Grover Beach City Council
January 22, 2024

Agenda Item No. 9

CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and City Council DATE: January 22, 2024 FROM: Matthew Bronson, City Manager
PREPARED BY: Lorena Zarate, Finance Manager
SUBJECT: FY 2022-23 Annual Comprehensive Financial Report

RECOMMENDATION
Receive and file the FY 2022-23 Annual Comprehensive Financial Report.

BACKGROUND
The Annual Comprehensive Financial Report (ACFR) is a set of financial statements comprising all financial activity of the City that has been reviewed by an independent auditor contracted by the Council using accepted standards and report formats to ensure the accuracy of the City’s financial practices and overall financial condition. The Government Finance Officers Association (GFOA) best practices recommend obtaining new auditors every five years. On March 8, 2021, Council authorized staff to enter into a three-year agreement with Glenn Burdette for independent financial audit services. This is the third year that Glenn Burdette conducted the audit for the City, which includes financial statements, internal documents and controls for the fiscal year ending June 30, 2023.

The goal of the independent audit is to provide reasonable assurance that the financial statements of the City are free of material misstatements, whether due to fraud or error. The independent audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The 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 financial statement presentation.

The Independent Auditors’ Report presented on page eight of the ACFR issued a clean and unmodified opinion, meaning the financial statements and other information reported in the ACFR present fairly in all material respects the financial position of the City as of June 30, 2023.

Financial Highlights
Key financial highlights for FY 2022-23 identified in the audit include:
• The Council adopted a five-year Capital Improvements Program (CIP) in March 2023 that identifies 13 projects for the next fiscal year 2024 with a budget of nearly $10 million. The largest funded category is Streets and Storm Drains which includes several Measure K-14 funded street projects with a projected cost of $2.2 million, along with funding for major street projects of $3.3 million not funded by Measure K-14 funds. • The City is in the eighth year of the multi-year Local Street Rehabilitation project funded by Measure K-14 which provides up to $48 million in bond funds for repair of residential streets Staff Report: FY 2022-23 Annual Comprehensive Financial Report Page 2 January 22, 2024

over the next 25 years. As of June 30, 2023, the City has completed 15 street projects with Measure K-14 funds. Total expenditures for street projects since passage of Measure K-14 are $31.9 million with approximately $3.7 million of the total expenditures spent on street projects in FY 2022-23.

• Measure F-20, a 1 percent transaction and use tax, was approved by voters in November 2020 and became effective in April 2021. Sales tax revenue collected from this new measure was $2.5 million in FY 2022-23.

• General Fund revenues increased by 1% or $218,500 when compared to the previous fiscal year. This result is primarily attributable to growth in the City’s tax revenues and grant funding including $1.6 million of American Rescue Plan Act funding. Although cannabis tax revenue reported a decrease of $318,000, sales tax revenue reported an increase of approximately $233,000 in part due to the Measure F-20 sales tax and property tax revenue increased about $376,000 higher than the previous fiscal year.

• The City’s General Fund revenue and other financing sources (uses) exceeded expenditures by $1.7 million in fiscal year 2023. This positive outcome was primarily due to tax revenues (sales tax and property tax) coming in higher than anticipated as mentioned above and lower CIP project cost, due to costs coming in lower than anticipated or not completed by the end of the fiscal year. The estimated carryover of unspent appropriated funds for capital projects and other expenditures to fiscal year 2024 is $2.3 million. This estimated carryover further reduces ending reserves for the General Fund to approximately $6.3 million. • The City’s General Fund continues to maintain a strong reserve level of 42% of operating expenditures compared to the Council’s reserve goal of 25%.

Overall, the audit affirmed that the City ended FY 2022-23 in a positive financial position with lower than budgeted expenditures leading to a level of reserves significantly above the Council’s policy goal in the General Fund. Staff would still recommend caution with these reserves since these do not include the unused appropriations at the end of the FY 2022-23 in active capital improvement projects and multi-year programs. The FY 2023-24 mid-year review will include an analysis of the active projects where prior unused remaining budget will be carried over to FY 2023-24 along with potential options for one-time mid-year expenditures. Staff is presenting the FY 2023-24 mid-year financial report to the Council on February 13 along with the updated fiveyear General Fund financial forecast.

A representative from Glenn Burdette will be in attendance at the meeting to answer any questions regarding the Annual Comprehensive Financial Report.

FISCAL IMPACT
There is no fiscal impact from this action.

ALTERNATIVES
The Council has the following alternatives to consider:

1. Receive and file the FY 2022-23 Annual Comprehensive Financial Report; or

2. Provide alternate direction to staff.

Staff Report: FY 2022-23 Annual Comprehensive Financial Report Page 3 January 22, 2024

PUBLIC NOTIFICATION
The agenda was posted in accordance with the Brown Act.

Attachments

1. FY 2022-23 Annual Comprehensive Financial Report

2. City of Grover Beach External Communication Letter
City of
GROVER BEACH  California
Annual Comprehensive Financial
Report
For the Fiscal Year Ended June 30, 2023
Attachment 1
This page intentionally left blank.

CITY OF GROVER BEACH,

CALIFORNIA

ANNUAL COMPREHENSIVE

FINANCIAL REPORT
For the Fiscal Year Ended
June 30, 2023
Prepared by
Department of Administrative Services
Presented by
Deanne Purcell, Director of Administrative Services

CITY OF GROVER BEACH
Annual Comprehensive Financial Report
Table of Contents
i

INTRODUCTORY SECTION
Letter of Transmittal ..............................................................................................................................................1 Organization of City Government .......................................................................................................................... 5 Directory of City Officials........................................................................................................................................6 Government Finance Officers Association Certificate of Achievement ..…………………………………………………………..7

FINANCIAL SECTION
Independent Auditors’ Report ............................................................................................................................... 8 Management’s Discussion and Analysis............................................................................................................... 12 Basic Financial Statements
Government‐Wide Financial Statements:

Statement of Net Position....................................................................................................................... 26 Statement of Activities  ........................................................................................................................... 27 Fund Financial Statements:

Governmental Funds:

Balance Sheet .....................................................................................................................................29 Reconciliation of the Balance Sheet to the Statement of Net Position.............................................. 30 Statement of Revenues, Expenditures, and Changes in Fund Balance .............................................. 31 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances to the Statement of Activities................................................................................ 32 Proprietary Funds:

Statement of Net Position .................................................................................................................. 33 Statement of Revenues, Expenses, and Changes in Net Position ...................................................... 34 Statement of Cash Flows.................................................................................................................... 35 Fiduciary Funds:

Statement of Fiduciary Net Position................................................................................................... 37 Statement of Changes in Fiduciary Net Position ................................................................................ 38 Notes to the Basic Financial Statements....................................................................................................... 39 Required Supplemental Information Section
Budgetary Basis of Accounting ‐ Note to the Required Supplemental Information............................................ 73 Budgetary Comparison Schedule – General Fund................................................................................................ 74 Budgetary Comparison Schedule – Street Rehabilitation and Repair Fund......................................................... 75 Schedule of Proportionate Share of Net Pension Liability ................................................................................... 76

CITY OF GROVER BEACH
Annual Comprehensive Financial Report
Table of Contents
ii
Schedule of Pension Contributions...................................................................................................................... 80 Supplemental Information Section
Nonmajor Governmental Funds Description ....................................................................................................... 84 Combining Balance Sheet Nonmajor Governmental Funds.......................................................................... 86 Combining Statement of Revenues, Expenditures, and Change in Fund Balances – Nonmajor Governmental Funds......................................................................................................... 90 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget to Actual – Nonmajor Governmental Funds:

Gas Tax Fund ...........................................................................................................................................94 Gas Tax RMRA Fund ................................................................................................................................95 Public Safety Grants Fund ....................................................................................................................... 96 Park Construction Fund........................................................................................................................... 97 Transportation Impact Fees Fund ........................................................................................................... 98 Law Enforcement Impact Fees Fund....................................................................................................... 99 Administrative Impact Fees Fund …………………………………………………………………………………………………….100 Fire Impact Fees Fund ........................................................................................................................... 101 Storm Water Impact Fees Fund ............................................................................................................ 102 Wastewater Impact Fees Fund.............................................................................................................. 103 Parks Facilities Impact Fees Fund.......................................................................................................... 104 Recreation Facilities Impact Fees Fund................................................................................................. 105 Water Impact Fees Fund ....................................................................................................................... 106 State Mandated ADA Fund.................................................................................................................... 107 Subsidized Senior Transportation Fund ................................................................................................ 108 Local Transportation Fund .................................................................................................................... 109 CDBG Non‐Entitlement Fund……………………………………………………………………………………………………………110 Home Grant Fund..................................................................................................................................111 Underground Utilities Fund……………………………………………………………………………………………………………..112 Capital Projects Fund.............................................................................................................................113 Combining Statement of Fiduciary Net Position – Private Purpose Trust Funds ........................................114 Combining Statement of Changes in Fiduciary Net Position – Private Purpose Trust Funds......................115 Combining Statement of Fiduciary Net Position – Custodial Funds............................................................ 116 Combining Statement of Changes in Fiduciary Net Position – Custodial Funds..........................................117

CITY OF GROVER BEACH
Annual Comprehensive Financial Report
Table of Contents
iii
Schedule of Debt Service Coverage………………………………………………………………………………………………………..118 STATISTICAL SECTION (Unaudited)
Explanation of Statistical Section ....................................................................................................................... 119 Financial Trends Information:

Net Position by Component......................................................................................................................... 120 Changes in Net Position............................................................................................................................... 122 Fund Balances of Governmental Funds....................................................................................................... 126 Changes in Fund Balances of Governmental Funds..................................................................................... 128 Revenue Capacity Information:

Tax Revenue by Source – General Fund ...................................................................................................... 130 Net Taxable Assessed Value History............................................................................................................ 131 Assessed Value of Taxable Property............................................................................................................ 132 Direct and Overlapping Property Tax Rates ................................................................................................ 134 Principal Property Taxpayers....................................................................................................................... 136 Property Tax Levies and Collections............................................................................................................ 138 Direct and Overlapping Sales Tax Rates ...................................................................................................... 139 Taxable Sales By Category ........................................................................................................................... 140 Debt Capacity Information:

Ratios of Outstanding Debt by Type............................................................................................................ 142 Ratios of General Bonded Debt Outstanding .............................................................................................. 143 Direct and Overlapping Governmental Activities Debt ............................................................................... 144 Legal Debt Margin........................................................................................................................................145 Demographic and Economic Information:

Demographics and Economic Statistics....................................................................................................... 146 Full‐Time Equivalent Government Employees by Function......................................................................... 147 Operating Indicators by Function/Program................................................................................................. 148 Capital Asset Statistics by Function/Program.............................................................................................. 150

INTRODUCTORY

SECTION
 Letter of Transmittal
 Organization of City Government
 Directory of City Officials
 Government Finance Officers
Association Certificate of Achievement
for Excellence in Financial Reporting
Matthew Bronson
City Manager
City of Grover Beach
Mayor Karen Bright Mayor Pro Tem Robert Robert
Council Member Clint Weirick, Council Member Daniel Rushing, Council Member Zach Zimmerman December 18, 2023
To the Honorable Mayor, Members of the City Council and Citizens of the City of Grover Beach, We are pleased to present the City of Grover Beach’s Annual Comprehensive Financial Report (ACFR) for the fiscal year ended June 30, 2023. The City follows a policy of preparing a complete set of financial statements in conformity with accounting principles generally accepted in the United States of America after the end of each fiscal year. These financial statements are audited by a licensed certified public accounting firm. The financial statement audit has been completed, and we hereby issue the Annual Comprehensive Financial Report of the City of Grover Beach for the fiscal year ending June 30, 2023.

This report consists of management’s representations concerning the finances of the City of Grover Beach.

Consequently, management assumes full responsibility for the completeness and reliability of all the information presented in this report. To provide a reasonable basis for making these representations, management of the City of Grover Beach has established a comprehensive internal control framework that is designed both to protect the City’s assets from loss, theft, or misuse and to communicate sufficient reliable information for the City of Grover Beach’s financial statements to be in conformity with accounting principles generally accepted in the United States of America. Because the cost of internal controls should not outweigh their benefits, the City of Grover Beach’s comprehensive framework of internal controls has been designed to provide reasonable rather than absolute assurance that the financial statements will be free from material misstatement. As management, we assert that, to the best of our knowledge and belief, this financial report is complete and reliable in all material respects.

The City of Grover Beach’s financial statements have been audited by Glenn Burdette, a licensed certified public accounting firm. The goal of the independent audit was to provide reasonable assurance that the financial statements of the City of Grover Beach for the fiscal year ended June 30, 2023, are free of material misstatement. The independent audit involved examining, on a test basis, evidence supporting amounts and disclosures in the financial statements; assessing the accounting principles used and significant estimates made by management; and evaluating the overall financial statement presentation. The independent auditing firm concluded, based upon the audit, that there was a reasonable basis for rendering an unmodified opinion that the City of Grover Beach’s financial statements for the fiscal year ended June 30, 2023, are fairly presented in conformity with accounting principles generally accepted in the United States of America. The independent auditors’ report is presented as the first component of the financial section of this report.

This report contains financial information and data using the new financial reporting format established for governments by the Governmental Accounting Standards Board (GASB). The GASB sets accounting and financial reporting standards for governments in the United States of America. The financial reporting standards require that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City of Grover Beach’s MD&A can be found immediately following the report of the independent auditors. 154 South Eighth Street ˜ Grover Beach, California 93433 ˜ www.groverbeach.org Administrative Services/Water (805) 473-4550 ˜ City Council/City Manager (805) 473-4567 ˜ City Clerk (805) 473-4568 ˜ Community Development - Building, Planning & Economic Development (805) 473-4520 ˜ Human Resources (805) 473-4564 ˜ Community Services (805) 473-4580 ˜ Police/Non-Emergency (805) 473-4511 ˜ Public Works (805) 473-4530 2 PROFILE OF THE CITY AND ITS OPERATIONS
The City of Grover Beach was incorporated in 1959 and is located on the Central Coast of California about midway between San Francisco and Los Angeles. The City is located in San Luis Obispo County, which is visited annually by a substantial number of tourists seeking to enjoy the area’s moderate climate, beautiful ocean views and sunsets, fine restaurants, and the relaxing atmosphere unique to coastal communities. The city has a population of approximately 13,000 and about 55 percent of the city’s properties are residential.

The City operates under a council-manager form of government. Policy making and legislative authority are vested in the City Council consisting of the Mayor and four Council Members elected at large. The Council is responsible, among other matters, for passing ordinances, adopting the City budget, appointing committees, and hiring the City Manager and City Attorney. The City Manager is responsible for carrying out the policies and ordinances of the City Council, for appointing other employees, and otherwise managing daily operations of the City.

The City provides a full range of municipal services including police protection, construction and maintenance of City streets, sanitary services, water system, storm drains, bridges and other infrastructure assets, and park maintenance, and community recreation activities. In terms of business type activities, the City provides water, wastewater, and storm water collection services through operation of its utility enterprises.

Fire protection is provided through the Five Cities Fire Authority, Joint Powers Agency.

The City’s biennial budget serves as the foundation for the City of Grover Beach’s financial planning and control system. All departments of the City submit requests for appropriations to the City Manager each fiscal year. The City Manager uses these requests as a starting point for developing a proposed budget which is presented to the City Council every two fiscal years. The Council holds a public hearing on the proposed budget and then ultimately adopts a formal budget. The budget is adopted by fund, function, department, and object. The Council periodically reviews during the fiscal year the City’s actual financial activity in relationship to the original budget, and as necessary amends the original budget to reflect changing conditions.

Budget to actual comparisons are provided in this report for each governmental fund for which an appropriated biennial budget has been adopted. The General Fund’s comparison is presented as required supplementary information in a separate section of this report immediately following the notes to basic financial statements. For the City’s other governmental-type funds, budget to actual comparison schedules are presented as optional information in the section of this report containing combining financial statements and individual fund schedules.

FACTORS AFFECTING FINANCIAL CONDITION
The information presented in the basic financial statements is perhaps best understood when it is considered in relationship to the City’s specific environment and the City’s plans.

Grover Beach Economy

The City of Grover Beach covers 2.31 square miles and is located along the beautiful Central Coast of California, 92 miles north of Santa Barbara and 150 miles south of Monterey. Grover Beach shares borders with Pismo Beach and Arroyo Grande and is just 20 minutes south of San Luis Obispo, home of Cal Poly State University. Grover Beach provides for a unique quality of life for over 12,000 residents and draws tourists with its moderate coastal climate and diverse recreational opportunities. Activities include weekly summer concert series, hiking, riding, and jogging along the white sandy beaches, dunes and sea cliffs, kayaking, fishing, clamming, surfing, golfing, horseback riding, wine tasting, and off-road vehicle riding. The City provides an entrance to California’s only drivable stretch of beach. 3 Grover Beach is a community-oriented beach town offering a range of housing options with a median home price of $720,000. About 80 percent of the City’s total revenues, applicable to its governmental-type activities, are derived from tax revenues; approximately 28 percent is from sales tax revenues and 36 percent is from local property taxes. Other top revenue generators are transient occupancy tax, cannabis tax, and other taxes.

There has been substantial progress with enhancing tourism infrastructure with over 400 new hotel rooms in the development planning, including the Grover Beach Lodge project, a unique public-private beachfront hotel located on State property at Pismo State Beach. In addition, the City has adopted a short-term rental (STR) ordinance to regulate and tax STRs which has increased the City’s transient occupancy tax revenues given visitor demand to rent such properties on the coast.

Long-Term Financial Planning
The City expects in fiscal year 2023-24 to complete capital improvement projects totaling more than $10.2 million. Additional projects are planned for subsequent fiscal years. The City will continue its practice of seeking out Federal, State, and Local grants and allocations to provide financing for the City’s capital projects.

These projects in fiscal year 2023-24 include continued Street Rehabilitation work, which is being funded primarily by Measure K-14 passed by the citizens in November 2014. The first increment of $5,000,000 in bonds were sold in March 2015. An additional $8,000,000 in bonds were sold in April 2016, $15,000,000 in December 2017 and $10,000,000 in FY 2021-22 for street rehabilitation work. To help fund capital projects and general City services, Grover Beach voters approved Measure F-20 in November 2020 which added a 1% Transactions and Use Tax to the City’s existing 0.5% Transactions and Use Tax approved by voters in 2006. Measure F-20 generated approximately $2,500,000 FY 2022-23 in general revenues to address community needs.

Cash Resources and Practices

During the fiscal year, almost all the idle cash was invested by the City in the State of California Local Agency Investment Fund (a pooled investment arrangement among California governments). Investment revenue from this investment pool increased from 3.15% at the end of fiscal year 2022-23 to 3.6% in the first quarter of fiscal year 2023-24. The City ended the fiscal year with approximately $30 million in cash and investments, which includes the proceeds from the Measure K-14 bond sales. This amount is more than sufficient to enable the City to move forward into the new fiscal year and conduct operations.

Risk Management
The City limits its exposure to losses from unfavorable events, employee injuries, and from the risk of damage to City property by participating with other governments in an insurance pool. Under the arrangement, the risk of loss is not transferred to the pool for the first $50,000 of each workers’ compensation claim and the first $30,000 of each liability claim. Losses above those amounts are covered by insurance provided by the insurance pool and its purchased excess insurance coverage.

Long-Term Debt Administration
The City’s enterprises issued water revenue bonds in 2020 in the amount of approximately $4.4 million, with debt service payments due each March and September, beginning in September 2020 and funded by utility rates. Debt currently is held by the Successor Agency in the amount of $2.9 million. Debt service payments are due on this obligation each February and August, and all payments have been made in a timely manner.

With the sale of General Obligation Bonds approved by Measure K-14, the City’s governmental activities now have issued $38 million in long-term debt as of June 30, 2022, $10 million of this amount was issued in FY 2021-22.
4 Pension Benefits
The City directly participates in the Public Employees’ Retirement System (PERS) of the State of California for all employees. The City funds each fiscal year’s required contribution to the miscellaneous and public safety plans as determined by PERS based upon actuarial information. Additional information about the plan is included in the notes to the basic financial statements.

Challenges for Fiscal Year 2024
In fiscal year 2023-24, there are continued near term fiscal uncertainties for the City to monitor. While inflation is slowing down, the increase in the costs of goods and services remains a concern. Additionally, the State is projecting a budget deficit of $68 billion in the coming fiscal year. Uncertainties also include future revenues in the cannabis industry given the evolving nature of the industry, the continued extent of an untaxed and unpermitted illicit market, and additional competition with cannabis businesses in nearby cities such as San Luis Obispo. Additional challenges include deferred maintenance needs in the City’s infrastructure, particularly City buildings and facilities, along with higher contribution costs towards fire services.

Award For Excellence in Financial Reporting
Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to City of Grover Beach for its annual comprehensive financial report (ACFR) for the fiscal year ended June 30, 2022. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized annual comprehensive financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe that our current annual comprehensive financial report continues to meet the Certificate of Achievement Program's requirements and we are submitting it to GFOA to determine its eligibility for another certificate.

Acknowledgements
The preparation of this report would not have been possible without the efficient and dedicated services of the entire staff of the Administrative Services Department and City Manager’s Office. We would like to express our appreciation to all members of the departments who assisted and contributed to the preparation of this report. Lastly, we must credit the City Council for their continued support for maintaining the highest standards of professionalism in the management of the City of Grover Beach’s financial affairs.

Respectfully submitted,
Deanne Purcell
Administrative Services Director
Matthew Bronson
City Manager
5 ORGANIZATIONAL STRUCTURE
Community of Grover Beach
City Council
City Manager
City
Management
Administrative
Services
Police Community
Development
Public Works
6 DIRECTORY OF CITY OFFICIALS

ELECTED OFFICIALS
Mayor.......................................................................................................................... Karen Bright Mayor Pro Tem ........................................................................................................ Robert Robert Council Member..........................................................................................................Clint Weirick Council Member...................................................................................................... Daniel Rushing Council Member.................................................................................................. Zach Zimmerman City Clerk...................................................................................................................... Wendi Sims

EXECUTIVE MANAGEMENT
City Manager...................................................................................................... Matthew Bronson Administrative Services Director.............................................................................Deanne Purcell Community Development Director.......................................................................... Megan Martin Police Chief ...................................................................................................................John Peters Public Works Director ................................................................................................. Gregory Ray Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Grover Beach
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2022
Executive Director/CEO
7 FINANCIAL

SECTION
 Independent Auditor’s Report
 Management’s Discussion and Analysis
 Basic Financial Statements
 Required Supplemental Information
 Supplemental Information
8 9
Honorable Mayor and City Council
City of Grover Beach

and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

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

Auditor's Responsibility for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on financial statements.

In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards we:

Exercise professional judgment and maintain professional skepticism throughout the audit.

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

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing opinions on the effectiveness of the City’s internal control. Accordingly, no such opinions are expressed.

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

Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.
10 Honorable Mayor and City Council
City of Grover Beach

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

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 schedules – General and Major Special Revenue Funds, the Schedule of Proportionate Share of the Net Pension Liability, and Schedule of Pension Plan Contributions, be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a basic part of the 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 opinions or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express opinions or provide any assurance.

Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The accompanying combining and individual nonmajor fund financial statements and Schedule of Debt Service Coverage, are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinions, the combining and individual nonmajor fund financial statements and Schedule of Debt Service Coverage are fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Information
Management is responsible for the other information included in the annual comprehensive financial report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditors’ report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express opinions or any form of assurance thereon. 11 Honorable Mayor and City Council
City of Grover Beach

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

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 18, 2023, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of intenral control over financial reporting and compliance and the results of that testing, and not to provide opinions on the effectiveness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Governemnt Auditing Standards in considering the City’s internal control over financial reporting and compliance.

Glenn Burdette Attest Corporation
San Luis Obispo, California
December 18, 2023

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
12 The management’s discussion and analysis of the City of Grover Beach presents a narrative overview and analysis of the City’s financial activities for the fiscal year ended June 30, 2023. City management encourages readers to consider the information presented here in conjunction with the accompanying transmittal letter located in the introductory section and the City's financial statements, which follow this section.

FINANCIAL HIGHLIGHTS
Key financial highlights for the fiscal year ended June 30, 2023, are as follows:
 The Council approved a five‐year Capital Improvements Program (CIP) in March 2023 that identifies 13 projects for the next fiscal year 2024 with a budget of nearly $10 million. The largest funded category is streets and storm drains, which includes several Measure K‐14 funded street projects, with a projected cost of $5 million.  The City is in the eighth year of the multi‐year Local Street Rehabilitation project funded by Measure K‐14 which provides up to $48 million in bond funds for repair of residential streets over the next 25 years. The City has completed fifteen street projects with Measure K‐14 funds.

As of June 30, 2023, total expenditures for street projects are $31.9 million; approximately $3.7 million of the total expenditures was spent on street projects in FY 2022‐23.  In FY 2022‐23, the City completed CIP Project 4267‐2 – Water Main upgrades with total expended for the project of $1.9 million.
 In FY 2022‐23, the City completed the Computer Aided Dispatch software implementation project with total expended for the project of approximately $314,000. In addition, the City completed improvements to the Police and Fire stations of approximately $117,000 and $100,000, respectively.
 Measure F‐20, a 1 percent transaction and use tax, was approved by voters in November 2020 and became effective in April 2021. Salestax revenue collected from this new measure was $2.5 million in FY 2022‐23.

 General Fund revenuesincreased by 1% or $218,500 when compared to the previousfiscal year.

This result is primarily attributable to the City’s tax revenues and grants.  Although cannabis tax revenue reported a decrease of $318,000, sales tax revenue reported an increase of approximately $233,000 in part due to the new Measure F‐20 sales tax added and property tax revenue increased about $376,000 than the previous fiscal year. The City also received the American Rescue Plan Act grant of $1.6 million in FY 2022‐23.  The City’s General Fund revenue and other financing sources (uses) exceeded expenditures by $1.7 million in fiscal year 2023. This positive outcome was primarily due to tax revenues (sales tax and property tax) coming in higher than anticipated as mentioned above and lower CIP project cost, due to costs coming in lower than anticipated or not completed by the end of the fiscal year.

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
13 OVERVIEW OF THE FINANCIAL STATEMENTS
The financial statements presented herein include all the activities of the City of Grover Beach using the integrated approach as prescribed by GASB Statement No. 34. This discussion and analysis are intended to serve as an introduction to the City’s basic financialstatements. The City’s basic financial statements comprise of three components: (1) government‐wide financial statements; (2) fund financial statements; and (3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements.  The government‐wide financial statements provide both long‐term and short‐term information about the City’s overall financial status.
 The fund financial statements focus on individual parts of the City government, reporting the City’s operations in more detail than the government‐wide statements. - The governmental funds statements tell how government services, such as general government, public safety, community development, parks and recreation and public works were financed in the short‐term as well as what remains for future spending.
- Proprietary fund statements offer short and long‐term financial information about the activities the government operates like businesses, such as the City’s water and wastewater systems.

The basic financial statements also include notes that provide additional information essential to understanding the data contained in the government‐wide and fund financial statements.

Figure A‐1 on the next page summarizes the major features of the City's financial statements, including the portion of the City government they cover and the types of information they contain.

