CITY COUNCIL AGENDA
CITY COUNCIL REGULAR MEETING
CITY OF HALF MOON BAY
TUESDAY, DECEMBER 2, 2025
HYBRID MEETING (SEE NEXT PAGE)
ADCOCK COMMUNITY CENTER
535 KELLY AVENUE
HALF MOON BAY, CA 94019
Robert Brownstone, Mayor
Debbie Ruddock, Vice Mayor
Patric Jonsson, Councilmember
Paul Nagengast, Councilmember
Deborah Penrose, Councilmember
7:00 PM
This agenda contains a brief description of each item to be considered. Those wishing to address the City Council on any matter not listed on the Agenda, but within the jurisdiction of the City Council to resolve, may come forward to the podium during the Public Forum portion of the Agenda and will have a maximum of three minutes to discuss their item. Those wishing to speak on a Public Hearing matter will be called forward at the appropriate time during the Public Hearing consideration.
Please Note: Anyone wishing to present materials to the City Council, please submit seven copies to the City Clerk.
Copies of written documentation relating to each item of business on the Agenda are on file in the Office of the City Clerk at City Hall and the Half Moon Bay Library where they are available for public inspection. If requested, the agenda shall be available in appropriate alternative formats to persons with a disability, as required by Section 202 of the Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12132.) Information may be obtained by calling 650-726-8271.
In compliance with the Americans with Disabilities Act, special assistance for participation in this meeting can be obtained by contacting the City Clerk’s Office at 650-726-8271. A 48-hour notification will enable the City to make reasonable accommodations to ensure accessibility to this meeting (28 CFR 35.102-35.104 ADA Title II).
https://www.halfmoonbay.gov/
1 HYBRID MEETING PARTICIPATION PROTOCOLS
This meeting will be held in-person and via Zoom for public participation. Remote participation is provided as a supplemental way to provide public comment, but this method does not always work. The public is encouraged to attend in person to ensure full participation. Public comments may be made in-person or remotely via Zoom, and interpretation will be available. All Councilmembers and staff will participate in person. During any public comment portions, attendees may use the “raise your hand” feature and will be called upon and unmuted when it is their turn to speak. The meeting will also be streamed on Channel 27, on pacificcoast.tv, and on the City website at https://www.halfmoonbay.gov/315/City-Council-Agendas. Please click to join the webinar: https://us06web.zoom.us/j/87674804231 or join by phone at 669-900-9128, using Webinar ID 876-7480-4231. If joining by phone, use *9 to raise your hand, *6 to mute and unmute.
1. ROLL CALL / PLEDGE OF ALLEGIANCE
2. APPROVAL OF AGENDA
3. PROCLAMATIONS AND PRESENTATIONS
3.A ALCOVE YOUTH ADVISORY GROUP
4. MAYOR'S ANNOUNCEMENTS OF COMMUNITY ACTIVITIES AND COMMUNITY SERVICE
5. REPORT OUT FROM RECENT CLOSED SESSION MEETINGS
6. CITY MANAGER UPDATES TO COUNCIL
7. PUBLIC FORUM
8. CONSENT CALENDAR
8.A WAIVE READING OF RESOLUTIONS AND ORDINANCES
8.B APPROVE THE MINUTES OF THE NOVEMBER 14, 2025 SPECIAL MEETING
ATTACHMENT
8.C APPROVE THE MINUTES OF THE NOVEMBER 18, 2025 SPECIAL MEETING
ATTACHMENT
8.D APPROVE THE MINUTES OF THE NOVEMBER 18, 2025 REGULAR MEETING
ATTACHMENT
8.E APPROVE THE MINUTES OF THE NOVEMBER 18, 2025 JOINT CITY COUNCIL / PLANNING COMMISSION SPECIAL MEETING.
ATTACHMENT
2 8.F APPROVE THE MINUTES OF THE NOVEMBER 22, 2025 SPECIAL MEETING.
ATTACHMENT
8.G ACCEPTANCE OF IMPROVEMENTS FOR THE CREEKSIDE COURT SUBDIVISION LOCATED AT 320 CHURCH STREET
Staff Recommendation: Adopt a resolution granting initial acceptance of improvements for the Creekside Court Subdivision, subject to one-year warranty period and release of securities.
STAFF REPORT
ATTACHMENT 1
ATTACHMENT 2
ATTACHMENT 3
8.H SAFE STREETS FOR ALL - AWARD OF PROFESSIONAL SERVICES AGREEMENT Staff Recommendation: Adopt a resolution authorizing the City Manager to execute a Professional Services Agreement with Kittelson & Associates, Inc. in an amount not to exceed $149,880 for the preparation of a Safe Streets for All Road Safety Action Plan.
STAFF REPORT
ATTACHMENT 1
ATTACHMENT 2
8.I ADOPT THE ANNUAL COMPREHENSIVE FINANCIAL REPORT (ACFR) FOR THE FISCAL YEAR ENDED JUNE 30, 2025
Staff Recommendation: Adopt a resolution receiving the City of Half Moon Bay Annual Comprehensive Financial Report (ACFR) for the fiscal year ended June 30, 2025.
STAFF REPORT
ATTACHMENT 1
ATTACHMENT 2
9. ORDINANCES AND PUBLIC HEARINGS
9.A INTRODUCTION OF AN ORDINANCE ADDING CHAPTER 7.65 “COMMERCIAL VITALITY” TO
THE HALF MOON BAY MUNICIPAL CODE
3 Staff Recommendation: Conduct a public hearing, waive first reading, and introduce an ordinance adding Chapter 7.65 “Commercial Vitality” to the Half Moon Bay Municipal Code, establishing maintenance standards for commercial storefronts. (Continued Public Hearing.)
STAFF REPORT
ATTACHMENT 1
ATTACHMENT 2
9.B ADOPT A RESIDENTIAL DWELLING UNIT PHASING AGREEMENT PURSUANT TO HALF MOON BAY MUNICIPAL CODE SECTION 17.06.055 (MEASURE D)
Staff Recommendation: Conduct a public hearing and adopt a resolution approving a Development Unit Phasing Agreement pursuant to Half Moon Bay Municipal Code Section
17.06.055 for 34 Measure D residential dwelling unit allocations over two years and make required findings.
STAFF REPORT
ATTACHMENT 1
ATTACHMENT 2
ATTACHMENT 3
ATTACHMENT 4
ATTACHMENT 5
10. RESOLUTIONS AND STAFF REPORTS
10.A ADOPT A RESOLUTION AUTHORIZING PARTICIPATION IN THE POOLED LIABILITY
ASSURANCE NETWORK JOINT POWERS INSURANCE AUTHORITY (PLAN JPA) WORKERS COMPENSATION PROGRAM.
Staff Recommendation: Adopt a resolution: 1) Authorizing the City Manager to execute all documents necessary for the City's participation in the Pooled Liability Assurance Network Joint Powers Insurance Authority (PLAN JPA) Workers Compensation Program, and 2) Authorizing the Interim Administrative Services Director to make a budget adjustment in the amount of $24,000.
STAFF REPORT
ATTACHMENT 1
ATTACHMENT 2
4 ATTACHMENT 3
10.B DRAFT CLIMATE ACTION AND ADAPTATION PLAN (PHASE TWO) UPDATE Staff Recommendation: Receive an update on the Draft Climate Action and Adaptation Plan Phase Two and provide feedback and direction for final preparation of the plan.
STAFF REPORT
ATTACHMENT
10.C AUTHORIZE INTERIM LEGAL SERVICES AGREEMENT
Staff Recommendation: Authorize the Mayor and Vice Mayor to negotiate and execute an interim legal services agreement with Burke, Williams & Sorensen LLP for a period of six months, with the option to convert to a permanent appointment.
STAFF REPORT
ATTACHMENT
11) COMMISSION / COMMITTEE UPDATES
12) FOR FUTURE DISCUSSION / POSSIBLE AGENDA ITEMS
13) CITY COUNCIL REPORTS
14) ADJOURNMENT
5 MINUTES
CITY OF HALF MOON BAY CITY COUNCIL
SPECIAL MEETING
FRIDAY, NOVEMBER 14, 2025
ADCOCK COMMUNITY CENTER, 535 KELLY AVENUE
1. CONVENE SPECIAL MEETING / ROLL CALL
Mayor Brownstone called the meeting to order at 6:00 p.m. and called the Roll Call.
PRESENT: Councilmembers Nagengast, Jonsson, Penrose, Vice Mayor Ruddock and Mayor Brownstone
2. CLOSED SESSION
2.A PUBLIC EMPLOYMENT (GOVT. CODE SECTION 54957): TITLE: CITY ATTORNEY
3. ADJOURN SPECIAL MEETING
The meeting adjourned at approximately 7:15 p.m.
________________________________ __________________________________ Maggie Rodriguez, Assistant City Clerk Robert Brownstone, Mayor 6 MINUTES
CITY OF HALF MOON BAY CITY COUNCIL
TUESDAY, NOVEMBER 18, 2025
ADCOCK COMMUNITY CENTER, 535 KELLY AVENUE
1. CONVENE SPECIAL MEETING / ROLL CALL
Mayor Brownstone called the meeting to order at 6:03 p.m. Assistant City Clerk Rodriguez called the Roll Call.
PRESENT: Councilmembers Nagengast, Jonsson, Penrose, Vice Mayor Ruddock and Mayor Brownstone
2. OPEN SESSION IDENTIFICATION OF CLOSED SESSION ITEMS
City Attorney Engberg announced that Councilmember Nagengast would be recused from agenda item 4.A. and would rejoin the Special Meeting after that item.
3. PUBLIC COMMENT ON CLOSED SESSION ITEMS - None
4. CLOSED SESSION
4.A CONFERENCE WITH LEGAL COUNSEL—EXISTING LITIGATION (Govt. Code section 54956.9(d)(1)) Name of case: Ellingson v. City of Half Moon Bay, – San Mateo Superior Court Civil No. 25-CIV- 04838
4.B CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATION (Govt. Code section 54956.9(d)(4) Initiation of litigation: (1 potential case)
5. ADJOURN SPECIAL MEETING
The meeting adjourned at approximately 7:00 p.m.
7 ________________________________ __________________________________ Maggie Rodriguez, Assistant City Clerk Robert Brownstone, Mayor 8 -
MINUTES
CITY OF HALF MOON BAY CITY COUNCIL
TUESDAY, NOVEMBER 18, 2025
ADCOCK COMMUNITY CENTER, 535 KELLY AVENUE
1. ROLL CALL / PLEDGE OF ALLEGIANCE
Mayor Brownstone called the meeting to order at 7:04 p.m. Assistant City Clerk Rodriguez took the roll call.
