044)
(9) 1 655 3,703 (1,401,179) (315,823)
45.188
_~) 1 655 3.703 (1,401,179) (270,635)
$ - $ - $~ $~~644 $ (1,411,501) $ (837,679)
75 CITY OF GRIDLEY
COMBINING STATEMENT OF NET POSITION
NON-MAJOR ENTERPRISE FUNDS
JUNE 30, 2021
Solid Waste Senior Taxi
Drainage Fund Fund Fund Totals
ASSETS
Current Assets
Cash and investments
Accounts receivable, net
Interest receivable
Total Current Assets
Capital Assets
Depreciable, net
Total Capital Assets
Total Assets
DEFERRED OUTFLOWS OF RESOURCES
Related to net pension liability
LIABILITIES
Current Liabilities
Accounts payable
Accrued expenses
Due to other funds
Unearned revenue
Total Current Liabilities
Non-Current Liabilities
Compensated absences
Net pension liability
Total Non-Current Liabilities
Total Liabilities
DEFERRED INFLOWS OF RESOURCES
Related to net pension liability
NET POSITION
Net investment in capital assets
Unrestricted
Total Net Position
$ 2,734 $ 5,955 $ 367,535 $ 376,224
- - 377 377
1 2 29 32
2.735 5.957 367.941 376,633
19.905 19.905
19.905 19.905
2,735 5.957 387.846 396,538
48.751 48.751
- 378 378
- 3,406 3,406
- 329,029 329,029
5.001 - 5.001
5.001 332,813 337,814
- - 31,126 31,126
_ - 231.323 231.323
262.449 262.449
5.001 595.262 600.263
_ - 7.412 7,412
- - 19,905 19,905
2,735 956 (185.982) (182,291)
$~ $~ $ (166.077) $ (162,386)
76 CITY OF GRIDLEY
COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION
NON-MAJOR ENTERPRISE FUNDS
FOR THE YEAR ENDED JUNE 30, 2021
Solid Waste Senior Taxi
Drainage Fund Fund Fund Totals
OPERATING REVENUES
Charges for services $ - $ - $ 5,088 $ 5,088
Intergovernmental revenues - - 95,500 95,500
Other revenue 3,879 3,879
Total Operating Revenue - - 104.467 104,467
OPERATING EXPENSES
Salaries and benefits - - 103,095 103,095
Materials, supplies, and operational expenses - - 5,084 5,084 Repairs and maintenance - - 482 482
Contractual services - - 443 443
Administration - - 906 906
Depreciation and amortization - - 6.636 6,636
Total Operating Expenses - - 116.646 116.646
Operating Income - - (12,179) (12,179)
NON-OPERATING REVENUES
Interest income 3 6 25 34
Total Non-Operating Revenues 3 6 25 34
Change in net position 3 6 (12,154) (12,145)
Net Position -July 1, 2020 2,732 950 (45,293) (41,611)
Prior Period Adjustment (Note 15) - - (108,630) (108,630) Net Position -July 1, 2020, restated 2,732 950 (153.923) (150,241) Net Position -June 30, 2021 $~ $ 956 $ (~) $ (162,386)
77 CITY OF GRIDLEY
COMBINING STATEMENT OF CASH FLOWS
NON-MAJOR ENTERPRISE FUNDS
FOR THE YEAR ENDED JUNE 30, 2021
Solid Waste Senior Taxi
Drainage Fund Fund Fund Totals
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers
Cash paid to suppliers
Cash paid to employees
Net Cash Provided by Operating Activities
CASH FLOWS FROM NON-CAPITAL FINANCING
ACTIVITIES
Due from other funds
Net Cash Provided by Non-Capital Financing
Activities
CASH FLOWS FROM INVESTING ACTIVITIES
Interest and dividends
Net Cash Provided by Investing Activities
Net Increase in Cash and Cash Equivalents
Cash and Cash Equivalents -July 1, 2020
Cash and Cash Equivalents -June 30, 2021
RECONCILIATION OF OPERATING LOSS TO NET
CASH PROVIDED BY OPERATING ACTIVITIES:
Operating loss
Adjustments to reconcile operating loss to net cash
provided by operating activities:
Depreciation
Pension expense
Changes ín assets and liabilities:
Decrease in accounts receivable
Decrease in accounts payable
Decrease in accrued expenses
Increase in compensated absences
Net Cash Provided by Operating Activities
$ - $ - $ 104,090 $ 104,090
- - (7,123) (7,123)
- (74,507) (74,507)
- - 22.460 22,460
220.399 220.399
220.399 220.399
6 13 189 208
6 13 189 208
6 13 243,048 243,067
2,728 5.942 124.487 133.157
$ 2,734 $_~ $ 367.535 $~_~
$ - $ - $ (12,179) $ ~ (12,179)
- - 6,636 6,636
- - 4,231 4,231
- - (377) (377)
- - (208) (208)
- - (2,192) (2,192)
- - 26.549 26,549
$ - $~_ $~22,460 $,, 22.460
78 CITY OF GRIOLEY
COMBINING STATEMENT OF FIDUCIARY NET POSITION
PRIVATE PURPOSE TRUST FUNDS
JUNE 30, 2021
Total Private
Successor Purpose Trust
Main Trust Agency Funds
ASSETS
Cash and investments $ 12,831 $ 719,498 $ 732,329
Restricted cash and investments - 381,393 381,393
Interest receivable 4 - 4
Capital assets, non-depreciable 1, 302,116 1, 302,116
Total Assets 12,835 2,403,007 2.415,842
LIABILITIES
Accounts payable and other liabilities 136 136
Interest payable 258,271 258,271
Advances from the City 426,868 426,868
Long-term liabilities 4.230.242 4.230.242
Total Liabilities 4.915,517 4,915,517
NET POSITION
Held in trust for private purposes $__ _ ___ 1.2,835 $ (2®) $ (2~) 79 CITY OF GRIDLEY
COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
PRIVATE PURPOSE TRUST FUNDS
FOR THE YEAR ENDED JUNE 30, 2021
Total Private
Successor Purpose Trust
Main Trust Agency Funds
ADDITIONS
Property taxes $ - $ 580,609 $ 580,609
Use of money and property 9 6.807 6.816
Total Additions 9 587.416 587,425
DEDUCTIONS
Administrative expense - 36,037 36,037
Interest costs 287.095 287.095
Total Deductions 323,132 323,132
Changes ín Net Position 9 264,284 264,293
Net Position -July 1, 2020 12,826 (2,776.794) f2,763,968) Net Position -June 30, 2021 $~~ $ (2.~ $ (2,~)
~
CITY OF GRIDLEY
COMBINING STATEMENT OF FIDUCIARY NET POSITION
CUSTODIAL FUNDS
JUNE 30. 2021
Hospital JPA