The remainder of this overview section of management’s discussion and analysis explains the structure and contents of each of the statements.

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
14 Figure A‐1
Major Features of City of Grover Beach’s Government‐Wide and Fund Financial Statements

Fund Statements
Government‐wide
Statements
Governmental Funds   Proprietary Funds
Scope     Entire City
government
The activities of the
City that are not
proprietary or
fiduciary, such as
police, fire, and parks
Activities the City
operates similar to
private businesses: the
water and wastewater
systems

Required financial
statements
 Statement of net
position
 Balance sheet  Statement of net
position
 Statement of
activities
 Statement of
revenues,
expenditures, and
changes in fund
balances
 Statement of
revenues expenses,
and changes in  net
position
 Statement of cash
flows
Accounting basis
and measurement
focus
Accrual accounting
and economic
resources focus
Modified accrual
accounting  and
current financial
resources focus
Accrual accounting and
economic resources
focus

Type of
asset/liability
information
All assets and
liabilities, both
financial and capital,
and short‐term and
long‐term
Only assets expected
to be  used up and
liabilities that   come
due during the year or
soon thereafter; no
capital assets included
All assets and liabilities,
both financial and
capital, and short‐term
and long‐term

Type of
inflow/outflow
information
All revenues and
expenses during year,
regardless of  when
cash is received or
paid
Revenues for which
cash is received during
or soon after the end
of the year; expenses
when goods or
services have been
received and payment
is due during the year,
or soon thereafter.

All revenues and
expenses during year,
regardless of when cash
is received or paid

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
15 Government‐Wide Financial Statements
The Government‐Wide Financial Statements report information about the City as a whole using accounting methods similar to those used by private‐sector companies or the accrual basis of accounting. These statements include all assets of the City (including infrastructure) as well as all liabilities (including long‐term debt).

The Statement of Net Position presents information on all the City’s assets and liabilities, as well as any deferred outflows or inflows, with the difference between them reported as net position.

Over time, increases or decreases in net position may serve as a useful indicator of whether the overall financial position of the City is improving or deteriorating.

The Statement of Activitiesincludes all the City’sfiscal year’srevenue and expendituresregardless of when cash is received or paid. These government‐wide statements report the City’s net position and how the City’s net position has changed during the fiscal year.

Both government‐wide statements distinguish the City’s functions that are principally supported by taxes and charges for services (governmental activities) that are intended to recover all or a significant portion of their costs through user fees and charges (business‐type activities). The governmental activities include general government, public safety, community development, public works and parks and recreation. The business‐type activities of the City include water, water conservation and wastewater.

Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The fund financial statements include statements for the three categories of activities – governmental, proprietary, and fiduciary. The governmental activities are prepared using the current financial resources measurement focus and the modified accrual basis of accounting. The business‐type (proprietary) activities are prepared using the economic resources measurement focus and the accrual basis of accounting.

The fiduciary activities include custodial funds, which only report a balance sheet and do not have a measurement focus, and trust funds which include activities of the dissolved Redevelopment Agency.

The fund financialstatements provide more detailed information about the City's mostsignificant funds, not the City as a whole. Some funds are required to be established by State law and by bond covenants, however management may establish other funds to help control and manage money for purposes or to show that it is meeting legal responsibilities for using certain taxes, grants, and other money.

The City has three types of fund financial statements:
 Governmental funds – Most of the City's basic services are reported in governmental funds, which focus on how money flows in and out of those funds and the balances left at fiscal year‐ end that are available forspending. These funds are reported using an accounting method called

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
16 modified accrual accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental funds statements provide a detailed short‐term view of the City’s general government operations, such as police, public works, community development, and parks and recreation, and the basic services it provides. Governmental funds information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance the City's programs. Because this information does not encompass the additional long‐term focus of the government‐wide statements, reconciliations that explain the relationship (or differences) between governmental funds and the governmental activities follow the governmental funds statements.  Proprietary funds – Services for which the City charges customers a fee are generally reported in proprietary funds. Proprietary funds are also referred to as enterprise funds. Proprietary fund statements, like the government‐wide statements, provide both long and short‐term financial information about the activities the City operates like businesses, such as utility services.  Fiduciary funds – The City’s fiduciary activities are reported in a separate statement of fiduciary net position and statement of changes in fiduciary net position. These activities are excluded from the City’s other financial statements since the City cannot use these assets to finance its operations. The City is responsible for ensuring that the assets reported in these funds are used for their intended purposes.

Notes to the Basic Financial Statements
The notes provide additional detailed information that is essential to a full understanding of the data provided in the government‐wide and fund financial statements.

Required Supplementary Information
The notes to the basic financial statements are followed by a section of required supplementary information (RSI) that further explains and supports the information in the financial statements.

Other Supplementary Information
In addition to the basic financial statements, accompanying notes and required supplementary information, this report also presents certain other supplementary information including combining fund statements for the City’s non‐major special revenue, capital projects and debt service funds, individual budget and actual statements for non‐major and major funds and combining statement of net position for fiduciary funds.

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
17 GOVERNMENT‐WIDE FINANCIAL ANALYSIS
Analysis of Net Position
The net position of the City decreased $1.2 million from $11.25 million to $10 million at June 30, 2023.
2022 2023 2022 2023 2022 2023
ASSETS
Current and other assets $ 23,688,581  $ 22,717,865  $ 13,904,476  $ 12,497,785  $ 37,593,057  $ 35,215,650 Net Capital assets     22,077,800      22,924,193         9,282,128         8,965,035      31,359,928      31,889,228 Total assets     45,766,381      45,642,058      23,186,604      21,462,820      68,952,985      67,104,878

DEFERRED OUTFLOWS OF

RESOURCES
Deferred outflows of resource         2,719,154         6,317,127            359,115            808,172         3,078,269         7,125,299 Total deferred outflows of
resources        2,719,154         6,317,127            359,115            808,172         3,078,269         7,125,299

LIABILITIES
Current and other liabilities        3,637,399         4,164,191            902,489         1,584,839         4,539,888         5,749,030 Long‐term liabilities outstanding     44,382,385      50,877,420         5,194,904         6,220,777      49,577,289      57,098,197 Total liabilities     48,019,784      55,041,611         6,097,393         7,805,616      54,117,177      62,847,227

DEFERRED INFLOWS OF

RESOURCES
Deferred Inflows        5,416,617         1,201,355         1,241,942            147,501         6,658,559           1,348,856 Total deferred inflows of
resources        5,416,617         1,201,355         1,241,942            147,501         6,658,559           1,348,856

NET POSITION
Net investment in capital assets     (7,176,380)       12,052,420  *         8,082,305           7,817,262  **            905,925      19,869,682 Restricted        6,224,776         6,644,643         6,224,776         6,644,643 Unrestricted     (3,999,262)   (22,980,844)        8,124,079         6,500,613         4,124,817    (16,480,231) $ (4,950,866) $ (4,283,781) $ 16,206,384  $ 14,317,875  $ 11,255,518  $ 10,034,094 * Net investment in capital assets for governmental activities excludes the unspent bond proceeds in the Street Rehab and Repair Fund.

The bond proceeds are used for the repairs and maintenance of city streets. These repairs are expensed in the year incurred and are not capitalized, which created a negative balance in the net investment in capital assets in fiscal year 2022 because they are not included as a capital asset. Certain reclassifications have been made to the prior year classification to conform to the current year presentation. ** Net investment in capital assets for business-type activities excludes the water bonds payable that has not been spent yet for capital purposes. Unspent bond proceeds are reported as unrestricted and related portion reported in the same component of net position as the unspent proceeds, and therefore will not have any net effect on any classification of net position.

Total net position
Governmental Activities Business‐type Activities Total
The following analysis of governmental and business‐type activities provides more detailed information for these changes.

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
18 Governmental Activities
 Current and other assets and deferred outflows of resources, in total, increased by $2.6 million. Deferred outflows of resources represent the unamortized portion of changes to the net pension liability, which increased by $3.6 million from the prior fiscal year. Cash and investments decreased by $590,000.
 Current and other liabilities increased by $527,000 from the prior fiscal year. This was mainly due to the increase in deferred revenue of $1.4 million related to unspent ARPA grant funds.
 Restricted net position, representing amounts that must be used in accordance with external restrictions increased $420,000. The remaining balance of unrestricted net position may be used to meet the City’s ongoing obligations to citizens and creditors.

Net position may serve over time as a useful indicator of a government’s financial position. For FY 2022‐23, liabilities and deferred inflows exceeded assets and deferred outflows by $4.2 million. It should be noted that the Street Rehabilitation and Repair Fund includes bonds, although the street repairs and maintenance that are paid from the bond proceeds do not get capitalized and are not included as a fixed asset; they are expensed in the year the cost is incurred.  This creates a negative balance in the net investments in capital assets.

Business‐Type Activities
 Total assets and deferred outflows of resources decreased by $1.27 million that is mainly due to a decrease in water fees that can be attributed to a new tiered rate system along with a successful water conservation effort that resulted in a significant reduction in water usage in addition to a decrease in CIP projects asset of $1.8 million. Deferred outflows of resources represent the unamortized portion of changes to the net pension liability, which increased by $449,000 from the prior fiscal year  Net investment in capital assets decreased by $265,000 due to capital asset additions, deletions or adjustments plus unspent bond proceeds and offset by capital related debt.

Additional capital asset information is in the Capital Asset section of this MD&A and in Note 4 to the financial statements.
 Business‐type activities use the same accrual basis of accounting as the Proprietary Funds and are used to account for those activities that are supported primarily by user charges to external customers. This includes water, water conservation and wastewater services.

For FY 2022‐23, assets and deferred outflows exceeded liabilities and deferred inflows by $14.3 million.

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
19 Analysis of Statement of Activities
The change in net position for governmental and business‐type activities are as follows:
2022 2023 2022 2023 2022 2023

REVENUES
Charges forservices $   1,489,656  $   1,799,849  $   5,213,375  $   4,966,827  $      6,703,031  $      6,766,676 Operating Contributions and Grants       4,045,051        1,862,592           4,045,051           1,862,592 Capital Contributions and Grants       1,131,438            437,101           1,131,438               437,101 General revenues:

Property taxes       6,836,295        7,552,939           6,836,295           7,552,939 Other taxes       9,143,089        9,124,697           9,143,089           9,124,697 Other revenues           200,433            438,642            100,155            193,873               300,588               632,515 Total revenues     22,845,962      21,215,820         5,313,530         5,160,700         28,159,492         26,376,520

EXPENSES
Governmental activities:

General Government       4,695,218        4,657,513           4,695,218           4,657,513 Public Safety       7,977,222        7,826,482           7,977,222           7,826,482 Community Development           976,070            851,204               976,070               851,204 Public Works       7,821,460        7,100,166           7,821,460           7,100,166 Parks and Recreation           606,330            603,660               606,330               603,660 Business‐type activities:

Water        3,149,314         5,389,559           3,149,314           5,389,559 Water Conservation              11,291               19,282                 11,291                 19,282 Wastewater        1,348,332         1,150,078           1,348,332           1,150,078 Total expenses     22,076,300      21,039,025         4,508,937         6,558,919         26,585,237         27,597,944 Change in net position
before transfers           769,662            176,795            804,593      (1,398,219)          1,574,255         (1,221,424) Transfers       (1,205,936)           490,290         1,205,936          (490,290) Change in net position        (436,274)           667,085         2,010,529      (1,888,509)          1,574,255         (1,221,424) Net position ‐ July 1     (4,514,592)     (4,950,866)     14,195,855      16,206,384           9,681,263         11,255,518 Net position ‐ June 30 $(4,950,866) $ (4,283,781) $ 16,206,384  $ 14,317,875  $    11,255,518  $    10,034,094 Program revenues:

Governmental  Activities Business‐type  Activities Total

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
20 Grants and
Contributions
9%
TOT Tax
3%
Property Tax
29%
Sales Tax
Cannabis 22%
Tax
4%
Charges for
Services
26%
Other
7%

REVENUES BY SOURCE
FY 2022‐23
Parks and
Recreation
2%
Public Safety
28%
Public Works
26%
Community
Development
3%
Business‐Type
Activities
24%
General
Government
17%

EXPENSES BY TYPE
FY 2022‐23

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
21 Governmental Activities
Governmental activities increased the City’s net position by about $667,000. Total resources available during the year to finance governmental activities consisted of net position at July 1, 2022, of ($4.9) million, program revenues of $4.1 million, and general revenues of $17.1 million.

Total expenses for governmental activities during the fiscal year were $21 million. Net interfund transfers for governmental activities from business type activities during the fiscal year were $490,000.

Key factors are as follows:
 Totalrevenue decreased by $1.6 million, from $22.8 million in the priorfiscal yearto $21.2 million in the current fiscal year. This decrease is mainly attributed to grant revenues that were received in the prior fiscal year including: 1) $1.8 million from Community Development Block Grant (CDBG) mainly used for the upgrade of 2” and 4” water mains and 2) $.5 million related to American Rescue Plan Act grant expended in prior fiscal year in comparison to the current year expended amount and 3) $.5 million grant from the County for major street rehabilitation. There was a decrease in cannabis tax revenue of $318,000 that was offset by increases in property tax revenues of $717,000 and increases in sales tax revenue of $233,000.
 Total expenses for governmental activities decreased $1 million during the fiscal year, mainly due to a decrease in expenses related to CIP projects for the street rehabilitation and repair fund.
 Interfund transfersincluded $330,000 for CIP projects and overhead cost allocationsfrom the Enterprise Funds to the General Fund of $160,000.

Business‐Type Activities
The City’s net position from business‐type activities decreased by $1.9 million. The programs for the business‐type activities include water, water conservation and wastewater utilities.

Key factors are as follows:
 Water net position decreased by approximately $2 million. Operating revenues decreased by $268,000 due to a new tiered rate system along with a successful water conservation effort during drought conditions that resulted in a significant reduction in water usage.

Operating expenses decreased approximately $354,000, mostly related to salaries and benefits, specifically for the end of year pension adjustment. Transfers decreased by $1.6 million mainly due to a transfer in of $1.6 million that was made from CDBG funds for the upgrade of water mains project in the prior fiscal year.  Wastewater net position increased minimally by approximately $175,000 due to higher wastewater fees offset by higher operating expenditures.

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
22 FINANCIAL ANALYSIS OF THE CITY’S FUNDS
Governmental Funds
The focus on the City’s governmental funds is to account for the near‐term inflows, outflows and balances of resources that are available for spending. This information is useful in assessing the City’s financing requirements. Specifically, unassigned fund balance is a useful measure of the agency’s net resources available to meet current and future needs at the end of the fiscal year.

Types of governmental funds reported by the City include the General Fund, Special Revenue Funds, Capital Projects Fund, and Debt Service Fund.

As of the fiscal year ended June 30, 2023, the City’s governmental funds reported a combined ending fund balance of $19.8 million, a decrease of $1.5 million from the prior fiscal year.

Revenuesfor governmental funds overall totaled $21.2 million or $1.7 million lower than the prior fiscal year primarily due to $5.2 million in various grants awarded for various capital projects including water main upgrades and majorstreet rehabilitation that wasreceived in the prior fiscal year. Expenditures for governmental funds totaled $23.5 million and included construction costs for major street rehabilitation, park rehabilitation and facility improvement projects and capital outlay for citywide sidewalk improvements and various other CIP projects and capital assets included on the next page under Capital Assets.

The fund balance for the General Fund increased by $1.7 million mainly due to higher than anticipated tax revenues and lower CIP project cost, due to costs coming in lower than anticipated or not completed by the end of the fiscal year.

The Street Rehabilitation and Repair Fund reported a decrease of $3.6 million in fund balance. In the prior fiscal year, this fund had an increase of $5.2 million related to a $10 million bond issue.

The fund balance for the Street Improvements Debt Service Fund decreased $10,500 related to the tax revenue received offset by debt service payments for the general obligation bonds issued to finance street improvements held by the County of San Luis Obispo.

The City’s governmental funds are classified as major or nonmajor. Majorfunds meet the specified criteria of revenues, expenditures, assets, or liabilities of at least 10% of corresponding totals for all governmental and enterprise funds and at least 5% of the aggregate amount for all government and enterprise funds. A fund that does not meet the specified criteria can still be classified as a major fund if it is deemed important to financialstatement users. For the current fiscal year 2022‐ 23, major funds included the General Fund, Street Rehabilitation and Repair Fund, and the Street Improvements Debt Service Fund. The City’s nonmajor funds that did not meet the specified criteria for a major fund are listed under Other Governmental Funds on the Governmental Funds Balance Sheet and Statement of Revenues, Expenditures and Changes in Fund Balances.

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
23 Proprietary Funds
The City’s proprietary funds statements provide the same type of information found in the government‐wide financial statements but in more detail. The proprietary fund financial statements provide separate information for each of the enterprise funds.

At the end of the fiscal year, the unrestricted net position for the Water, Water Conservation and Wastewater Funds are $1.9 million, $0.3 million, and $4.3 million respectively, for a combined total of $6.5 million unrestricted net position for the proprietary funds. Key factors concerning the finances of the enterprise funds have been addressed previously in the discussion of the City’s business‐type activities.

General Fund Budgetary Highlights
As compared to the final budget, the General Fund revenues reported a negative variance of $1.4 million mainly due to budgeting the receipt of $1.6 million of American Rescue Plan Act grant, but only expending approximately $650,000 in the current fiscal year. Overall, General Fund expenditures come under budget as compared to the final budget by approximately $1.5 million related to lower CIP project costs and not expending the full American Rescue Plan Act grant than expected.

CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets
As of June 30, 2023, net capital assets of the governmental activities totaled $22.9 million, and the net capital assets of the business‐type activities totaled $9 million.

The following table presents summary information on the City’s capital assets as of June 30, 2022 and 2023:
2022 2023 2022 2023 2022 2023
Land $1,890,915 $1,890,915 $60,125 $260,849 $1,951,040 $2,151,764 Construction in progress         636,489        1,137,457     2,117,095          293,784        2,753,584        1,431,241 Capacity rights    1,598,578       1,598,578        1,598,578        1,598,578 Equipment       2,332,873        2,994,428         749,311          779,228        3,082,184        3,773,656 Right‐to‐use leased equipment          371,147           371,147           371,147           371,147 Subscription Intagible                    ‐             363,268                      ‐             363,268 Infrastructure     26,348,475      26,737,547  12,131,358    14,134,134      38,479,833      40,871,681 Accumulated depreciation    (9,502,099)   (10,570,569)   (7,777,057)    (8,101,538)   (17,279,156)   (18,672,107) Net capital assets $22,077,800 $22,924,193 $8,879,410 $8,965,035 $30,957,210 $31,889,228 Governmental Activities Business‐Type Activities Total
This year’s major capital assets additions included:
 Citywide Sidewalk Infill – $82,600

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
24  Citywide Disability Access Improvements ‐ $27,900
 Fire Station Improvements ‐ $100,000
 Police Station Improvements ‐ $117,800
 Computer Aided Dispatch software ‐ $314,000
 Upgrade of 2" and 4" Water Mains ‐ $1,980,000
 Land Purchase 0 Calvin Ct. ‐ $200,700
 Dispatch Room Improvements ‐ $40,000
 Stop Sign Replacement ‐ $77,500
 Enterprise Resource Planning Software ‐ $363,000
More detailed information about the City’s capital assets is presented in Note 4 to the basic financial statements section.

Debt Administration
As of June 30, 2023, the City had $52.1 million of outstanding long‐term obligations related to governmental activities and $6.2 million related to business‐type activities, for a total of $58.3 million. Debt outstanding as of June 30, 2023, with a comparison to prior year and the net change are as follows:
2022 2023 2022 2023 2022 2023
Bonds payable $38,134,487 $37,223,345  $4,102,000  $3,918,000 $42,236,487 $41,141,345 Loans payable          112,454             87,898           112,454             87,898 Early retirement             13,529               8,069              7,697             4,157             21,226             12,226 Compensated absences          577,732           780,976         108,630         152,037           686,362           933,013 Financed purchases            70,509                      ‐               70,509                      ‐ Lease liability          371,147           313,905           371,147           313,905 Subscription liability                     ‐             226,718                      ‐            226,718 Net pension liability      6,391,236     13,443,275      1,186,422     2,146,583       7,577,658     15,589,858 Total long‐term debt $45,671,094 $52,084,186  $5,404,749 $6,220,777 $51,075,843 $58,304,963 Governmental Activities Business‐Type Activities Total
Total outstanding long‐term debt for governmental activities increased by $6.4 million in fiscal year 2022‐23, which was mainly due to a $7 million increase in net pension liability.

In November 2014, Grover Beach voters passed Ballot Measure K‐14, which approved the sale of bonds, up to $48 million dollars. These funds are to be used to fund improvements to the residential streets in the city. The first bonds were issued on March 25, 2015, and were issued for $5 million dollars, payable over 20 years. The second series of bonds were issued on March 31, 2016, for $8 million dollars, also payable over 20 years. The third series of bonds were issued on December 20, 2017, for $15 million dollars, payable over 20 years. The fourth series of bonds were issued January 26, 2022, for $10 million and a total of $38 million in bonds being issued.

These series of bonds and future bonds will be placed on the property tax roll.

CITY OF GROVER BEACH
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2023
25 Total outstanding long‐term debt for business‐type activities increased by $816,000 in fiscal year 2022‐23 which was mainly due to a $960,000 increase in net pension liability.

More detailed information about the City’s total long‐term liabilities is presented in Note 6 to the financial statements.

ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS AND RATES
The budget for fiscal year 2023‐24 assumes a balanced budget with reserves that are currently maintained above the General Fund Reserve policy. General Fund fiscal year 2023‐24 budgeted appropriations, including Capital Improvements are set at $18.9 million.

The fiscal year 2023‐24 budget has proposed capital expenditures of $10.2 million for infrastructure related projects.

Capital improvements included in the $10.2 million listed above includes:
 Ramona Garden Park Rehabilitation
 City Corporation Yard Improvements
 Citywide Disability Access Improvements
 Facilities Condition Assessment
 Train Station Stormwater Alt Compliance
 Annual Street Lighting Project
 Citywide Sidewalk Improvements
 Major Street Rehabilitation Projects
 Water Meter Replacement program
 Sewer Lining Project
 Central Coast Blue Project
 Water Main Zone Valves
 Well Capacity Analysis
 Reservoir Analysis
 Sewer System Upgrades
 Lift State Upgrades
As to the City's business‐type activities, about $10 million is expected to be spent in fiscal year 2023‐24 to conduct operations and make capital improvements. The enterprise fund programs are solely funded by charges for services to system users.

REQUESTS FOR INFORMATION
This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the City's finances and to demonstrate the City's accountability for the money it receives. If you have questions about thisreport or need additional financial information, contact the Administrative Services Director, City of Grover Beach, 154 South 8th Street, Grover Beach, CA 93433.

CITY OF GROVER BEACH

STATEMENT OF NET POSITION
June 30, 2023
Governmental
Activities
Business‐type
Activities Total
ASSETS
Cash and investments $       21,303,855  $         9,131,040  $       30,434,895 Accounts receivable, net             2,182,186              1,275,968              3,458,154 Interest receivable                   70,678                    53,941                  124,619 Inventory                 115,769                  115,769 Loans receivable                 333,975                  333,975 Loans receivable ‐ Successor Agency                   29,870                    29,870 Internal balances            (1,175,589)             1,175,589                               ‐ Investment in Joint Powers Authority                 657,170                  657,170 Prepaid items                     1,148                    58,438                    59,586 Deposits                     1,612                      1,612 Capital assets:

Non‐Depreciable:

Land             1,890,915                  260,849              2,151,764 Construction in progress             1,137,457                  293,784              1,431,241 Depreciable and amortizable:

Equipment             2,984,728                  779,228              3,763,956 Right‐to‐use leased equipment                 371,147                  371,147 Subscription asset                 363,268                  363,268 Buildings and infrastructure           26,747,247            14,134,134            40,881,381 Capacity rights             1,598,578              1,598,578 Accumulated depreciation and amortization         (10,570,569)            (8,101,538)         (18,672,107) Total assets           45,642,058            21,462,820            67,104,878

DEFERRED OUTFLOWS
Related to pensions             6,317,127                  808,172              7,125,299 Total deferred outflows             6,317,127                  808,172              7,125,299

LIABILITIES
Accounts payable                 767,558              1,397,970              2,165,528 Accrued wages                 334,133                    17,476                  351,609 Unearned revenue             1,433,999              1,433,999 Interest payable                 421,735                    31,736                  453,471 Deposits                 137,657                  137,657 Noncurrent liabilites
Due within one year             1,206,766                  203,636              1,410,402 Due in more than one year           50,877,420              6,017,141            56,894,561 Total Liabilities           55,041,611              7,805,616            62,847,227

DEFERRED INFLOWS
Related to pensions             1,201,355                  147,501              1,348,856 Total deferred inflows             1,201,355                  147,501              1,348,856

NET POSITION
Net investment in capital assets           12,052,420              7,817,262            19,869,682 Restricted for:

Street improvements             2,355,877              2,355,877 Transportation                   22,942                    22,942 Public safety                 354,323                  354,323 Community development projects                 150,528                  150,528 Administrative functions                   27,807                    27,807 Storm water functions                 148,073                  148,073 Wastewater functions                 232,917                  232,917 Park facilities                 266,454                  266,454 Recreation facilities                   49,524                    49,524 State mandated ADA                   10,028                    10,028 Underground utilities                 232,332                  232,332 Home grant                 122,500                  122,500 Debt service             2,671,338              2,671,338 Unrestricted          (22,980,844)             6,500,613          (16,480,231) Total net position $       (4,283,781) $       14,317,875  $       10,034,094 The accompanying notes are an integral part of these financial statements. 26 CITY OF GROVER BEACH

STATEMENT OF ACTIVITIES
For the Fiscal Year Ended June 30, 2023
Expenses Charges for Services
Operating
Contributions and
Grants
Governmental activities:

General government $               4,657,513                        995,944  $                   712,004 Public safety                   7,826,482                           59,895                        285,233 Community development                       851,204                        185,000                        239,462 Public works                   7,100,166                        355,512                        625,893 Parks and recreation                       603,660                        203,498 Total governmental activities:                 21,039,025                     1,799,849                    1,862,592 Business‐type Activities:

Water                   5,389,559                     3,638,849 Water conservation                         19,282                                      ‐ Wastewater                   1,150,078                     1,327,978 Total business‐type Activities:                   6,558,919                     4,966,827 Total  $             27,597,944  $                6,766,676  $               1,862,592 Net position ‐ end of fiscal year
The accompanying notes are an integral part of these financial statements.