PRESENT: Councilmembers Jonsson, Nagengast and Penrose, Vice Mayor Ruddock and Mayor Brownstone
2. APPROVAL OF AGENDA
MOTION
Councilmember Penrose moved and Vice Mayor seconded a motion to approve the agenda. The question was called and the motion carried unanimously.
3. PROCLAMATIONS AND PRESENTATIONS
3.A PROCLAMATION HONORING LENNIE ROBERTS
Mayor Brownstone presented a Proclamation to Lennie Roberts, Committee for Green Foothills for her many years of advocacy of open space and community service.
4. MAYOR'S ANNOUNCEMENTS OF COMMUNITY ACTIVITIES AND COMMUNITY SERVICE - None
5. REPORT OUT FROM RECENT CLOSED SESSION MEETINGS - None
6. CITY MANAGER UPDATES TO COUNCIL
9 November 18, 2025
City Council Minutes
Interim Public Works Director Seeley discussed the Community Emergency Response Team (CERT) program and their most recent program and graduates.
7. PUBLIC FORUM
The following members of the public addressed the City Council:
• Deborah Penrose
• Joaquin Jimenez
• Joe Farrell
• Cid Young
8. CONSENT CALENDAR
8.A WAIVE READING OF RESOLUTIONS AND ORDINANCES
8.B APPROVE THE MINUTES OF THE NOVEMBER 4, 2025 SPECIAL MEETING
8.C APPROVE THE MINUTES OF THE NOVEMBER 4, 2025 REGULAR MEETING
8.D ACCEPT WARRANTS FOR THE MONTH OF OCTOBER 2025
8.E ADOPT RESOLUTION 2025-75, AUTHORIZING THE CITY MANAGER TO
DISPOSE OF ASSETS ACQUIRED TO PROVIDE SERVICES AT THE
OPPORTUNITY CENTER OF THE COASTSIDE IN ACCORDANCE WITH THE CITY’S ASSET DISPOSITION POLICY
8.F ADOPT RESOLUTION 2025-76, APPROVING THE MITIGATION MONITORING REPORTING PROGRAM (MMRP) FOR 6TH CYCLE HOUSING ELEMENT MITIGATED NEGATIVE DECLARATION ADOPTED BY THE CITY COUNCIL ON NOVEMBER 4, 2025
8.G ADOPT ORDINANCE 2025-01, ADOPTING THE 2025 EDITIONS OF THE CALIFORNIA BUILDING STANDARDS CODE REPEALING CHAPTER 14.06 OF THE HALF MOON BAY MUNICIPAL CODE, “ELECTRIFICATION OF BUILDINGS,” AND REPEALING AND REPLACING CHAPTER 14.04 OF THE HALF MOON BAY MUNICIPAL CODE, ADOPTING BY REFERENCE THE 2025 EDITION OF THE CALIFORNIA BUILDING STANDARDS CODE,
WITH LOCAL AMENDMENTS, AND FINDING THE AMENDMENTS TO BE EXEMPT FROM
ENVIRONMENTAL REVIEW UNDER THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA); AND, ADOPT RESOLUTION 2025-77, ESTABLISHING THE “NEED FOR LOCAL MODIFICATIONS TO THE CALIFORNIA BUILDING STANDARDS CODE” AND RATIFYING THE COASTSIDE FIRE PROTECTION DISTRICT’S ORDINANCE NO. 2025-01. 10 November 18, 2025
City Council Minutes
MOTION
Mayor Brownstone moved and Councilmember Penrose seconded a motion to approve the Consent Calendar items 8.A - 8.G. The question was called and the motion carried unanimously.
9. ORDINANCES AND PUBLIC HEARINGS - None
10. RESOLUTIONS AND STAFF REPORTS - None
11. COMMISSION / COMMITTEE UPDATES - None
12. FOR FUTURE DISCUSSION / POSSIBLE AGENDA ITEMS - None
13. CITY COUNCIL REPORTS - None
14. ADJOURNMENT
The meeting adjourned at 7:47 p.m.
Respectfully submitted,
________________________________ __________________________________ Maggie Rodriguez, Assistant City Clerk Robert Brownstone, Mayor 11 MINUTES
CITY OF HALF MOON BAY
CITY COUNCIL / PLANNING COMMISSION JOINT MEETING
TUESDAY, NOVEMBER 18, 2025
ADCOCK COMMUNITY CENTER, 535 KELLY AVENUE
1. CONVENE SPECIAL MEETING / ROLL CALL
Mayor Brownstone called the Special Meeting to order at 8:00 p.m. Assistant City Clerk Rodriguez took the Roll Call:
PRESENT: Mayor Brownstone, Vice Mayor Ruddock, Councilmembers Jonsson, Nagengast, and Penrose. Planning Chair Ruddock, Commissioners Del Nagro, Hernandez and Rems.
ABSENT: Planning Commission Vice Chair Gorn.
2. SPECIAL STUDY SESSION: CITY COUNCIL / PLANNING COMMISSION
2.A LOCAL RESPONSIBILITY AREA FIRE HAZARD SEVERITY ZONES MAPS Interim Public Works Director Seeley and Cal Fire Unite Chief Wilson presented a report on Fire Hazard Severity Zones maps and the implications to the Half Moon Bay community associated with the maps and Defensible Space Zones.
The following members addressed the City Council and Planning Commission:
• Jimmy Benjamin
• Sarah O’Sullivan
• Colleen Henney
• Janice Moody
• Amber Stow
RECESS
Mayor Brownstone announced a recess at 9:19 p.m.
12 November 18, 2025
City Council / Planning Commission
Special Joint Meeting
RECONVENED
Mayor Brownstone reconvened the meeting at 9:34 p.m. with all Councilmembers and Planning Commissioners present. Planning Commission Vice Chair Gorn was absent.
2.B HALF MOON BAY SAFETY ELEMENT UPDATE
Community Development Director Lacko and San Mateo County Safety Element consultant Pfannestiel presented a progress report on the City’s Safety Element update. The Council and Planning Commission asked questions of staff and consultant.
The following members addressed the City Council and Planning Commission:
• Jimmy Benjamin
3. ADJOURN SPECIAL MEETING
The meeting adjourned at approximately 10:59 p.m.
Respectfully submitted,
________________________________ __________________________________ Maggie Rodriguez, Assistant City Clerk Robert Brownstone, Mayor 13 MINUTES
CITY OF HALF MOON BAY CITY COUNCIL
SPECIAL MEETING
SATURDAY, NOVEMBER 22, 2025
ADCOCK COMMUNITY CENTER, 535 KELLY AVENUE
1. CONVENE SPECIAL MEETING / ROLL CALL
Mayor Brownstone called the meeting to order at 10:00 a.m. and called the Roll Call.
PRESENT: Councilmembers Nagengast, Jonsson, Penrose, Vice Mayor Ruddock and Mayor Brownstone
2. CLOSED SESSION
2.A PUBLIC EMPLOYMENT (GOVT. CODE SECTION 54957): TITLE: CITY ATTORNEY
3. ADJOURN SPECIAL MEETING
The meeting adjourned at approximately 12:30 p.m.
________________________________ __________________________________ Maggie Rodriguez, Assistant City Clerk Robert Brownstone, Mayor 14
BUSINESS OF THE COUNCIL OF THE CITY OF HALF MOON BAY
AGENDA REPORT
For meeting of: December 02, 2025
TO: Honorable Mayor and City Council
VIA: Matthew Chidester, City Manager
FROM: Dale Leda, Interim City Engineer
TITLE: ACCEPTANCE OF IMPROVEMENTS FOR THE CREEKSIDE COURT SUBDIVISION LOCATED AT 320 CHURCH STREET
______________________________________________________________________________ RECOMMENDATION:
Adopt a resolution granting initial acceptance of improvements for the Creekside Court Subdivision, subject to one-year warranty period and release of securities.
FISCAL IMPACT:
There is no fiscal impact associated with this action. All costs associated with this subdivision are covered by the various development fee payments.
STRATEGIC ELEMENTS:
This action supports the Infrastructure and Environment and Healthy Communities and Public Safety elements of the Strategic Plan.
BACKGROUND:
On November 7, 2017, the City Council by Resolution No. C-2017-92 conditionally approved the Tentative Subdivision Map, Coastal Development Permit, and Use Permit to divide two parcels totaling 5.5 acres into 12 residential lots with associated improvements, including utilities, an open space conservation easement, and an open space area for passive recreation at 320 Church Street in the C-D (Commercial Downtown) Residential Zoning District.
On July 20, 2021, the City Council approved the Final Map and Subdivision Improvement Agreement for the Creekside Court Subdivision. The agreement covered the construction of improvements, including private road, sewer, storm drain, utilities, passive park, trail easement, and access easements, as well as limited public improvements within the Church Street rightof-way for the subdivision.
As part of the City Council's approval, the developer entered into an Affordable Housing Agreement with the City on July 21, 2021, pursuant to Municipal Code Chapter 18.35. The 15
project provides four multifamily affordable housing units on Lot 1 (two Very Low Income and two Low Income units), to be rented at affordable rates for 55 years.
The improvements for the Creekside Court Subdivision have been completed by the Subdivider per the approved improvement plans and are now ready for initial acceptance in accordance with the Subdivision Improvement Agreement. The Subdivider's securities for the faithful performance and labor and materials bonds will be released upon the City's receipt of a Warranty Bond in the amount of $236,250 from the Subdivider, which is 25 percent of the value of the improvements, in accordance with the agreement.
DISCUSSION:
The improvements for the Creekside Court Subdivision were inspected on November 6, 2025, and completed to the satisfaction of the Interim City Engineer and initial acceptance is ready to be granted to the Subdivider. After initial acceptance is granted, the Subdivider and City will enter into a one-year bonded warranty period in which the Subdivider will guarantee or warranty the improvements against any defective work or labor done or defective materials furnished.
The completed improvements include the following:
Private Improvements (to be maintained by the Homeowners' Association):
• Sewer System: Private sewer main, lift station with backup generator, and force main to convey flows back to Church Street. The owner has provided a spill response plan for the HOA which covers maintenance and operation of the lift station and procedures for responding to pump failures or sewer overflow events.
• Storm Drain System: Storm drain inlets, mains, manholes, and a bioretention planter located in the Common Area.