Administration
Gridley Bid Fund Fund Total
ASSETS
Current Assets
Cash and investments
Total Assets
NET POSITION
Net position restricted for individuals, organizations and other governments
$ 61 $ 2 $ 63
61 2 63
61 2 63
Total Net Position $ 61 $ 2 $ 63
m
CITY OF GRIDLEY
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
CUSTODIAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2021
Hospital JPA
Administration
Gridley Bid Fund Fund Total
ADDITIONS
Interest income
Total Additions
DEDUCTIONS
Professional services
Total Deductions
Change in fiduciary net position
Fiduciary Net Position -Beginning, Restated
Fiduciary Net Position -Ending
$ - $ 2 $ 2
2 2
496 496
496 496
- (494) (494)
61 496 557
$ 61 $ 2 $ 63
82 CITY OF GRIDLEY
GENERAL FUND
COMBINING BALANCE SHEET
JUNE 30, 2021
Equipment Sick Leave Total
General GF Reserve City Hall Reserve Payout General
Fund Fund WeII Fund Reserve Fund Fund Reserve Fund Fund ASSETS
Cash and investments $ 4,371,493 $ 1,140,433 $ 40,507 $ 150,780 $ 2,497,371 $ 176,447 $ 8,377,031 Accounts receivable 520,279 - - - 4,942 - 525,221
Interest receivable 1,252 81 12 49 701 51 2,146
Taxes receivable 310,367 - - - - - 310,367
Due from other funds 3,129,294 - - - - - 3,129,294
Prepaid items 84,534 - - - - - 84,534
Advances to fiduciary fund 176.868 - - - - 176.868
Total Assets $ 8,594,087 $ 1,140,514 $ 40,519 $ 150 829 $ 2,503,014 $ 176,498 $ 12,605.461
LIABILITIES AND FUND BALANCES
LIABILITIES
Accounts payable and accrued liabilities $ 350,620 $ - $ - $ 13,432 $ 9,599 $ - $ 373,651 Accrued payroll and benefits 32,755 - - - - - 32,755
Unearned revenue 19,100 - - - - - 19,100
Deposits payable 350 - - - - 350
Total Liabilities 402.825 13.432 9.599 425.856
FUND BALANCES
Nonspendable 84,534 - - - - - 84,534
Committed - - 40,519 - - - 40,519
Assigned - 1,140,514 - 137,397 2,493,415 176,498 3,947,824 Unassigned 8.106,728 - - - 8.106,728
Total Fund Balances 8.191,262 1.140.514 40.519 137.397 2.493,415 176.498 12.179,605 Total Liabilities and Fund Balances $ 8 594 087 $ 1 140 514 $ 40,519 $_ 150,829 $ 2 503 014 $ $ 12 605 461 83 CITY OF GRIDLEY
GENERAL FUND
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES FOR THE YEAR ENDED JUNE 30, 2021
Equipment Sick Leave Total
General GF Reserve City Hall Reserve Payout General
Fund Fund Weil Fund Reserve Fund Fund Reserve Fund Fund
REVENUES
Taxes and assessments $ 3,015,986 $ - $ - $ - $ - $ - $ 3,015,986 License, permits, and fees 69,996 - - - - - 69,996
Fines and forteitures 7,226 _ _ _ _ _ 7 226
Use of money and property 13,128 217 31 (60) 1,805 135 15,256 Intergovernmental 2,102,998 _ _ _ _ - 2 102 998
Charges for services 607,726 - - - - - 607,726
Recreation and event fees 17,075 - - - - - 17,075
Insurance proceeds 3,641 - - - - - 3,641
Other revenues 23.909 - - 23.909
Total Revenues 5.861.685 217 31 (60) 1.605 135 5.863.813
EXPENDITURES
Current:
General administration 75,668 - - 26,810 285 - 102,763
Pubiicsafety 4,015,102 - - (1) - - 4,015,101
Streets and public works 294,407 - - - - - 294,407
Community development 153,457 - - - - - 153,457
Parks and recreation 131,409 - - - - - 131,409
Capital outlay 132.951 - - 94.564 34.810 262.345
Total Expenditures 4.802.994 - 121.393 35.095 4.959,482 Excess (Deficiency) of Revenues over
Expenditures 1.058,691 217 31 (121.453) (33,290) 135 904.331
OTHER FINANCING SOURCES (USES)
Transfers in 1,579,341 855,917 - - - - 2,435,258
Transfers out (856,164) - - - (856,184)
Total Other Financing Sources (Uses) 723.157 855.917 - - - 1.579.074 Net Change in Fund Balances 1,781,848 856,134 31 {121,453) (33,290) 135 2,483,405 Fund Balances -July 1, 2020 6,467,894 284,380 40,488 258,850 2,526,705 176,363 9,754,680 Prior Period Adjustment (Note 15) (58.460) - - - - (58,480) Fund Balances -June 30, 2021 $ 8 191 262 $ 1 140 514 $ 40 519 $ 137 397 $ 2 493 415 $_ 176,496 $_ 12,179.605 84 CITY OF GRIDLEY
SINGLE AUDIT AND OTHER REPORTS
FOR THE YEAR ENDED
JUNE 30, 2021
MUN CPAs, LLP
1760 CREEKSIDE OAKS DRIVE, SUITE 160
SACRAMENTO, CALIFORNIA 95533
CITY OF GRIDLEY
SINGLE AUDIT AND RELATED REPORTS
FOR THE YEAR ENDED JUNE 30, 2021
TABLE OF CONTENTS
Page
Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with government Auditing Standards 1 - 2
Independent Auditor's Report on Compliance for Each Major Program and on Internal Control over Compliance Required by the Uniform Guidance 3 - 4 Schedule of Expenditures of Federal Awards
Notes to the Schedule of Expenditures of Federal Awards D Schedule of Findings and Questioned Costs 7 -12
Schedule of Prior Year Findings and Questioned Costs 13 - 14 ~ M~u~N
INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON
COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
To the City Council of
the City of Gridley
Gridley, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Gridley, as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the City of Gridley's basic financial statements, and have issued our report thereon dated December 5, 2023.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City of Gridley's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City of Gridley's internal control. Accordingly, we do not express an opinion on the effectiveness of the City of Gridley's internal control.