Investment income (loss)
Other revenues
Transfers
Total general revenues and transfers
Change in net position
Net position ‐ beginning of fiscal year
Other taxes
Program Revenues
General Revenues:

Taxes:

Property tax
Sales and use tax
Cannabis tax
Transient occupancy tax
Franchise fees
27 Capital
Contributions and
Grants
Governmental
Activities
Business‐type
Activities Total
$                                ‐   $              (2,949,565) $                               ‐   $              (2,949,565) (7,481,354)                  (7,481,354)
(426,742)                     (426,742)
437,101                   (5,681,660)                  (5,681,660) (400,162)                     (400,162)
437,101                 (16,939,483)                (16,939,483) (1,750,710)                  (1,750,710)
(19,282)                       (19,282)
177,900                        177,900
(1,592,092)                  (1,592,092)
$                   437,101                 (16,939,483)                 (1,592,092)                (18,531,575) 7,552,939                    7,552,939
5,882,949                    5,882,949
1,198,037 1,198,037
924,162                        924,162
713,394                        713,394
406,155                        406,155
336,714                       193,873                        530,587 101,928                                     ‐                        101,928 490,290                      (490,290)                                    ‐ 17,606,568                      (296,417)                 17,310,151 667,085                  (1,888,509)                  (1,221,424) (4,950,866)                 16,206,384                  11,255,518 $              (4,283,781) $            14,317,875  $             10,034,094 Net (Expenses) Revenue and Changes in Net Position
28 CITY OF GROVER BEACH

GOVERNMENTAL FUNDS

BALANCE SHEET
June 30, 2023
General Fund
Street
Rehabilitation
and Repair
Fund
Street
Improvements
Debt Service
Fund
Other
Governmental
Funds Totals
ASSETS
Cash and investments $     8,591,904  $      6,068,794  $      2,671,338  $         3,971,819  $    21,303,855 Accounts receivable         1,853,677                                               328,509            2,182,186 Interest receivable               47,440                                                  23,238                  70,678 Loans receivable                                                                          333,975               333,975 Due from funds            197,945               197,945 Prepaid items                 1,148                                                  1,148 Deposits                 1,612                    1,612 Total assets $  10,693,726  $      6,068,794  $      2,671,338  $         4,657,541  $    24,091,399

LIABILITIES AND FUND BALANCES
Liabilities:

Accounts payable $        264,556  $          227,142  $                    ‐     $            275,860  $          767,558 Accrued wages            331,369                    2,697                            67               334,133 Due to funds                                                                                                        197,945               197,945 Advances payable         1,175,589                                          1,175,589 Unearned revenue         1,433,999            1,433,999 Total liabilities         3,205,513               229,839                            ‐                 473,872            3,909,224 Deferred Inflows of Resources:

Unavailable revenue                                                                           333,975               333,975 Total deferred inflows of resources                          ‐                            ‐                            ‐                 333,975               333,975 Fund Balances:

Nonspendable
Prepaid items                 1,148                    1,148 Deposits                 1,612                    1,612 Restricted for:

Street improvements           5,838,955              2,355,877            8,194,832 Transportation                   22,942                  22,942 Public safety                354,323               354,323 Community development projects                150,528               150,528 Administrative functions                   27,807                  27,807 Storm water functions                148,073               148,073 Wastewater functions                232,917               232,917 Park facilities                266,454               266,454 Recreation facilities                   49,524                  49,524 State mandated ADA                   10,028                  10,028 Underground utilities                232,332               232,332 Debt service          2,671,338                               ‐            2,671,338 Unassigned         7,485,453                    (1,111)           7,484,342 Total fund balances         7,488,213            5,838,955           2,671,338              3,849,694          19,848,200 Total liabilities, deferred inflows of resources, and fund balances $  10,693,726  $      6,068,794  $      2,671,338  $         4,657,541  $    24,091,399 The accompanying notes are an integral part of these financial statements. 29 CITY OF GROVER BEACH
June 30, 2023
$               19,848,200
all assets are reported, including capital assets and accumulated depreciation.

Land 1,890,915
CIP 1,137,457
Equipment 2,984,728
Right‐to‐use leased equipment 371,147
Subscription asset 363,268
Buildings and infrastructure 26,747,247
Capital assets at historical cost 33,494,762 $
Accumulated depreciation (10,570,569)
Net capital assets 22,924,193
it matures and is paid.  In government‐wide statements, it is recognized in the period that it is incurred.                       (421,735)
statement of net position, all liabilities, including long‐term liabilities, are reported.

Long‐term liabilities relating to governmental activities consist of:

State loan 87,898
Early retirement incentive 8,069
Compensated absences payable 780,976
General obligation bonds 37,223,345
Leases 313,905
Subscription liability 226,718
Net pension liability 13,443,275
Total long‐term liabilities (52,084,186)
are not reported because they are applicable to future periods.  In the statement of net position, deferred outflows and inflows of resources relating to pensions are reported.                     5,115,772
collected within the prescribed time period after fiscal year‐end.  However, the revenues are included on the accrual basis used in the government‐wide financial statements.                        333,975
Total net position ‐ governmental activities (4,283,781) $ The accompanying notes are an integral part of these financial statements.

Certain revenues in the governmental funds are deferred because the revenues are not RECONCILIATION OF THE GOVERNMENTAL FUNDS ‐ BALANCE SHEET

TO THE STATEMENT OF NET POSITION
Total fund balances ‐ governmental funds
In governmental funds, only current assets are reported.  In the statement of net position, In governmental funds, interest on long‐term debt is not recognized until the period in which Long‐term liabilities:  In governmental funds, only current liabilities are reported.  In the In governmental funds, deferred outflows and inflows of resources relating to pensions 30 CITY OF GROVER BEACH

GOVERNMENTAL FUNDS

STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES For the Fiscal Year Ended June 30, 2023
General Fund
Street
Rehabilitation
and Repair
Fund
Street
Improvements
Debt Service
Fund
Other
Governmental
Funds Totals
Revenues:

Taxes $ 14,640,552  $                       ‐   $       2,037,085  $                     ‐     $    16,677,637 Licenses, permits, and fees           424,554                                             424,554 Intergovernmental           831,966                                          1,467,727            2,299,693 Charges for services           953,107                                             244,593            1,197,700 Fines and forfeitures              42,857                                               42,857 Use of money and property           255,429               112,763                 37,926                 67,017               473,135 Other                        3                 94,787                    5,454                            ‐               100,244 Total revenues      17,148,468               207,550            2,080,465            1,779,337         21,215,820 Expenditures:

General government        4,517,231                                          4,517,231 Public safety        7,804,889                                               51,517            7,856,406 Community development           665,320                                             239,646               904,966 Public works        1,447,905            3,899,878                    3,600               355,213            5,706,596 Parks and recreation           550,570                                                  4,464               555,034 Capital outlay           667,204                                             933,577            1,600,781 Debt service:

Principal           270,202                                             775,000                                          1,045,202 Interest              26,249                                          1,312,419                                          1,338,668 Total expenditures      15,949,570            3,899,878            2,091,019            1,584,417         23,524,884 Excess of revenues over (under) expenditures        1,198,898          (3,692,328)               (10,554)              194,920          (2,309,064) Other Financing Sources (Uses):

Subscription financing           344,613               344,613 Transfers in           546,541                 96,866                            ‐               915,162            1,558,569 Transfers out          (387,507)                         ‐               (680,772)         (1,068,279) Total other financing sources (uses)           503,647                 96,866                          ‐                 234,390               834,903 Net change in fund balances        1,702,545          (3,595,462)               (10,554)              429,310          (1,474,161) Fund balances ‐ July 1        5,785,668            9,434,417            2,681,892            3,420,384         21,322,361 Fund balances ‐ June 30 $    7,488,213  $       5,838,955  $       2,671,338  $       3,849,694  $    19,848,200 The accompanying notes are an integral part of these financial statements. 31 CITY OF GROVER BEACH
$                (1,474,161)
statement of activities, the cost of those assets is allocated over their estimated useful lives as depreciation expense.  This is the amount by which additions to capital outlay of $1,924,563 exceeds depreciation and amortization expense $(1,078,170) in the period. 846,393 government‐wide statements, repayments of long‐term debt are reported as reductions of liabilities.                     1,045,202
becomes due.  In the government‐wide statements of activities, it is recognized in the period that it is incurred.  Unmatured interest owing at the end of the period, less matured interest paid during the period but owing from the prior period was: (105,290) during the fiscal year.  In governmental funds, however, expenditures for these items are measured by the amount of financial resources used (essentially the amounts paid).  This fiscal year, vacation earned exceeded the amounts used by: (203,244) In the statement of activities, pension costs are recognized on the accrual basis.

This fiscal year, the difference between accrual‐basis pension costs and actual employer contribution was:                        761,196 In the statement of activities, early retirement incentive benefit costs are recognized on the accrual basis.  This year, the difference between benefits paid and accrued was: 5,460 financing source in the period it is incurred.  In the government‐wide statements, the premium is amortized as interest over the life of the debt.  Amortization of debt issue premium for the period is:                        136,142 government‐wide statements, proceeds from debt are reported as increases to liabilities.

Amounts recognized in governmental funds as proceeds from debt, net of issue premium or discount, were:                       (344,613)
Changes in net position ‐ governmental activities 667,085 $ The accompanying notes are an integral part of these financial statements.

RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF

GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
For the Fiscal Year Ended June 30, 2023
Total net change in fund balances ‐ governmental funds
Capital outlays are reported in governmental funds as expenditures.  However, in the In governmental funds, proceeds from debt are recognized as other financing sources.  In the In governmental funds, repayments of long‐term debt are reported as expenditures.  In the In governmental funds, interest on long‐term debt is recognized in the period that it In the statement of activities, compensated absences are measured by the amounts earned In governmental funds, pension costs are recognized when employer contributions are made.

In governmental funds, early retirement incentive benefit costs are recognized when paid.

In governmental funds, if debt is issued at a premium, the premium is recognized as an other 32 CITY OF GROVER BEACH

PROPRIETARY FUNDS

STATEMENT OF NET POSITION
June 30, 2023
Water Fund
Water
Conservation
Fund
Wastewater
Fund Totals
ASSETS
Current assets:

Cash and investments $    5,449,044  $         355,145  $    3,326,851  $     9,131,040 Accounts receivable,net           669,238                                          606,730           1,275,968 Interest receivable              33,096                   2,037               18,808                53,941 Prepaid items              58,438                58,438 Inventory at cost           115,769                                                                      115,769 Total current assets        6,325,585               357,182         3,952,389        10,635,156 Noncurrent assets:

Loans receivable              29,870                                                                        29,870 Advances receivable                                                                1,175,589           1,175,589 Investment in Joint Powers Authority           657,170              657,170 Capital assets:

Land           260,849              260,849
Construction in progress              17,300             276,484              293,784 Equipment           311,335             467,893              779,228 Infrastructure        9,774,687         4,359,447        14,134,134 Capacity rights        1,598,578           1,598,578
10,364,171         6,702,402        17,066,573
Less accumulated depreciation      (3,884,312)       (4,217,226)        (8,101,538) Total capital assets, net of accumulated depreciation        6,479,859         2,485,176           8,965,035 Total noncurrent assets        7,166,899                          ‐           3,660,765        10,827,664 Total assets      13,492,484               357,182         7,613,154        21,462,820

DEFERRED OUTFLOWS OF RESOURCES
Related to pensions           473,943             334,229              808,172 Total deferred outflows of resources           473,943             334,229              808,172

LIABILITIES
Current liabilities:

Accounts payable        1,211,773                      812             185,388           1,397,973 Accrued payroll                9,086                      100                 8,290                17,476 Deposits           137,657              137,657
Accrued interest payable              31,736                                           31,736 Compensated absences ‐ current                6,661                 5,820                12,481 Early retirement ‐ current                2,075                 1,080                  3,155 Revenue bonds ‐ current           188,000              188,000 Total current liabilities        1,586,988                     912            200,578          1,788,478 Noncurrent liabilities:

Revenue bonds, net of current         3,730,000                                      3,730,000 Compensated absences, net of current              83,031               56,525              139,556 Early retirement, net of current                        ‐                 1,002                  1,002 Net pension liability        1,277,526             869,057           2,146,583 Total noncurrent liabilities        5,090,557             926,584           6,017,141 Total liabilities        6,677,545                      912         1,127,162           7,805,619

DEFERRED INFLOWS OF RESOURCES
Related to pensions              87,784               59,717              147,501 Total deferred inflows of resources              87,784               59,717              147,501

NET POSITION
Net investment in capital assets        5,332,086                            ‐         2,485,176           7,817,262 Unrestricted         1,869,012               356,270         4,275,331           6,500,613 Total net position $    7,201,098 $         356,270 $    6,760,507 $   14,317,875 The accompanying notes are an integral part of these financial statements. 33 CITY OF GROVER BEACH

PROPRIETARY FUNDS

STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION For the Fiscal Year Ended June 30, 2023
Water Fund
Water
Conservation
Fund
Wastewater
Fund Totals
Operating Revenues:

Charges for services $    3,501,444  $                    ‐     $       1,327,978  $      4,829,422 Other operating revenues           137,405                                                                         137,405 Total operating revenues        3,638,849                         ‐              1,327,978           4,966,827 Operating Expenses:

Salaries and benefits           422,986                  7,024               572,491           1,002,501 Supplies and services        2,019,383                      978               453,252           2,473,613 Non‐capitalized equipment              52,700                11,280                                               63,980 Depreciation           200,146                                           124,335               324,481 Total operating expenses        2,695,215                19,282            1,150,078           3,864,575 Operating income (loss)           943,634              (19,282)              177,900           1,102,252 Non‐Operating Revenues (Expenses):

Interest income           118,037                  6,365                  69,471               193,873 Interest expense            (95,878)                                                        ‐               (95,878) Nonoperating expenses for Joint Powers
Authority      (2,598,466)         (2,598,466)
Total non‐operating revenues (expenses)      (2,576,307)                 6,365                  69,471          (2,500,471) Income (loss) before transfers      (1,632,673)             (12,917)              247,371          (1,398,219) Transfers:

Transfers in              38,426                        62               104,923               143,411 Transfers out          (456,531)                                         (177,170)            (633,701) Total transfers          (418,105)                       62                (72,247)            (490,290) Change in net position      (2,050,778)             (12,855)              175,124          (1,888,509) Net position ‐ July 1       9,251,876            369,125          6,585,383       16,206,384 Net position ‐ June 30 $   7,201,098 $        356,270 $      6,760,507 $   14,317,875 The accompanying notes are an integral part of these financial statements. 34 CITY OF GROVER BEACH

PROPRIETARY FUNDS

STATEMENT OF CASH FLOWS
For the Fiscal Year Ended June 30, 2023
Water Fund
Water
Conservation
Fund
Wastewater
Fund Totals
Cash Flows From Operating Activities:

Receipts from customers $    3,589,077  $                    ‐     $       1,366,474  $     4,955,551 Payments to suppliers      (1,223,082)             (11,477)            (458,810)        (1,693,369) Payments to employees          (815,737)                (7,246)            (761,958)        (1,584,941) Other receipts           137,405              137,405
Net cash provided (used) by operating activities        1,687,663              (18,723)              145,706           1,814,646 Cash Flows From Capital and Related Financing Activities:

Interest paid on long‐term debt            (97,368)                                            (97,368) Principal paid on long‐term debt          (184,000)           (184,000) Acquisition of capital assets           159,179             (166,567)                (7,388) Net cash used by capital and related financing activities          (122,189)            (166,567)           (288,756) Cash Flows From Noncapital Financing Activities:

Cash paid for Joint Powers Authority      (2,598,466)        (2,598,466) Advances to/from other funds                                         106,724              106,724 Transfers to other funds          (456,531)            (177,170)           (633,701) Transfers from other funds              38,426                        62               104,923              143,411 Net cash provided (used) by noncapital financing activities      (3,016,571)                       62                 34,477         (2,982,032) Cash Flows From Investing Activities:

Investment in Joint Powers Authority          (657,170)           (657,170) Interest income received              96,382                  4,884                 55,708              156,974 Net cash provided by investing activities          (560,788)                 4,884                 55,708            (500,196) Net increase (decrease) in cash and cash equivalents      (2,011,885)             (13,777)                69,324         (1,956,338) Cash and cash equivalents ‐ July 1        7,460,929              368,922            3,257,527        11,087,378 Cash and cash equivalents ‐ June 30 $    5,449,044 $         355,145 $       3,326,851 $     9,131,040

The notes to financial statements are an integral part of this statement. 35 CITY OF GROVER BEACH

PROPRIETARY FUNDS
STATEMENT OF CASH FLOWS (Continued)
For the Fiscal Year Ended June 30, 2023
Water Fund
Water
Conservation
Fund
Wastewater
Fund Totals
Reconciliation of operating income (loss) to net cash provided (used) by operating activities:

Operating income (loss) $       943,634 $         (19,282) $          177,900 $     1,102,252 Adjustments to reconcile operating activities:

Depreciation expense          200,146             124,335            324,481 Changes in assets, deferred outflows of resources,
liabilities and deferred inflows of resources:

Receivables, net            70,976               38,496            109,472 Prepaid expenses           (58,438)            (58,438) Inventories           (13,336)                                          (13,336) Deferred outflows        (285,513)           (163,544)          (449,057) Accounts payable          920,775                   781                (5,558)            915,998 Accrued payroll           (21,817)                  (222)              (16,931)            (38,970) Deposits            16,657                                            16,657 Compensated absences            28,487               14,920              43,407 Early retirement             (2,460)                (1,080)               (3,540) Net pension liability          566,147             394,014            960,161 Deferred inflows        (677,595)           (416,846)       (1,094,441) Net cash provided (used) by operating activities $    1,687,663 $          (18,723) $          145,706 $      1,814,646 The accompanying notes are an integral part of these financial statements. 36 CITY OF GROVER BEACH

FIDUCIARY FUNDS

STATEMENT OF FIDUCIARY NET POSITION
June 30, 2023
Successor Agency
Private‐Purpose
Trust Funds
Custodial
Funds
ASSETS
Cash and investments $             12,629  $       289,323 Cash and investments with fiscal agent               297,062 Accounts receivable ‐ other                1,319
Land held for projects               380,000
Total assets               689,691  $       290,642

LIABILITIES
Accounts payable and other liabilities                                           29,818 Accrued interest payable                 55,729
Due to local governments           312,376
Unearned revenue               222,375
Noncurrent liabilities
Due within one year               150,000
Due in more than one year           2,554,869
Total Liabilities           2,982,973  $       342,194

NET POSITION
Restricted for:

Individuals, organizations, and other governments          (2,293,282)            (51,552) Total net position $      (2,293,282) $        (51,552)

The accompanying notes are an integral part of these financial statements. 37 CITY OF GROVER BEACH

FIDUCIARY FUNDS

STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
For the Fiscal Year Ended June 30, 2023
Successor Agency
Private‐Purpose
Trust Funds Custodial Funds
Additions:

Taxes $           293,375  $           110,805
Interest 9,861                153,675
Security deposits
Building and planning deposits               108,226
Other                 30,726
Total additions               303,236                403,432 Deductions:

Community development 7,221                125,662
Payment of tourism marketing district tax to other governments               109,401 Refunds and transfers to other systems               164,728 Interest expense               134,342
Other expense 5,986
Total deductions               141,563                405,777 Change in net position               161,673 (2,345)
Total net position‐beginning         (2,454,955)               (49,207) Total net position‐ending $      (2,293,282) $            (51,552) The accompanying notes are an integral part of these financial statements. 38 CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
39 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
The accompanying basic financial statements present the financial activity of the City of Grover Beach. There are no component units included in this report which meet the criteria of GASB Statement No. 14, The Financial Reporting Entity, as amended by GASB Statements No. 39, No. 61, and No. 80.

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 is the acknowledged standard setting body for establishing accounting and financial reporting standards followed by governmental entities in the United States of America.

UGovernment‐wide Statements
The Statement of Net Position and the Statement of Activities display information about the City.

These statements include the financial activities of the overall City government, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities. The City does not eliminate interfund services provided and used during the process of consolidation. Governmental activities generally are financed through taxes, intergovernmental revenues, and other non‐exchange transactions.

The Statement of Activities presents a comparison between direct expenses and program revenues for each segment 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 function. Program revenues include (a) charges paid by the recipients of goods or services offered by the programs, (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. Revenuesthat are not classified as program revenues, including all taxes, are presented as general revenues.

UFund Financial Statements
The fund financialstatements provide information about the City’sfunds, including fiduciary funds.

Separate statements for each fund category—governmental, proprietary, and fiduciary—are presented. The emphasis of fund financial statements is on major individual funds, each of which is displayed in a separate column. All remaining governmental funds are aggregated and reported as nonmajor funds.

Proprietary fund financial statements include a Statement of Net Position; a Statement of Revenues, Expenses, and Changes in Net Position; and a Statement of Cash Flows for all

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
40 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) B. Basis of Presentation (Continued)
Fund Financial Statements (Continued)
proprietary funds.

Proprietary funds are accounted for using the economic resources measurement focus and the accrual basis of accounting. Accordingly, all assets and liabilities (whether current or noncurrent) are included on the Statement of Net Position. The Statement of Revenues, Expenses, and Changes in Net Position presentsincreases(revenues) and decreases(expenses) in total net position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which liability is incurred.

Operating revenues in the proprietary funds are those revenues that are generated from the primary operation of the fund. All other revenues are reported as nonoperating revenues.

Operating expenses are those expenses that are essential to the primary operations of the fund.

All other expenses are reported as nonoperating expenses.

Fiduciary funds are used to account for assets held by the City in a trustee capacity or as a custodian for individuals, private organizations, other governmental units, and/or other funds. Fiduciary Funds use the full accrual basis of accounting and a measurement focus on the periodic determination of additions, deductions, and net position restricted for others. Fiduciary funds are reported in the fund financial statements but are not included for government‐wide reporting purposes.

C. Major Funds
GASB Statement No. 34, defines major funds and requiresthat the City’s major funds are identified and presented separately in the fund financial statements. All other funds, called nonmajor funds, are combined and reported in a single column, regardless of their fund‐type.

Major funds are defined as funds that have either assets, liabilities, revenues, or expenditures/expenses equal to ten percent of their fund‐type total. The General Fund is always a major fund. The City may also select other funds it believes should be presented as major funds.

The City reported the following major governmental funds in the accompanying financial statements:

UGeneral FundU
This fund accounts for all financial resources except those to be accounted for in another fund. It is the general operating fund of the City.

UStreet Rehabilitation and Repair Fund
This is a special revenue fund that accounts for bond proceeds from the issuance of debt and is restricted to the repairs and maintenance of City streets.

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
41 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Major Funds (Continued)
Street Improvements Debt Service Fund
This fund is held by the County of San Luis Obispo and pays the semiannual principal and interest payments for the general obligation bonds issued to finance street improvements within the City.

The City reported the following major proprietary funds:

UWater Fund
This fund accounts for the activities of providing water to residents of the City.

UWastewater Fund
Thisfund accountsfor the activities associated with the sewage treatment plant, pumping stations, and collection systems.

UWater Conservation Fund
This fund accounts for water conservation fees and is restricted to improving water conservation within the City.

D. Basis of Accounting
The government‐wide, proprietary funds, and fiduciary funds financial statements are reported using the economic resources measurement focus and the full accrual basis of accounting.

Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place.

Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. The City considers all revenues reported in the governmental funds to be available if the revenues are collected within sixty days after the fiscal year‐end. Expenditures are recorded when the related fund liability isincurred, except for principal and interest on general long‐term debt, claims and judgments, and compensated absences, which are recognized as expenditures to the extent that they have matured. Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of long‐term debt and acquisitions under financed purchases are reported as other financing sources.

Non‐exchange transactions, in which the City gives or receives value without directly receiving or giving equal value in exchange, include property taxes, grants, entitlements, and donations. On an accrual basis, revenues from property taxes are recognized in the fiscal year for which the taxes are levied. Revenue from grants, entitlements, and donations is recognized in the fiscal year in which all eligibility requirements have been satisfied. Other revenues susceptible to accrual include other taxes, intergovernmental revenues, interest, and charges for services. 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‐

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
42 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) D. Basis of Accounting (Continued)
reimbursement grants, categorical block grants, and general revenues. Thus, both restricted and unrestricted net assets may be available to finance program expenditures/expenses. The City’s policy is to first apply restricted grant resources to such programs, followed by general revenues if necessary.

E. Compensated Absences
In compliance with Governmental Accounting Standards Board Statement No. 16, the City has established a liability for accrued sick leave and vacation in relevant funds. For governmental type funds, the current liability appears in the respective funds. All vacation paid is accrued when incurred in the government‐wide and proprietary funds financial statements. This liability is set up for the current employees at the current rates of pay. If sick leave and vacation are not used by the employee during the term of employment, compensation is payable to the employee at the time of retirement. Sick leave is only payable to employees participating in the Public Employees’ Retirement System. Such compensation is calculated at the employee’s prevailing rate at the time of retirement or termination. Each fiscal year, an adjustment to the liability is made based on pay rate changes and adjustments for the current portion. The General Fund is primarily responsible for the repayment of the governmental portion of compensated absences.

F. Property Taxes
California Constitution Article XIII A limits the combined property tax rate to one percent of a property’s assessed valuation. Additional taxes may be imposed with voter approval. Assessed value is calculated at one hundred percent of a property’s fair value, as defined by Article XIII A, and may be increased no more than two percent per year unless a change in ownership occurs.

The State Legislature has determined the method of distributing the one percent tax levy among the various taxing jurisdictions.

Property tax revenues are recognized in the fiscal year for which taxes have been levied and collected within sixty days of the fiscal year end. Property taxes are billed and collected as follows on the next page:

USecuredU UUnsecured
Valuation/Lien Date(s) January 1 January 1
Levy Date(s) July 1 July 1
Due Date(s) November 1 (50%) August 1
February 1 (50%)
Delinquency Date(s) December 10 (November) August 31
April 10 (February)

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
43 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) G. Capital Assets
All capital assets are valued at historical cost or estimated historical cost if actual historical cost is not available. Contributed capital assets are valued at their estimated fair value on the date contributed. Any donated capital assets or donated works of art and similar items are valued at their acquisition value rather than fair value. Any capital assets received in a service concession arrangement are valued at their acquisition value. The City’s policy is to capitalize all capital assets with costs exceeding the minimum thresholds at $5,000, except for infrastructure at $25,000 and with useful lives exceeding one year.

With the implementation of GASB Statement No. 34, the City was not required to record infrastructure assets existing or acquired prior to July 1, 2001. The City elected not to record such infrastructure assets. The City may elect to record such infrastructure assets in the future.

The purpose of depreciation is to spread the cost of capital assets equitably among all users over the life of these assets. The amount charged to depreciation expense each fiscal year represents that fiscal year’s pro rata share of the cost of capital assets. GASB Statement No. 34 requires that all capital assets with limited useful lives be depreciated over their estimated useful lives.

Depreciation is provided using the straight‐line method which means the cost of the asset is divided by its expected useful life in years and the result is charged to expense each fiscal year until the asset is fully depreciated. The City has assigned the useful lives listed below to capital assets.

Structures and Improvements 50 years
Equipment   5‐25 years
Infrastructure   15‐50 years
H. Deferred Outflows and Inflows of Resources
Pursuant to GASB Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position, and GASB Statement No. 65, Items Previously Reported as Assets and Liabilities, the City recognizes deferred outflows and inflows of resources.

In addition to assets, the Statement of Net Position will sometimes report a separate section for deferred outflows of resources. A deferred outflow of resources represent a consumption of net assets that applies to future periods. The City has one item which qualifies for reporting in this category, refer to Note 7 for a detailed listing of the deferred outflows of resources the City has recognized.