• Street Improvements: Curb, gutter, and sidewalk, with asphalt and permeable paver street paving, and gated emergency vehicle access to Shoreline Station. • Street Lights, Trees, Landscaping, Irrigation, Signage, and Fencing: Street lights, street trees, landscaping, landscape irrigation, signage, and fencing throughout the subdivision.
• Passive Park: Park area and related amenities within the Common Area on Parcel A. • Utilities: Underground utilities.
Public Improvements (to be accepted by the City):
• Street Improvements: Curb, gutter, and sidewalk improvements to complete the cul-desac within the Church Street right-of-way.
At the conclusion of the one-year warranty period, staff will bring an item to Council to release the warranty bond. As indicated in the original Subdivision Improvement Agreement, all private improvements will be maintained by the Homeowners' Association, while the limited public improvements within Church Street right-of-way will be accepted into the City-maintained system. The subdivision includes a total of 12 residential lots. 16
The Final Map has been recorded with the office of the San Mateo County Recorder and offers in dedication to the City for public use Emergency Vehicle Access Easements, 10-foot Trail Easement, and Public Access Easements. Water system improvements have also been accepted for maintenance by the Coastside County Water District.
ATTACHMENTS:
1. Resolution
2. Copy of Subdivision Improvement Agreement
3. Copy of Affordable Housing Agreement
17 Resolution No. C-2025-____
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HALF MOON BAY
TO APPROVE THE INITIAL ACCEPTANCE OF IMPROVEMENTS AND RELEASE OF SECURITIES,
FAITHFUL PERFORMANCE BOND, AND LABOR AND MATERIALS BONDS, AND ACCEPTANCE OF
WARRANTY BOND FOR THE CREEKSIDE COURT SUBDIVISION
WHEREAS, the Public Improvement Plans for the Creekside Court Subdivision were approved on July 20, 2021, under and pursuant to the provisions of the Subdivision Improvement Agreement ("Agreement") between the City of Half Moon Bay and Gibraltar Capital Inc.; and
WHEREAS, HMB Coast LLC subsequently acquired the property and assumed all obligations under the Agreement as successor in interest; and WHEREAS, the Subdivider executed and posted securities conditioned upon the faithful performance and labor and materials provisions of the Agreement; and WHEREAS, the improvements for the Creekside Court Subdivision project have been completed; and
WHEREAS, the improvements include private improvements to be maintained by the Homeowners' Association consisting of a private sewer system (including private sewer main, lift station with backup generator, and force main), storm drain system (including inlets, mains, manholes, and bioretention planter), street improvements (including curb, gutter, sidewalk, asphalt and permeable paver paving, and gated emergency vehicle access), street lights, street trees, landscaping, landscape irrigation, signage, fencing, passive park and related amenities, and underground utilities; and
WHEREAS, the improvements also include limited public improvements within the Church Street right-of-way consisting of curb, gutter, and sidewalk to complete the cul-de-sac, which will be accepted into the City-maintained system; and WHEREAS, the City Council is willing to release the securities for the faithful performance and labor and materials upon receipt of a warranty bond; and WHEREAS, the Agreement provides that the security shall extend for a period of one year after the date of acceptance of improvements to cover the warranty period of said improvements under the Agreement; and
WHEREAS, the Interim City Engineer has made a final inspection of the improvements for the Creekside Court Subdivision project on November 6, 2025, and recommends that the City Council accept the improvements as constructed in accordance with the approved plans and specifications.
18 NOW, THEREFORE, BE IT RESOLVED THAT the City Council of the City of Half Moon Bay hereby authorizes the City Manager or his designee to accept those certain public and private improvements included in the Creekside Court Subdivision project, as completed in accordance with the recorded Improvement Agreement, the approved plans, specifications, and upon recommendation of the Interim City Engineer.
***************************************************************** I, the undersigned, hereby certify that the foregoing Resolution was duly passed and adopted on the 2nd day of December 2025, by the City Council of Half Moon Bay by the following vote:
AYES, Councilmembers:
NOES, Councilmembers:
ABSENT, Councilmembers:
ABSTAIN, Councilmembers:
ATTEST: APPROVED:
___________________________ _____________________________ Maggie Rodriguez, Assistant City Clerk Robert Brownstone, Mayor 19 2021- 154698
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
City of Half Moon Bay
501 Main Street
Half Moon Bay, California 94019
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IMPROVEMENT AGREEMENT
CITY OF HALF MOON BAY
CREEKSIDE COURT SUBDIVISION
THIS IMPROVEMENT AGREEMENT ( the " Agreement") is made and entered into on this 3 Rb
day of /'i0VPpnb€ r2021( the "Effective Date") by and between Gilbraltar Capital, Inc.
Developer"), and the CITY OF HALF MOON BAY, a California municipal corporation (" City").
RECITALS
A. On November 7, 2017, the City Council of the City of Half Moon Bay adopted among other approvals, Resolution No. C- 2017- 92, approving the Tentative Map for the Creekside Court Subdivision hereinafter referred to as " Creekside Court Subdivision" prepared by BGT Land Surveying April 2017 and ( the " Tentative Map"), subject to certain conditions of approval ( the " Conditions").
B. The Conditions require either ( 1) that certain public improvements for the Creekside Court Subdivision be constructed prior to approval of the final map, or (2) that Developer enter into an agreement with the City providing for the future construction of such improvements.
C. Developer has submitted the final map and applied to City for final map approval without having completed the required public, improvements and therefore will enter into an agreement with the City providing for the future construction and installation of such improvements, as required by Government Code section 66462( a)( 1).
D. Developer has submitted to the City plans, specifications, and drawings entitled Creekside Court Subdivision", prepared by BKF Engineers, dated June 2020, the " Improvement Plans"), which, in addition to other improvements, provide for certain on -site public improvements for the Creekside Court Subdivision ( the Improvements").
E. Developer is the current fee owner of that certain real property consisting of approximately 5. 483 acres located within the City of Half Moon Bay, County of San Mateo, State of California, described in Exhibit A, attached hereto and incorporated herein by reference ( the " Property"). Upon approval and recordation of the final map, 1 20
the Property will be divided into 12 lots and associated parcels intended for residential development.
F. City and Developer desire to enter into an agreement providing for the construction and installation of the Improvements in accordance with the Improvement Plans.
AGREEMENT
NOW, THEREFORE, in consideration of the faithful performance of the terms and conditions set forth in this Agreement, the parties hereto agree as follows:
1. Puroose. The purpose of this Agreement is to guarantee completion of the Improvements and ensure satisfactory performance by Developer of Developer s obligations to satisfy the Conditions pertaining solely to the Improvements.
2. Property Subject to Agreement. The Property shall be subject to this Agreement; provided, however, that from and after acceptance of the Improvements as set forth in Section 12 below, the Property shall be released and no longer subject to this Agreement, and a release shall be executed and recorded by the City.
3. Duty to Install Improvements. Developer shall construct, install and complete, or cause to be constructed, installed or completed, at the Developer' ssole cost and expense, the Improvements, in accordance with the Improvement Plans ( defined in Recital D. above) and to the satisfaction of the City Engineer, in his reasonable discretion consistent with the Conditions and Improvement Plans. Developer will also supply all labor and materials therefore, all in strict accordance with the terms and conditions of this Agreement. The construction, installation and completion of the Improvements and all labor and materials furnished in connection therewith are hereinafter referred to collectively as the " Work".
4. Com 3letion Date. Developer shall complete the Work within one year of the commencement of the Work. All Work shall be completed and in a good and workmanlike manner in accordance with accepted design and construction practices consistent with the Conditions and Improvement Plans. This completion date may be extended by the City in its sole and absolute discretion at the request of the Developer, which request shall be accompanied by a written assurance acceptable to the City Attorney that the securities required by Section 13 shall remain enforceable throughout the term of the extension.
5. Estimated Cost of Work. The engineer' s estimated cost of the Work is $ 945, 000.
6. Modifications to the Plans. Approval of this Agreement by the City does not release Developer of its responsibility to correct mistakes, errors or omissions in the Improvement Plans. If, at any time, in the opinion of the City Engineer, in his reasonable discretion, the Improvement Plans are deemed inadequate in any respect Developer 2 21
agrees to make such modifications, changes or revisions as necessary in order to complete the Work in a good and workmanlike manner in accordance with accepted design and construction standards consistent with the Conditions and Improvement Plans.
7. Repairs. Developer agrees to repair or have repaired in a timely manner at its sole cost and expense all other public or private property damaged as a result of or incidental to the Work or in connection with the development of the project, or to pay to the City or property owner of any damaged property, the full cost of such repair. In addition, Developer shall obtain the written acceptance of such repair or payment from any owner whose private property was repaired by Developer or to whom Developer has paid the full cost of such repair in accordance with this Section 7. City shall be under no obligation whatsoever to accept the Work completed under this Agreement until such time as all repairs have been completed or have been paid for and written acceptances have been provided to the City Engineer, except as otherwise provided in Section 12.
8. Foreman or Superintendent. Developer shall give personal attention to the Work. A competent foreman or superintendent, satisfactory to the City Engineer, in his reasonable discretion, with authority to act for and on behalf of Developer, shall be named in writing by Developer prior to commencement of the Work, shall be present on the Property during the performance of the Work and may not be changed without the advance notification to and satisfaction and concurrence of the City Engineer.
9. Examination of Work. All the Work shall be performed to the satisfaction of the City Engineer, in his reasonable discretion consistent with the Improvement Plans. The City and its authorized agents shall, at all times during the performance of the Work, have free access to the Work and shall be allowed to examine the Work and all materials used and to be used in the Work.
10. City' s Inspection, Administration and Testing Costs. Developer shall pay to the City the actual cost for all inspection, administration and testing services furnished by City in connection with this Agreement, including those performed by consultants under contract with the City (the " City Costs"). The estimated City Costs are $ 57,26 the " Estimated Cost"). Prior to or concurrently with the execution of this Agreement, Developer shall deposit an amount equal to the Estimated Cost with City for the payment of the City Costs. In the event that the Estimated Cost is insufficient to cover the actual City Costs incurred, Developer shall, upon notice in writing by the City Engineer, deposit such additional amount as may be required to pay the City Costs. Any amount of the Estimated Cost, initial deposit or additional amounts deposited remaining after payment of all City Costs shall be returned to Developer. City may, at its discretion, deposit such funds in an interest -bearing account and retain any and all interest earned.