Our consideration of internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that have not been identified. However, as described in the accompanying schedule of findings and questioned costs, we did identify certain deficiencies in internal control that we consider to be material weaknesses and significant deficiencies.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected, on a timely basis. We consider the deficiency described in the accompanying schedule of findings and questioned costs as item 2021-001 to be a material weakness.
A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. We consider the deficiencies described in the accompanying schedule of findings and questioned costs as items 2021-002 and 2021-003 to be significant deficiencies.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City of Gridley's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements.
However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
City of Gridley's Response to Findings
City of Gridley's responses to the findings identified in our audit are described in the accompanying schedule of findings and questioned costs. City of Gridley's responses were not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on them.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity's internal control or on compliance.
This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Sacramento, California
December 5, 2023
M•U•N
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM
AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE To the City Council of
the City of Gridley
Gridley, California
Report on Compliance for Each Major Federal Program
We have audited the City of Gridley's compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of the City of Gridley's major federal programs for the year ended June 30, 2021. City of Gridley's major federal programs are identified in the summary of auditor's results section of the accompanying schedule of findings and questioned costs.
Management's Responsibility
Management is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs.
Auditor's Responsibility
Our responsibility is to express an opinion on compliance for each of the City of Gridley's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance).
Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the City of Gridley's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program.
However, our audit does not provide a legal determination of the City of Gridley's compliance.
Opinion on Each Major Federal Program
In our opinion, the City of Gridley complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2021.
Other Matters
The results of our auditing procedures disclosed instances of noncompliance which are required to be reported in accordance with the Uniform Guidance and which are described in the accompanying schedule of findings and questioned costs as items 2021-004 and 2021-005. Our opinion on each major federal program is not modified with respect to these matters.
City of Gridley's responses to the noncompliance findings identified in our audit are described in the accompanying schedule of findings and questioned costs. City of Gridley's responses were not subjected to the auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the responses.
Report on Internal Control Over Compliance
Management of the City of Gridley, is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the City of Gridley's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the City of Gridley's internal control over compliance.
A deficiency in internal confro/ over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis.
A material weakness in infernal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Gridley, as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the City of Gridley's basic financial statements. We issued our report thereon dated December 5, 2023, which contained unmodified opinions on those financial statements. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the basic financial statements. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by the Uniform Guidance and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the schedule of expenditures of federal awards is fairly stated in all material respects in relation to the basic financial statements as a whole.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance.
Accordingly, this report is not suitable for any other purpose. /1~ v iv c ~.A-f ~ ~ ~ Í~
Sacramento, California
December 5, 2023
CITY OF GRIDLEY
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2021
Federal
Assistance Pass-Through Entity
Listing (AL) Identifying Federal
Federal Grantor/Pass-Through Grantor Program Number Number/Grant Number Expenditures U.S Department of Transportation
Pass-Through California Department of
Transportation:
Highway Planning and Construction 20.205 03-5140F15 $ 65.294 Total U.S. Department of Transportation 65.294
U.S Department of the Treasury
Pass-Through California Department of Finance:
Coronavirus Relief Fund 21.019 OIG-CA-20-028 79.062
Total U.S. Department of the Treasury 79.062
U.S Department of Housing and Urban Development
Pass-Through California Department of Housing and
Community Development:
Community Development Block Grants 14.228 17-CDBG-12015 347,296 Community Development Block Grants 14.228 Beginning Loan Balance 1.775.128 Total Community Development Block Grants 2,122,424
HOME Investment Partnerships Program 14.239 Beginning Loan Balance 7.791.817 Total U.S. Department of Housing and Urban
Development 9.914.241
U.S. Department of Agriculture
Pass-Through California Department of Forestry and
Fire Protection:
Cooperative Forestry Assistance 10.664 7FG20020 4,942
Total U.S. Department of Agriculture 4.942
U.S Environmental Protection Agency
Pass-Through State Water Resources Control Board:
Capitalization Grants for Clean Water State
Revolving Funds 66.458 D190102400 200,532
Total U.S. Environmental Protection Agency 200.532
U.S Department of Homeland Security
Direct Program:
Staffing for Adequate Fire and Emergency
Response 97.083 - 405,255
Total U.S. Department of Homeland Security 405.255
Total Expenditures of Federal Awards $ 10.669,326
5 CITY OF GRIDLEY
NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE YEAR ENDED JUNE 30, 2021
NOTE 1: REPORTING ENTITY
The accompanying Schedule of Expenditures of Federal Awards presents the activity of all federal financial assistance programs of the City of Gridley. The City of Gridley reporting entity is defined in Note 1 of the City's basic financial statements. All federal awards received directly from federal agencies as well as federal awards passed through other government agencies are included on the schedule. When federal awards were received from apassthrough entity, the Schedule of Expenditures of Federal Awards shows, if available, the identifying number assigned by the pass-through entity.
NOTE 2: BASIS OF ACCOUNTING
The accompanying Schedule of Expenditures of Federal Awards includes the federal grant activity of the City and is presented on accounting principles generally accepted in the United States of America. The information in this schedule is presented on the accrual basis of accounting and in accordance with requirements of Title 2, U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Costs Principles, and Audit Requirements for Federal Awards (Uniform Guidance).
NOTE 3: RELATIONSHIP TO FINANCIAL STATEMENTS
The amounts reported in the accompanying Schedule of Expenditures of Federal Awards agree, in all material respects, to amounts reported within the City's basic financial statements. Federal award revenues are reported principally in the City's financial statements as intergovernmental revenues in the governmental funds.
NOTE 4: CLAIMS
The City of Gridley has received federal grants for specific purposes that are subject to review and audit by the Federal Government pass-through entity. Although such audits could result in expenditure disallowance under grant terms, any required reimbursements are not expected to be material which have not already been recorded.
NOTE 5: INDIRECT COSTS
The City elected not to use the 10% de minimus indirect cost rate, and did not charge indirect costs to federal grants during the year ended June 30, 2021.