In addition to liabilities, the Statement of Net Position will sometimesreport a separate section for deferred inflows of resources. A deferred inflow of resourcesrepresent an acquisition of net assets that applies to future periods. The City has two items which qualify for reporting in this category; refer to Note 7 and Note 15 for a detailed listing of the deferred inflows of resources the City has recognized.

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
44 NOTE 1 ‐ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) I. Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenditures, or expenses as appropriate. Actual results could differ from those estimates.

J. Cash Equivalents
For purposes of the Statement of Cash Flows, the City considers all highly liquid investment instruments purchased with a maturity of three months or less to be cash equivalents.

K. Fund Balances
Fund balances of the governmental funds are classified as follows:

Nonspendable Fund Balance – represents amounts that cannot be spent because they are either not in spendable form (such as inventory or prepaid insurance) or legally required to remain intact (such as notes receivable or principal of a permanent fund).

Restricted Fund Balance – represents amounts that are constrained by external parties, constitutional provisions or enabling legislation.

Committed Fund Balance – represents amounts that can only be used for a specific purpose because of a formal action by the City’s governing board. Committed amounts cannot be used for any other purpose unless the governing board removes those constraints by taking the same type of formal action. Committed fund balance amounts may be used for other purposes with appropriate due process by the governing board. Commitments are typically done through adoption and amendment of the budget. Committed fund balance amounts differ from restricted balances in that the constraints on their use do not come from outside parties, constitutional provisions, or enabling legislation.

Assigned Fund Balance – represents amounts which the City intends to use for a specific purpose, but that do not meet the criteria to be classified as restricted or committed. Intent may be stipulated by the governing board or by an official or body to which the governing board delegates the authority. Specific amounts that are not restricted or committed in a special revenue, capital projects, debt service, or permanent fund are assigned for purposesin accordance with the nature of their fund type or the fund’s primary purpose. Assignments within the general fund conveys that the intended use of those amounts is for a specific purpose that is narrower than the general purpose of the City.

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
45 NOTE 1 ‐ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) K. Fund Balances (Continued)
Unassigned Fund Balance – represents amounts which are unconstrained in that they may be spent for any purpose. Only the general fund reports a positive unassigned fund balance. Other governmental funds might report a negative balance in this classification because of overspending for specific purposes for which amounts had been restricted, committed, or assigned.

When an expenditure is incurred for a purpose for which both restricted and unrestricted fund balance is available, the City considers restricted funds to have been spent first. When an expenditure is incurred for which committed, assigned, or unassigned fund balances are available, the City considers amounts to have been spent first out of committed funds, then assigned funds, and finally unassigned funds.

L. Net Position
GASB Statement No. 63 requires that the difference between assets added to the deferred outflows of resources and liabilities added to the deferred inflows of resources be reported as net position. Net position is classified as either net investment in capital assets, restricted, or unrestricted.

Net position that is net investment in capital assets consist of capital assets, net of accumulated depreciation, and reduced by the outstanding principal of related debt. Unspent bond proceeds should be reported as either restricted or unrestricted assets, as appropriate, and the related portion of the bonded debt should be reported in the same component of net position as the unspent proceeds, and therefore will not have any net effect on any classifications of net position.

Restricted net position is the portion of net position that has external constraints placed on it by creditors, grantors, contributors, laws, or regulations of other governments, or through constitutional provisions or enabling legislations. Unrestricted net position consists of net position that does not meet the definition of net investment in capital assets or restricted net position.

M. 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 California Public Employees’ Retirement System (CalPERS) Miscellaneous and Safety Plans and additions to/deductions from Plans’ fiduciary net position have been determined on the same basis as they are reported by CalPERS. 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. The General Fund is primarily responsible for the repayment of the governmental portion of the pension liability.

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
46 NOTE 1 ‐ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) N.         Accounting Pronouncements
GASB Statements listed below were implemented in the current year financial statements:

Statement No. 91 "Conduit Debt Obligations" The provisions of this statement are effective for fiscal years ending after December 15, 2022.

Statement No. 93 "Replacement of Interbank Offered The provision of this statement except for paragraphs Rates" 11b, 13, and 14 are effective for fiscal years beginning after June 15, 2020. Paragraph 11b is effective for fiscal years beginning after December 31, 2021. Paragraphs
13 and 14 are effective for fiscal years beginning after June 15, 2021.

Statement No. 94 "Public-Private and Public-Public The provisions of this statement are effective Partnerships and Availability for fiscal years beginning after June 15, 2022.

Payment Arrangements"
Statement No. 95 "Postponement of the Effective The provision of this Statement are effective Dates of Certain Authoritative Guidance" for fiscal years beginning after June 15, 2022.

Statement No. 96 "Subscription-Based Information The provisions of this statement are effective Technology Arrangements" for fiscal years beginning after June 15, 2022.

Statement No. 98 "The Annual Comprehensive Financial The provisions of this statement are effective Report" for fiscal years ending after December 15, 2021.

Statement No. 99 "Omnibus 2022"
GASB Statements listed below will be implemented in future year financial statements:

Statement No. 99 "Omnibus 2022"
Statement No. 100 "Accounting Changes and The provisions of this statement are effective Error Corrections" for fiscal years beginning after June 15, 2023 Statement No. 101 "Compensated Abesenses" The provisions of this statement are effective for fiscal years beginning after December 15, 2023
The requirements related to extension of the use of LIBOR, accounting for SNAP distributions, disclosures of nonmonetary transactions, pledges of future revenues by pledging governments, clarification of certain provisions in Statement 34, as amended, and terminology updates related to Statement 53 and Statement 63 are effective upon issuance.

The requirements related to financial guarantees and the classification and reporting of derivative instruments within the scope of Statement 53 are effective for fiscal years beginning after June 15, 2023, and all reporting periods thereafter.

The requirements related to leases, PPPs, and SBITAs are effective for fiscal years beginning after June 15, 2022, and all reporting periods thereafter.

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
47 NOTE 1 ‐ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) O.         Leases
Lessee:  The City is a lessee for a noncancellable lease of equipment.  The City of Grover Beach recognizes a lease liability and an intangible right‐to‐use lease asset in the government‐wide financial statements.  The City recognizes lease liabilities with an initial individual value of $50,000 or more.

At the commencement of a lease, the City initially measures the lease liability at the present value of payments expected to be made during the lease term. Subsequently, the lease liability is reduced by the principal portion of the lease payments made.  The lease asset is initially measured as the initial amount of the lease liability, adjusted for lease payments made at or before the lease commencement date, plus certain initial direct costs.  Subsequently, the lease asset is amortized on a straight‐line basis over its useful life.

Key estimates and judgements related to leases include how the City determines 1) the discount rate it uses to discount the expected lease payments to present value, 2) lease term, and 3) lease payments,
 The City usesthe interestrate charged by the lessor asthe discount rate.  When the interest rate charged by the lessor is not provided, the City generally usesits estimated incremental borrowing rate as the discount rate for leases.
 The lease term includes the noncancellable period of the lease.  Lease payments included in the measurement of the lease liability are composed of fixed payments and purchase option price that the City is reasonably certain to exercise.

The City monitors changes in circumstances that would require a remeasurement of its lease and will remeasure the lease asset and liability if certain changes occur that are expected to significantly affect the amount of the lease liability.

Lease assets are reported with the other capital assets and lease liabilities are reported with long‐ term debt on the statement of net position.

P.         Subscription‐Based Assets and Liabilities
Change in Accounting Principle
The City accounts for Subscription‐Based Information Technology Arrangements (“SBITAs”) in accordance with GASB Statement No. 96, Subscription‐Based Information Technology Arrangements, which was implemented by the City for the year ended June 30, 2023.   This statement provides guidance on accounting and financial reporting for SBITAsfor government end users.  SBITAs are defined as a contract that conveys control of the right to use another party’s information technology (IT) software, alone or in combination with tangible capital assets, as specified in the contract for a period of time in an exchange or exchange‐like transaction.  A

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
48 NOTE 1 ‐ SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) government is required to recognize a right‐to‐use subscription asset – an intangible asset – and a corresponding subscription liability.  The subscription liability is measured at the present value of the subscription payments expected to be made during the subscription term.  Future payments are discounted using an incremental borrowing rate of 2.656%.  Due to the implementation of this statement, the City recognized and recorded $363,268 as a right‐to‐use subscription asset, along with $344,613 as a related subscription liability, and $18,655 of initial implementation stage outlay as of July 1, 2022.

The City’s right of use SBITAs is included in capital assets on the Statement of Net Position.  See Note 4.  See Note 6 for information on the City’s SBITA activities and balances for the year ended June 30, 2023.  The City has not recorded a restatement of beginning net position for the year ended June 30, 2022 for the implementation of this Standard, since such restatement would be immaterial in relation to the financial statements taken as a whole.

NOTE 2 ‐ STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
A.   Budgetary Information
Annual budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America for governmental funds. The City’s budget ordinance requires that by June 1P
stP each year, the City Manager must submit a preliminary budget that includes projected expenditures and the means of financing them, to the City Council for the fiscal year commencing the following July 1. As modified during public study sessions, the preliminary budget becomesthe proposed budget. Following public hearings on the proposed budget, the final annual budget is adopted by the City Council in June of the next fiscal year. After adoption of the final budget, transfers of appropriations within a general fund department, or within other funds, can be made by the City Manager.

Budgeted expenditures may be reallocated within a fund by the City Manager, and within a department program by the department director, but any inter‐fund transfers or reallocation must be approved by resolution of the City Council. Numerous properly authorized amendments are made during the fiscal year. Budgetary control is enhanced by integrating the budget into the general ledger accounts. Encumbrance accounting is employed (e.g., purchase orders) to avoid expenditures over budget. Encumbrances outstanding at fiscal year‐end are automatically rebudgeted in the following fiscal year.

B.   Excess of Expenditures Over Appropriations
Excess of expenditures over appropriations in individual funds are as follows:

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
49 NOTE 2 ‐ STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (Continued)

Major Funds:

General Fund:

Public Works 107,144 $
Parks and Recreation 17,283 $
Capital Outlay 223,403 $
Nonmajor Funds:

Special Revenue Fund:

CDBG Non‐Entitlement 239,646 $
NOTE 3 – CASH AND INVESTMENTS
Cash and investments are classified in the financial statements as shown below, based on whether their use is restricted under the terms of the City’s debt instruments or Agency’s agreements:

Cash and Investments 30,434,895 $
Total cash and investments, statement of net position 30,434,895 Cash and Investments 301,952
Cash and investments with fiscal agent 297,062
Total cash and investments, statement of fiduciary net position 599,014 Total cash and investments 31,033,909 $
On June 30, 2022, the City had the following cash and investments on hand:

Cash on hand 1,252 $
Demand deposits with financial institutions 10,231,374
Investments 20,801,283
Total cash and investments 31,033,909 $
Fair Value Measurements
The City categorizes its fair value investments within the fair value hierarchy established by generally accepted accounting principles. Investment securities classified in Level 1 of the fair value hierarchy are valued using prices quoted in active markets for those securities. Investment securities classified in Level 2 of the fair value hierarchy are valued using matrix pricing or market corroborated pricing. Matrix pricing is used to value securities based on the securities’ relationship to benchmark quoted prices. Investment securities classified in Level 3 of the fair value hierarchy are valued using significant unobservable inputs.

At June 30, 2023, the City had investments in money market funds and the San Luis Obispo County Investment Pool which are measured under Level 2 of the fair value hierarchy.  The City’s investments in US Agency securities and corporate medium‐term notes are classified in Level 2 of the fair value hierarchy and are valued using a matrix pricing technique.  Matrix pricing is used to value securities based on the

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
50 NOTE 3 – CASH AND INVESTMENTS (Continued)
securities’ relationship to benchmark quoted prices.  The City’s remaining investments are held in the Local Agency Investment Fund (LAIF), which is not subject to the fair value hierarchy.

Investment Type June 30, 2023 Level 1 Level 2 Level 3
San Luis Obispo County
Investment Pool 2,671,338 $        ‐ $                     $        ‐ 2,671,338 $ US Agency Securities 997,420                            997,420 Corporate Medium Term Notes 963,177                            963,177 $        ‐ 4,631,935 $                     $        ‐ 4,631,935 $ Investments at Amortized Cost
Held by Bond Trustees:

Money Market Funds 297,062
Investments not Subject to Hierarchy
LAIF 15,872,286
Total Investments 20,801,283 $
Investments Authorized by the California Government Code and the City’s Investment Policy The table below identifies the investment types that are authorized for the City by the California Government Code. The table also identifies certain provisions of the California Government Code that address interest rate risk, credit risk, and concentration of credit risk.

Authorized
Investment Type
Maximum
Maturity
Maximum
Percentage Of
Portfolio
Maximum
Investment
in One Issuer
Local Agency Bonds 5 years None None
U.S. Treasury Obligations 5 years 60% None
U.S. Agency Securities 5 years None None
Bankers' Acceptances 180 days 40% 30%
Commercial Paper 270 days 25% 10%
Negotiable Certificates of Deposit 1 year 20% None
Repurchase Agreements 1 year None None
Reverse Repurchase Agreements 92 days 20% of base value None Medium‐Term Notes 5 years 30% None
Mutual Funds N/A 20% 10%
Money Market Funds N/A 20% 10%
Local Agency Investment Fund (LAIF) N/A None None
JPA Pools (other investment pools) N/A None None
Guaranteed Investment Contracts 15months None None
Canadian Government Obligations 5 years None None

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
51 NOTE 3 – CASH AND INVESTMENTS (Continued)
Investments Authorized by Debt Agreements
Investment of note proceeds held by note trustees are governed by the provisions of the debt agreements, rather than the general provisions of the California Government Code or the City’s investment policy. The table on the following page identifies the investment types that are authorized for investments held by fiscal agents. The table also identifies certain provisions of these debt agreements that address interest rate risk, credit risk, and concentration of credit risk.

Authorized
Investment Type
Maximum
Maturity
Maximum
Percentage
Of
Portfolio
Maximum
Investment
in One Issuer
Money market accounts N/A None None
Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of itsfair value to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer‐term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations.

Information about the sensitivity of the fair values of the City’s investments (including investments held by bond trustees) to market interest rate fluctuations is provided by the following table that shows the distribution of the City’s investments by maturity:

Investment Type
Carrying
Amount
12 Months Or
Less
13‐24
Months
25‐60
Months
More than
60 Months
LAIF 15,872,286 $     $ ‐ 15,872,286 $               ‐ $               ‐ $ San Luis Obispo County
Investment Pool 2,671,338                 2,671,338
Held by bond trustees:

Money market funds 297,062                        297,062 US Agency Securities 997,420                        997,420 Corporate Medium Term Notes 963,177                        239,754        235,653        487,770 $    20,801,283 $20,077,860 $     235,653 $      ‐ 487,770 $ Remaining Maturity (in Months)
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 rating by a nationally recognized statistical rating organization. Presented on the following page is the minimum rating required by (where applicable) the

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
52 NOTE 3 – CASH AND INVESTMENTS (Continued)
California Government Code, the City’s investment policy, or debt agreements, and the actual rating as of fiscal year end for each investment type.

Minimum Not
Carrying Legal Required to
Investment Type Amount Rating be Rated AAA AA Not Rated LAIF 15,872,286 $     N/A 15,872,286 $     ‐ $               ‐ $               ‐ $ San Luis Obispo County
Investment Pool 2,671,338           N/A 2,671,338
Held by bond trustees:

Money market funds 297,062              N/A 297,062
US Agency Securities 997,420                     997,420 Corporate Medium Term Notes 963,177              N/A 963,177 $    20,801,283 $    15,872,286 $      ‐ 997,420 $               $    3,931,577 Rating as of Fiscal Year End
Concentration of Credit Risk
The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. There are no investments in any one issuer that represent 5% or more of total City’s investments.

UCustodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The California Government Code and the City’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits, 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 waived by the governmental unit).  The fair value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure the City’s deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.

None of the City’s deposits with financial institutions in excess of the Federal Depository Insurance Corporation’s limits were held in uncollateralized accounts.

The 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’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for investments. With respect to investments, custodial credit risk generally applies only to direct investments in marketable securities. Custodial credit risk does not apply to a local government’s indirect investment in securities with mutual funds or government investment pools (such

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
53 NOTE 3 – CASH AND INVESTMENTS (Continued)
as LAIF or the San Luis Obispo County Investment Pool).

U
Investment in State Investment Pool
The City is 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. The fair value of the City’s investment in this pool is reported in the accompanying basic financial statements at the amounts based upon the City’s pro‐rata share ofthe fair value provided by LAIF forthe entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis.

NOTE 4 – CAPITAL ASSETS
Capital asset activity for the City’s governmental activities for the fiscal year ended June 30, 2023, is as follows:

Balance
June 30, 2022 Additions Deletions
Transfers/
Reclass
Balance
June 30, 2023
Non‐depreciable capital assets
Land 1,890,915 $       ‐ $                  ‐ $                    ‐ $                       $       1,890,915 Construction in progress 636,489                     1,143,213           (642,245)          1,137,457 Total nondepreciable capital assets 2,527,404 $       $      ‐ 1,143,213 $                    $       (642,245) $       3,028,372 Depreciable capital assets
Equipment 2,332,873 $       $          ‐ 347,487 $                $         314,068 $       2,994,428 Right‐to‐use leased equipment 371,147              $          371,147 Subscription intangible asset 363,268             $          363,268 Buildings and improvements 26,348,475                     70,595            (9,700)            328,177        26,737,547 Total depreciable capital assets 29,052,495                   781,350            (9,700)            642,245        30,466,390 Accumulated depreciation
Equipment 1,676,242                     371,427          2,047,669 Right‐to‐use leased equipment 18,557                             74,229                92,786 Subscription intangible asset 53,145                              53,145 Buildings and improvements 7,807,300                     579,369            (9,700)          8,376,969 Total accumulated depreciation 9,502,099                 1,078,170            (9,700)        10,570,569 Net depreciable capital assets 19,550,396 $     $        ‐ (296,820) $                    $         642,245 $    19,895,821 Net capital assets $    22,077,800 $          ‐ 846,393 $                    ‐ $                       $    22,924,192

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
54 NOTE 4 – CAPITAL ASSETS (Continued)
Capital asset activity for the City’s business‐type activities for the fiscal year ended June 30, 2023, is as follows:

Balance
June 30, 2022 Additions Deletions Transfers/Reclass
Balance
June 30, 2023
Non‐depreciable capital assets
Land 60,125 $            $         ‐ 200,724 $                    ‐ $                      $          260,849 Construction in progress 2,117,095                     ‐ 153,950                             (1,977,261)             293,784 Total nondepreciable capital assets 2,177,220 $       $         ‐ 354,674 $                    $    (1,977,261) $          554,633 Depreciable capital assets
Capacity rights 1,598,578 $       ‐ $                      ‐ $                    ‐ $                      $       1,598,578 Equipment 749,311                           ‐ 29,917                  ‐                                 779,228 Infrastructure 12,131,358                      ‐ 25,515                          1,977,261        14,134,134 Total depreciable capital assets 14,479,247                      ‐ 55,432                               1,977,261        16,511,940 Accumulated depreciation
Capacity rights 998,321                           ‐ 31,971                  ‐                              1,030,292 Equipment 543,910                           ‐ 45,652                  ‐                                 589,562 Infrastructure 6,234,826                     ‐ 246,858                  ‐                              6,481,684 Total accumulated depreciation 7,777,057                    324,481          8,101,538 Net depreciable capital assets 6,702,190 $       $        ‐ (269,049) $                    $     1,977,261 $       8,410,402 Net capital assets $      8,879,410 $           ‐ 85,625 $                    ‐ $                      $       8,965,035 Depreciation expense the City’s governmental and business‐type activities for the fiscal year ended June 30, 2023, is as follows:

Governmental Activities:

General Government 233,685 $
Public Safety 257,535
Parks and Recreation              72,262
Public Works 514,688
Total depreciation expense ‐ governmental activities 1,078,170 $ Business‐type Activities:

Water 200,146 $
Wastewater 124,335
Total depreciation expense ‐ business‐type activities 324,481 $

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
55 NOTE 5 – INTERFUND TRANSACTIONS
Due from/due to:

Receivable Fund Payable Fund Amount
General Fund Nonmajor Governmental Funds 197,945 $
These amounts include balances of working capital loans made to several nonmajor governmental funds, which the general fund expects to collect in the subsequent year.

Advances from/to other funds:

Advances receivable and payable constitute long‐term borrowing between funds. Each advance carries a state interest rate and has scheduled debt service payments. Interfund advances receivable and payable balance on June 30, 2023, are as follows:

Receivable Fund Payable Fund Amount
Wastewater Fund General Fund 1,175,589 $
Interfund transfers:

Enterprise
Fund
Enterprise
Fund
Enterprise
Fund
General Fund
Street
Rehabilitation
and Repair Fund
Nonmajor
Governmental
Funds    Water Fund
Water
Conservation
Fund
Wastewater
Fund Total
Transfers out:

General Fund 1,876 $                  $           359,473 $          6,173 $                  62 $        19,923 $           387,445 Nonmajor Governmental Funds 9,000                              554,519           32,253           85,000               680,772 Enterprise Fund‐Water Fund 361,541                             94,990               456,531 Enterprise Fund‐Wastewater Fund 176,000                              1,170               177,170 Total 546,541 $         $               96,866 $           915,162 $        38,426 $                  62 $     104,923 $        1,701,918 Transfers in:

During the year, transfers are mainly used to move overhead cost allocations from the Enterprise Funds to the General Fund and move funding from various funds to pay for capital improvement projects.

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
56 NOTE 6 – LONG‐TERM LIABILITIES
U Changes in Long‐Term Liabilities
Long‐term liability activity for the fiscal year ended June 30, 2023, was as follows:

Balance Balance Due Within
June 30, 2022 Additions Deletions June 30, 2023 One Year Governmental Activities:

General obligations bonds 35,135,000 $             $                 775,000 $            34,360,000 $                810,000 Unamortized premium 2,999,487                                      136,142                 2,863,345                   136,142 Total general obligation bonds 38,134,487                                    911,142               37,223,345                   946,142 State loan 112,454                                            24,556                       87,898                     24,800 Early retirement incentive 13,529                                                5,460                         8,069                       2,460 Compensated absences 577,732                                          249,497                       46,253                     780,976                     62,478 Financed purchases 70,509                                               ‐ 70,509                                   ‐ Lease liability 371,147                                            57,242                     313,905                     59,013 Subscription liability 344,613                                          117,895                     226,718                   111,873 Net pension liability 6,391,237                                  8,128,028                 1,075,990               13,443,275 Total governmental activities 45,671,095 $             $              8,722,138 $              2,309,047 $            52,084,186 $            1,206,766 Business‐type Activities:

Water revenue bond 4,102,000 $               $                 184,000 $              3,918,000 $                188,000 Early retirement incentive 7,697                                                  3,540                         4,157                       3,155 Compensated absences 108,630                                            52,325                         8,918                     152,037                     12,481 Net pension liability 1,186,421                                  2,707,899                 1,747,737                 2,146,583 Total business‐type activities 5,404,748 $               $              2,760,224 $              1,944,195 $              6,220,777 $                203,636 Compensated Absences
Governmental Accounting Standards Board Statement No. 16 identifies certain items that should be accrued as a liability as the benefits are earned by the employees but only to the extent it is probable that the employer will compensate the employees for the benefits through cash payments conditioned on the employee’s termination or retirement.

City employees accumulate earned but unused benefits which can be converted to cash at termination of employment. The non‐current portion of these vested benefits, payable in accordance with various collective bargaining agreements, on June 30, 2023, total $780,976 for governmental activities and $152,037 for business‐type activities.

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
57 NOTE 6 – LONG‐TERM LIABILITIES (Continued)
UState Loan
The City entered into a loan agreement with the California Energy Resources Conservation and Development commission for an energy savings project. Loan funds were disbursed on a reimbursement basis. The project was completed on December 31, 2011. Loan payments began on December 22, 2012, and terminate December 22, 2026, with an annual interest rate of 1.00% payable on a semi‐annual basis.

Future minimum payment obligations for the loan payable on June 30, 2023, as shown on the following page:

Fiscal year Ending June 30 Principal Interest Total
2024 24,800 $         $           819 $        25,619
2025 25,051                          568           25,619 2026 25,302                          317           25,619 2027 12,746                            66           12,812 $        87,899 $        1,770 $        89,669
General Obligation Bonds
The City is authorized to issue general obligation bondsin an amount not to exceed $48,000,000 to finance improvementsto streets within the City. The bonds were authorized at an election of the registered voters of the City held on November 4, 2014.

On March 10, 2015, the City issued $5,000,000 of those bonds at a premium of $376,225. The bonds are payable semiannually on March 1 and September 1 of each year with interest rates varying from 3% to 5%. The bonds are subject to optional and mandatory redemption prior to maturity. As of June 30, 2023, $4,090,000 was still outstanding.

Future minimum payment obligations for the bonds on June 30, 2023, are as follows:

Fiscal year Ending June 30 Principal Interest Total
2024 155,000 $          $         155,057 $         310,057 2025 165,000                          147,056             312,056 2026 175,000                          138,556             313,556 2027 180,000                          129,681             309,681 2028 190,000                          120,432             310,432 2029‐2033 1,080,000                      481,512         1,561,512 2034‐2038 1,265,000                      292,902         1,557,902 2039‐2041 880,000                            53,800             933,800 $      4,090,000 $      1,518,996 $      5,608,996

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
58 NOTE 6 – LONG‐TERM LIABILITIES (Continued)
UGeneral Obligation Bonds (Continued)
On April 16, 2016, the City issued $8,000,000 of those bonds at a premium of $509,358. The bonds are payable semiannually on March 1 and September 1 of each year with interest rates varying from 2% to 5%. The bonds are subject to optional and mandatory redemption prior to maturity. As of June 30, 2023, $6,715,000 was still outstanding.

Future minimum payment obligations for the bonds on June 30, 2023, are as follows:

Fiscal year Ending June 30 Principal Interest Total
2024 245,000 $          $         225,969 $         470,969 2025 260,000                          213,344            473,344 2026 270,000                          200,094            470,094 2027 285,000                          186,219            471,219 2028 300,000                          173,094            473,094 2029‐2033 1,660,000                      700,170        2,360,170 2034‐2038 1,930,000                      429,520        2,359,520 2039‐2042 1,765,000                      115,841        1,880,841 $      6,715,000 $      2,244,251 $     8,959,251
On December 5, 2017, the City issued $15,000,000 of those bonds at a premium of $1,110,466. The bonds are payable semiannually on March 1 and September 1 of each year with interest rates varying from 3% to 5%. The bonds are subject to optional and mandatory redemption prior to maturity. As of June 30, 2023, $13,555,000 was still outstanding.

Future minimum payment obligations for the bonds on June 30, 2023, are as follows:

Fiscal year Ending June 30 Principal Interest Total
2024 410,000 $          $         492,600 $         902,600 2025 430,000                         471,600            901,600 2026 450,000                         449,600            899,600 2027 470,000                         426,600            896,600 2028 495,000                         402,475            897,475 2029‐2033 2,870,000                  1,608,650        4,478,650 2034‐2038 3,495,000                  1,008,525        4,503,525 2039‐2043 4,050,000                      444,000        4,494,000 2044 885,000                           13,275            898,275 $   13,555,000 $      5,317,325 $   18,872,325

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
59 NOTE 6 – LONG‐TERM LIABILITIES (Continued)
On January 26, 2022, the City issued $10,000,000 of those bonds at a premium of $1,457,191. The bonds are payable semiannually on March 1 and September 1 of each year with interest rates varying from 3% to 5%. The bonds are subject to optional and mandatory redemption prior to maturity. As of June 30, 2023, $10,000,000 was still outstanding.