11. Completion of Work. After Developer ( a) completes the Work in accordance with the Improvement Plans and the terms and conditions of this Agreement, and ( b) repairs any 3 22
private or public property ( other than public roads and streets) damaged as a result of the Work or pays the full cost of such repair to the owner whose property was damaged and ( c) obtains the written acceptance of such repair or payment from any owner whose private property was repaired by Developer or to whom Developer paid the full cost of such repair, Developer will provide City with a written notice of completion, together with copies of all written acceptances, if any.
12. Final Acceptance.
12. Notice of Com oletion. Within thirty ( 30) days of receipt of Developer' s written
notification pursuant to Section 11 above, City Engineer shall inspect the Work and repairs and review the written acceptances, if any, and send Developer a written notice stating whether the Work and repairs are complete to the satisfaction of the city Engineer, in his reasonable discretion, and whether the written acceptances have been provided. If the Work and repairs are, in the opinion of the City Engineer, not complete and satisfactory, and/ or written acceptances have not been provided, the City Engineer shall list the deficiencies that must be corrected to find the Work and repairs complete and satisfactory. Upon satisfactory completion of the Work and repairs and submittal of written acceptances, the City Engineer shall send Developer a written notice of satisfactory completion. The requirement for written acceptances may be waived by the City Engineer, in his reasonable discretion, if Developer has made commercially reasonable efforts to obtain such acceptances.
12. 2 Acceptance of Improvements. After sending Developer a written notice of satisfactory completion pursuant to Section 12., the City Engineer shall recommend acceptance of the Improvements to the City Council. The acceptance of the Improvements shall be by resolution of the City Council, with the hearing on said resolution held within thirty (30) days of the City Engineer' s written notice of
satisfactory completion. Upon adoption of such resolution, the City Engineer shall promptly record a notice of acceptance, in a form to be approved by the City Attorney, in the Official Records of San Mateo County. Alternately, the City may in its sole discretion request that Developer deliver to the City a quitclaim deed conveying the fee interest in the Improvements and, as appropriate, the underlying real property; Developer shall promptly deliver the requested deed. The Improvements shall be deemed to be " Finally Accepted" upon recordation of such notice and/ or deed.
13. Performance, Labor and Materials and Warranty Security. Developer shall furnish and deliver to the City, within the times set forth below, the following surety bonds, each of which must be issued by a surety company duly and regularly authorized to do general surety business in the State of California, or such other surety as may be acceptable to the City Attorney.
13. Performance Bond. Developer shall furnish and deliver a performance surety bond in the amount of $945, 000 (100% of estimated " hard" cost of completion of the 4 23
construction and installation of the Improvements and the installation of monuments as required by the Final Map, as determined by the City Engineer) concurrently with the execution of this Agreement, which bond must meet the requirements of Government Code Section 66499. 1and be reasonably acceptable to the City Attorney. The bond shall be conditioned upon the faithful performance of this Agreement with respect to the Work and shall be released by the City upon final acceptance of the Improvements as described in Section 12. 2and Developer' s delivery of the Warranty Bond described in Section 13. 3.
13. 2Labor and Materials Bond. Developer shall furnish and deliver a labor and materials surety bond in the amount of $945, 000 (100% of estimated " hard" cost of completion of the construction and installation of the Improvements and the installation of monuments as required by the Final Map, as determined by the City Engineer) concurrently with the execution of this Agreement, which bond must meet the requirements or Government Code Section 66499. 2and be acceptable to the City Attorney. The bond shall secure payment to the contractor( s) and subcontractor( s) performing the Work and to all persons furnishing labor, materials or equipment to them. The City shall retain the bond until both ( i) the City accepts the Work in accordance with Section 12 above and ( ii) the statute of limitations to file an action under Civil Code section 3114 et seq. has expired. After said date, the bond may be reduced by the City Engineer to an amount not less than the total amount claimed by all claimants for whom claims of lien have been recorded and notice given in writing to the City Council. The balance of the bond shall be retained until the final settlement of all such claims and obligations. If no such claims have been recorded within the statutory time limits, the bond shall be released in full by the City Engineer.
13. 3 Warranty Bond. Developer shall furnish and deliver a warranty bond in the amount of $236,50 (25% of estimated " hard" cost of completion of the construction and installation of the Improvements, as determined by the City Engineer) upon Final Acceptance of the Improvements and prior to release of the Performance Bond. The bond shall be in a form reasonably acceptable to the City Attorney and shall guarantee and warrant the Work for a period of one ( 1) year following the completion and acceptance thereof against any defective work or labor done, or defective materials furnished.
14. Warranty Period; Repair and Reconstruction. Without limiting the foregoing, Developer expressly warrants and guarantees all Work performed under this Agreement and all materials used in the Work for a period of two (2) years after final acceptance in accordance with Section 12. If, within this two (2) year period, any Improvement or part of any Improvement installed or constructed, or caused to be installed or constructed by Developer, or any of the Work done under this Agreement, fails to fulfill any of the requirements of the Improvement Plans or this Agreement, Developer shall, without delay and without cost to City, repair, replace or reconstruct any defective or otherwise unsatisfactory part or parts of the Work or Improvement to the satisfaction of the City 5 24
Engineer. Should Developer fail to act promptly or in accordance with this requirement, or should the exigencies of the situation require repairs, replacements or reconstruction to be made before Developer can be notified, City may, at its option, make the necessary repairs, replacement or perform the necessary reconstruction and Developer shall pay to the City upon demand the actual cost of such repairs, replacements or reconstruction. The warranty provided in this section shall survive the termination of this Agreement.
15. Maintenance. At all times prior to Final Acceptance, Developer shall be solely responsible for the maintenance of the Improvements.
16. Developer Not Agent of City. Neither Developer nor Developer' scontractors, subcontractors, agents, officers, or employees are agents or employees of City and the Developer' srelationship to the City, if any, arising here from is strictly that of an independent contractor.
17. Indemnification. Developer agrees to indemnify, defend and hold the City, its elective and appointed boards, commission, officers, agents, employees and consultants, harmless from and against any and all claims, liabilities, losses, damages or injuries to persons or property of any kind, including the reasonable costs to the City of carrying out the terms of any judgment, settlement, consent decree, or other partial or complete termination of an action or procedure that requires the City to take any action collectively, "Claims") arising out of (a) Developer' s or Developer' scontractors', subcontractors', agents' or employees', acts, omissions, or operations or (b) the noncompliance of the Improvements with any applicable federal, State, or local law. The aforementioned indemnity shall apply regardless of whether any insurance required under this Agreement is applicable to any Claims. The City does not and shall not waive any of its rights under this indemnity provisions because of its acceptance of the bonds or insurance required under the provisions of this Agreement. The indemnification herein shall survive termination of this Agreement.
18. Insurance.
a. Developer shall require each and every design consultant involved in the design of the Improvements to carry errors and omissions insurance coverage ( primary as to City) as to such involvement in the minimum amount of two million dollars 2, 000,0) and subject to requirement to provide extended claim reporting provision in the insurance policy (" tail coverage").
b. Developer shall maintain Comprehensive Liability Insurance protecting the City from incidents as to bodily injury liability and property damage liability that may occur as a result of the Work and additional warranty repairs. Developer shall provide a certificate of insurance to City before any Work commences. The insurance policy shall contain, or be endorsed to contain, the following provisions:
6 25
1) The City, its officers, officials, employees, consultants and agents are to be covered as additional insureds as respects liability arising out of activities performed by or on behalf of Developer. The coverage shall contain no special limitations on the scope of protection afforded to the City, its officers, officials, employees, consultants and agents.
2) The amounts of public liability and property damage coverage shall not be less than 2, 000,00 (Two Million Dollars) per occurrence for bodily injury, personal injury and property damage. Coverage shall include Contractual Liability, owners' and contractors' protection, products an operations coverages, and Premises and Operations Liability with no explosion, underground, or collapse exclusions. 3) The insurance shall be maintained in full force until the City Engineer issues a notice of satisfactory completion pursuant to Section 12. above. 4) The insurance policy shall provide for 30 days notice of cancellation to the City. The policy shall not be cancelled earlier than nor the amount of coverage be reduced earlier than 30 days after the City receives, notice from the insurer of the intent of cancellation or reduction.
5) Any failure to comply with the reporting provisions of the policy shall not affect the coverage provided to the City, its officers, officials, employees, consultants and agents.
6) Developer' sinsurance coverage shall be primary insurance as respects the City, its officers, officials, employees, consultants and agents. Any insurance or selfinsurance maintained by the City, its officers, officials, employees, consultants or agents shall be in excess of Sub -divider' sinsurance and shall not contribute to it. If commercially available, the insurance policy shall contain a waiver of subrogation for the benefit of the City.
7) In the event that Developer' sinsurance is cancelled, Developer shall provide replacement coverage or all Work must cease as of the cancellation date until replacement insurance coverage is provided.
8) Any deductibles or self -insured retentions shall be the Developer' sresponsibility to pay; any such deductible or self -insured retention greater than $ 50, 000 shall be approved by the City Manager.
9) The insurer shall waive its right of subrogation against the City. Developer hereby waives all rights against the City for loss or damage to the extent covered by the insurance required under this Agreement.
10) Prior to commencing Work and upon request by the City, Developer shall provide a Certificate of Insurance with endorsements showing compliance with the requirements of this Agreement.
7 26
19. Worker' s Com Densation and Employers' Liability Insurance. Developer shall provide, or cause to be provided, Workers' Compensation insurance as required by law, including 1, 000,00 Employers' Liability coverage and shall cause its contractors and their subcontractors, agents and representatives to also maintain such insurance as required by law. No Work shall commence until such Workers' Compensation insurance is obtained and in full force and effect.
20. Com fiance with Laws. Developer shall comply with all federal, state and local laws, ordinances and regulations in the performance of this Agreement. Developer shall, at its own cost and expense, obtain all necessary permits and licenses for the Work, give all necessary notices, pay all fees and taxes required by law and make any and all deposits legally required by those public utilities that will serve the residential development on the Property. Copies and/ or proof of payment of said permits, licenses, notices, fee and tax payments and deposits shall be furnished to the City Engineer upon request.
21. Encroachment Permits. Developer shall obtain, at its sole cost and expense, any encroachment permits required by the City in order to perform the Work.
22. Payments. Developer agrees that it will pay, when due, all those furnishing labor or materials in connection with the Work. Developer further agrees that pursuant to Government Code section 66499. 7, the Labor and Materials Bond provided by Developer in accordance with Section 13. of this Agreement shall not be released if any mechanics liens or stop notices are outstanding, unless said liens are released by bond in compliance with Civil Code section 3143.