NOTE 6: LOANS OUTSTANDING
The programs listed below had the following aggregate Federally funded loans outstanding as of June 30, 2021:
Federal AL Amount
Number Program Title Outstanding
14,228 Community Development Block Grants $ 1,989,491
14.239 HOME Investment Partnership Program 7.784,913
$ 9,774,404
C~
CITY OF GRIDLEY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2021
SECTIONi -SUMMARY OF AUDITOR'S RESULTS
Financial Statements
Type of auditor's report issued: Unmodified
Internal control over financial reporting:
Material weaknesses) identified? Yes
Significant deficiency(ies) identified? Yes
Noncompliance material to financial statements noted? No Federal Awards
Internal control over major programs:
Material weaknesses) identified? No
Significant deficiency(es) identified? None reported
Type of auditor's report issued on compliance for major programs: Unmodified Any audit findings disclosed that are required to be reported in accordance with section 200.516 of the Uniform Guidance? Yes
Identification of Major Programs:
Community Development Block Grant/State's Program and Non-Entitlement Grants in Hawaii, AL 14.228
HOME Investment Partnerships Program, AL - 14.239
Dollar threshold used to distinguish between type A and type B programs: $750,000 Auditee qualified as low-risk auditee? No
CITY OF GRIDLEY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
CURRENT YEAR FINDINGS
FOR THE YEAR ENDED JUNE 30, 2021
SECTION II: FINANCIAL STATEMENT FINDINGS
Findings related to the financial statements which are required to be reported in accordance with Generally Accepted Government Auditing Standards:
Finding 2021-001 Financial Close (Material Weakness -Repeat Finding) Criteria
An effective internal control system and timely financial reporting provides reasonable assurance for the safeguarding of assets, the reliability of financial information, and compliance with laws and regulations.
Condition
During the performance of the audit, processes utilized for closing and reporting of financial activity for the fiscal year were not effective, which contributed to the delayed accounting close of the City's trial balances and unpreparedness for the audit. The year-end audit for the June 30, 2021 fiscal year-end began in December 2022 and in April 2023, the City provided a revised version of the trial balance to be audited.
Cause
Due to personnel turnover, the City did not have adequate controls in place to ensure accounting records were closed timely and accurately.
Effect
The financial statements as presented to the auditors contained material misstatements that required adjustments, Recommendation
We recommend the City institute a program to methodically identify and document its significant operational and accounting processes. Documenting a process involves identifying and gaining an understanding of the events or transactions that trigger performance of the process, the automated or manual procedures used in performing the process, the persons) or positions(s) responsible for performing the procedures, the source documents used or generated, the procedures for approval, review, and correction of any errors detected, and the financial or operational entries or reports summarizing the result of the process.
We further recommend the City develop checklists or other guidance documents over the City's closing process to ensure all closing entries are captured in the City's general ledger in a timely manner, and supporting schedules agree and reconcile to respective account balances prior to the trial balance being provided for the audit.
Views of Responsible Officials
The City experienced significant staffing turnover and had recently transitioned to new financial software which was the primary focus of testing conversion data. The City has since hired staff and has been establishing an internal process to train newly appointed staff which encompasses internal routine financial close.
CITY OF GRIDLEY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
CURRENT YEAR FINDINGS (continued)
FOR THE YEAR ENDED JUNE 30, 2021
Findïna 2021-002 Negative pooled cash balances (Significant Deficiencv - Repeat Finding► Criteria
An effective internal control system and timely financial reporting provides reasonable assurance for the safeguarding of assets, the reliability of financial information, and compliance with laws and regulation.
Condition
During our audit procedures to test cash and pooled cash balances, we identified the following:
• We noted 32 funds as of year-end which contained negative pooled cash balances. Fifteen of these funds reported the same negative pooled cash balance in the prior year. This resulted in management proposing a significant number of adjustments to record due to/due from entries to offset the negative pooled cash balances and many of these adjustments were repeat adjustments from the prior year. • We noted a difference between pooled cash reported in the Pooled Cash fund and the total pooled cash reported in all other funds combined.
Cause
The City does not have adequate controls in place to effectively monitor pooled cash balances for individual funds.
Effect
The financial statements as presented to the auditors contained misstatements that required adjustment.
Recommendation
• Management needs to perform procedures to review all funds with negative pooled cash balances and determine if the negative balances and due to/due from entries are appropriate. A due to/due from balance should only be recorded for less than one year. If a due to/due from is recorded for longer than one year, the due to/due from needs to be converted to a formal loan agreement between the funds. • Management needs to improve the Gity's pooled cash reconciliation process to ensure that pooled cash reported ín the Pooled Gash fund is equally offset by pooled cash reported in all other funds combined.
Views of Responsible Officials
The Cíty is currently looking at consolidating funds based on the nature of the fund and the restriction of the revenue stream. For those that cannot be consolidated, the City will seek direction from the City Council.
CITY OF GRIDLEY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
CURRENT YEAR FINDINGS (continued)
FOR THE YEAR ENDED JUNE 30, 2021
Finding 2021-003 Funds with negative fund balances and no current year activity (Significant Deficiency - Repeat Finding)
Criteria
GASB 54: Fund Balance Reporting and Governmental Fund Type Definitions, defines special revenue funds as funds used to report proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes, other than capital projects or debt service. In addition, per paragraph 31, a government should discontinue reporting a special revenue fund, and instead report the fund's remaining resources in the general fund, if the government no longer expects that a substantial portion of the inflows will derive from restricted or committed revenue sources.
Condition
During our audit procedures, we noted that the City's general ledger contains multiple funds designated as special revenue funds which either have had no activity for multiple years, have negative pooled cash balances, have a negative fund balance, or a combination of these three issues. There are several special revenue funds which have one or more of these characteristics.
Cause
The City did not assess the requirements of GASB 54 as they apply to special revenue funds.
Effect
The financial statements as presented to the auditors contained misstatements that required adjustment. The City's financial statements also may not be in compliance with GASB 54.
Recommendation
Management needs to perform procedures to review all open funds in the City and close funds which no longer have activity or a purpose. If there are special revenue funds with negative cash balances which should remain open, management needs to determine if the revenue source for which the fund was opened still exists, or if the General Fund is inappropriately financing the activity of the fund. If the City no longer expects that a substantial portion of the inflows will derive from restricted or committed resources, the fund should be closed and the remaining resources should be reported in the General Fund.