Future minimum payment for the bonds on June 30, 2023, are as follows:

Fiscal year Ending June 30 Principal Interest Total
2024 $                 ‐ $        363,800 $         363,800 2025 363,800                       363,800
2026 363,800                       363,800
2027 15,000                         363,800            378,800 2028 15,000                         363,350            378,350 2029‐2033 90,000                      1,448,250         1,538,250 2034‐2038 90,000                      1,790,450         1,880,450 2039‐2043 1,240,000                1,752,250         2,992,250 2044‐2048 8,550,000                   944,400         9,494,400 $   10,000,000 $     7,753,900 $   17,753,900
Water Revenue Bond
On February 26, 2020, the City issued $4,456,000 of water revenue bonds to use for capital projects. The bonds are payable semiannually on March 1 and September 1 of each year with an interest rate of 2.43%.

As of June 30, 2023, $3,918,000 is still outstanding.

Future minimum payment for the bonds on June 30, 2023, are as follows:

Fiscal year Ending June 30 Principal Interest Total
2024 188,000 $          $                    92,923 $                280,923 2025 193,000                                   88,294                    281,294 2026 198,000                                   83,543                    281,543 2027 203,000                                   78,670                    281,670 2028 208,000                                   73,677                    281,677 2029‐2033 1,118,000                              289,166                1,407,166 2034‐2038 1,261,000                              144,811                1,405,811 2039‐2040 549,000                                   13,424                    562,424 $     3,918,000 $                  864,508                4,782,508

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
60 NOTE 6 – LONG‐TERM LIABILITIES (Continued)
The City has pledged future watersystem revenues, net ofspecific operating expenses, to repay the bonds on parity with a pledge that services all parity obligations.   The bonds are payable solely from water customer net revenues.  For the year ended June 30, 2023, principal and interest paid, and total customer net revenues were $279,878 and $1,040,796, respectively.   This debt issue is subject to a reserve requirement in conjunction with parity debt issued by the City.  The City isin compliance with the revenue rate covenant requiring net revenues of the water system to be at least equal to 1.2 times the amount necessary to pay principal and interest on the bonds and all other parity bonds.

Lease Liability
In the prior fiscal year, the City entered into a five‐year lease agreement as lessee for the acquisition of a command post vehicle for the Police Department.  An initial lease liability was recorded in the amount of $371,147 during the prior fiscal year.  The annual principal and interest payments are due on March 28 each year with an interest rate of 3.095%.  Future minimum lease payments are as follows:

Fiscal year Ending June 30 Principal Interest Total
2024 59,013 $           $      9,715 $      68,728
2025 60,840                        7,889          68,729 2026 62,723                        6,006          68,729 2027 64,664                        4,065          68,729 2028 66,665                        2,063          68,728 Totals 313,905 $         $    29,738 $    343,643
Subscriptions Liability
In the current fiscal year, the City entered into a 36 month subscription for the use of an ERP system. An initial subscription liability was recorded in the amount of $344,613. As of June 30, 2023, the value of the subscription liability is $226,718. The City is required to make annual fixed payments of $117,895. The subscription has an interest rate of 2.6560%. The value of the right to use the asset as of June 30, 2023 is $363,268 with accumulated amortization of $53,145. Future payments are as follows:

Fiscal year Ending June 30 Principal Interest Total
2024 111,873 $         $      6,022 $    117,895
2025 114,845                     3,050       117,895
Totals 226,718 $         $      9,072 $    235,790

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
61 NOTE 7 – PENSION PLANS
A.     General Information about the Pension Plans
Plan Descriptions
All qualified permanent and probationary employees are eligible to participate in the City’s separate Safety (Police and Fire) or Miscellaneous Employee Pension Plans (Plans), cost‐sharing multiple employer defined benefit plans administered by the California Public Employees’ Retirement System (CalPERS).

Benefit provisions under the Plans are established by State statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.

Benefits Provided
CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full‐time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non‐duty disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost‐of‐living adjustments for each plan are applied as specified by the Public Employees’ Retirement Law.

The Plans’ provisions and benefits in effect on June 30, 2023, are summarized as follows:

Prior to On or after
Hire Date January 1, 2013 January 1, 2013
Benefit formula 2% @ 55 2% @ 62
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50‐63 52‐67
Monthly benefits, as a % of eligible compensation 1.426% to 2.418% 1.0% to 2.5% Required employee contribution rates 8.00% 6.75%
Required employer contribution rates 12.21% + $657,340 7.47% + $17,976 Prior to On or after
Hire Date January 1, 2013 January 1, 2013
Benefit formula 3.0% @ 55 2.7% @ 57
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50 50‐57
Monthly benefits, as a % of eligible compensation 3.00% 2.0% to 2.7% Required employee contribution rates 12.00% 13.00%
Required employer contribution rates 21.84% + $494,669 12.78% + $10,277 Miscellaneous
Safety‐Police

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
62 NOTE 7 – PENSION PLANS (Continued)
Prior to On or after
Hire Date January 1, 2013 January 1, 2013
Benefit formula 1/2% @ 55 2.0% @ 55
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50‐55 50‐55
Monthly benefits, as a % of eligible compensation 1.783% to 2.5% 1.426% to 2.0% Required employee contribution rates N/A N/A
Required employer contribution rates 0% + $42,020 N/A
Safety‐Fire
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 Plans are determined annually on an actuarial basis as of June 30 by CalPERS. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.

For the year ended June 30, 2023, the contributions recognized as part of pension expense for each Plan were as follows:

Miscellaneous Safety
Contributions‐employer 921,270 $                           $                          858,085 On June 30, 2023, the City reported net pension liabilities for its proportionate shares of the net position liability of each Plan as follows:

Proportionate Share of
Net Pension Liability
Miscellaneous 8,813,149 $
Safety 6,776,709
Total 15,589,858 $

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
63 NOTE 7 – PENSION PLANS (Continued)
B.     Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
The net pension liability was measured as of June 30, 2022, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2021, rolled forward to June 30, 2022, 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 plans relative to the projected contributions of all Pension Plan participants, actuarially determined.

On June 30, 2023, the City’s proportionate share of the net pension liability for each Plan as of June 30, 2022, and June 30, 2023, was as follows:

Miscellaneous Safety
Proportion‐June 30, 2022 0.24037% 0.08587%
Proportion‐June 30, 2023 0.18835% 0.09862%
Change‐Increase (Decrease) ‐0.05202% 0.01275%
For the year ended June 30, 2023, the City recognized pension expense (income) of $(613,689) for the Miscellaneous Plan and $1,170,498 for the Safety Plan. Pension expense (income) represents the change in the net pension liability during the measurement period, adjusted for actual contributions and the deferred recognition of changes in investment gain/loss, actuarial gain/loss, actuarial assumptions or method, and plan benefits. On June 30, 2023, the City reported deferred outflows of resources and deferred inflows of resources related to pension as follows:

Deferred Outflows
of Resources
Deferred Inflows
of Resources
Changes in assumptions 903,091 $                    ‐ $ Differences between expected and actual experience 176,985                                              118,537 Net difference between projected and actual earnings on retirement plan investments 1,614,335
Changes in proportion and differences between City
contributions and proportionate share of contributions 232,595 Adjustment due to differences in proportion 19,802                                                254,457 City contributions subsequent to the measurement date 1,008,890 $                3,723,103 $                   605,589
Miscellaneous

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
64 NOTE 7 – PENSION PLANS (Continued)
Deferred Outflows
of Resources
Deferred Inflows
of Resources
Changes in assumptions 683,297 $                    ‐ $ Differences between expected and actual experience 280,463                                                73,590 Net difference between projected and actual earnings on retirement plan investments 1,070,137
Changes in proportion and differences between City
contributions and proportionate share of contributions 614,316 Adjustment due to differences in proportion 469,845                                                55,361 City contributions subsequent to the measurement date 898,454 $                3,402,196 $                   743,267
Safety
Deferred outflows of resources and deferred inflows of resources above represent the unamortized portion of changes to net pension liability to be recognized in future periods in a systematic and rational manner.

Deferred outflows of resources related to pensions resulting from City contributions made subsequent to the measurement date of the net pension liability but before the end of the City’s reporting period of $1,008,890 and $898,454 for the Miscellaneous and Safety Plans, respectively, will be recognized as a reduction of the net pension liability in the year June 30, 2024.

Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in the pension expenses as follows:

Miscellaneous Safety
2024 472,097 $                    $                   463,359 2025 409,676                                              389,357 2026 239,470                                              254,962 2027 987,381                                              652,797 $                2,108,624 $                1,760,475
Fiscal year ending June 30
Actuarial Assumptions
The June 30, 2021 valuation was rolled forward to determine the June 30, 2022 total pension liability using the following actuarial assumptions on the next page:

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
65 NOTE 7 – PENSION PLANS (Continued)
Valuation Date
Measurement Date
Actuarial Cost Method
Actuarial Assumptions:

Discount Rate
Inflation
Projected Salary Increase
Investment Rate of Return
Mortality (1)
(1)   The mortality table used was developed based on CalPERs'specific data.  The rates incorporate Generational Mortality to capture ongoing mortality improvement using 80% of Scale MP 2020 published by the Socity of Actuaries.  For more details, please refer to the 2021 experience study report that can be found on the CalPERS website.

6.90%
Derived using CalPERS' Membership
Data for all Funds
Varies by Entry Age and Service

2.30%

6.90%
Miscellaneous and Safety
June 30, 2021
June 30, 2022
Entry‐Age Normal Cost Method
Discount Rate
The discount rate used to measure the total pension liability was 6.90 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 investment 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 a building‐block method in which best‐estimate ranges of expected future real rates of return (expected returns, net pension plan investment expense and inflation) are developed for each major asset class.

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
66 NOTE 7 – PENSION PLANS (Continued)
In determining the long‐term expected rate of return, CalPERS considered both short‐term and long‐term market return expectations as well as the expected pension fund cash flows. Using historical returns of all the funds’ asset classes, expected compound returns were calculated over the short‐term (first 10 years) and the long‐term (11 + years) using a building‐block approach. Using the expected nominal returns for both short‐term and long‐term, the present value of benefits was calculated for each fund. The expected rate of return wasset by calculating the 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 the long‐term expected real rate of return by asset class.

Asset Class (1)
Assumed
Asset
Allocation
Real Return
Years 1‐10
(1,2)
Real Return
Years 11+ (3)
Global equity ‐ cap‐weighted 30.0% 4.45% 5.98%
Global equity ‐ non‐cap‐weighted 12.0% 3.84% 2.62%
Private Equity 13.0% 7.28% 1.81%
Treasury 5.0% 0.27% 7.23%
Mortgage‐backed Securities 5.0% 0.50% 4.93%
Investment Grade Corporates 10.0% 1.56% ‐0.92%
High Yield 5.0% 2.27%
Emerging Market Debt 5.0% 2.48%
Private Debt 5.0% 3.57%
Real Assets 15.0% 3.21%
Leverage ‐5.0% ‐0.59%
Total 100.0%
(1)   An expected inflation of 2.30% used for this period. (2)   Figures are based on the 2021‐22 Asset Liability Managementstudy.

Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in Discount Rate The following represents the City’s proportionate share of the net pension liability calculated using the discount rate of 6.90 percent, 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 (5.90 percent) or 1‐ percentage point higher (7.90 percent) than the current rate:

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
67 NOTE 7 – PENSION PLANS (Continued)

Miscellaneous Safety
1% Decrease 5.90% 5.90%
Net Pension Liability 12, $                      953,837 $             10,629,157 Current Discount Rate 6.90% 6.90%
Net Pension Liability 8, $                         813,149 $                6,776,709 1% Increase 7.90% 7.90%
Net Pension Liability 5, $                         406,391 $                3,628,203

Pension Plan Fiduciary Net Position
Detailed information about the pension plan’s fiduciary net position is available in the separately issued CalPERS financial reports.

C.   Payable to the Pension Plan
On June 30, 2023, the City had no amount outstanding for contributions to the pension plan required for the fiscal year ended June 30, 2023.

NOTE 8 – OTHER POST EMPLOYMENT BENEFITS
The City provided an early retirement incentive under extremely specific criteria. Five employees qualified and opted to take the early retirement incentive. The City is refunding the employee’s medical costs up to $500 per month until eligible for Medicare. The maximum potential liability as of June 30, 2023, was $12,226.

NOTE 9 – LIABILITY, WORKERS’ COMPENSATION, AND PURCHASED INSURANCE A.    UDescription of Self‐Insurance Pool Pursuant to Joint Powers Agreement The City of Grover Beach is a member of the California Joint Powers Insurance Authority (Authority). The Authority is composed of 123 California public entities and is organized under a joint powers agreement pursuant to California Government Code §6500 et seq. The purpose of the Authority is to arrange and administer programs for the pooling of self‐insured losses, to purchase excess insurance or reinsurance, and to arrange for group purchased insurance for property and other lines of coverage. The California JPIA began covering claims of its members in 1978. Each member government has an elected official as its representative on the Board of Directors. The Board operates through a nine‐member Executive Committee.

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
68 NOTE 9 – LIABILITY, WORKERS’ COMPENSATION, AND PURCHASED INSURANCE (Continued) B.    Primary USelf‐Insurance Programs of the Authority Each member pays an annual contribution at the beginning of the coverage period. A retrospective adjustment is then conducted annually thereafter, for coverage years 2012‐13 and prior. Coverage years 2013‐14 and forward are not subject to routine annual retrospective adjustment. The total funding requirement for self‐insurance programs is based on an actuarial analysis. Costs are allocated to individual agencies based on payroll and claims history, relative to other members of the risk‐ sharing pool.

Primary Liability Program
Claims are pooled separately between police and general government exposures. (1) The payroll of each member is evaluated relative to the payroll of other members. A variable credibility factor is determined for each member, which establishes the weight applied to payroll and the weight applied to losses within the formula. (2) The first layer of losses includes incurred costs up to $3 million for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the first layer. (3) The second layer of losses includes incurred costs from $3 million to $30 million for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the second layer. (4) Incurred costs from $30 million to $50 million, are distributed based on the outcome of cost allocation within the first and second loss layers.

The overall coverage limit for each member, including all layers of coverage, is $50 million per occurrence. Subsidence losses have a sub‐limit of $50 million per occurrence. The coverage structure includes retained risk that is pooled among members, reinsurance, and excess insurance. More detailed information about the various layers of coverage is available on the following website:
https://cjpia.org/coverage/risk‐sharing‐pools/.

Workers’ Compensation Program
Claims are pooled separately between public safety (police and fire) and general government exposures. (1) The payroll of each member is evaluated relative to the payroll of other members.

A variable credibility factor is determined for each member, which establishes the weight applied to payroll and the weight applied to losses within the formula. (2) The first layer of losses includes incurred costs up to $1 million for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the first layer. (3) The second layer of losses includes incurred costs from $1 million to $2 million for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the second layer. (4) Incurred costs from $2 million to statutory limits are distributed based on the outcome of cost allocation within the first and second loss layers.

For FY 2022‐23 the Authority’s pooled retention is $2 million per occurrence, with reinsurance to statutory limits under California Workers’ Compensation Law. Employer’s Liability losses are pooled among members to $2 million. Coverage from $2 million to $5 million is purchased through

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
69 NOTE 9 – LIABILITY, WORKERS’ COMPENSATION, AND PURCHASED INSURANCE (Continued) reinsurance policies, and Employer’s Liability losses from $5 million to $10 million are pooled among members.

C. UPurchased Insurance
Property Insurance
The City of Grover Beach participates in the all‐risk property protection program of the Authority. This insurance protection is underwritten by several insurance companies. City of Grover Beach property is currently insured according to a schedule of covered property submitted by the City of Grover Beach to the Authority. City of Grover Beach property currently has all‐risk property insurance protection in the amount of $50 million. There is a $10,000 deductible per occurrence except for non‐emergency vehicle insurance which has a $2,500 deductible.

D.   UAdequacy of Protection

During the past three fiscal years, none of the above programs of protection experienced settlements or judgments that exceeded pooled or insured coverage. There were also no significant reductions in pooled or insured liability coverage in FY 2022‐23.

NOTE 10 – CONTINGENCIES AND COMMITMENTS
The City is involved in various litigations. In the opinion of management and legal counsel, the disposition of all litigations pending will not have a material effect on the City’s financial statements.

The City has received state and federal funds for specific purposes that are subject to review and audit by the grantor agencies. Although such audits could generate expenditure disallowances under terms of the grants, it is believed that any required reimbursements will not be material. The City had the following construction contracts as of June 30, 2023: $66,653 for Fire Station Kitchen Remodel, $3,169,887 for Measure K‐14 Street Rehabilitation and Repair projects, and $198,560 for Sewer Cleaning.

NOTE 11 – REVENUE LIMITATIONS IMPOSED BY CALIFORNIA PROPOSITION 218 Proposition 218, which was approved by the voters in November 1996, will regulate the City’s ability to impose, increase, and extend taxes, assessments, and fees. Any new, increased, or extended taxes, assessments, and fees subject to the provisions of Proposition 218, require voter approval before they can be implemented. Additionally, Proposition 218 provides that these taxes, assessments, and fees are subject to the voter initiative process and may be rescinded in the future years by the voters.

NOTE 12 – JOINT OPERATING AGREEMENTS
Wastewater operations. The City does not own and operate a separate wastewater treatment plant facility. Pursuant to a purchase agreement with the South San Luis Obispo County Sanitation District, the

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
70 NOTE 12 – JOINT OPERATING AGREEMENTS (Continued)
City’s waste is transported through City‐owned, and City maintained lines for processing at the District’s plant. The City purchased up to 30 percent of the District’s treatment plant capacity. The cost of this purchased capacity is recorded as a capital asset of the wastewater enterprise, and this cost is being amortized to expense over 20 years using the straight‐line method. The City is also obligated to pay to the District the costs of maintaining and operating the District’s plant, based upon the number of City’s customers, times certain rates, and such operating costs are to be paid monthly by the City. The City records such operating costs as expenses in its wastewater enterprise.

Water operations. The San Luis Obispo County Flood Control and Water Conservation District, a county‐ wide agency, issued voter‐approved general obligation bonds for the purpose of building Lopez Dam, a storage reservoir, water treatment plant, and other facilities to provide a primary municipal water supply.

The City has entered into a water supply agreement wherein the City has agreed to pay annually, regardless of water deliveries, a prorated percentage of certain costs. In addition, the City also pays the District a prorated share of operating, maintenance, pumping, and related operating costs which expensed in the City’s water enterprise fund.

NOTE 13 – FIVE CITIES FIRE AUTHORITY
The City of Grover Beach is a member of the Five Cities Fire Authority (FCFA), a joint powers authority between the Cities of Arroyo Grande and Grover Beach as reconstituted in June 2023. FCFA was formed on July 9, 2010, for the purpose of providing a more efficient fire protection service within the City limits of Arroyo Grande and Grover Beach, as well as the unincorporated community of Oceano prior to the withdrawal of the Oceano Community Services District as a member in 2023. Each member contributes its pro rate share of operating costs to FCFA based on a funding formula, calculated annually. The Authority is governed by a four‐member Board of Directorsthat consists of two representativesfrom each city with all policy decisions made by this board.  The City of Grover Beach contributed $2,015,115 to FCFA during the fiscal year ended June 30, 2023, for fire protectionsservices. Separate financialstatements may be obtained from the Five Cities Fire Authority at 140 Traffic Way in Arroyo Grande, California.

NOTE 14 ‐ INVESTMENT IN JOINT POWERS AGREEMENT
In September 2022, the City entered into Central Coast Blue Regional Recycled Water Authority Joint Powers Authority (JPA) with the Cities of Arroyo Grande and Pismo Beach.  The purpose of the JPA is to construct a regional recycled water project that will enhance supply reliability by injecting advanced purified water into the Northern Cities Management Area of the Santa Maria Groundwater Basin (Project).  The JPA will also oversee and manage the planning and implementation, including but not limited to construction, operation and administration of the Project.  The City of Pismo Beach is the lead agency for the design and construction of the Project and will continue to cover all costs associated with the Project until project completion in late 2026.  In accordance with the cost sharing agreement for the members of the JPA, the City of Pismo Beach bills each member for their proportionate share of costs throughout construction.

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
71 NOTE 14 ‐ INVESTMENT IN JOINT POWERS AGREEMENT (Continued) During the year ended June 30, 2023, the City has reimbursed the City of Pismo Beach $3,255,636 for their share of the design, pre‐construction, land acquisition and other costs to date for the Project.  Included in this amount is $657,170 for the acquisition of the land that was subsequently contributed to the JPA.  The remaining costs paid of $2,598,466 are presented as nonoperating costs in the Water Fund for the year ended June 30, 2023.  The investment in the JPA as of June 30, 2023, was $657,170 and is presented as Investment in Joint Powers Authority in the Statement of Net Position.

Separate financial statements of the JPA may be obtained from the City of Grover Beach, 154 South 8th Street in Grover Beach, California.

NOTE 15 – SUCCESSOR AGENCY
UBonds Payable
On December 8, 2005, the former Improvement Agency issued $4,390,000 of 2005 tax allocation bonds to refund the outstanding balance of the 2001 tax allocation notes and pay the costs of redevelopment activities within the Agency’s Improvement Project. The bonds are secured by a pledge of the Agency’s tax increment revenues excluding to be paid to other taxing authorities, pursuant to pass‐through agreements, bear interest from 3.25 to 5.00 percent, and mature on August 1, 2035. On February 1, 2014, the Successor Agency assumed the tax allocation bonds previously held by the former Improvement Agency. As of June 30, 2023, the principal balance was $2,675,000.

The future minimum payment obligations for the bonds payable on June 30, 2023, are as follows:

Fiscal year Ending June 30 Principal Interest Total
2024 150,000 $       $      137,375 $      287,375
2025 160,000                  130,000         290,000
2026 165,000                  122,250         287,250
2027 175,000                  114,125         289,125
2028 185,000                  105,625         290,625
2029‐2033 1,065,000               384,125      1,449,125 2034‐2036 775,000                  104,000         879,000 $   2,675,000 $   1,097,500 $   3,772,500

U
Loan Payable
On February 1, 2015, the Successor Agency assumed loans due to the City of Grover Beach previously held by the formerImprovement Agency. There is no formal paymentschedule. Loan payments are made when monies become available, with an annual interest rate of 0.5%. The amount due to the City of Grover Beach as of June 30, 2023, was $29,869.

U

CITY OF GROVER BEACH
Notes to Basic Financial Statements
June 30, 2023
72 NOTE 15 – SUCCESSOR AGENCY (Continued)
Changes in Long‐Term Liabilities
Long term liability activity for the fiscal year ended June 30, 2023, are as follows:

Balance Balance Due Within
July 1, 2022 Additions Deletions June 30, 2023 One Year Tax allocation bonds 2,820,000 $         $        145,000 $        2,675,000 $     135,000 Loan payable 29,869                                  29,869 $         ‐ 2,849,869 $                  $        145,000 $        2,704,869 $     135,000 NOTE 16 – DEFERRED INFLOWS OF RESOURCES
On June 30, 2023, deferred inflows of resources, reported in the governmental fund financial statements, consisted of the following:

Home
Grant Fund Total
Unavailable Revenue 333,975 $    $333,975
$   333,975 $333,975

NOTE 17 – SUBSEQUENT EVENT
Events subsequent to June 30, 2023 have been evaluated through December 18, 2023, which is the date the financialstatements were available to be issued.  Management did not identify any subsequent events requiring disclosure.

CITY OF GROVER BEACH
Required Supplemental Information
June 30, 2023
73 Budgetary Information
Through the budget, the City Council sets the direction of the City, allocates its resources and establishes its priorities.  The Annual Budget assures the efficient and effective use of the City’s economic resources, as well as establishing that the highest priority objectives are accomplished.

The Annual budget serves the fiscal period July 1 to June 30 and is a vehicle that accurately and openly communicates these priorities to the community, businesses, vendors, employees and other public agencies.  Additionally, it establishes the foundation of effective financial planning.

The City prepares a two‐year budget.  The City Council adopts governmental fund budgets consistent with generally accepted accounting principles as legally required.

The City Council generally reauthorizes appropriations for continuing projects and activities.  The City Council has the legal authority to amend the budget of any fund, at any time during the fiscal year.  The budgetary legal level of control (the level on which expenditures may not legally exceed appropriations) is generally at the fund level.   Budgeted expenditures may be reallocated within a fund by the City Manager, and within a department program by the department director, but any inter‐fund transfers or reallocation must be approved by resolution of the City Council.

CITY OF GROVER BEACH

GENERAL FUND

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE

BUDGET TO ACTUAL
For the Fiscal Year Ended June 30, 2023
Original Final Actual Amounts
Variance with
Final Budget
Positive
(Negative)
Revenues:

Taxes $         14,918,200  $         14,781,200  $         14,640,552  $           (140,648) Licenses, permits, and fees                   400,000                    400,000                    424,554                  24,554 Intergovernmental               1,794,963                2,149,463                    831,966           (1,317,497) Charges for services                   937,320                    899,820                    953,107                  53,287 Fines and forfeitures                     53,700                      53,700                      42,857                 (10,843) Use of money and property                   227,300                    227,300                    255,429                  28,129 Other                                ‐                               ‐                                  3                            3 Total revenues             18,331,483              18,511,483              17,148,468           (1,363,015) Expenditures:

General government               5,669,574               5,901,574               4,517,231             1,384,343 Public safety               7,725,101               7,895,168               7,804,889                  90,279 Community development                   773,301               1,137,801                   665,320                472,481 Public works               1,279,261               1,340,761               1,447,905               (107,144) Parks and recreation                   440,787                  533,287                   550,570                 (17,283) Capital Outlay                   110,500                  443,801                   667,204               (223,403) Debt service:                         ‐
Principal                   166,664                  166,664                   270,202               (103,538) Interest                     14,761                    14,761                     26,249                 (11,488) Total expenditures             16,179,949              17,433,817              15,949,570              1,484,247 Excess of revenues over (under) expenditures               2,151,534                1,077,666                1,198,898           (2,847,262) Other Financing Sources (Uses):

Subscription financing                   344,613                344,613 Transfers in                   571,000                  571,000                   546,541                 (24,459) Transfers out              (2,235,000)              (3,061,955)                 (387,507)             2,674,448 Total other financing sources (uses)              (1,664,000)              (2,490,955)                   503,647             2,994,602 Net change in fund balances                   487,534               (1,413,289)               1,702,545                147,340 Fund balance ‐ July 1               5,785,668               5,785,668               5,785,668 Fund balance ‐ June 30 $           6,273,202 $           4,372,379 $           7,488,213 $            147,340 Budgeted Amounts
74 CITY OF GROVER BEACH

STREET REHABILITATION AND REPAIR FUND

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE

BUDGET TO ACTUAL
For the Fiscal Year Ended June 30, 2023
Original Final Actual Amounts
Variance with
Final Budget
Positive
(Negative)
Revenues:

Charges for services $                          ‐     $                          ‐     $                          ‐    $                      ‐ Use of money and property                     15,000                      15,000                    112,763                   97,763 Intergovernmental                     20,000                      20,000                      94,787                   74,787 Total revenues                     35,000                      35,000                    207,550                  172,550 Expenditures:

Public works               2,441,988                4,195,598                3,899,878                 295,720 Capital outlay                                ‐                                ‐                                ‐                          ‐ Total expenditures               2,441,988                4,195,598                3,899,878                 295,720 Excess of revenues over (under) expenditures              (2,406,988)              (4,160,598)              (3,692,328)                (123,170) Other Financing Sources (Uses):

Transfers in                     20,000                  134,960                     96,866                 (38,094) Transfers out
Total other financing sources (uses)                     20,000                    134,960                      96,866                 (38,094) Net change in fund balance              (2,386,988)              (4,025,638)              (3,595,462)                (161,264) Fund balance ‐ July 1               9,434,417               9,434,417               9,434,417 Fund balance ‐ June 30 $           7,047,429 $           5,408,779 $           5,838,955 $           (161,264) Budgeted Amounts
75 CITY OF GROVER BEACH
Schedule of Proportionate Share of Net Pension Liability Miscellaneous Plan
Last 10 Years*
As of June 30, 2023
Fiscal Year 2014‐15 2015‐16 2016‐17
Measurement Period 2013‐14 2014‐15 2015‐16
Proportion of the net pension liability 0.059220% 0.177090% 0.171680% Proportionate share of the net pension liability 3,684,79 $                  7 $                 4,740,779 $                 5,964,116 Covered payroll 2,201,20 $                  6 $                 2,352,410 $                 2,544,097 Proportionate share of the net pension
liability as a percentage of covered payroll 167.40% 201.53% 234.43% Plan fiduciary net position as a percentage
of the total pension liability 81.15% 79.89% 75.87%
Notes to schedule
Changes in assumptions:

1. In 2022, the discount rate was changed from 7.15% to 6.90%.

2. In 2018, demographic assumptions and the inflation rate were changed in accordance to the CalPERS Experience Study and Review of Actuarial Assumptions December 2017. There were no changes in the discount rate.