23. Notice of Breach and Default. The occurrence of any of the following constitutes a breach and default of this Agreement:
1) Developer refuses or fails to complete the Work within the time set forth herein or abandons the Work.
2) Developer assigns the Agreement in violation of Section 29 below. 3) Developer is adjudged bankrupt or makes a general assignment for the benefit of creditors, or a receiver is appointed in the event of Developer' sinsolvency. 4) Developer or Developer' scontractors, subcontractors, agents or employees, fail to comply with any terms or conditions of this Agreement.
5) Any delay in the construction of any portion of the Work or repairs, which in the reasonable opinion of the City Engineer, endangers public or private property. 6) Developer fails to maintain insurance in the amounts and subject to the terms required in Sections 18 and 19 above.
The City may serve written notice of breach and default upon Developer and the financial institution holding the bonds.
8 27
24. Oa3ortunity to Cure. If the City gives Developer notice under Section 23 of breach and default of this Agreement, Developer shall have 30 days within which to correct, remedy or cure the default. If the written notification states that the problem is urgent and relates to the public health and safety, then Developer shall have 24 hours to correct, remedy or cure the default, If Developer does not cure the default within the applicable timeframe, the City may pursue the remedies set forth in Section 25 below.
25. Remedies.
25. 1 City may proceed to complete the Work by contract or other method the City considers advisable at the sole expense of Developer. Developer, immediately upon demand, shall pay the costs and charges related to the Work and any subsequent repairs. City, without liability for doing so, may take possession of and utilize in completing the Work and repairs, if any, such materials and other property belonging to the Developer as may be on or about the Property and necessary for completion of the Work. Developer hereby grants the City an easement, effective upon the running of the 30 -day cure period for an uncured default under Sections 23( 1) —( 5) above, to enter the Property as necessary to complete the Work. In the event of default, the financial institution holding the bonds shall be liable to City to pay the face amount of the bonds, as specified under Section 13.
25. City may bring legal action to compel performance of this Agreement and recover the cost of completing the Work and/ orrepairs, if any, including City' s administrative and legal costs or pursue any other action at law or equity.
25. 3 Developer agrees that if legal action is brought by City under this section of the Agreement, Developer shall pay all of the costs of suit, reasonable attorney fees, arbitration costs and such other costs as may be determined by the court or arbitrator.
25. 4 No failure on the part of City to exercise any right or remedy hereunder shall operate as a waiver of any right or remedy that City may have hereunder.
25. 5 The rights and remedies of City are cumulative, and the exercise by City of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default.
26. Final Drawings. Upon completion of the Work and prior to Final Acceptance, Developer shall deliver to City a set of "As -Built" drawings as required by the Conditions. These drawings shall be in a form reasonably acceptable to the City Engineer, shall be certified as being " As -Built" and shall reflect the Work as actually constructed, with any and all changes incorporated therein. Said drawings shall be signed and sealed as accurate by the engineer of record.
27. Attorney Fees. Should any legal action or arbitration be brought by either party because of breach of this Agreement or to enforce any provision of this Agreement, the prevailing party shall be entitled to all costs of suit, reasonable attorney fees, arbitration costs and such other costs as may be determined by the court or arbitrator. 9 28
28. Notices. Formal written notices, demands, correspondence and communications between City and Developer shall be sufficiently given if: (a) personally delivered; or (b) dispatched by next day delivery by a reputable carrier such as Federal Express to the office of City and Developer indicated below, provided that a receipt for delivery is provided; or (c) if dispatched as first class mail, postage prepaid, to the offices of City and Developer indicated below. Such written notices, demands, correspondence and communications may be sent in the same manner to such persons and addresses as either party may from time -to -time designate by next day delivery or by mail as provided in this section.
City: City of Half Moon Bay
501 Main Street
Half Moon Bay, CA 94109
Attn: City Manager
With a copy to: City of Half Moon Bay
501 Main Street
Half Moon Bay, CA 94109
Attn: City Attorney
Developer: Gilbraltar Capital, Inc.
6 Ashdown Place
Half Moon Bay, CA, 94019
Notices delivered by deposit in the United States mail as provided above shall be deemed to have been served two (2) business days after the date of deposit if addressed to an address within the State of California, and thee (3) business days if addressed to an address within the United States but outside the state of California.
29. Transfers; Assignments. Developer may not assign its obligations under this Agreement without the prior written approval of the City, which approval shall not be unreasonably withheld. In connection with any such assignment, Developer and its assignee shall execute and deliver to City a written assignment and assumption agreement in a form reasonably acceptable to the City Attorney.
30. Binding U Don Heirs, Successors and Assigns. Subject to the transfer restrictions set forth in Section 29, the terms, covenant and conditions of this Agreement shall be binding upon all heirs, successors and assigns of the parties hereto.
31. Headin; s. Section headings in this Agreement are for convenience only and are not intended to be used in interpreting or construing the terms, covenants or conditions contained in this Agreement.
10 29
32. Severabilitv. If any provision of this Agreement is held, to any extent, invalid, the remainder of this Agreement shall not be affected, except as necessarily required by the invalid provision, and shall remain in full force and effect.
33. Entire Agreement. The terms and conditions of this Agreement constitute the entire agreement between City and Developer with respect to the matters addressed in this Agreement. This Agreement may not be altered, amended or modified without the written consent of all parties hereto.
34. Governing Law; Venue. This Agreement shall be construed and enforced in accordance with the laws of the State of California, without reference to choice of law provisions.
Any legal actions under this Agreement shall be brought only in the Superior Court of the County of San Mateo, State of California.
35. Authority. Each party executing this Agreement on behalf of a party represents and warrants that such person is duly and validly authorized to do so on behalf of the entity it purports to bind and if such party is a partnership, corporation or trustee, that such partnership, corporation or trustee has full right and authority to enter into this Agreement and perform all of its obligations thereunder.
36. Time is of the Essence. Time is of the essence of this Agreement and of each and every term and condition hereof.
37. Runs with the Land; Recordation. This Agreement pertains to and shall run with the Property. Upon execution, this Agreement shall be recorded in the Official Records of San Mateo County. Upon City Final Acceptance of the Improvements, a written statement shall be recorded by the City in the Official Records of San Mateo County terminating this Agreement and releasing all of the Property as set forth in Section 2 above. The recorded written statement does not release the parties from obligations that survive termination of the Agreement, including indemnification.
38. Domestic Water System. The City and Developer acknowledge and agree that the public domestic water system for the Property (the " Water System") is also shown on the Improvement Plans, but is not subject to this Agreement. The Water System will be the subject of a Water Service Agreement by and between the Developer and Coastside County Water District, which district ( as opposed to the City) has jurisdiction over plan approval, construction, bonding and acceptance of the public domestic water system. 11 30
IN WITNESS WHEREOF, City and Developer have executed this Agreement as of the Effective Date.
CITY"
CITY OF HALF MOON BAY, a California
municipal corporation
Dated: t t 3 2-1
A TEST:
City Attorney
Dated: IVoimmikr 9091
City Manager
City Council Action dated
DEVELOPER"
Gilbraltar Capital, Inc.
By:
Name:
Title: CFc12
31 ACKNOWLEDGMENT
A notary public or other officer completing this
certificate verifies only the identity of the individual who signed the document to which this certificate is
attached, and not the truthfulness, accuracy, or
validity of that document.
State of California
County of San Mateo
On November 01 , 2021 before me,
Carlos Garcia, Notary Public
insert name and title of the officer)
personally appeared C roA1 ' CS
who proved to me on the basis of satisfactory evidence to be the person( s) whose name( s) is/ are subscribed to the within instrument and acknowledged to me that he/ she/ they executed the same in his/er/ their authorized capacity( ies), and that by his/er/ their signature( s) on the instrument the person( s), or the entity upon behalf of which the person( s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature Ca -f-4 Seal)
CARLOS GARCIA
Notary Public California
San Mateo County
Commission # 2375381
y Comm, Expires Oct 15, 2025
Title or Type of Document: ,,. G -# m
f`b1te-/ 1° l6r4 re em anoT
32 CALIFORNIA ALL- PURPOSE ACKNOWLEDGMENT CIVIL CODE § 1189 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
State of California ,
t
County of 5ah Mate'
On Novel -y-1 be I' 3, 202/ before me,
Date
personally appeared
S!' 7eY/ 5a/ s? , Nol- art4
Here Insert Name and Title of the Officer
1; zobe!- tN)' sbetName( s) ofSigner( s)
who proved to me on the basis of satisfactory evidence to be the person() whose name( a) is/ are- sttl seribed to the within instrument and acknowledged to me that he/ she/ thy executed the same in his/er/ their authorized capacity( ies), and that by his/er/ their signature( e)- onthe instrument the person( 4or the entity upon behalf of which the person,( s)' acted, executed the instrument.
SHERI SAISI
Notary Public - California
San Mateo County
Commission >k2222900 v
My Comm. Expires Nov 23, 2021
Place Notary Seal and/ or Stamp Above
I certify under PENALTY OF PERJURY under the
laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal.
Signature
OPTIONAL
Signature of Notary Public
Completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document.
Description of Attached Document r—A- 4PaoU ' ieNT A '/2, 5EMENT Title or Type of Document: G/ _E - J SI 17, E SUB bI VI SON Document Date: Number of Pages:
Signer( s) Other Than Named Above: NONa
Capacity( ies) Claimed by Signer( s)
Signer' s
Name: R®13E12- YI`llS SgT Signer' s Name:
Corporate Officer — Title( s): Corporate Officer — Title( s):
Partner — Limited General Partner — Limited General
Individual Attorney in Fact Individual Attorney in Fact Trustee Guardian of Conservator Trustee Guardian of Conservator Other: G / rY M, 4NAGaR Other:
Signer is Representing: C /7'( D HAL- F Signer is Representing:
MooN l3, aY
2017 National Notary Association
33 2021- 154699
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
City Clerk
City of Half Moon Bay
501 Main Street
Half Moon Bay, CA 94019
11: 27 am 11/ 04121 AG DR Fee: NC) FEE
Co! rnt of Pares 21
Recorded in O ficial Records
County of San Mateo
Mark Church
Assessor -County Clerk , Recorder
1111/ 111111111( 111111111 11111111$ F? 0
l i //I/ 0 3 1 6 # 3 2
I/I4/
4 .*
No fee for recording pursuant
to Government Code § 27383
space above for Recorder' s use only)
AFFORDABLE HOUSING REGULATORY AGREEMENT
AND DECLARATION OF RESTRICTIVE COVENANTS
This Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants ( this Agreement") is entered into for reference purposes as of July 21, 2021 ( the " Effective Date"), by and between the City of Half Moon Bay, a California municipal corporation (" City") and Gibraltar Capital Inc., a California corporation, and any authorized successor or assignee Developer"). City and Developer are individually referred to herein as a " Party" and collectively as the " Parties."