Views of Responsible Officials
The City is currently looking at consolidating funds based on the nature of the fund and the restriction on the revenue stream. For those that cannot be consolidated, the City will seek direction from the City Council. ~
CITY OF GRIDLEY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
CURRENT YEAR FINDINGS (continued)
FOR THE YEAR ENDED JUNE 30, 2021
SECTION III: FEDERAL AWARD FINDINGS AND QUESTIONED COSTS Findings and questioned costs for Federal Awards, which includes audit findings as defined in Section 200.516 of the Uniform Guidance.
Finding 2021-004 Federal Grant Procedures Manual (Uniform Guidance Compliance - Repeat Findingl Criteria
OfFce of Management and Budget (OMB), Titte 2 U.S. Code of Federal Regulations, Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), subpart D, sections 200.317 - 200.326.
Condition
The City has not updated their procurement policy in accordance with the Uniform Guidance standards.
Cause
City management was unaware of the Uniform Guidance procurement requirements and implementation dates.
Effect
The City's procurement policies and procedures are not in compliance with the Uniform Guidance.
Recommendation
We recommend the City review the Uniform Guidance procurement requirements and update their policy.
Views of Responsible Officials
The City will in the future update Federal Grant Procedures Manual. ~
CITY OF GRIDLEY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
CURRENT YEAR FINDINGS (continued)
FOR THE YEAR ENDED JUNE 30, 2021
Finding 2021-005 Financial Reporting Timeliness (Uniform Guidance Compliance - Repeat Finding) Criteria
In accordance with CFR section 200.512 of the Uniform Guidance, the audit must be completed and the data collection form and reporting package must be submitted to the Federal Audit Clearinghouse within the earlier of 30 calendar days after receipt of the auditor's reports) or nine months after the end of the audit period.. In accordance with OMB Memo M-20-26, and due to the coronavirus, an extension of six months beyond the normal due date was granted for submission of the audit, data collection form, and reporting package.
Condition
The 2021 Single Audit reporting package and data collection form have not been submitted to the Federal Audit Clearinghouse by the original deadline of March 31, 2022, nor the extended deadline of September 30, 2022.
Cause
There were various issues which caused delays in the completion of the 2021 annual audit.
Effect
The filing of the Single Audit Reporting package and data collection form is past the due date.
Recommendation
As noted in recommendation 2021-001, we recommend the City strive to close the year-end with properly prepared reconciliations within 3 - 4 months after year-end in order to complete the annual financial audit timely.
Views of Responsible Officials
The City experienced significant staffing turnover and had recently transitioned to new financial software which was the primary focus of testing conversion data. The City has since hired staff and has been establishing an internal process to train newly appointed staff which encompasses internal routine financial close. Now that the City is fully staffed up, the City will continue to catch up on audits to bring them current. 12 CITY OF GRIDLEY
SCHEDULE OF PRIOR YEAR FINDINGS AND QUESTIONED COSTS
JUNE 30, 2021
Finding 2020-001 Financial Close (Material Weakness)
Condition
During the performance of the audit, processes utilized for closing and reporting of financial activity for the fiscal year were not effective, which contributed to the delayed accounting close of the City's trial balances and unpreparedness for the audit. The year-end audit for the June 30, 2020 fiscal year-end began in February 2021 and in July 2021, the City provided a revised version of the trial balance to be audited.
Recommendation
We recommend the City institute a program to methodically identify and document its significant operational and accounting processes. Documenting a process involves identifying and gaining an understanding of the events or transactions that trigger performance of the process, the automated or manual procedures used in performing the process, the persons) or positions(s) responsible for performing the procedures, the source documents used or generated, the procedures for approval, review, and correction of any errors detected, and the financial or operational entries or reports summarizing the result of the process.
We further recommend the City develop checklists or other guidance documents over the City's closing process to énsure all closing entries are captured in the City's general ledger in a timely manner, and supporting schedules agree and reconcile to respective account balances prior to the trial balance being provided for the audit.
Status
Not implemented
Finding 2020-002 Negative pooled cash balances (Significant Deficiency -Repeat Findingl Condition
During our audit procedures to test cash and pooled cash balances, we identified the following:
• We noted 28 funds as of year-end which contained negative pooled cash balances. Sixteen of these funds reported the same negative pooled cash balance in the prior year. This resulted in management proposing a significant number of adjustments to record due to/due from entries to offset the negative pooled cash balances and many of these adjustments were repeat adjustments from the prior year. • We noted a difference between pooled cash reported in the Pooled Cash fund and the total pooled cash reported in all other funds combined.
Recommendation
• Management needs to perform procedures to review all funds with negative pooled cash balances and determine if the negative balances and due to/due from entries are appropriate. A due to/due from balance should only be recorded for less than one year. If a due to/due from is recorded for longer than one year, the due toldue from needs to be converted to a formal loan agreement between the funds. • Management needs to improve the City's pooled cash reconciliation process to ensure that pooled cash reported in the Pooled Cash fund is equally offset by pooled cash reported in all other funds combined.
Status
Not implemented
13 CITY OF GRIDLEY
SCHEDULE OF PROIR YEAR FINDINGS AND QUESTIONED COSTS (continued) JUNE 30, 2021
Finding 2020-003 Funds with negative fund balances and no current year activity (Significant Deficiency - ReaeatFinding)
Condition
During our audit procedures, we noted that the City's general ledger contains multiple funds designated as special revenue funds which either have had no activity for multiple years, have negative pooled cash balances, have a negative fund balance, or a combination of these three issues. There are several special revenue funds which have one or more of these characteristics.
Recommendation
Management needs to perform procedures to review all open funds in the City and close funds which no longer have activity or a purpose. If there are special revenue funds with negative cash balances which should remain open, management needs to determine if the revenue source for which the fund was opened still exists., or if the General Fund is inappropriately financing the activity of the fund. If the City no longer expects that a substantial portion of the inflows will derive from restricted or committed resources, the fund should be closed and remaining resources should be reported in the general fund or another fund type.
Status
Not Implemented.
Finding 2020-004 Federal Grant Procedures Manual (Uniform Guidance Compliance -Repeat Finding) Condition
The City has not updated their procurement policy in accordance with the Uniform Guidance standards.
Recommendation
We recommend the City review the Uniform Guidance procurement requirements and update their policy.
Status
Not Implemented.