3. In 2017, as part of the Asset Liability Management review cycle, the discount rate was changed from 7.65% to 7.15%.

4. In 2016, the discount rate was changed from 7.5% (net of administrative expense) to 7.65% to correct for an adjustment to exclude administrative expense

5. In 2015, amounts reported as changes in assumptions resulted primarily from adjustments to expected retirement ages of general employees
*Fiscal year 2014‐15 was the 1st year of implementation 76 2017‐18 2018‐19 2019‐20 2020‐21 2021‐22 2022‐23
2016‐17 2017‐18 2018‐19 2019‐20 2020‐21 2021‐22

0.172750% 0.175950% 0.177750% 0.180240% 0.240370% 0.188350% $                 6,810,002 $                 6,631,010 $                 7,117,875 $                 7,602,638 $          4,564,134 $        8,813,149 $                 2,823,759 $                 3,007,940 $                 3,077,837 $                 3,138,281 $          3,164,383 $        3,327,458 241.17% 220.45% 231.26% 242.25% 144.23% 264.86%

75.39% 77.69% 77.73% 77.71% 90.49% 78.19%
77 CITY OF GROVER BEACH
Schedule of Proportionate Share of Net Pension Liability Safety Plan
Last 10 Years*
As of June 30, 2023
Fiscal Year 2014‐15 2015‐16 2016‐17 2017‐18
Measurement Period 2013‐14 2014‐15 2015‐16 2016‐17
Proportion of the net pension liability 0.058560% 0.089290% 0.089350% 0.088890% Proportionate share of the net pension liability $           3,643,925 $           3,611,809 $           4,627,579 $           5,311,534 Covered payroll $           1,308,085 $           1,193,228 $           1,400,666 $           1,606,728 Proportionate share of the net pension
liability as a percentage of covered payroll 278.57% 302.69% 330.38% 330.58% Plan fiduciary net position as a percentage
of the total pension liability 78.83% 77.27% 72.69% 71.74% Notes to schedule
Changes in assumptions:

1. In 2022, the discount rate was changed from 7.15% to 6.90%.

2. In 2018, demographic assumptions and the inflation rate were changed in accordance to the CalPERS Experience Study and Review of Actuarial Assumptions December 2017. There were no changes in the discount rate.

3. In 2017, as part of the Asset Liability Management review cycle, the discount rate was changed from 7.65% to 7.15%.

4. In 2016, the discount rate was changed from 7.5% (net of administrative expense) to 7.65% to correct for an adjustment to exclude administrative expense

5. In 2015, amounts reported as changes in assumptions resulted primarily from adjustments to expected retirement ages of general employees
*Fiscal year 2014‐15 was the 1st year of implementation 78 2018‐19 2019‐20 2020‐21 2021‐22 2022‐23
2017‐18 2018‐19 2019‐20 2020‐21 2021‐22

0.090830% 0.092060% 0.094170% 0.085870% 0.098620%
$           5,329,358 $           5,746,863 $           6,274,015 $                    3,013,525 $                    6,776,709 $           1,611,098 $           1,724,360 $           1,820,004 $                    2,210,811 $                    2,129,749 330.79% 333.28% 344.73% 136.31% 318.19%

73.39% 73.37% 73.12% 86.61% 75.53%
79 CITY OF GROVER BEACH

SCHEDULE OF CONTRIBUTIONS
Miscellaneous Plan
Last 10 Years*
As of June 30, 2023
Fiscal Year 2015 2016 2017 2018 2019
Contractually required contribution (actuarially determined) 387,424 $         $        502,704 $         564,258 $         640,602 $         739,558 Contribution in relation to the actuarially determined
contributions 387,424                      502,704            564,258            640,602            739,558 Contribution deficiency (excess) $                 ‐ ‐ $                 ‐ $                   ‐ $                   ‐ $ Covered payroll 2,241,150 $     $    2,201,206 $      2,352,410 $      2,544,097 $      2,823,759 Contributions as a percentage of covered payroll 17.29% 22.84% 23.99% 25.18% 26.19% Notes to Schedule
Valuation Date 6/30/2020
Actuarial Cost Method Entry Age Normal Cost Method
Amortization Method Varies by date established and source. May be level dollar or level percent of pay and may include direct rate smoothing.

Remaining Amortization Periods Differs by employer rate plan but not more than 28 years Asset Valuation Method Market value of asset
Inflation 2.50%
Salary Increases Varies by category, entry age and service Discount Rate ** 7.00% (net of investment and administrative expenses) Mortality Derived using CalPERS Membership Date for all Funds. The post‐retirement mortality rates include 15 years of projected on‐going improvement using 90 percent of Scale MP 2016 published by the Society of Actuaries.
** From the CalPERS reports (Appendix A):
https://www.calpers.ca.gov/docs/forms‐publications/actuarial‐valuation‐section2‐miscellaneous‐2020.pdf https://www.calpers.ca.gov/docs/forms‐publications/actuarial‐valuation‐section2‐safety‐2020.pdf * Fiscal year 2015 was the 1st year of implementation, therefore only seven years are shown. 80 2020 2021 2022 2023
$         831,877 $         827,979 $         921,270 $      1,008,890 831,877            827,979            921,270         1,008,890 $                   ‐ ‐ $                   ‐ $                   ‐ $ $      3,007,940 $      3,077,837 $      3,138,281 $      3,164,383

27.66% 26.90% 29.36% 31.88%
81 CITY OF GROVER BEACH

SCHEDULE OF CONTRIBUTIONS
Safety Plan
Last 10 Years*
As of June 30, 2023
Fiscal Year 2015 2016 2017 2018 2019
Contractually required contribution (actuarially determined) 329,602 $         $        426,742 $         477,038 $         568,347 $         569,000 Contribution in relation to the actuarially determined
contributions 329,602                      426,742            477,038            568,347            569,000 Contribution deficiency (excess) $                 ‐ ‐ $                 ‐ $                   ‐ $                   ‐ $ Covered payroll 1,242,711 $     $    1,308,085 $      1,193,228 $      1,400,666 $      1,606,728 Contributions as a percentage of covered payroll 26.52% 32.62% 39.98% 40.58% 35.41% Notes to Schedule
Valuation Date 6/30/2020
Actuarial Cost Method Entry Age Normal Cost Method
Amortization Method Varies by date established and source. May be level dollar or level percent of pay and may include direct rate smoothing.

Remaining Amortization Periods Differs by employer rate plan but not more than 28 years Asset Valuation Method Market value of asset
Inflation 2.50%
Salary Increases Varies by category, entry age and service Discount Rate ** 7.00% (net of investment and administrative expenses) Mortality Derived using CalPERS Membership Date for all Funds. The post‐retirement mortality rates include 15 years of projected on‐going improvement using 90 percent of Scale MP 2016 published by the Society of Actuaries.
** From the CalPERS reports (Appendix A):
https://www.calpers.ca.gov/docs/forms‐publications/actuarial‐valuation‐section2‐miscellaneous‐2020.pdf https://www.calpers.ca.gov/docs/forms‐publications/actuarial‐valuation‐section2‐safety‐2020.pdf * Fiscal year 2015 was the 1st year of implementation, therefore only seven years are shown. 82 2020 2021 2022 2023
$         676,869 $           808,253 $         858,085 $         898,454 676,869          1,308,253             858,085             898,454 $                  ‐ $          ‐ (500,000) $                   ‐ $ $      1,611,098 $       1,724,360 $      1,820,004 $      2,210,811

42.01% 75.87% 47.15% 40.64%
83 NONMAJOR GOVERNMENTAL FUNDS
84 SPECIAL REVENUE FUNDS
Special revenue funds are used to account for revenues that are restricted by law or administrative actions to expenditures for specified purposes. Nonmajor special revenue funds used by the City are listed below:

Gas Tax ‐ These funds are restricted in use to acquisition of rights of way, construction, maintenance, engineering, and administrative costs of the public street system. Income is derived from state excise taxes on fuel and is allocated to the City in accordance with Street and Highway Code Sections 2103‐2108.

Gas Tax Road Maintenance and Rehabilitation Account ‐ These funds are used to account for the receipt and expenditure of Senate Bill 1, an additional gas tax, that enable cities and counties to address significant maintenance, rehabilitation and safety needs on the local streets and road system.

Public Safety Grants – The purpose of this fund is to receive and track all Police Department State grant revenue and expenditures in accordance with prescribed regulations. Revenue for this fund is comprised of funds from the Citizens Option for Public Safety Program (COPs). Under the standard grant program allocation, the City is eligible to receive a minimum amount of $100,000 annually, with additional proportionate share based on population estimates determined by the California Department of Finance.

Parks Construction – This fund receives Park‐In‐Lieu fees from developers and is restricted to the acquisition, construction, major improvements, and rehabilitation.

Transportation Impact Fees – This fund accounts for fees generated by development for the construction of transportation improvements.

Law Enforcement Impact Fees – This fund accounts for fees generated by development. These funds may be used for law enforcement improvements related to expansion.

Administrative Impact Fees – This fund accounts for fees generated by development. These funds may be used for administrative improvements related to expansion.

Fire Development Impact Fees – This fund accounts for fees generated by development. These funds may be used for fire improvements related to expansion.

Storm Water Impact Fees – This fund accounts for fees generated by development. These funds may be used for storm water related expansion.

Wastewater Impact Fees – This fund accounts for fees generated by development. These funds may be used for wastewater related expansion.

Parks Facilities Impact Fees – This fund accounts for fees generated by development. These funds may be used for parks facilities related expansion.

Recreation Facilities Impact Fees – This fund accounts for fees generated by development. These funds may be used for recreation related expansion.
85 Water Development Impact Fees – This fund accounts for fees generated by development. These funds may be used for water related expansion.

State Mandated ADA Fund – This fund accounts for the State Mandated Disability and Education Fee (SB 1186 Steinberg). Cities are required to collect four dollars from every business license or equivalent instrument. Cities are required to transmit thirty percent of the fees to the State on a quarterly basis for deposit in the Disability Access and Education Revolving Fund. Cities keep seventy percent of the fees to be used for ADA Certified Specialists Program.

Subsidized Senior Transportation – This fund accounts for expenditures related to the Senior Transportation program funded by Local Transportation Funds.

Local Transportation – This fund accounts for apportioned revenue from the state and is restricted in use to acquisition of rights of way, construction, maintenance, engineering, and administrative costs associated with the public street system, as well as transit‐related costs. Income derived from state and federal grants generally administered by SLOCOG and Caltrans Local Assistance and include State Highway Account Urban and Regional (USHA and RSHA) Funds.

Community Development Block Grant (CDBG) Non‐Entitlement  – CDBG funds may be used for economic development, housing or public service projects which primarily benefit low‐ and moderate‐income residents.

Home Grant  – The Home Investment Partnership Program (HOME) funds can be used for First Time Homebuyer Program, First Time Homebuyer Project, Owner Occupied Rehabilitation Program, Rental Rehabilitation, Rental New Construction Project, and Tenant‐Based Rental Assistance Programs.

CAPITAL PROJECTS FUND
Capital projects funds are restricted, committed or assigned for capital outlay and include:

Underground Utilities – This fund accounts for underground utility developer fees restricted to the placement of utility lines underground in accordance with City Council priorities set by resolution.

Capital Projects – This fund was set up to account for capital projects in a central fund where the funding is transferred in from the funding source and the capital expenditures are appropriated and tracked by project.

CITY OF GROVER BEACH

NONMAJOR GOVERNMENTAL FUNDS

COMBINING BALANCE SHEET
June 30, 2023
Gas Tax Gas Tax RMRA
Public Safety
Grants
Park
Construction
Transportation
Impact Fees
ASSETS
Cash and investments $         90,322  $         280,919  $         325,320  $         49,452  $            115,916 Accounts receivable             29,326                 49,881 Loans receivable
Interest receivable                  628                   2,708                   1,866                   283                         665 Total assets $      120,276  $         333,508  $         327,186  $         49,735  $            116,581

LIABILITIES, DEFERRED INFLOWS OF RESOURCES,

AND FUND BALANCES
Liabilities:

Accounts payable $           3,300  $                    ‐     $                    ‐     $                 ‐     $                1,296 Accrued wages                        ‐
Due to funds
Total liabilities               3,300                           ‐                           ‐                        ‐                      1,296 Deferred Inflows of Resources:

Unavailable revenue
Total deferred inflows of resources
Fund Balances:

Restricted           116,976               333,508               327,186              49,735                 115,285 Unassigned
Total fund balances           116,976               333,508               327,186              49,735                 115,285 Total liabilities, deferred inflows of resources, and
fund balances $      120,276  $         333,508  $         327,186  $         49,735  $            116,581 Special Revenue Funds
86 Law
Enforcement
Impact Fees
Administrative
Impact Fees
Fire
Development
Impact Fees
Storm Water
Impact Fees
Wastewater
Impact Fees
Parks
Facilities
Impact Fees
Recreation
Facilities Impact
Fees
$            14,745  $              28,936  $              14,813  $         148,517  $          232,393  $      216,076  $            50,531

85                        167                           86                      852                    1,820                1,939                      289 $            14,830  $              29,103  $              14,899  $         149,369  $          234,213  $      218,015  $            50,820 $              1,296  $                1,296  $                1,296  $              1,296  $               1,296  $           1,296  $              1,296 1,296                     1,296                      1,296                   1,296                    1,296                1,296                   1,296 13,534                   27,807                   13,603               148,073               232,917            216,719                 49,524 13,534                   27,807                   13,603               148,073               232,917            216,719                 49,524 $            14,830  $              29,103  $              14,899  $         149,369  $          234,213  $      218,015  $            50,820 87 CITY OF GROVER BEACH

NONMAJOR GOVERNMENTAL FUNDS

COMBINING BALANCE SHEET
June 30, 2023
Water
Development
Impact Fees
State Mandated
ADA
Subsidized
Senior
Transportation
Local
Transportation
CDBG Non
Entitlement
ASSETS
Cash and investments $                    ‐     $            10,078  $             22,811  $        1,779,897  $               ‐ Accounts receivable                                                                                                                               249,302 Loans receivable
Interest receivable                     185                                                    131                   10,211 Total assets $                 185  $            10,078  $             22,942  $        1,790,108  $    249,302

LIABILITIES, DEFERRED INFLOWS OF RESOURCES,

AND FUND BALANCES
Liabilities:

Accounts payable $              1,296  $                   50  $                     ‐     $                      ‐     $      23,262 Accrued wages                  67
Due to funds                                                                                                                               197,945 Total liabilities                  1,296                        50         221,274 Deferred Inflows of Resources:

Unavailable revenue
Total deferred inflows of resources
Fund Balances:

Restricted                          ‐                 10,028                  22,942             1,790,108          28,028 Unassigned                (1,111)
Total fund balances                (1,111)                10,028                  22,942             1,790,108           28,028 Total liabilities, deferred inflows of resources, and
fund balances $                 185  $            10,078  $             22,942  $        1,790,108  $    249,302 Special Revenue Funds
88 Home Grant
Fund
Underground
Utilities
Capital
Projects Total
$    122,500  $       231,009  $       237,584  $     3,971,819 328,509
333,975                                                                  333,975 1,323                                          23,238
$    456,475  $       232,332  $       237,584  $     4,657,541 $              ‐     $                  ‐     $       237,584  $        275,860 67 197,945
237,584              473,872
333,975              333,975
333,975              333,975
122,500           232,332                         ‐          3,850,805 (1,111)
122,500            232,332          3,849,694
$    456,475  $       232,332  $       237,584  $     4,657,541 Capital Projects Funds
89 CITY OF GROVER BEACH

NONMAJOR GOVERNMENTAL FUNDS

COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES For the Fiscal Year Ended June 30, 2023
Gas Tax Gas Tax RMRA
Public Safety
Grants
Park
Construction
Transportation
Impact Fees
Revenues:

Intergovernmental $     336,733  $       284,660  $        165,271  $                  ‐     $                   ‐ Charges for services                     ‐                        ‐                         ‐               11,004                93,784 Use of money and property             2,564                7,517                 5,352                    815                  1,379 Total revenues         339,297            292,177             170,623               11,819                95,163 Expenditures:

Public safety                     ‐                        ‐               47,053                         ‐                          ‐ Community development                     ‐                        ‐                         ‐                         ‐                          ‐ Public works         306,203                        ‐                         ‐                         ‐                  2,232 Parks and recreation                     ‐                        ‐                         ‐                         ‐                          ‐ Capital outlay                     ‐                        ‐               18,415                         ‐                          ‐ Total expenditures         306,203                        ‐               65,468                         ‐                  2,232 Excess of revenues over (under) expenditures           33,094            292,177             105,155               11,819                92,931 Other Financing Sources (Uses):

Transfers in                     ‐                        ‐                         ‐                         ‐                          ‐ Transfers out          (85,621)          (299,000)                      ‐                         ‐                          ‐ Total other financing sources (uses)          (85,621)          (299,000)                      ‐                         ‐                          ‐ Net change in fund balances          (52,527)              (6,823)            105,155               11,819                92,931 Fund balances ‐ July 1         169,503            340,331             222,031               37,916                22,354 Fund balances ‐ June 30 $     116,976  $       333,508  $        327,186  $          49,735  $         115,285 Special Revenue Funds
90 Law
Enforcement
Impact Fees
Administrative
Impact Fees
Fire
Development
Impact Fees
Storm Water
Impact Fees
Wastewater
Impact Fees
Parks
Facilities
Impact Fees
Recreation
Facilities
Impact Fees
$                  ‐     $                     ‐     $                  ‐     $                  ‐     $              ‐     $                 ‐     $                ‐ 3,976                    5,998                 2,652               22,406           38,093              23,881               4,269 241                       477                    252                 2,472             5,330                5,773               1,084 4,217                    6,475                 2,904               24,878           43,423              29,654               5,353 2,232                            ‐                 2,232                         ‐                     ‐                        ‐                       ‐ ‐                            ‐                         ‐                         ‐                     ‐                        ‐                       ‐ ‐                    2,232                         ‐                 2,232             2,232                        ‐                       ‐ ‐                            ‐                         ‐                         ‐                     ‐                2,232               2,232 ‐                            ‐                         ‐                         ‐                     ‐                        ‐                       ‐ 2,232                    2,232                 2,232                 2,232             2,232                2,232               2,232 1,985                    4,243                    672               22,646           41,191              27,422               3,121 ‐                            ‐                         ‐                         ‐                     ‐                        ‐                       ‐ ‐                            ‐                         ‐                         ‐            (85,000)          (121,898)           (51,000) ‐                            ‐                         ‐                         ‐            (85,000)          (121,898)           (51,000) 1,985                    4,243                    672               22,646          (43,809)            (94,476)           (47,879) 11,549                  23,564               12,931             125,427         276,726            311,195             97,403 $          13,534  $             27,807  $          13,603  $        148,073  $    232,917  $       216,719  $        49,524 91 CITY OF GROVER BEACH

NONMAJOR GOVERNMENTAL FUNDS

COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES For the Fiscal Year Ended June 30, 2023
Water
Development
Impact Fees
State
Mandated
ADA
Subsidized
Senior
Transportation
Local
Transportation
CDBG Non
Entitlement
Revenues:

Intergovernmental $                     ‐   $                 ‐   $                     ‐   $          441,601  $          239,462 Charges for services               33,015              5,515 Use of money and property                    359                                            402                 28,932 Total revenues               33,374              5,515                     402               470,533               239,462 Expenditures:

Public safety
Community development                                                                                                                       239,646 Public works                 2,232                                                                   37,850 Parks and recreation
Capital outlay
Total expenditures                 2,232                      ‐                          ‐                 37,850               239,646 Excess of revenues over (under) expenditures               31,142              5,515                     402               432,683                     (184) Other Financing Sources (Uses):

Transfers in
Transfers out              (32,253)            (6,000)
Total other financing sources (uses)              (32,253)            (6,000)                        ‐                           ‐ Net change in fund balances                (1,111)               (485)                    402               432,683                     (184) Fund balances ‐ July 1                       ‐              10,513                22,540            1,357,425                 28,212 Fund balances ‐ June 30 $            (1,111) $       10,028  $           22,942  $       1,790,108  $            28,028 Special Revenue Funds
92 Home Grant
Fund
Underground
Utilities
Capital
Projects Totals
$                      ‐   $                   ‐   $                   ‐          1,467,727 244,593
4,068                                        67,017
‐                  4,068                      ‐            1,779,337 51,517
239,646
355,213
4,464
915,162             933,577
‐                        ‐            915,162          1,584,417 ‐                4,068           (915,162)            194,920 915,162             915,162
(680,772)
915,162             234,390
‐                  4,068             429,310
122,500            228,264                      ‐            3,420,384 $          122,500  $       232,332  $                 ‐     $     3,849,694 Capital Project Funds
93 CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

GAS TAX
For the Fiscal Year Ended June 30, 2023
Final Budget Actual
Variance
Over/(Under)
Revenues:

Intergovernmental $    365,695  $      336,733  $         (28,962) Use of money and property             5,000                2,564                 (2,436) Total revenues         370,695           339,297               (31,398) Expenditures:

Public works         309,450           306,203                   3,247 Total expenditures         309,450           306,203                   3,247 Excess of revenues over (under) expenditures           61,245              33,094               (34,645) Other Financing Sources (Uses):

Transfers out       (185,008)           (85,621)               99,387 Total other financing sources (uses)       (185,008)           (85,621)               99,387 Net change in fund balance $   (123,763)           (52,527) $           64,742 Fund balance ‐ July 1          169,503
Fund balance ‐ June 30 $       116,976
94 CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

GAS TAX RMRA
For the Fiscal Year Ended June 30, 2023
Final Budget Actual
Variance
Over/(Under)
Revenues:

Intergovernmental $    328,788  $      284,660  $         (44,128) Use of money and property            5,000                7,517                  2,517 Total revenues        333,788           292,177               (41,611) Other Financing Sources (Uses):

Transfers out      (299,000)         (299,000)
Total other financing sources (uses)      (299,000)         (299,000) Net change in fund balance $      34,788              (6,823) $         (41,611) Fund balance ‐ July 1          340,331
Fund balance ‐ June 30 $       333,508
95 CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

PUBLIC SAFETY GRANTS
For the Fiscal Year Ended June 30, 2023
Final Budget Actual
Variance
Over/(Under)
Revenues:

Intergovernmental $   165,000  $      165,271  $                 271 Use of money and property           5,000                5,352                      352 Total revenues       170,000           170,623                      623 Expenditures:

Public safety         60,000              47,053                12,947 Capital outlay         20,000              18,415                   1,585 Total expenditures         80,000              65,468                14,532 Net change in fund balance $     90,000           105,155  $           15,155 Fund balance ‐ July 1          222,031
Fund balance ‐ June 30 $       327,186
96 CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

PARK CONSTRUCTION
For the Fiscal Year Ended June 30, 2023
Final Budget Actual
Variance
Over/(Under)
Revenues:

Charges for services $      10,500  $        11,004  $                 504 Use of money and property                500                   815                      315 Total revenues          11,000              11,819                      819 Expenditures:

Parks and recreation             9,000                         ‐                   9,000 Total expenditures             9,000                         ‐                   9,000 Excess of revenues over (under) expenditures             2,000              11,819                   9,819 Other Financing Sources (Uses):

Transfers out           (9,000)                  9,000
Total other financing sources (uses)           (9,000)                  9,000 Net change in fund balance $       (7,000)             11,819  $           18,819 Fund balance ‐ July 1            37,916
Fund balance ‐ June 30 $         49,735
97 CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

TRANSPORTATION IMPACT FEES
For the Fiscal Year Ended June 30, 2023
Final
Budget Actual
Variance
Over/(Under)
Revenues:

Charges for services $    30,000  $        93,784  $           63,784 Use of money and property          1,300                1,379                        79 Total revenues        31,300              95,163                63,863 Expenditures:

Public works          7,500                2,232                   5,268 Total expenditures          7,500                2,232                   5,268 Excess of revenues over (under) expenditures        23,800              92,931                69,131 Net change in fund balance $    23,800              92,931  $           69,131 Fund balance ‐ July 1            22,354
Fund balance ‐ June 30 $       115,285
98 CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

LAW ENFORCEMENT IMPACT FEES
For the Fiscal Year Ended June 30, 2023
Final
Budget Actual
Variance
Over/(Under)
Revenues:

Charges for services $    3,000  $           3,976  $                 976 Use of money and property            150                   241                        91 Total revenues         3,150                4,217                   1,067 Expenditures:

Public safety         7,500                2,232                   5,268 Total expenditures         7,500                2,232                   5,268 Net change in fund balance $   (4,350)               1,985  $             6,335 Fund balance ‐ July 1            11,549
Fund balance ‐ June 30 $         13,534
99 CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

ADMINISTRATIVE IMPACT FEES
For the Fiscal Year Ended June 30, 2023
Final Budget Actual
Variance
Over/(Under)
Revenues:

Charges for services $       3,200  $           5,998  $             2,798 Use of money and property               300                   477                      177 Total revenues           3,500                6,475                   2,975 Expenditures:

General government           7,500                2,232                   5,268 Total expenditures           7,500                2,232                   5,268 Net change in fund balance $      (4,000)               4,243  $             8,243 Fund balance ‐ July 1            23,564
Fund balance ‐ June 30 $         27,807
100

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

FIRE DEVELOPMENT IMPACT FEES
For the Fiscal Year Ended June 30, 2023
Final
Budget Actual
Variance
Over/(Under)
Revenues:

Charges for services $      5,000  $           2,652  $            (2,348) Use of money and property             150                   252                      102 Total revenues          5,150                2,904                 (2,246) Expenditures:

Public safety          7,500                2,232                   5,268 Total expenditures          7,500                2,232                   5,268 Net change in fund balance $    (2,350)                  672  $             3,022 Fund balance ‐ July 1            12,931
Fund balance ‐ June 30 $         13,603
101

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

STORM WATER IMPACT FEES
For the Fiscal Year Ended June 30, 2023
Final
Budget Actual
Variance
Over/(Under)
Revenues:

Charges for services $   10,000  $        22,406  $           12,406 Use of money and property         2,000                2,472                      472 Total revenues       12,000              24,878                12,878 Expenditures:

Public works         7,500                2,232                   5,268 Total expenditures         7,500                2,232                   5,268 Net change in fund balance $     4,500              22,646  $           18,146 Fund balance ‐ July 1          125,427
Fund balance ‐ June 30 $       148,073
102

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

WASTEWATER IMPACT FEES
For the Fiscal Year Ended June 30, 2023
Final Budget Actual
Variance
Over/(Under)
Revenues:

Charges for services $     50,000  $        38,093  $         (11,907) Use of money and property           5,000                5,330                      330 Total revenues         55,000              43,423               (11,577) Expenditures:

Public works           7,500                2,232                   5,268 Total expenditures           7,500                2,232                   5,268 Excess of revenues over (under) expenditures         47,500              41,191                 (6,309) Other Financing Sources (Uses):

Transfers out        (85,000)           (85,000)                          ‐ Total other financing sources (uses)        (85,000)           (85,000)                        ‐ Net change in fund balance $   (37,500)           (43,809) $            (6,309) Fund balance ‐ July 1          276,726
Fund balance ‐ June 30 $       232,917
103

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

PARKS FACILITIES IMPACT FEES
For the Fiscal Year Ended June 30, 2023
Final Budget Actual
Variance
Over/(Under)
Revenues:

Charges for services $     71,000  $        23,881  $         (47,119) Use of money and property           8,000                5,773                 (2,227) Total revenues         79,000              29,654               (49,346) Expenditures:

Parks and recreation           7,500                2,232                   5,268 Total expenditures           7,500                2,232                   5,268 Excess of revenues over (under) expenditures         71,500              27,422               (44,078) Other Financing Sources (Uses):

Transfers out     (385,474)         (121,898)             263,576 Total other financing sources (uses)     (385,474)         (121,898)             263,576 Net change in fund balance $ (313,974)           (94,476) $         219,498 Fund balance ‐ July 1          311,195
Fund balance ‐ June 30 $       216,719
104

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

RECREATION FACILITIES IMPACT FEES
For the Fiscal Year Ended June 30, 2023
Final
Budget Actual
Variance
Over/(Under)
Revenues:

Charges for services $    12,000  $           4,269  $            (7,731) Use of money and property          1,500                1,084                    (416) Total revenues        13,500                5,353                 (8,147) Expenditures:

Parks and recreation          7,500                2,232                   5,268 Total expenditures          7,500                2,232                   5,268 Excess of revenues over (under) expenditures          6,000                3,121                 (2,879) Other Financing Sources (Uses):

Transfers out      (51,000)           (51,000)                          ‐ Total other financing sources (uses)      (51,000)           (51,000)                        ‐ Net change in fund balance $  (45,000)           (47,879) $            (2,879) Fund balance ‐ July 1            97,403
Fund balance ‐ June 30 $         49,524
105

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

WATER DEVELOPMENT IMPACT FEES
For the Fiscal Year Ended June 30, 2023
Final
Budget Actual
Variance
Over/(Under)
Revenues:

Charges for services $    32,000  $        33,015  $             1,015 Use of money and property                   ‐                   359                      359 Total revenues        32,000              33,374                   1,374 Expenditures:

Public works          7,500                2,232                   5,268 Total expenditures          7,500                2,232                   5,268 Excess of revenues over (under) expenditures        24,500              31,142                   6,642 Other Financing Sources (Uses):

Transfers out       (32,000)           (32,253)                   (253) Total other financing sources (uses)       (32,000)           (32,253)                   (253) Net change in fund balance $     (7,500)             (1,111) $             6,389 Fund balance ‐ July 1                  ‐
Fund balance ‐ June 30 $          (1,111)
106

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

STATE MANDATED ADA
For the Fiscal Year Ended June 30, 2023
Final
Budget Actual
Variance
Over/(Under)
Revenues:

Charges for services $      6,000  $           5,515  $               (485) Total revenues          6,000                5,515                    (485) Other Financing Sources (Uses):

Transfers out         (6,000)             (6,000)
Total other financing sources (uses)         (6,000)             (6,000) Net change in fund balance $             ‐                    (485) $               (485) Fund balance ‐ July 1            10,513
Fund balance ‐ June 30 $         10,028
107

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

SUBSIDIZED SENIOR TRANSPORTATION
For the Fiscal Year Ended June 30, 2023
Final
Budget Actual
Variance
Over/(Under)
Revenues:

Intergovernmental $     5,000  $                 ‐     $            (5,000) Use of money and property                  402                      402 Total revenues         5,000                   402                 (4,598) Expenditures:

Public works         1,000                         ‐                   1,000 Total expenditures         1,000                         ‐                   1,000 Excess of revenues over (under) expenditures         4,000                   402                 (3,598) Other Financing Sources (Uses):

Transfers out                ‐                         ‐                             ‐ Total other financing sources (uses)                ‐                         ‐                           ‐ Net change in fund balance $     4,000                   402  $            (3,598) Fund balance ‐ July 1            22,540
Fund balance ‐ June 30 $         22,942
108

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

LOCAL TRANSPORTATION FUND
For the Fiscal Year Ended June 30, 2023
Final Budget Actual
Variance
Over/(Under)
Revenues:

Intergovernmental $    468,200  $      441,601  $         (26,599) Use of money and property             2,000              28,932                26,932 Total revenues        470,200           470,533                      333 Expenditures:

Public works          84,500              37,850                46,650 Total expenditures          84,500              37,850                46,650 Excess of revenues over (under) expenditures        385,700           432,683                46,983 Other Financing Sources (Uses):

Transfers out       (160,000)                      ‐                160,000 Total other financing sources (uses)       (160,000)                      ‐                160,000 Net change in fund balance $    225,700           432,683  $         206,983 Fund balance ‐ July 1       1,357,425
Fund balance ‐ June 30 $   1,790,108
109

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL CDBG NON‐ENTITLEMENT
For the Fiscal Year Ended June 30, 2023
Final Budget Actual
Variance
Over/(Under)
Revenues:

Intergovernmental $               ‐     $      239,462  $         239,462 Total revenues                   ‐             239,462              239,462 Expenditures:

Community development          239,646            (239,646) Total expenditures          239,646            (239,646) Excess of revenues over (under) expenditures                     ‐                  (184)                   (184) Net change in fund balance $               ‐                    (184) $               (184) Fund balance ‐ July 1            28,212
Fund balance ‐ June 30 $         28,028
110

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

HOME GRANT FUND
For the Fiscal Year Ended June 30, 2023
Final Budget Actual
Variance
Over/(Under)
Revenues:

Other $              ‐     $                  ‐     $                    ‐ Total revenues                  ‐                         ‐                           ‐ Net change in fund balance $              ‐                         ‐     $                    ‐ Fund balance ‐ July 1          122,500
Fund balance ‐ June 30 $       122,500
111

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

UNDERGROUND UTILITIES
For the Fiscal Year Ended June 30, 2023
Final
Budget Actual
Variance
Over/(Under)
Revenues:

Use of money and property $      4,000  $           4,068  $                   68 Total revenues          4,000                4,068                        68 Net change in fund balance $      4,000                4,068  $                   68 Fund balance ‐ July 1          228,264
Fund balance ‐ June 30 $       232,332
112

CITY OF GROVER BEACH
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE ‐ BUDGET TO ACTUAL

CAPITAL PROJECTS
For the Fiscal Year Ended June 30, 2023
Final Budget Actual
Variance
Over/(Under)
Revenues:

Intergovernmental $                  ‐     $                 ‐     $                    ‐ Total revenues                      ‐                         ‐                           ‐ Expenditures:

Capital outlay        4,437,226           915,162           3,522,064 Total expenditures        4,437,226           915,162           3,522,064 Excess of revenues over (under) expenditures      (4,437,226)         (915,162)          3,522,064 Other Financing Sources (Uses):

Transfers in        4,437,226           915,162         (3,522,064) Total other financing sources (uses)        4,437,226           915,162         (3,522,064) Net change in fund balance $                  ‐     $                    ‐ Fund balance ‐ July 1
Fund balance ‐ June 30 $               ‐
113

CITY OF GROVER BEACH

COMBINING STATEMENT OF FIDUCIARY NET POSITION

PRIVATE PURPOSE TRUST FUNDS
June 30, 2023
Housing
Successor
Agency
RDA Successor
Agency Total
ASSETS
Cash and investments $               23,913  $             (11,284) $             12,629 Cash and investments with fiscal agent                 297,062               297,062 Land held for projects                 380,000               380,000 Total assets                 403,913                  285,778               689,691

LIABILITIES
Accounts payable
Accrued interest payable                   55,729                 55,729 Unearned revenue                 222,375               222,375 Noncurrent liabilites
Due within one year                 150,000               150,000 Due in more than one year             2,554,869            2,554,869 Total Liabilities             2,982,973            2,982,973

NET POSITION
Restricted for:

Individuals, organizations, and other governments $             403,913 $        (2,697,195) $      (2,293,282) 114

CITY OF GROVER BEACH

PRIVATE PURPOSE TRUST FUNDS
For the Fiscal Year Ended June 30, 2023
Housing
Successor Agency
RDA Successor
Agency Total
Additions:

Taxes $                           ‐ $            293,375 $           293,375 Interest                    9,861                   9,861 Other                            ‐
Total additions                              ‐                303,236              303,236 Deductions:

Community development                    7,221                   7,221 Interest expense                134,342              134,342 Total deductions                              ‐                141,563              141,563 Change in net position                         ‐                161,673              161,673 Total net position‐beginning                403,913          (2,858,868)         (2,454,955) Total net position‐ending $             403,913 $        (2,697,195) $      (2,293,282)

COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION 115

CITY OF GROVER BEACH

CUSTODIAL FUNDS
June 30, 2023
Tourism
Marketing
District Tax
Fund
Building and
Planning
Fund
Deposit
Fund  Total
ASSETS
Cash and investments $          10,321  $       107,187  $       171,814 $       289,323 Accounts Receivable ‐ Other $            1,319 $            1,319 Total assets              10,321             107,187             173,133            290,642

LIABILITIES
Accounts payable and other liabilities              29,818              29,818 Due to other governments              10,321            107,187            194,867            312,376 Total Liabilities              10,321             107,187             224,685            342,194

NET POSITION
Restricted for:

Individuals, organizations, and other
governments $                   ‐     $                   ‐    $         (51,552) $        (51,552)

COMBINING STATEMENT OF FIDUCIARY NET POSITION
116

CITY OF GROVER BEACH

CUSTODIAL FUNDS
For the Fiscal Year Ended June 30, 2023
Tourism
Marketing
District Tax
Fund
Building and
Planning
Fund
Deposit
Fund  Total
Additions:

Taxes for other governments $       110,805 $                    ‐ $                    ‐ $       110,805 Security deposits          153,675           153,675
Building and planning deposits           108,226           108,226 Other             30,726             30,726
Total additions           110,805           108,226           184,401           403,432 Deductions:

Building and planning expense           125,662           125,662 Payments to other governments          109,401           109,401 Refunds          164,728           164,728
Other expense                5,986                5,986 Total deductions           109,401           125,662           170,714           405,777 Change in net position               1,404           (17,436)             13,687              (2,345) Total net position‐beginning             (4,579)           (33,062)           (11,566)           (49,207) Total net position‐ending $           (3,175) $         (50,498) $            2,121 $         (51,552)

COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION 117

CITY OF GROVER BEACH

SCHEDULE OF DEBT SERVICE COVERAGE
For the Fiscal Year Ended June 30, 2023
2023
Service charges $ 3,501,444
Other operating revenue        137,405
Total service charges     3,638,849
Investment income        118,037
Other income                 ‐
Total miscellaneous revenue        118,037
Total Revenue $ 3,756,886
Personnel costs        422,986
Supplies (1)        724,241
Lopez Contract O&M (2)        828,088
Lopez Dam Bonds ‐ 2011A Debt Service (2) (3)          83,500 Lopez SRF Loan Debt Service (2)        295,254
Lopez Capital Outlay (2)          88,300
Other Charges (1), (4)        252,846
2,695,215
25% Coverage Factor of Lopez 2011A Bonds (5)          20,875 Total Operations and Maintenance     2,716,090
Net Revenue Available for Debt Service $ 1,040,796
Debt service:
2020 Water Bond        279,878
Total debt service        279,878
Net Revenue after Debt Service
Calculated coverage 3.71874888
Meets covenant restrictions yes
Notes:
(1) Supplies and services less (2) and (3)
(2) Includes actual cost from San Luis Obispo County
(3) Includes debt service allocated to the City, net of County received property taxes (4) Includes non‐capital equipment and depreciation expense (5) For Lopez 2011A bonds, pledge of gross revenue requires coverage factor of 25% of Lopez 2011A bond debt service
118

STATISTICAL

SECTION
119

STATISTICAL SECTION
This section of the City’s Annual Comprehensive Financial Report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City’s overall financial health.

Financial Trends Information
These schedules contain trend information to help the reader understand how the City’s financial performances and well‐being have changed over time.

Revenue Capacity Information
These schedules contain trend information to help the reader understand the City’s most significant local revenue source, property taxes.

Debt Capacity Information
These schedules contain trend information to help the reader assess the affordability of the City’s current level of outstanding debt and the City’s ability to issue additional debt in the future.

Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the environment within which the City’s financial activities take place.

Operating Information
These schedules contain service and infrastructure data to help the reader understand how the information in the City’s financial report relates to the services the City provides and the activities it performs.

Sources
Unless otherwise noted, the information in these schedules is derived from the Annual Comprehensive Financial Reports for the relevant year.

CITY OF GROVER BEACH

NET POSITION BY COMPONENT
Last Ten Fiscal Years
2014 2015 2016 2017
Governmental Activities
Net investment in capital assets $  16,199,940  $  15,969,238  $  12,890,591  $  10,357,447 Restricted        1,666,256         2,346,071       14,200,615       11,338,614 Unrestricted            885,639        (5,072,493)    (14,013,120)    (11,773,429) Total governmental activities net position      18,751,835       13,242,816       13,078,086         9,922,632 Business‐type Activities
Net investment in capital assets $    5,401,948  $    5,214,650  $    5,703,245  $    5,601,488 Restricted
Unrestricted        6,669,924         6,400,614         5,734,800         5,486,860 Total business‐type activities net position $  12,071,872  $  11,615,264  $  11,438,045  $  11,088,348 Primary Government
Net investment in capital assets $  21,601,888  $  21,183,888  $  18,593,836  $  15,958,935 Restricted        1,666,256         2,346,071       14,200,615       11,338,614 Unrestricted        7,555,563         1,328,121        (8,278,320)       (6,286,569) Total primary government net position $  30,823,707  $  24,858,080  $  24,516,131  $  21,010,980 Fiscal Year
120
2018 2019 2020 2021 2022 2023
$    3,309,344  $  17,844,806  $  19,087,485  $  19,441,210  $  (7,176,380) $  12,052,420 4,335,595       16,443,580       12,464,114         9,082,474         6,224,776         6,644,643 (6,661,847)    (35,569,175)    (34,991,224)    (33,038,276)       (3,999,262)    (22,980,844) 983,092        (1,280,789)       (3,439,625)       (4,514,592)       (4,950,866)      (4,283,781) $    5,425,644  $    5,312,360  $    1,899,045  $    6,673,989  $    8,082,305  $    7,817,262 5,068,837         5,716,976       11,058,092         7,521,866         8,124,079         6,500,613 $  10,494,481  $  11,029,336  $  12,957,137  $  14,195,855  $  16,206,384  $  14,317,875 $    8,734,988  $  23,157,166  $  20,986,530  $  26,115,199  $       905,925  $  19,869,682 4,335,595       16,443,580       12,464,114         9,082,474         6,224,776         6,644,643 (1,593,010)    (29,852,199)    (23,933,132)    (25,516,410)        4,124,817     (16,480,231) $  11,477,573  $    9,748,547  $    9,517,512  $    9,681,263  $  11,255,518  $  10,034,094 Fiscal Year
121
2014 2015 2016 2017
General government $    1,169,957  $    1,516,480  $    1,884,959  $    2,086,579 Public safety        4,514,113         4,775,994         3,738,665         5,535,688 Community development            425,966             487,336             806,727         1,195,283 Public works        1,476,487         1,547,554         5,194,271         7,433,919 Parks and recreation            423,917             701,247             717,105             475,754 Total governmental activities        8,010,440         9,028,611       12,341,727       16,727,223 Water        2,639,329         2,595,771         3,814,432         2,724,944 Water conservation              42,421             159,739             126,950               92,307 Wastewater        1,933,447         1,684,728         1,591,627         2,594,299 Storm water
Building and planning
Total business‐type activities:        4,615,197         4,440,238         5,533,009         5,411,550 Total primary government expenses $  12,625,637  $  13,468,849  $  17,874,736  $  22,138,773 General government $       202,839  $       214,898  $       523,119  $       380,195 Public safety            120,492             139,906             127,024             131,546 Community development            278,829             443,144 Public works            145,633             209,789             698,187             588,912 Parks and recreation            287,332             346,798             326,693             200,647 572,259             758,249         1,474,983         1,874,270 1,106,217             799,651         1,425,586         1,489,982 Total governmental activities program
revenues $    2,713,601  $    2,912,435  $    4,575,592  $    4,665,552 Water        3,323,751         2,848,085         2,617,463         2,698,170 Water conservation              41,625             104,873             238,095             194,268 Wastewater        2,190,405         2,165,005         2,214,610         2,598,351 Storm water
Building and planning
Total business‐type activities program
revenues        5,555,781         5,117,963         5,070,168         5,490,789 Total primary government program
revenues $    8,269,382  $    8,030,398  $    9,645,760  $  10,156,341 Fiscal Year
Business‐type Activities:

Capital contributions and grants

CITY OF GROVER BEACH

CHANGES IN NET POSITION
Last Ten Fiscal Years
Charges for services:

Capital contributions and grants:

EXPENSES
Governmental Activities
Business‐type Activities:

PROGRAM REVENUES
Governmental Activities
Charges for services:

Operating contributions and grants
122
2018 2019 2020 2021 2022 2023
$    2,670,331  $    2,716,640  $    3,275,341  $    4,363,505  $    4,695,218  $    4,657,513 6,490,947         6,171,995         7,580,648         7,385,514         7,977,222         7,826,482 679,727             611,340         1,064,355             698,932             976,070             851,204 9,986,270         7,859,731         7,994,179         5,961,342         7,821,460         7,100,166 482,567             537,448             517,919             373,201             606,330             603,660 20,309,842       17,897,154       20,432,442       18,782,494       22,076,300       21,039,025 3,589,286         2,857,203         2,900,305         3,181,371         3,149,314         5,389,559 26,131                 9,658               13,278                 9,265               11,291               19,282 2,763,509         1,147,410         1,142,702         1,297,102         1,348,332         1,150,078 6,378,926         4,014,271         4,056,285         4,487,738         4,508,937         6,558,919 $  26,688,768  $  21,911,425  $  24,488,727  $  23,270,232  $  26,585,237  $  27,597,944 $       416,456  $       681,253  $       400,435  $       721,381  $       798,367  $       995,944 153,464             213,377             224,084               46,924               58,587               59,895 149,698               86,368             149,400             187,500             197,365             185,000 774,174             574,020             639,556             218,552             241,138             355,512 259,066             245,015             261,915               57,443             194,199             203,498 652,324             804,496         2,919,414         1,405,720         4,045,051         1,862,592 205,034         1,792,844         1,737,261             639,160         1,131,438             437,101 $    2,610,216  $    4,397,373  $    6,332,065  $    3,276,680  $    6,666,145  $    4,099,542 3,290,282         3,532,917         3,973,531         4,311,419         3,906,986         3,638,849 49,651               22,418
2,781,150         1,358,119         1,263,722         1,272,571         1,306,389         1,327,978 6,121,083         4,913,454         5,237,253         5,583,990         5,213,375         4,966,827 $    8,731,299  $    9,310,827  $  11,569,318  $    8,860,670  $  11,879,520  $    9,066,369 Fiscal Year
123
2014 2015 2016 2017
Fiscal Year
Net revenue (expense)
Governmental activities $    6,315,010  $    9,429,292  $  12,151,631  $  15,644,290 Business‐type activitiesl activities       (1,115,543)            415,046             341,382             888,137 Total primary government  $    5,199,467  $    9,844,338  $  12,493,013  $  16,532,427 Taxes:

Secured and unsecured property taxes        3,825,049         3,968,869         4,478,834         4,614,075 Other taxes        2,584,155         2,742,187         3,135,658         3,378,521 Investment income (loss)                7,034               13,934               30,311               43,797 Other revenues                9,126               60,900             294,663             446,058 Extraordinary gain
Transfers             465,471             459,713             343,935             463,766 Total governmental activities        6,890,835         7,245,603         8,283,401         8,946,217 Investment income (loss)                8,244                 9,476               12,249               34,830 Other revenues
Transfers           (465,471)          (459,713)          (343,935)          (463,766) Total business‐type activities          (457,227)          (450,237)          (331,686)          (428,936) Total primary government  $    6,433,608  $    6,795,366  $    7,951,715  $    8,517,281 Governmental activities $       575,825  $  (2,183,689) $  (3,868,230) $  (6,698,073) Business‐type activities            658,316           (865,283)          (673,068)       (1,317,073) Total primary government $    1,234,141  $  (3,048,972) $  (4,541,298) $  (8,015,146)

CHANGE IN NET POSITION

GENERAL REVENUES AND OTHER CHANGES

IN NET POSITION
Governmental Activities
Business‐type Activities:
124
2018 2019 2020 2021 2022 2023
Fiscal Year
$  15,286,938  $  16,035,069  $  14,100,377  $  15,505,814  $  15,410,155  $  16,939,483 (2,106,812)          (857,169)       (1,180,968)       (1,096,252)          (704,438)        1,592,092 $  13,180,126  $  15,177,900  $  12,919,409  $  14,409,562  $  14,705,717  $  18,531,575 5,044,595         5,970,615         6,209,369         6,509,477         6,836,295         7,552,939 3,382,130         4,896,931         6,191,702         7,843,083         9,143,089         9,124,697 74,531             192,334             171,193             (22,612)          (184,073)            336,714 13,875               90,956               19,476               59,549             384,506             101,928 410,323             502,499           (650,199)              41,350        (1,205,936)            490,290 8,925,454       11,653,335       11,941,541       14,430,847       14,973,881       17,606,568 26,149               86,155               96,634               49,547               48,536             193,873 134,269               51,619                          ‐ (410,323)          (502,499)            650,199             (41,350)        1,205,936           (490,290) (384,174)          (416,344)            746,833             142,466         1,306,091           (296,417) $    8,541,280  $  11,236,991  $  12,688,374  $  14,573,313  $  16,279,972  $  17,310,151 $  (6,361,484) $  (4,381,734) $  (2,158,836) $  (1,074,967) $      (436,274) $       667,085 1,722,638             440,825         1,927,801         1,238,718         2,010,529        (1,888,509) $  (4,638,846) $  (3,940,909) $      (231,035) $       163,751  $    1,574,255  $  (1,221,424) 125

CITY OF GROVER BEACH

FUND BALANCES OF GOVERNMENTAL FUNDS
Last Ten Fiscal Years
2014 2015 2016 2017

GENERAL FUND
Nonspendable $             1,612  $             1,612  $               1,612  $              1,612 Unassigned          2,338,162          2,928,630            3,456,896           3,053,454 Total general fund $     2,339,774  $     2,930,242  $       3,458,508  $      3,055,066

ALL OTHER GOVERNMENTAL FUNDS
Restricted $     1,666,256  $     7,322,212  $     14,049,871  $    10,802,117 Unassigned              (45,976)             (40,997)                     (326)            (107,570) Total all other governmental funds $     1,620,280  $     7,281,215  $     14,049,545  $    10,694,547 Fiscal Year
Effective June 30, 2011, the City of Grover Beach implemented GASB Statement No. 54 classifications of fund balance.
126
2018 2019 2020 2021 2022 2023
$              1,612  $              1,612  $          86,115  $              2,823  $              1,612  $              2,760 1,269,091           2,210,205          3,183,015           4,048,221           5,784,056           7,485,453 $      1,270,703  $      2,211,817  $     3,269,130  $      4,051,044  $      5,785,668  $      7,488,213 $    19,066,870  $    16,339,179  $   12,195,614  $      9,082,474  $    15,536,693  $    12,361,098 1,179,248             (378,497)           (349,107)            (322,696)                 (1,111) $    20,246,118  $    15,960,682  $   11,846,507  $      8,759,778  $    15,536,693  $    12,359,987 Fiscal Year
127
2014 2015 2016 2017
Taxes $   6,409,204  $   6,711,056  $ 7,614,492  $ 7,992,596 Licenses, permits, and fees           216,006           255,717          302,023          258,201 Intergovernmental       1,677,976        1,517,900       2,871,124       3,364,252 Charges for services           563,865           742,111       1,003,102          695,134 Fines and forfeitures             60,053             70,319            61,822            79,365 Use of money and property           172,643           250,021          315,926          314,460 Other             39,218           151,202          194,245          265,891 Total revenues       9,138,965        9,698,326    12,362,734    12,969,899 General government       1,129,692        1,385,147       1,759,005       1,951,745 Public safety       4,470,611        4,808,341       5,005,977       5,337,278 Community development           373,609           428,979          746,748       1,131,505 Public works       1,148,494        1,347,199       1,514,746       1,665,054 Parks and recreation           392,651           391,954          413,671          438,981 Capital outlay           681,382           895,621       4,239,849       6,043,779 Debt service:

Principal             33,689             22,673            22,893          133,130 Interest               3,172                2,947          193,530          450,633 Total expenditures       8,233,300        9,282,861    13,896,419    17,152,105 Excess of revenues over (under)
expenditures           905,665           415,465     (1,533,685)    (4,182,206) Long‐term debt issued
Lease liability (as lease)
Transfers in           520,189           508,012          549,308          576,979 Transfers out           (54,718)           (48,299)       (205,373)       (113,213) Bond proceeds       5,376,225       8,509,358
Total other financing sources (uses)           465,471        5,835,938       8,853,293          463,766 Net change in fund balances $   1,371,136  $   6,251,403  $ 7,319,608  $(3,718,440) Debt service as a percentage of
non‐capital expenditures 0.48% 0.31% 1.67% 3.62%