RECITALS
A. Developer is the owner of approximately 5. acres ofreal property in the City of Half Moon Bay, San Mateo County, State of California, located at 320 Church Street, which is the subject of Tentative Subdivision Map No. 16- 02 Creekside Court ( the " Property"). The Property is more particularly described in Exhibit A, attached hereto, B. Developer submitted an application to the City for a Tentative Subdivision Map, Coastal Development Permit, and environmental review pursuant to the California Environmental Quality Act on the Property, consisting of 12 residential lots, known as Creekside Court ( the Project"). The City Planning Cornrnission recommended approval of the tentative subdivision map and related permits for the Project on October 10, 2017. The City Council approved the Project on November 7, 2017, including by adopting the Tentative Subdivision Map and associated Coastal Development Permit, and conditioned the approval compliance with the requirements described in the Conditions ofApproval. on Developer' s
On October 20,
2020, the City Council approved a 12 -month extension of the Project' sTentative Subdivision Map. The final Project includes 11 lots for single family residential development and one lot for a four -unit multifamily residential development.
C. The Project' s
Conditions ofApproval include standards for the development of the Property and specifically require that 20 percent of all new residential units developed on the Property be affordable to moderate and/ orlower income households pursuant to Half Moon Bay Municipal Code Chapter 18. 35, Below Market Rate Housing. The Project shall provide four multifamily housing units, to be rented at affordable rates for 55 years, as further described below ( the " Affordable Units"). Developer shall lease or sell two of the Affordable Units to Very 1 34
Low Income Households and two of the Affordable Units to Low Income Households at affordable ' rental rates or sales prices, as described below in Section 2. 5, and must grant first preference to rental or sale of the Affordable Units to those households with a household member who works or lives in Half Moon Bay, as described below.
D. The Conditions ofApproval also require Developer to enter into an Affordable Housing Compliance Agreement, subject to approval of the City Attorney, that implements the City - approved affordable housing requirements in the Conditions of Approval. This Agreement serves as that required Affordable Housing Compliance Agreement.
E. To ensure the continued affordability ofthe Affordable Units for the Term as described below in Section 5. 1, this Agreement shall be executed and recorded against the Property prior to the recordation of any final subdivision map or issuance of building permits for the Project, whichever occurs first.
F. The Parties intend the covenants set forth in this Agreement to run with the land and to be binding upon Developer and Developer' ssuccessors and assigns for the full term of this Agreement.
NOW, THEREFORE, in consideration of the foregoing, it is mutually agreed by and between the undersigned parties as follows:
1. Definitions. The following terms have the meanings set forth in this Section wherever used in this Agreement or the attached exhibits.
Adjusted for Family Size Appropriate for the Unit" means adjusted for a household of one person in the case of a studio unit, two persons in the case of a one -bedroom unit, three persons in the case of a two -bedroom unit, four persons in the case of a three -bedroom unit, and one additional person for every additional bedroom thereafter. The Family Size Appropriate for the Unit is intended to be used solely for the purposes ofestablishing maximum rent limits for the Affordable Units, and not as a maximum occupancy limit for the Affordable Units.
Affordable Rent" means all monthly payments, other than deposits, paid by the Tenant of an Affordable Unit for (1) the use and occupancy of an Affordable Unit and land and all facilities associated with the Affordable Unit, including but not limited to parking, and use of all common areas, (2) any rent increase allowed by, and imposed in accordance with the terms ofthis Agreement, and ( 3) reasonable utility allowance for utilities paid by the tenant, including garbage collection, sewer, water, electricity, gas and other heating, cooking and refrigeration fuel, but not telephone service, Internet, or cable or subscription TV, plus other fees and charges required to be paid by tenants of the Affordable Units on a non -optional basis. "Maximum Monthly Rent" shall have the meaning as set forth in Section 2. 6 below.
Affordable Unit" shall mean one of the Low Income or Very Low Income Units offered by the Developer to be sold to Eligible Households at an Affordable Sales Price (as defined in Section 11( d)) or rented to Eligible Households at Affordable Rents. 2 35
Area Median Income" means the median income for San Mateo County, California, adjusted for the actual number ofpersons in the applicable household, as determined by the U. S.
Department ofHousing and Urban Development (" HUD") pursuant to Section 8 of the United States Housing Act of 1937. In the event that such income determinations are no longer published, or are not updated for a period of at least 18 months, the City shall provide the Developer with other income determinations which are reasonably similar with respect to methods of calculation to those previously published by HUD.
Eligible Household" means a household for which gross household income does not exceed the applicable maximum income level for an Affordable Unit.
Low Income household" means any household whose income, as adjusted for the actual number of persons in the applicable household, is between 50 and one -tenth percent and 80 percent ofthe Area Median Income for San Mateo County, pursuant to Half Moon Bay Municipal Code Section 18. 35. 015( C).
Tenant" is a household occupying an Affordable Unit.
Very Low Income Household" means any household whose income, as adjusted for the actual number of persons in the applicable household, is 50 percent or less of the Area Median Income for San Mateo County, pursuant to Half Moon Bay Municipal Code Section 18. 35. 015( D).
2. Unit Affordability, Construction, and Use.
2. 1 Compliance with Affordabilit and Occupancy Requirements. Developer hereby covenants and agrees, for itself and its successors and assigns, that the Affordable Units shall be used solely in compliance with this Agreement, and the requirements set forth herein. Developer represents and warrants that it has not entered into any agreement that would restrict or compromise its ability to comply with the occupancy and affordability restrictions set forth in this Agreement, and Developer covenants that it shall not enter into any agreement that is inconsistent with such restrictions without the express written consent of City.
2. Timing for Affordable Unit Construction. The Parties intend that all of the Affordable Units be constructed and completed concurrently with, or earlier than, the Project' s market rate units, The City will not issue certificates of compliance for more than two market rate units until the Developer has rented or sold all of the Affordable Units.
2. 3 Unit Design and Quality. The Affordable Units in the Project shall be of comparable design and construction quality as market rate units in the Project, and each Affordable Unit shall be of comparable quality as each other Affordable Unit, Affordable Units shall all have similar standard fixtures, finishes and appliances as the market rate units, but the Affordable Units shall not be required to include any above standard, fixtures, finishes or appliances.
2. 4 Affordable Unit Size. The Affordable Units shall be at least 700 square feet and have at least two bedrooms, and generally range in size between 700 and 1, 000 square feet per unit. Each Affordable Unit shall be of comparable size to each other Affordable Unit. 3 36
2. 5 Income Mix for Affordable Units. Two of the Affordable Units will be made available for rent to Very Low Income Households ( each, a " Very Low Income Unit"), and two Affordable Units shall be made available for rent to Low Income Households ( each, an " Low Income Unit").
2. 6 Requirement of Occupancy of Affordable Units by Eligible Households. The Developer shall not permit a household to occupy an Affordable Unit designated for Low - Income or Very Low -Income households unless the household is determined to be an Eligible Household. The Developer shall recertify the income eligibility of the Low- and Very Low - Income Households occupying the Affordable Units on not less than an annual basis to determine the continuing eligibility of the Eligible Household, as described in Sections 4. 2 and
4.3, below. If the household no longer qualifies as an Eligible Household, as defined herein, the provisions of Section 4. 5, below, shall apply.
2. 7 Maximum Monthly Rent. Except as otherwise stated in the Definition of Affordable Rent above, monthly rents for Affordable Units for Low Income households shall not exceed one -twelfth of 30 percent of 80 percent of Area Median Income, Adjusted for Family Size Appropriate for the Unit. The monthly rents for the Affordable Units for the Very Low Income households shall not exceed one -twelfth of 30 percent of 50 of percent of Area Median Income, Adjusted for Family Size Appropriate for the Unit.
2. 8 Prohibited Assignments. Developer may prohibit any assignment of any Affordable Unit lease at any time, except to that Affordable Unit' spreviously listed, existing, and identified Eligible Household Members under 4. 2(a) below, nor shall any Affordable Unit be rented in whole or part via short term rental platforms. Any attempted assignment or assignment, sublease or attempted sublease, license or attempted license of such a unit to anyone, except an existing identified Eligible Household Member under 4.2(a) below, shall be made a material default under any lease.
3. Non -Discrimination; Compliance with Fair Housing Laws.
3. 1 Preference for Local Employees and Residents. In order to ensure that there is an adequate supply of affordable housing within the City for residents and employees ofbusinesses within the City, to the extent permitted by fair housing law and other laws, at initial lease up and during the term of this Agreement, Developer shall give first preference in the renting or sale of the Affordable Units to Eligible Households with members who live or work in the city limits of Half Moon Bay. If there are no eligible Very Low and Low Income Households who meet these criteria, second preference shall be granted to Eligible Households with members who live or work in San Mateo County Coastside. In the event there are fewer applicants for the Affordable Units that meet the criteria specified in this paragraph than there are available Affordable Units, such units shall be made available to members of the general public who are qualified Very Low and Low Income Households.
3. 2 Fair Housing. Developer shall comply with state and federal fair housing laws in the marketing and rental of the Affordable Units. With respect to the Affordable Units, Developer shall accept as tenants, on the same basis as all other prospective tenants, persons who are recipients of federal certificates or vouchers for rent subsidies pursuant to the existing 4 37
Section 8 program or any successor thereto. Developer shall not apply or permit the application ofmanagement policies or lease provisions with respect to the Affordable Units which have the effect of precluding occupancy of Affordable Units by tenants who are recipients of federal certificates for rent subsidies pursuant to such Section 8.
3. Non -Discrimination. Developer shall not restrict the rental, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Affordable Units on the basis of race, color, religion, creed, sex, sexual orientation, gender identity or status, disability, marital status, ancestry, or national origin of any person. Developer covenants for itself and all persons claiming under or through it, and this Agreement is made and accepted upon and subject to the condition that there shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision ( a) or ( d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926., subdivision ( in) and paragraph ( 1) of subdivision (p) of Section 12955, and Section 12955. 2ofthe Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Affordable Units, nor shall Developer or any person claiming under or through Developer establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or purchasers in, of, or for the Affordable Units.