Finding 2020-005 Financial Reaorting Timeliness (Uniform Guidance Compliance) Condition
The 2020 Single Audit reporting package and data collection form have not been submitted to the Federal Audit Clearinghouse by the original deadline of March 31, 2021, nor the extended deadline of November 30, 2021.
Recommendation
As noted in recommendation 2020-001, we recommend the City strive to close the year-end with properly prepared reconciliations within 3 - 4 months after year-end in order to complete the annual financial audit timely.
Status
Not Implemented.
14 SUCCESSOR AGENCY TO THE GRIDLEY REDEVELOPMENT AGENCY (A PRIVATE-PURPOSE TRUST FUND OF
THE CITY OF GRIDLEY, CALIFORNIA)
WITH INDEPENDENT AUDITOR'S REPORT
JUNE 30, 2021
MUN CPAS, LLP
1760 CREEKSIDE OAKS DRIVE, SUITE 160
SACRAMENTO, CALIFORNIA 95833
SUCCESSOR AGENCY TO THE GRIDLEY REDEVELOPMENT AGENCY
TABLE OF CONTENTS
JUNE 30, 2021
Page
Independent Auditor's Report on Basic Financial Statements 1 - 2 Basic Financial Statements:
Statement of Fiduciary Net Position 3
Statement of Changes in Fiduciary Net Position 4
Notes to Basic Financial Statements 5 - 10
Other Reports:
Independent Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 11 - 12 M•U•N
INDEPENDENT AUDITOR'S REPORT
To the City Council
Oversight Board of the Successor Agency
to the Gridley Redevelopment Agency
Gridley, California
Report on the Financial Statements
We have audited the accompanying basic financial statements of the Successor Agency to the Gridley Redevelopment Agency of the City of Gridley (the "Agency") as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the Agency's basic financial statements as listed in the Table of Contents.
Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the f nancial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion.
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Successor Agency to the Gridley Redevelopment Agency of the City of Gridley as of June 30, 2021, and the changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Management has omitted the management's discussion and analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinion on the basic financial statements is not affected by this omitted information.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 5, 2023, on our consideration of the Successor Agency to the Gridley Redevelopment Agency of the City of Gridley's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Agency's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Successor Agency to the Gridley Redevelopment Agency of the City of Gridley's internal control over financial reporting and compliance.
M v~ c~~-s, ~ ~~
Sacramento, California
December 5, 2023
SUCCESSOR AGENCY TO THE GRIDLEY REDEVELOPMENT AGENGY
STATEMENT OF FIDUCIARY NET POSITION
FIDUCIARY FUND
JUNE 30, 2021
ASSETS
Cash and investments (Note 2)
Restricted cash and investments (Note 2)
Note receivable, net of allowance (Note 3)
Capital assets, non-depreciable (Note 4)
Total Assets
LIABILITIES
Accounts payable
Interest payable
Advances from City (Note 5)
Long-term liabilities (Note 6):
Due within one year
Due in more than one year
Total Liabilities
NET POSITION
Held in trust for private purposes
PrivatePurpose Trust
Fund
$ 719,498
381,393
1,302.116
2.403, 007
136
258,271
426,868
80,000
4.150.242
4.915.517
$ (2,512,510)
See accompanying notes to the basic financial statements.
SUCCESSOR AGENCY TO THE GRIDLEY REDEVELOPMENT AGENCY
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FIDUCIARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2021
ADDITIONS
Property taxes
Use of money and property
Total Additions
DEDUCTIONS
Administrative expenses
Interest costs
Total Deductions
Change in Net Position
NET POSITION -JULY 1, 2020
NET POSITION -JUNE 30, 2021
PrivatePurpose Trust
Fund
$ 580,609
6.807
587.416
36,037
287.095
323.132
264,284
(2, 776, 794)
$ (2,512,510)
See accompanying notes to the basic financial statements.
SUCCESSOR AGENCY TO THE GRIDLEY REDEVELOPMENT AGENCY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. The Reporting Entity
The Gridley Redevelopment Agency (the "former RDA") was created pursuant to the California Community Redevelopment Law of the California Health and Safety Code. The former RDA was created to revitalize and upgrade a significant area of the community for the purpose of increasing sales and business tax revenues, assuring coordinated growth and stability, and improving the qualify of life for residents of the City of Gridley (City).
On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 that provided for the dissolution of all redevelopment agencies in the State of California as of January 17, 2012, at which time the City of Gridley elected to take over as the Successor Agency (the "Agency").
The assets and liabilities of the former RDA were transferred to the Successor Agency on January 17, 2012 as a result of the dissolution. The Successor Agency acts in a fiduciary capacity to wind down the affairs of the former RDA which includes disposing of the assets and liabilities, and its activities are reported in the fiduciary privatepurpose trust fund.
B. Basis of Presentation
Fiduciary Funds:
Private-Puroose Trust Funds -Private Purpose Trust Funds are used to report all other trust arrangements under which principal and income benefit individuals, private organizations, or other governments. As a Successor Agency, this fund is used to track the activity by the Oversight Board and the Department of Finance to dissolve the Agency.
C. Basis of Accounting
The financial statements are presented using the accrual basis of accounting. Under the accrual basis of accounting, revenues are recognized when earned and expenses are recorded when the liability is incurred or economic asset is used. Revenues, expenses, gains, losses, assets and liabilities resulting from exchange and exchange-like transactions are recognized when the exchange takes place.
D. Cash and Investments
Cash and investments held at June 30, 2021 with original maturities greater than one year are stated at fair value.
Fair value is estimated based on quoted market prices at year end. All investments not required to be stated at fair value are stated at cost or amortized cost.
E. Capital Assets
Capital assets owned by the Agency are valued at historical cost, or estimated historical cost if actual is unavailable, except for donated capital assets which are recorded at their acquisition value at the date of donation. Depreciation is provided over the assets' estimated useful lives using the straight-line method of depreciation. It is the Agency's policy to capitalize structures and improvements greater than $5,000.
F. Use of Estimates
The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from these estimates.
SUCCESSOR AGENCY TO THE GRIDLEY REDEVELOPMENT AGENCY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 2: CASH AND INVESTMENTS
Cash and investments as of June 30, 2021 are classified in the accompanying financial statements as follows:
Cash Investments Total
Fiduciary activities $~ 719,498 $~ $ 1.100,891
Represents the Agency's share of the City's investment pool.