CITY OF GROVER BEACH
Last Ten Fiscal Years
Fiscal Year

CHANGES IN FUND BALANCES OF GOVERNMENTAL

REVENUES

EXPENDITURES

OTHER FINANCING SOURCES (USES)
128
2018 2019 2020 2021 2022 2023
$   8,426,725 $10,867,546 $  12,401,071  $  14,352,559  $   15,979,383  $   16,677,637 295,736          430,005            406,479            335,682              351,466              424,554 852,357      2,597,339         4,656,675         2,044,880          5,176,489          2,299,693 1,124,635      1,127,114         1,070,362            779,821              970,860          1,197,700 71,626            62,378              57,198               40,845                47,823                42,857 328,910          433,845            294,560            103,952              (45,691)             473,135 25,358            29,981              17,400               28,500              488,132              100,244 11,125,347      15,548,208        18,903,745       17,686,239        22,968,462        21,215,820 2,518,969        2,589,635          3,056,601         4,210,209          4,443,393          4,517,231 5,738,932        5,671,913          6,749,585         7,235,622          7,592,483          7,856,406 608,668           566,312             967,603            706,733              949,997              904,966 1,906,684        6,375,483          6,426,259         4,615,693          7,011,955          5,706,596 441,286           462,319             420,650            335,923              550,091              555,034 7,813,816        2,213,161          1,842,128         1,088,752          2,707,198          1,600,781 360,169           467,695             814,627            842,171              852,838          1,045,202 589,631        1,050,787          1,032,955            997,301              971,370          1,338,668 19,978,155      19,397,305        21,310,408       20,032,404        25,079,325        23,524,884 (8,852,808)     (3,849,097)       (2,406,663)       (2,346,165)        (2,110,863)        (2,309,064) 16,209,693           434,614
371,147
484,104           540,483             571,605         1,302,405          3,231,799          1,558,569 (73,781)           (37,984)       (1,221,804)       (1,261,055)        (4,437,735)        (1,068,279) 11,457,191
16,620,016           937,113           (650,199)              41,350        10,622,402              834,903 $   7,767,208  $ (2,911,984) $   (3,056,862) $  (2,304,815) $     8,511,539  $    (1,474,161)

5.13% 8.84% 9.49% 9.71% 8.35% 11.04%
Fiscal Year
129

CITY OF GROVER BEACH
Last Ten Fiscal Years
Fiscal
Year Property Sales & Use Cannabis
Transient
Occupancy
Franchise
Fees Other Total
2014         3,825,049          1,588,136        278,456         506,171         211,392  $    6,409,204 2015         3,968,869          1,720,394        314,272         509,642         197,879  $    6,711,056 2016         4,478,834          2,044,178        363,352         523,347         204,781  $    7,614,492 2017         4,614,075          2,221,417        368,672         542,912         245,520  $    7,992,596 2018         5,044,595          2,188,629          16,359        371,169         529,160         276,813  $    8,426,725 2019         5,970,615          2,657,247        953,342        433,249         555,460         297,633  $  10,867,546 2020         6,209,369          2,819,913    1,936,729        433,460         585,035         416,565  $  12,401,071 2021         6,509,477          3,846,966    2,424,914        580,423         600,228         390,552  $  14,352,560 2022         6,836,295          5,649,554    1,515,590        952,228         619,416         406,301  $  15,979,384 2023         7,552,939          5,882,949    1,198,037        924,162         713,394         406,155  $  16,677,636 TAX REVENUE BY SOURCE ‐ GENERAL FUND
‐
2 4
6 8
10 12
14 16
18 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

MILLIONS
Property Sales & Use Cannabis Transient Occupancy Franchise Fees Other 130

CITY OF GROVER BEACH
Last Ten Fiscal Years
Fiscal Year Secured Unsecured SBE Nonunitary Net Total AV % Change 2014      1,279,956,046          38,338,700               369,633       1,318,664,379 2015      1,366,395,227          34,940,002               350,890       1,401,686,119 6.30% 2016      1,428,953,619          36,070,896               340,461       1,465,364,976 4.54% 2017      1,507,554,753          40,916,971               307,339       1,548,779,063 5.69% 2018      1,589,746,399          37,312,380               311,781       1,627,370,560 5.07% 2019      1,691,583,881          39,079,692               295,068       1,730,958,641 6.37% 2020      1,774,051,571          42,307,282               295,699       1,816,654,552 4.95% 2021      1,855,486,235          45,766,485               290,500       1,901,543,220 4.67% 2022      1,934,674,078          27,407,309               285,642       1,962,367,029 3.20% 2023      2,060,810,502          27,901,941               388,172       2,089,100,615 6.46% Notes:

A) Secured property is generally real property, defined as land, mines, minerals, timber and improvements such as buildings, structures, crops, trees and vines.

B) Unsecured property is generally personal property including machinery, equipment, office tools and supplies.

Data Source: San Luis Obispo County Assessor FY 2013‐14 to FY 2022‐23 Combined Tax Rolls HDL, Coren & Cone FY 2013‐14 to FY 2022‐23

NET TAXABLE ASSESSED VALUE HISTORY
0 200
400
600
800
1000
1200
1400
1600
1800
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

MILLIONS
Fiscal Year Secured Unsecured SBE Nonunitary
131
2014 2015 2016 2017
Residential $  1,075,424,353  $  1,155,793,567  $   1,222,920,374  $  1,291,868,396 Commercial          129,403,170           133,744,656           136,713,661           142,779,798 Industrial            43,925,036             44,165,492             35,828,814             36,762,963 Government Owned                   23,154                    23,258                     23,722                    24,082 Dry Farm
Institutional              1,514,274               1,810,146               1,551,535               1,539,460 Irrigated              1,138,890               1,231,983               1,256,596               1,275,757 Miscellaneous              2,376,989               2,234,368               2,606,272               2,776,708 Recreational              1,024,622               1,029,268               1,044,460               1,060,383 Vacant            25,125,558             26,362,489             27,008,185             29,467,206 1,279,956,046       1,366,395,227        1,428,953,619       1,507,554,753 369,633                  350,890                   340,461                  307,339 38,338,700             34,940,002             36,070,896             40,916,971 $  1,318,664,379  $  1,401,686,119  $   1,465,364,976  $  1,548,779,063

0.18510 0.18390 0.18532 0.18530
Notes:

B) In 1978 the voters of the State of California passed Proposition 13 which limited taxes to a total maximum rate of 1%, based upon the assessed value of the property being taxed.

Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum of 2%).

With few exceptions, property is only reassessed as a result of new construction activity or at the time it is sold to a new owner.  At that point, the property is reassessed based upon the added value of the construction or at the purchase price (market value) or economic value of the property sold.  The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above.

Data Source: San Luis Obispo County Assessor FY 2013‐14 to FY 2022‐23 Combined Tax Rolls HDL, Coren & Cone FY 2013‐14 to FY 2022‐23
Secured
Unknown
Total Secured
Fiscal Year

CITY OF GROVER BEACH

ASSESSED VALUE OF TAXABLE PROPERTY
Last Ten Fiscal Years
Category
Unsecured
Totals
Total Direct Rate
A) Exempt values are not included in Total.

SBE Nonunitary
132
2018 2019 2020 2021 2022 2023
$  1,367,724,526 $   1,445,030,947 $  1,500,964,842  $  1,568,642,884  $  1,655,549,609  $  1,772,551,906 149,072,791           147,306,313           149,800,008           158,850,295           163,479,302           169,592,187 37,867,319           69,391,476            68,420,094             71,395,036             74,970,268             79,062,188 24,562 25,053 26,332 26,857
2,330,851               2,377,466
1,625,318 1,805,612              2,235,079               1,648,802               1,665,882               1,699,198 1,451,248 1,480,272              1,509,876               1,540,073               1,556,026               1,587,145 2,819,803 3,235,053              4,067,641              4,135,414               3,413,905               3,471,921 1,082,022 1,103,657              1,119,771               1,142,162                  903,223                  921,285 28,078,810           22,205,498            41,105,924             43,482,466             33,109,531             31,897,815 2,497,485               2,271,637
1,589,746,399       1,691,583,881       1,774,051,571       1,855,486,235       1,934,674,078       2,060,810,502 311,781                  295,068                  295,699                  290,500                  285,642                  388,172 37,312,380             39,079,692             42,307,282             45,766,485             27,407,309             27,901,941 $  1,627,370,560  $  1,730,958,641  $  1,816,654,552  $  1,901,543,220  $  1,962,367,029  $  2,089,100,615

0.18547 0.18536 0.18494 0.18514 0.18526 0.18540
Fiscal Year
133
2014 2015 2016 2017

1.00000 1.00000 1.00000 1.00000
Cuesta Community College 2014 A & A1 0.00000 0.00000 0.01925 0.01925 Grover Beach Road 2014 Series A & B 0.00000 0.00000 0.02400 0.03431 Lopez Dam Retrofit 2011 Ref 2000 0.00992 0.00992 0.00982 0.00882 Lucia Mar Unified 0.03994 0.04094 0.04094 0.03994
State Water Bond 0.00400 0.00400 0.00374 0.00400

1.05386 1.05486 1.09775 1.10632

0.18408 0.18362 0.18423 0.18253

0.18510 0.18390 0.18532 0.18500
Notes:

This 1% is shared by all taxing agencies for which the subject property resides within.  In addition to the 1% fixed amount, property owners are charged taxes as a percentage of assessed property values for the payment of any voter approved bonds.
(2) Overlapping rates are those of local and county governments that apply to property owners within the City.

Not all overlapping rates apply to all property owners. (3) City's Share of 1% Levy is based on the City's share of the general fund tax rate area with the largest net taxable value within the City.  The ERAF portion of the City's Levy has been subtracted where known. and is subject to the limitations described above.
(4) Redevelopment Rate is based on the largest RDA tax rate area and only includes rate(s) from indebtedness adopted prior to 1989 per California State statute.  RDA direct and overlapping rates are applied only to the incremental property values.  The approval of ABX1 26 eliminated Redevelopment from the State of California for the fiscal year 2012‐13 and years therafter.
(5) Total Direct Rate is the weighted average of all individual direct rates applied by the City/Agency preparing the statistical section information and excludes revenues derived from aircraft.  Beginning in FY 2013‐14 the Total Direct Rate no longer includes revenue generated from the former redevelopment tax rate areas.

Challenges to recognized enforceable obligations are assumed to have been resolved during FY 2012‐13.  For the purpose of this report, residual revenue is assumed to be distributed to the City/Agency in the same proportions as general fund revenue.

HDL, Coren & Cone FY 2013‐14 to FY 2022‐23

CITY OF GROVER BEACH

DIRECT AND OVERLAPPING PROPERTY TAX RATES
Last Ten Fiscal Years
Fiscal Year
Redevelopment Rate (4)
Total Direct Rate (5)
(1) In 1978, California voters passed Proposition 13 which set the property tax rate at a 1% fixed a Data Source: San Luis Obispo County Assessor FY 2013‐14 to FY 2022‐23 Combined Tax Rolls Agency
Basic Levy (1)
Total Direct & Overlapping (2) Tax Rates
City's Share of 1% Levy Per Prop 13 (3)
Voter Approved City Debt Rate
134
2018 2019 2020 2021 2022 2023

1.00000 1.00000 1.00000 1.00000 1.00000 1.00000

0.01925 0.01925 0.01925 0.01925 0.01925 0.01925

0.05135 0.08500 0.08500 0.08500 0.08500 0.09500

0.00732 0.00489 0.00489 0.00600 0.00600 0.00600

0.08194 0.08094 0.07234 0.05749 0.05878 0.03950

0.00400 0.00400 0.00400 0.00400 0.00400 0.00400

1.16386 1.19408 1.18548 1.17174 1.17303 1.16375

0.18223 0.18214 0.18174 0.18129 0.18223 0.18194

0.18547 0.18536 0.18494 0.18514 0.18526 0.18540
Fiscal Year
135

CITY OF GROVER BEACH
Current Year and Nine Fiscal Years Ago
Taxpayer Type of Business
Taxable Assessed
Value Rank
Percent of Total
City Taxable
Assessed Value
Safeway Realty LLC Commercial $        13,805,705 1 0.66% Searidge LP Residential             11,842,000 2 0.57%
Siyaram LLC Commercial             11,575,167 3 0.55%
California Fine Wire Company Industrial               6,592,869 4 0.32% Grover Beach Ramona Garden
Apartments Residential               6,500,000 5 0.31%
Vision To Life LLC Residential               5,705,169 6 0.27% Manfred G Freutel Trust Residential               5,393,392 7 0.26% James A Cashin Trust Et Al Residential               4,761,309 8 0.23% Behrooz Zarrabian Trust Commercial               4,686,064 9 0.22% Philip G Korte Trust Residential               4,460,204 10 0.21% Top Ten Total $         75,321,879 3.60%
City Total $   2,089,100,615
Unitary Tax Roll
HDL, Coren & Cone FY 2013‐14 & FY 2022‐23

PRINCIPAL PROPERTY TAXPAYERS
2023
Data Source: San Luis Obispo County Assessor FY 2013‐14 to FY 2022‐23 Combined Tax Rolls and the SBE Non 136
Taxable Assessed
Value Rank
Percent of Total
City Taxable
Assessed Value
4,647,869 10 0.35%
$          4,647,869 0.35%
$   1,318,664,379
2014
137

CITY OF GROVER BEACH
Last Ten Fiscal Years
Fiscal Year
Taxes Levied for the
Fiscal Year Amount Percentage of Levy
2014                      2,517,650                         2,517,650 100.00% 2015                      2,555,715                         2,555,715 100.00% 2016                      2,681,559                         2,681,559 100.00% 2017                      2,922,009                         2,922,009 100.00% 2018                      3,035,376                         3,035,376 100.00% 2019                      3,201,623                         3,201,623 100.00% 2020                      3,353,952                         3,353,952 100.00% 2021                      3,441,883                         3,441,883 100.00% 2022                      3,654,906                         3,654,906 100.00% 2023                      3,955,026                         3,955,026 100.00% Notes:

Source: San Luis Obispo County Assessor

PROPERTY TAX LEVIES AND COLLECTIONS
Collected within the Fiscal Year of the Levy
Only current secured property taxes are reported on this schedule.  The City has elected the Teeter Plan method of property tax collection, whereby the County remits 100% of taxes levied and pursues collection and retains any delinquent taxes and related penalties and interest. 138

CITY OF GROVER BEACH
Last Ten Fiscal Years
Fiscal Year City Supplemental
State of
California
County of San
Luis Obispo Total Rate
2014 0.75% 0.50% 6.50% 0.25% 8.00%
2015 0.75% 0.50% 6.50% 0.25% 8.00%
2016 0.75% 0.50% 6.50% 0.25% 8.00%
2017 1.00% 0.50% 6.00% 0.25% 7.75%
2018 1.00% 0.50% 6.00% 0.25% 7.75%
2019 1.00% 0.50% 6.00% 0.25% 7.75%
2020 1.00% 0.50% 6.00% 0.25% 7.75%
2021 1.00% 1.50% 6.00% 0.25% 8.75%
2022 1.00% 1.50% 6.00% 0.25% 8.75%
2023 1.00% 1.50% 6.00% 0.25% 8.75%
Notes:

In 2020, the City voters authorized a one percent (1.0%) transaction and use tax, effective November 3, 2020.

Source: STATE OF California ‐ Board of Equalization

DIRECT AND OVERLAPPING SALES TAX RATES
City Direct Rates Overlapping Rates
139

CITY OF GROVER BEACH
Last Ten Fiscal Years
(in thousands of dollars)
2014 2015 2016 2017
Eating and Drinking Places 32,655 $              $            36,908 $             43,476 $             44,113 Auto Dealers and Supplies 29,829 32,276 30,325 29,694
Other Retail Stores 24,469 16,906 17,250 13,557
All Other Outlets 26,976 28,165 33,477 31,236
Total  $           113,930  $           114,256  $           124,528  $           118,600 Source:  California Municipal Statistics

TAXABLE SALES BY CATEGORY
Source: MuniServices
Fiscal Year
140
2018 2019 2020 2021 2022 2023
$             43,560 $            47,219 $             46,209 $             49,853 $             52,076 $             50,781 11,235 32,582 9,588 11,334 10,311 9,467
30,545 33,571 43,583 54,953 50,802 43,300
36,245 32,579 54,369 47,025 57,519 71,874
$           121,585  $           145,951  $           153,749  $           163,165  $           170,708  $           175,422 Fiscal Year
141

CITY OF GROVER BEACH
Last Ten Fiscal Years
Fiscal
Year
Financed
Purchases
Capital
Leases
Subscription
Liability
State
Loan
General
Obligation
Bonds
Financed
Purchases
Water
Revenue
Bonds
Total Primary
Government
Outstanding
Debt to
Assessed
Value
Debt per
Capita
2014   300,318                300,318 0.02% 22.83 $
2015   277,645       5,372,537             5,650,182 0.40% 430.69 $ 2016   254,752     13,862,147           14,116,899 0.96% 1,053.74 $ 2017   231,622     13,717,418           13,949,040 0.90% 1,038.03 $ 2018       77,419    208,261     29,452,999      116,128           29,854,807 1.83% 2,201.68 $ 2019     392,934    184,665     29,050,145        89,165           29,716,909 1.72% 2,195.88 $ 2020     277,135    160,837     28,297,291        60,867       4,456,000           33,252,130 1.83% 2,516.43 $ 2021     159,035    136,766     27,519,437        31,168       4,282,000           32,128,406 1.69% 2,447.32 $ 2022          70,509      371,147    112,454     38,134,487       4,102,000           42,790,597 2.25% 3,259.49 $ 2023     313,905         226,718      87,898     37,223,345       3,918,000           41,769,866 2.00% 3,350.43 $

RATIOS OF OUTSTANDING DEBT BY TYPE
Governmental Activities Business‐Type Activities
142

CITY OF GROVER BEACH
Last Ten Fiscal Years
Fiscal
Year
General
Bonded Debt
Less: Amount
Available in
Debt Service
Funds
Net General
Bonded Debt
Ratio of Net
Bonded Debt
to Assessed
Value Population
Net Bonded
Debt per
Capita
2014 0.00% 13,153
2015      5,372,537           235,669 0.00% 13,119
2016    13,862,147           673,579      13,188,568 0.90% 13,397                        984.44 2017    13,717,418           654,212      13,063,206 0.84% 13,438                        972.11 2018    29,452,999       1,442,555      28,010,444 1.72% 13,560                     2,065.67 2019    29,050,145       1,602,656      27,447,489 1.59% 13,533                     2,028.19 2020    28,297,291       1,510,458      26,786,833 1.47% 13,214                     2,027.16 2021    27,519,437       1,477,942      26,041,495 1.37% 13,128                     1,983.66 2022    38,134,487       2,681,892      35,452,595 1.81% 12,707                     2,790.01 2023    37,223,345       2,671,338      34,552,007 1.65% 12,467                     2,771.48

RATIOS OF GENERAL BONDED DEBT OUTSTANDING
143

CITY OF GROVER BEACH
For the Fiscal Year Ended June 30, 2023
Jurisdiction
Net Debt
Outstanding
Percentage
Applicable to the
City
Amount Applicable
to the City
Direct and Overlapping Tax and Assessment Debt:

San Luis Obispo County Flood Control and Water Conservation District, Zone No. 3 $             5,490,000 18.322% $             1,005,878 San Luis Obispo County Community College District             156,300,000 3.105%                 4,853,115 Lucia Mar Unified School District             149,359,378 11.402%               17,029,956 City of Grover Beach               37,851,866 100.000%               37,851,866 (1) Total Direct and Overlapping Tax and Assessment Debt               60,740,815 Overlapping General Fund Debt:

San Luis Obispo County Certificates of Participation               84,246,776 3.118%                 2,626,814 San Luis Obispo County Pension Obligations               26,295,037 3.118%                    819,879 Lucia Mar Unified School District General Fund Obligations               14,985,000 11.402%                 1,708,590 City of Grover Beach General Fund Obligations                     558,726 100.000%                    558,726 (2) Total Overlapping General Fund Debt                 5,714,009 Overlapping Tax Increment Debt (Successor Agency):                 2,675,000 100.000%                 2,675,000 Total Direct Debt               38,410,592
Total Overlapping Debt               30,719,232
Combined Total Debt $          69,129,824 (3)
Ratios to FY 2022‐23 Assessed Valuation:

Direct Debt ($37,851,866) 1.81%
Total Direct and Overlapping Tax and Assessment Debt 2.91% Total Direct Debt ($38,410,592) 1.84%
Combined Total Debt 3.31%
Ratio to Redevelopment Incremental Valuation ($286,629,401):

Total  Overlapping Tax Increment Debt 0.93%
Notes:
(1) Excludes general obligation bonds to be sold.

Source:  California Municipal Statistics
(2) Share of San Luis Obispo County Financing Authority lease revenue bonds.

DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
(3) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non‐bonded capital lease obligations. 144

CITY OF GROVER BEACH
Last Ten Fiscal Years
Assessed value $    2,089,100,615
Debt limit (15% of assessed value)           313,365,092 Debt applicable to limit
$       313,365,092
Fiscal Year Debt Limit
Debt Applicable
to Limit
Legal Debt
Margin
Debt as
Percentage of
Limit
2014         197,799,657          197,799,657 0.00%
2015         210,252,918          210,252,918 0.00%
2016         219,804,746          219,804,746 0.00%
2017         232,316,859          232,316,859 0.00%
2018         244,105,584          244,105,584 0.00%
2019         259,643,796          259,643,796 0.00%
2020         272,498,183          272,498,183 0.00%
2021         285,231,483          285,231,483 0.00%
2022         294,355,054          294,355,054 0.00%
2023         313,365,092          313,365,092 0.00%
Note:  The legal debt margin for the City of Grover Beach is calculated using a debt limit of 15% of the assessed value of property within city limits.

Data Source: San Luis Obispo County Assessor
City of Grover Beach, Administrative Services Department

LEGAL DEBT MARGIN
Legal Debt Margin Calculation for the Current Year:

Legal Debt Margin ‐ Current Year
145

CITY OF GROVER BEACH
Last Ten Fiscal Years
Fiscal Year Population
Personal
Income
Per Capita
Personal
Income
Unemployment
Rate Median Age
2014              13,153            333,876               25,384 5.1% 38.7 2015              13,119            342,721               26,124 6.2% 38.1 2016              13,397            357,180               26,661 5.1% 38.3 2017              13,438            384,587               28,619 4.7% 39.1 2018              13,560            411,163               30,321 2.8% 37.9 2019              13,533            417,525               30,852 2.9% 35.5 2020              13,214            432,525               32,732 3.6% 36.2 2021              13,128            457,054               34,815 6.9% 37.2 2022              12,707            465,071               36,599 4.5% 38.4 2023              12,467            478,002               38,341 2.0% 39.8 Demographic Data is totaled from Census Block Groups that overlap the City's boundaries.

HDL, Coren & Cone  FY 2013‐14 to FY 2022‐23

DEMOGRAPHIC AND ECONOMIC STATISTICS
Notes and Data Sources:  Population: California State Department of Finance.

Unemployment Data: California Employment Development Department.

Income and Age Data: US Census Bureau, most recent American Community Survey.

Projections are developed by incorporation all of the prior census data released to date. 146

CITY OF GROVER BEACH
Last Ten Fiscal Years
Function 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 General government      15       15       15       15       17     17      17       17       19       19 Public safety      29       29       29       29       32       32       34       34       37       30 Community development        3         3         3         3         5        5        5         5         5         5 Public works      13       13       16       17       15     16      16       16       16       16 Parks and recreation        3         3         3         3         3        3        3         3         3         3 Total       63       63       66       67       72       73       75       75       80       73 Notes:

FULL‐TIME EQUIVALENT GOVERNMENT EMPLOYEES BY FUNCTION
Source: City of Grover Beach payroll records
A full‐time employee is scheduled to work 2,080 hours per year (including vacation and sick leave).  Full‐time  equivalent employment is calculated by dividing total labor hours by 2,080.

Fiscal Year
147

CITY OF GROVER BEACH
Last Ten Fiscal Years
Function/Program 2014 2015 2016 2017
General Government:

Number of business licenses          1,325           1,390           1,445         1,392 Number of recruitments                    9                     2                 12 Police:

Physical arrests              748               770               799              827 Traffic citations          1,387               887           1,361         1,212 Public Works:

Miles of streets resurfaced             0.46              1.26            5.65 Water customer accounts          4,736           4,764           4,760         4,816 Acre feet of water consumed          1,349           1,252           1,209         1,250 Community Development:

Building permits issued              271               339               404              275 Parks and Recreation:

Number of class admissions              961               787               981              951 Operating Indicators by Function/Program
Source: City of Grover Beach Departments
Note: General government information related to recruitments unavailable prior to 2015 Fiscal Year
148
2018 2019 2020 2021 2022 2023
1,510           1,379           1,374           1,421           1,434           1,469 11                14                 13                     8                   16                   32 585            505              413               694                681                598 743            964              761               897                783                676

0.41           0.97             1.90              3.35              3.80              2.44 4,844          4,832           4,960           4,983           5,277           5,298 1,220          1,182           1,114           1,173           1,137           1,022 326              276               361               297                340                317 1,133          1,020               944               179                782           1,049 Fiscal Year
149

CITY OF GROVER BEACH
Last Ten Fiscal Years
Function/Program 2014 2015 2016 2017 2018
Police:

Stations 1                              1               1              1               1 Patrol Units 6                              6               6              6               6 Public Works:

Miles of streets       33.21       33.34       33.34      33.34       33.34 Streetlights 20                          20             20           20            20 Traffic signals 32                          32             32           32            32 Parks and Recreation:

Community centers 1                              1               1              1               1 Parks 7                              7               7              7               7 Park acreage 14.0                  14.0         14.0       14.0        14.0 Water:

Miles of mains 48                          48             48           48            48 Fire hydrants 400                    400          400         400          400 Number of connections 5,169              5,248       5,191      5,256       5,254 Storage capacity (thousands of gallons) 4,500              4,500       4,500      4,500       4,500 Sewer:

Miles of sewers 35                          35             35           35            35 Number of connections 5,030              5,109       5,052      5,117       5,115 Note:

Capital Asset Statistics by Function/Program
Source: City of Grover Beach Departments
Sewer treatment provided by South San Luis Obispo County Sanitation District as a pass through by the C which collects the fees and remits to the Sanitation District.

Fiscal Year
150
2019 2020 2021 2022 2023
1              1                1                1                1 6              6                6                6                6

33.34     33.34       33.34       33.34       33.34
20          20              48              48              48 32          32              32              32              32 1              1                1                1                1 7              7                7                7                7

14.0       14.0         14.0         14.0         14.0
48          48              48              48              48 400        400          400          400          400
5,184     5,258       5,270       5,277       5,298
4,500     4,500       4,500       4,500       4,500
35          35       35.33       35.33       35.33
5,045     5,119       5,120       5,138       5,199
Fiscal Year
151
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Attachment 2