4. Reporting and Income Certification Recuirements; Leases.
4. 1 Retaining a Third Party Organization. In perfonning under this Agreement, Developer has the right to retain as agent for Developer any qualified third party approved by the City including, but not limited to, a nonprofit housing organization, with experience in qualifying low income households in San Francisco or San Mateo County, provided that no such action shall relieve Developer from its obligations under this Agreement.
4. 2 Eli Jible Household Certification. Developer, or Developer' sauthorized agent, shall obtain from each household prior to that household' sinitial occupancy of each Affordable Unit, and on every anniversary thereafter, a written certificate containing at least all the following, in such format and with such supporting documentation, as City and Developer may reasonably require; (a) the identity of each household member; (b) the number of household members; and ( c) the total gross household income ( i.e., inclusive of all household members' individual income). Developer shall retain such certificates for not less than five years, and upon City' srequest, shall provide copies of such certificates to City and snake the originals available for City inspection.
4. 3 Verification of Income. The Developer shall make a good faith effort to verify and document that the income statement provided by applicants for and Tenants of a Low Income Unit or Very Low Income Unit is accurate by obtaining a copy ofthe federal income tax return for each Eligible Household Member under Section 4.2(a) for the taxable year immediately preceding such lessee' sinitial occupancy in the Project or, if an Eligible Household Member certifies that he or she did not file or did not retain a copy of such tax return, other satisfactory evidence of income for such year, such as wage statements, employer records or other form of independent verification approved by City. 5 38
4. Certified Annual Report. By not later than April 30th of each year during the term ofthis Agreement, Developer shall submit an annual report to the City ("Annual Report") for the prior calendar or portion of any prior calendar year that the Affordable Units start or cease being required under the terms of this Agreement with a certification that the Project complies with this Agreement. The Annual Report shall, at a minimum, include the following information for each Affordable Unit in the Project: (a) unit number; (b) number ofbedrooms; (c) current rent and other charges; (d) dates of any vacancies during the previous year; (e) number ofpeople residing in the unit; (f) total gross household income of all residents living in the unit; (g) documentation of source of household income including if applicable, place of any employment.
Developer shall include with the Annual Report, an income recertification for each household, documentation verifying Eligible Household eligibility, and such additional information as City may reasonably request from time to time in order to demonstrate compliance with this Agreement. The Annual Report shall conform to the format requested by City.
4. 5 Household Income Increases.
a) Low Income Household Income Increases. If upon recertification of an Low Income Household' sgross income, Developer determines that such Household' s gross
income has increased and exceeds the qualifying income for a Low Income Household, then upon the expiration of such Tenant' slease and following 6 months' notice, and if so permitted by local and state law, such Tenant shall be required to vacate the unit and Developer shall rent the unit to a Low Income Household to restore the affordability mix required by this Agreement.
During the 6 months following the above -referenced notice, Developer shall not increase Tenant' sMonthly Rent. In addition, should a Tenant' s
gross income exceed the qualifying
income for a Low Income Household, Developer shall still be deemed in compliance with this Agreement until such time as Tenant is required to move out pursuant to this Agreement, at which point the Affordable Unit shall be rented as an Low Income Unit as needed to restore the affordability mix required by this Agreement.
b) Very Low Income Household Income Increases. If upon recertification of a Very Low Income Household' s
gross income, Developer determines that such Tenant' sgross income has increased and exceeds the qualifying income for a Very Low Income Household but does not exceed the qualifying income for a Low Income Household, then upon the expiration of such Tenant' slease and following 3 months' notice, Developer may increase Tenant' sMonthly Rent to Low Income rent and Developer shall make the next vacant Low Income unit available as a Very Low Income Unit to restore the affordability mix required by this Agreement.
If upon recertification of a Very Low Income Household' s gross income, Developer determines
that such household' sgross income has increased and exceeds the qualifying income for a Very Low Income Household and Low Income Household, then upon the expiration of such Tenant' s lease and following 6 months' notice, and if so permitted by local and state law, such Tenant shall be required to vacate the unit and Developer shall rent the unit to a Very Low Income Household to restore the affordability mix required by this Agreement. During the 6 months following the above -referenced notice, Developer shall not increase Tenant' sMonthly Rent. In addition, should a Tenant' s
gross income exceed the qualifying income for a Low Income Household, Developer shall still be deemed in compliance with this Agreement until such time 6 39
as Tenant is required to move out pursuant to this Agreement, at which point the Affordable Unit shall be rented as a Very Low Income Unit as needed to restore the affordability mix required by this Agreement.
4. 6 Minimum Lease Term. Tenants must be offered an initial lease term of 12 months; however, leases may be renewed for terms of less than 12 months at the Tenant' s request.
4. 7 Lease Provisions. Developer shall use a form oftenant lease approved by the City for the Affordable Units. The tenant lease form shall, among other matters:
a) provide for termination ofthe lease for failure: (1) to provide any information required under this Agreement ( or subject to the City' s approval on a case by case basis, any additional reasonably requested by the Developer) to establish or recertify the Tenant' squalification, or the qualification of the Tenant' shousehold, for occupancy of the Affordable Units in accordance with this Agreement, or (2) to qualify as a Low Income Household as a result of any material misrepresentation made by such Tenant with respect to the income computation or certification;
b) provide that the rent may not be raised more often than once every 12 months. The Developer will provide each Tenant with at least 90 days written notice of any increase in rent applicable to such Tenant, and with such further notice as may be required by this Section or by any applicable law or regulation;
c) prohibit subleasing of the Affordable Unit or any portion of the unit, contain nondiscrimination provisions, and include the Tenant' sobligation to inform the Developer of any need for maintenance or repair;
d) include reasonable rules of conduct consistent with California law; and e) allow termination of the tenancy only for good cause, including violation of the terms and conditions of the lease, violations ofapplicable federal, state, or local law, or other good cause.
4. 8 Accounting Records. The Developer shall maintain records and books accurately and fully showing the amount of rent eharged to and received from each of the Affordable Units.
The Developer shall not be required to maintain such records and books relating to a particular rental of a particular Affordable Unit for more than five years following termination of a tenancy.
4. 9 Annual Monitoring Fees. The Developer shall pay to the City on or before April 1 of each year for the term of this Agreement an annual fee covering the period of the immediately preceding fiscal year ending June 30, in an amount equivalent to one hour of City Planning staff time billed at the rate adopted by resolution ofthe City Council, to defray a portion of the cost incurred by the City to monitor the Developer' scompliance with the terms of this Agreement.
This Annual Monitoring Fee may be increased on an annual basis by the lesser ofthree percent of the then current fee or the increase in the Consumer Price Index for each corresponding year. 7 40
5. Term of Agreement.
5. 1 Term of Restrictions, This Agreement shall remain in effect for each Affordable Unit through the 55th anniversary of the latest lease start date for the initial occupancy of any of the four Affordable Units, ifthe Affordable Units are initially offered for rent; or the 55th anniversary of the latest date that title transfers on any of the four Affordable Units, if the Affordable Units are initially offered for sale (the " Term"). After the end ofthe Term, this Agreement and all of its restrictions shall irrevocably and permanently terminate as to the Affordable Units without any act, cost or fee due from Developer or occupant ofthe Project except as provided in Section 4. 3.
5. 2 Effectiveness Succeeds Conveyance ofProperty. This Agreement shall remain effective and fully binding for the full fixed 55 -year Term hereof, described in Section 5. 1, regardless of any sale, assignment, transfer, or conveyance of the Property or the Project or any part thereof or interest therein.
5. 3 Conveyance. Upon the termination of this Agreement at the end of the Term, the Parties agree to execute and record appropriate instruments at no cost to the Developer, except for the reimbursement of any City incurred title report, title insurance, drafting of instruments fees and costs, and recording fees incurred, if any; provided, however, the execution and recordation of such instruments shall not be necessary or a prerequisite to the termination of this Agreement upon the expiration of the term.
6. Property Management, Repair and Maintenance; Marketing.
6. 1 Management Responsibilities. Developer shall be responsible for all management functions with respect to the Affordable Units, including without limitation the selection of tenants, certification and recertification ofhousehold income and eligibility, evictions, collection ofrents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and security. City shall have no responsibility for construction, rehabilitation, management, repair, maintenance or marketing of the Affordable Units.
6. 2 Recurred Submissions to City. Three months before the first certificate of occupancy is issued to an Affordable Unit, the Developer or its designated representative shall notify City of the availability ofthe Affordable Units and provide to the City its proposed Marketing and Management Plan for the Affordable Units as described below in Section 6. 3; and the proposed form oftenant lease to confirm conformance with the provisions of this Agreement, all for City review and approval.
6. 3 Marketing and Management Plan. The Marketing and Management Plan shall address, in detail, how Developer plans to market the Affordable Units to prospective Eligible Households in accordance with fair housing laws and this Agreement (" Marketing and Management Plan" or "Plan"). The Plan shall include the following: means to be used to advertise Affordable Units to the public upon initial occupancy and as vacancies occur and maintenance of a waiting list; the amount of any application screening fee based on reasonable costs of processing applications by Developer, and information to be provided to applicants, including the preferences described in Section 3.1, conditions and restrictions applicable to 8 41
occupancy of the Affordable Units, proposed Affordable Rents for the Affordable Units, permitted rent increases, maximum qualifying income for an Eligible Household, the requirement for annual household income recertification, and requirement to vacate the Affordable Unit ifthe Tenant' shousehold income exceeds the maximum qualifying income, as described in Section 4. 5. The Plan shall also describe the management team and shall address how Developer and any management entity plan to manage and maintain the Affordable Units.
6. 4 Review of Marketin and Mana 7ement Plan. Upon receipt of the Plan, the City shall promptly review the Plan and shall approve or disapprove it within 45 days after City determines that the submitted Plan is complete. Ifthe Plan is not approved, the City shall provide Developer with a written description ofthe changes required to obtain approval, and the Developer shall submit a revised Plan within 30 days of receipt of such comments, which the City will again review and reasonably approve or disapprove within 15 days, again stating reasons for disapproval and corrections required as detailed above. If the Plan is not approved, the Developer shall submit a revised Plan within 30 days, which shall be subject to the sarne review procedure set forth in this Section 6. 4. Developer shall abide by the terms ofthe Plan in marketing, managing, leasing, and maintaining the Affordable Units, and throughout the term of this Agreement, shall submit proposed material modifications to City for review and approval.