Authorized Investments of the Agency
The table below identifies the investment types that are authorized by the Agency's investment policy. This table does not address investments of debt proceeds held by bond trustees that are governed by the provisions of debt agreements of the Agency, rather than the general provisions of the California Government Code or the Agency's investment policy.
Maximum Maximum
Maximum Percentage of Investment in
Authorized Investment Type Maturity Portfolio one Issuer Local Agency Bonds
U.S. Treasury Obligations
State Obligations - CA And Others
CA Local Agency Obligations
U.S. Agency Obligations
Banker's Acceptances
Commercial Paper -Select Agencies
Commercial paper -Other Agencies
Negotiable Certificates of Deposit
CD Placement Service
Repurchase Agreements
Reverse Repurchase Agreements and Securities
Lending Agreements
Medium-Term Notes
Mutual Funds and Money Market Mutual Funds
Collateralized Bank Deposits
Mortgage Pass -Through Securities
Bank/Time Deposits
County Pooled Investment Funds
Joint Powers Authority Pool
Local Agency Investment Fund (LAIF)
Voluntary Investment Program Fund
5 years None 10%
5 years None None
5 years None None
5 years None None
5 years None None
180 days 40% 30%
270 days 25% 10%
270 days 40% 10%
5 years 30% 30%
5 years 30% 30%
1 year None 10%
92 days 20% 10%
5 years 30% 10%
N/A 20% 10%
5 years None None
5 years 20% None
5 years None None
N/A None None
N/A None None
N!A None None
N/A None None
The Agency complies with the provisions of the California Government Code (or the Agency's investment policy, where more restrictive) pertaining to the types of investments held, institutions in which deposits were made and security requirements. The Agency will continue to monitor compliance with applicable statutes pertaining to public deposits and investments.
0 SUCCESSOR AGENCY TO THE GRIDLEY REDEVE<_OPMENT AGENCY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 2: CASH AND INVESTMENTS (CONTINUED)
Investments Authorized by Debt Aoreements
Investment of debt proceeds held by bond trustees are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the Agency's investment policy. The table below identifies the investment types that are authorized by bond trustees. The table also identifies certain provisions of these debt agreements that address interest rate risk, credit risk, and concentration of credit risk.
Maximum Maximum
Maximum Percentage of Investment in
Authorized Investment Type Maturity Portfolio one Issuer Local agency bonds None None None
U.S. Treasury obligations None None None
U.S. Agency securities None None None
Banker's acceptances 365 days None None
Commercial paper 270 days None None
Federal Funds 365 days None None
Unsecured Certificates of Deposit 365 days None None
Time Deposits 365 days None None
Cash Sweep Accounts None None None
Money market funds N/A None None
Mortgage-backed securities None None None
Local Agency Investment Fund (LAIF) N/A None None
Disclosure 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 Agency's interest rate risk is mitigated 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.
Information about the sensitivity of the fair values of the Agency's investments (including investments held by bond trustees) to market rate fluctuations is provided by the following table that shows the distribution of the Agency's investments by maturity as of June 30, 2021:
Remaining Maturity
12 months or
less 1-5 years Fair Value
Held by bond trustee:
Investment pool (CAMP} $ 381.393 $ - $ 381.393
$ 381, 393 $ - $~
SUCCESSOR AGENCY TO THE GRIDLEY REDEVELOPMENT AGENCY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 2: CASH AND INVESTMENTS (CONTINUED)
Investments with Fair Values Highly Sensitive to Interest Rate Fluctuations The Agency had no investments (including investments held by bond trustees) that were highly sensitive to interest rate fluctuations as of June 30, 2021.
Disclosures Relating to Credit Risk
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 investment policy, or debt agreements, and the actual rating as of the fiscal year for each investment type.
Rating as of Fiscal Year End
Total S&P Moody's NIA
Held by bond trustee:
Investment pool (CAMP) $_~ AAAm
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. Custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g. broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the Agency 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 government unit).
The market value of the pledged securities in the collateral pool must equal at least 110°!0 of the total amount deposited by the public agencies. California law also allows financial institutions to secure Agency deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.
Concentration of Credit Risk
The investment policy of the Agency contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code.
Investment in Investment Pool
The Agency is a voluntary participant in the California Asset Management Program, (CAMP), a California Joint Powers Authority (JPA) established in 1989 to provide California public agencies with professional investment services. The CAMP Pool is a permitted investment for all local agencies under California Government Code Section 53601(p). The fair value of the Agency's investment in this pool is reported in the accompanying financial statements at amounts based upon the Agency's pro-rata share of the fair value provided by CAMP for the entire portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by CAMP, which is recorded on an amortized cost basis. 8 SUCCESSOR AGENCY TO THE GRIDLEY REDEVELOPMENT AGENCY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 3: NOTE RECEIVABLE
The former RDA engaged in programs designed to encourage business enterprises, construction or improvement in low-to-moderate income housing or other projects. Under these programs, grants or loans were provided under favorable terms to businesses, homeowners or developers who agreed to spend these funds in accordance with the Agency's terms.
The Agency's note receivable, including interest, at June 30, 2021 is explained in detail below:
Less:
Note Allowance for
Receivable Doubtful Note Total
Washington Court Apartments
Affordable Housing Project Construction Loan $ 678.000 $ (678,000) $ - Total $ $ (678.000) $~
A. Washington Court Apartments Affordable Housing Project Construction Loan The former RDA assisted Gridley Pacific Associates with its acquisition and development of the Washington Court Apartments Affordable Housing Project by providing $678,000 in the form of cash in return for a note bearing simple interest at a rate of 3% per year, secured by a deed of trust on the Project.
B. Allowance for Doubtful Notes
The former RDA had several programs under which it extended loans to qualifying individuals or groups for the purpose of improving the City's housing stock and/or its supply of low-and-moderate income housing. The remaining loan, issued to the Washington Court Apartments, has a forgiveness clause if the developer complies with all the terms of the loan over its full term. The former RDA had provided an allowance of 100% for the note receivable subject to the forgiveness provision of this loan. Per long-term monitoring reviews, all terms have been met by the developer for the loan as of June 30, 2021.
NOTE 4: CAPITAL ASSETS
Capital asset activity for the fiscal year ended June 30, 2021, was as follows:
Balance at Balance at
July 1, 2020 Additions Retirements June 30, 2021
Capital assets not being depreciated
Land $ 1.302.116 $ - $ - $ 1.302,116
Total capital assets $ 1 302 116 $ - $ - $ 1 302 116
NOTE 5: ADVANCES FROM CITY
Pursuant to Agency Resolution No. 2003-RDA-05, the Agency agreed to reimburse the City's Block Grant fund for the infrastructure improvements within the Agency's industrial park up to $250,000. Repayment is to be made as funds are available and approved on the recognized obligation payment schedule. No interest accrues on the amount due to the City.
The Agency agreed to reimburse the City's General Fund for the formation of the RDA in the amount of $176,868.
Repayment is to be made as funds are available. No interest accrues on the amount due to the City.
D
SUCCESSOR AGENCY TO THE GRIDLEY REDEVELOPMENT AGENCY
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 6: LONG-TERM LIABILITIES
The following is a summary of long-term liabilities transactions for the year ended June 30, 2021:
Balance at Reductions) Balance at Due Within
July 1, 2020 Additions Adjustments June 30, 2021 One Year Tax allocation bonds, Series 2008 $ 4,410,000 $ - $ (70,000) $ 4,340,000 $ 80,000 Less:
Unamortized bond discounts (117,238) - 7,480 (109,758) - Total Long-term liabilities $ 4.292,762 $ - $ (62,520) $ 4.230,242 $_ 80.000 A description of the long-term liabilities at June 30, 2021 follows:
A. Tax Allocation Bonds, Series 2008A (Taxable) and 20088 (Tax Exempt) In 2002, the former RDA issued $4,750,000 of tax allocation bonds, Series 2008A (Taxable) and Series 20086 (Tax Exempt). A total of $2,980,000 of Series 2008A bonds were issued and $1,770.,000 of Series 20086 bonds.
The proceeds of the Series 2008A bonds issued were used to repay a significant portion of the loans from the City of Gridley to the Agency. The bonds bear annual interest at varying rates between 7.00°/a and 7.50%. The bonds were issued in fully registered form without coupons in denominations of $5,000. Interest is payable semi-annually, due on August 1st and February 1st. Principal is paid in annual installments beginning August 1, 2014 and ending August 1, 2038 in amounts ranging from $45,000 to $250,000.
The proceeds from the Series 20088 bonds issued were for capital improvements within the project area. The bonds bear annual interest at 5.00%. The bonds were issued in fully registered form without coupons in denominations of $5,000. Interest is payable semi-annually, due on August 1st and February 1st, Principal is paid in annual installments beginning August 1, 2014 and ending August 1, 2043 in amounts ranging from $5,000 to $345,000.
B. Bonds Payable Debt Service Requirements
Future debt service requirements are shown below:
For the Year
Ending, June 30 Principal Interest
2022
2023
2024
2025
2026
2027 - 2031
2032 - 2036
2037 - 2041
2042 - 2044
~ 80,000
85,000
90,000
100, 000
105,000
650,000
935, 000
1, 315, 000
980,000
~ 281,750
276, 000
269,750
263,125
255, 875
1,153, 250
876, 250
486,125
99, 750
Total $~ 4,340.,000 $c 3,961,875
10 M•U•N
INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON
COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN
ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
To the City Council
Oversight Board of the Successor Agency
to the Gridley Redevelopment Agency
Gridley, California
We have audited, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, the financial statements of the Successor Agency to the Gridley Redevelopment Agency of the City of Gridley, as of and for the year ended June 30, 2021, and the related notes to the financial statements which collectively comprise the Agency's basic financial statements and have issued our report thereon dated December 5, 2023.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City of Gridley's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City of Gridley's internal control over financial reporting.
Accordingly, we do not express an opinion on the effectiveness of the City of Gridley's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Successor Agency to the Gridley Redevelopment Agency of the City of Gridley's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
/l/1 ~~ c PAs, ~ c P
Sacramento, California
December 5, 2023
City Council Agenda Item #6
Staff Report
Date: January 16, 2024
To: Mayor and City Council
From: Martin Pineda, Finance Director
Subject: Reinvestment of Certificate of Deposit (CD)
Recommendation
Staff respectfully requests the City Council approve staff re-investing one of the four CDs (Certificate of Deposit) that has matured into another federally insured CD at the best rate available that exceeds LAIF (Local Agency Investment Fund) at the time of reinvestment.
Background
In 2016 TVI (Time Value Investments) assisted with the set-up of the securities custody account with US Bank and placed one million dollars into four different CDs to ensure all funds remained fully FDIC insured. Since that time, the city has been reviewing reinvesting as each CD matures.
At no additional costs to the City except for banking fees, TVI has been historically assisting the City of Gridley with those investments of City funds to increase earnings.
Staff has received approval to continue the practice of reinvesting one million dollars in federally insured CDs as they reach maturity. Staff is requesting Council approval and direct Staff to reinvest all future CDs that will reach maturity.
Below are the current CDs in the City’s portfolio. There is one CD that matured on 12/15/2023.
The City’s four CDs are as follows:
1. Sallie Mae Bank Salt Lake UT $249,000 (.70%) Matured -12/15/2023
2. Capital One NA CTF DEP $249,000 (3.45%) Maturity Date-09/16/2024
3. First Technology Federal Credit $248,000 (5.25%) Maturity Date-10/15/2024
4. Texas Exchange Bank SSB CTF DE $249,000 (.45%) Maturity Date-04/30/2025 AVAILABLE REINVESTMENT RATES:
The City has a CD that matured on 12/15/2023:
• $249,000 Sallie Mae Bank Salt Lake UT Rate .70% Matured 12/15/2023 Below are the best available CD options for reinvestment consideration in 2-3 years.
X Regular
Special
Closed
Emergency
2 Years:
3 Years:
Due to the California Local Agency Investment Fund (LAIF) at 3.9% lower than rates provided for reinvestment. TVI has provided the following options above and recommends reinvesting the recently matured CD for higher year to ensure the stable rates. As each CD matures Staff will review options and reinvest with the best option available exceeding LAIF.
Recommendation
It’s important to note that rates may change by the time this staff report is presented to council. Based on the information on this staff report, my recommendation is to reinvest in a 3- year option, this is primarily due to the Fed expected to cut rates this year.
Financial Impact
Financial reporting requirements being met by approval, there are no direct costs associated with approval of the report only reinvestment of current funds historically earmarked for investment activity which results in higher return of city funds.
Attachment
None