6. 5 Repair, Maintenance and Security. Throughout the term of this Agreement, Developer shall at its own expense, maintain the Affordable Units in good physical condition, in good repair, and in decent, safe, sanitary, habitable and tenantable living conditions in conformity with all applicable state, federal, and local laws, ordinances, codes, and regulations.
Without limiting the foregoing, Developer agrees to maintain the Affordable Units ( including without limitation, the residential units, common areas, landscaping, driveways, parking areas and walkways) in a condition free of all waste, nuisance, debris, unrnaintained landscaping, graffiti, disrepair, abandoned vehicles/ appliances, and illegal activity, and shall take all reasonable steps to prevent the same from occurring on the Affordable Units. Developer shall prevent and/ or rectify any physical deterioration apart from reasonable wear and tear of the Affordable Units and shall make all repairs, renewals and replacements necessary to keep the Affordable Units and the improvements located therein in good condition and repair. Developer shall provide adequate security measures for the Affordable Units, including without limitation, the installation of adequate lighting and deadbolt locks.
6. City' sRight to Perform Maintenance. In the event that Developer breaches any of the covenants contained in Section 6. 5, and such default continues for a period of 10 days after written notice from City (with respect to graffiti, debris, and waste material) or 30 days after written notice from City (with respect to landscaping, building improvements and general maintenance), or such additional time as is reasonably required to rectify the condition, then City, in addition to any other remedy it may have under this Agreement or at law or in equity, shall have the right, but not the obligation, to enter upon the Affordable Units and perform all acts and work necessary to protect, maintain, and preserve the improvements and the landscaped areas on the Property. All reasonable third -party costs expended by City in connection with the foregoing shall be paid by Developer to City upon demand. All such sums remaining unpaid 30 days following delivery of City' sinvoice therefor shall bear interest at the lesser of8% per annum or the highest rate permitted by applicable law. City shall have a lien against the 9 42
Affordable Units for the amount of such unpaid sums and shall have the right to record a Notice of Claim of Lien against the Affordable Units.
6. 7 Property Damage or Destruction. If any part of the Affordable Units are damaged or destroyed, Developer shall repair or restore the same, consistent with the occupancy and rent restriction requirements set forth in this Agreement. Such work shall be commenced as soon as reasonably practicable after the damage or loss occurs and shall be completed within one year thereafter or as soon as reasonably practicable, provided that insurance proceeds are available to be applied to such repairs or restoration within such period and the repair or restoration is financially feasible. During such time that lenders providing financing for the construction of the Affordable Units impose requirements that differ from the requirements of this Section the requirements of such lenders and investors shall prevail.
7. BindinU ion Successors; Covenants to Run with the Land. Developer hereby subjects its interest in that parcel with the Affordable Units ( Lot 1, as shown in Exhibit A ("Lot 1") to the covenants and restrictions set forth in this Agreement, as they may apply to that residential building. The Parties hereby declare their express intent that the covenants and restrictions set forth herein shall be deemed covenants running with the land and shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest, transferees, and assigns of the Parties, regardless of any sale, assignment, refinancing, conveyance or transfer of the Affordable Units, or any part thereof or interest therein, whether a change in interest occurs voluntarily or involuntarily, by operation of law or otherwise, except as expressly released by City. Any successor -in -interest to Developer, including without limitation any purchaser, transferee or lessee of the Affordable Units ( other than the tenants of the individual Affordable Units) shall be subject to all of the duties and obligations imposed hereby for the full term of this Agreement. Each and every contract, deed, lease or other instrument affecting or conveying the Affordable Units or any part thereof, shall conclusively be held to have been executed, delivered and accepted subject to the covenants, restrictions, duties and obligations set forth herein, regardless of whether such covenants, restrictions, duties and obligations are set forth in such contract, deed, lease or other instrument. If any such contract, deed, lease or other instrument has been executed prior to the date hereof, Developer hereby covenants to obtain and deliver to City an instrument in recordable form signed by the parties to such contract, deed, lease or other instrument pursuant to which such parties acknowledge and accept this Agreement and agree to be bound hereby.
Developer agrees for itself and for its successors that in the event that a court of competent jurisdiction determines that the covenants herein do not run with the land, such covenants shall be enforced as equitable servitudes against the Affordable Units in favor of City. Without limiting the generality of the foregoing, Developer and City hereby declare their understanding and intent that:
a) The covenants and restrictions contained in this Agreement shall be construed as covenants running with the land pursuant to California Civil Code section 1468 and not as conditions which might result in forfeiture oftitle by Developer; 10 43
b) The burden of the covenants and restrictions set forth in this Agreement touch and concern the Property in that the Developer' slegal interest in the Property and all improvements thereon are rendered less valuable thereby; and
c) The benefit of the covenants and restrictions set forth in this Agreement touch and concern the land by enhancing and increasing the enjoyment and use of the Property by the Affordable Unit tenants.
d) A11 covenants and restrictions contained herein without regard to technical classification or designation shall be binding upon Developer and its successors in interest for the benefit of the City, and such covenants and restrictions shall run in favor of the City for the entire period during which such covenants and restrictions shall be in force and effect, without regard to whether the City is an owner of any land or interest therein to which such covenant and restrictions relate.
8. Recordation; Subordination. This Agreement shall be recorded in the Official Records of San Mateo County prior to the recordation of the final subdivision map for the Project.
Developer hereby represents, warrants and covenants that with the exception of easements of record, absent the written consent of City, this Agreement shall not be subordinated in priority to any lien (other than those pertaining to taxes or assessments), encumbrance, or other interest in the Affordable Units. If, at the time this Agreement is recorded, any interest, lien, or encumbrance has been recorded against Lot 1 in a position superior to this Agreement, upon the request of City, Developer hereby covenants and agrees to promptly undertake all action necessary to clear such matter from title or to subordinate such interest to this Agreement consistent with the intent of and in accordance with this Section 7, and to provide such evidence thereof, as City may reasonably request. Notwithstanding the foregoing, the City agrees that, pursuant to Health and Safety Code Section 33334. 1( a)( 4), the City will not withhold consent to reasonable requests for subordination of this Agreement to deeds of trust, provided that the instruments effecting such subordination include reasonable protections to the City in the event of default consistent with the requirements ofHealth and Safety Code Section 33334. 1( a)( 4), including without limitation, extended notice and cure rights.
9. Transfer and Encumbrance.
9. 1 Permitted Transfers. Notwithstanding any contrary provision hereof, the Permitted Transfers of the Affordable Units or of Lot 1 (" Permitted Transfers") are as follows:
a) the granting of easements or permits to facilitate development of the Property; (b) bulk sale of all four Affordable Units by the Developer or Developer' ssuccessors in interest; (c) the sale, lease or rental of the individual Affordable Units to Eligible Households for occupancy as their principal residence during the 55 -year Term in accordance with this Agreement, and the market rate sale, lease or rental of any Affordable Units following the end ofthe 55 -year Tenn; or (d) assignments creating security interests for the purpose of financing the acquisition, construction, or permanent financing of the Project or the Property or portions of the Project or Property or the reconstruction, repair of the Project or Property, or portions of the Project or Property, or as may be permitted by law, or Permitted Transfers directly resulting from the foreclosure of, or granting of a deed in lieu of foreclosure of, such a security interest. 11 44
9. 2 Agreement by Transferees. Each transferee shall agree: that (a) the Project is and shall, during the Term of this Agreement, continue to be operated in compliance with this Agreement and (b) the transferee expressly assumes all obligations of Developer imposed by this Agreement.
9. 3 City Purchase Option. In the event that the Developer successor in interest elects to place all four Affordable Units on the market or the
for
Developer' s
bulk sale during
the 55 -year Term of this Agreement, the Developer shall notify the City, in writing, of that decision at least six months before any Affordable Units are listed for sale or any sales agreements are executed. The City shall have the option to purchase the Affordable Units, and may choose to exercise this option at its sole discretion by providing written notice to Developer.
9. 4 Mortgagee Protection. No violation of any provision contained herein shall defeat or render invalid the lien of any mortgage or deed of trust made in good faith and for value upon all or any portion of the Project or the Property, and the purchaser at any trustee' ssale or foreclosure sale shall not be liable for any violation of any provision hereof occurring prior to the acquisition of title by such purchaser. Such purchaser shall be bound by and subject to this Agreement from and after such trustee' ssale or foreclosure sale. Promptly upon determining that a violation ofthis Agreement has occurred, City shall give written notice to the holders of record of any mortgages or deeds of trust encumbering the Project or the Property that such violation has occurred.
10. Transition to For -Sale Project. In the event that the Developer elects to place the Affordable Units on the market for sale during the 55 -year Term of this Agreement, the Developer shall notify the City, in writing, of that decision at least six months before any Affordable Units are listed for sale or any sales agreements are executed. City and Developer shall meet and confer to determine procedures to be utilized for sale ofthe Affordable Units.
Purchase Option. The City shall have the option to purchase the Affordable Units, and may choose to exercise this option at its sole discretion by providing written notice to Developer Exercise Notice"). Not later than 90 days after Developer' sreceipt or refusal of the City' s Exercise Notice, the City may purchase the Affordable Unit at a price equal to the Affordable Sales Price, as defined below in Section 10( c). This Section 11 shall not apply to the bulk sale of all four Affordable Units by the Developer or Developer' ssuccessors in interest, although it would apply to the sale ofindividual units following such bulk sale. a) If the City does not exercise its option to purchase the Affordable Units, the Affordable Units shall be sold to and occupied by Eligible Households at an Affordable Sales Price, as defined below in Section 10( c). Each Affordable Unit shall first be offered for sale to the existing Tenant at the Affordable Sales Price. If City has created a waiting list ofEligible Households, the Affordable Units shall next be offered for sale to any household on the City' s list ofEligible Households.
b) The initial and any subsequent purchasers (" Purchaser") of an Affordable Unit shall execute those instruments or agreements approved by and provided by the City restricting the resale price of the Affordable Unit in accordance with City Ordinances for the remainder of the 55 -year period defined in Section 5. 1, above. Such instruments or agreements shall be recorded, as applicable, against each individual Affordable Unit sold and shall contain such provisions as 12 45
the city may reasonably require to ensure continued compliance by the Purchaser with City' s existing Ordinances. The instruments or agreements shall be in a form as may mutually be agreed to by the City and the Developer. Developer and City shall cooperate to ensure that the instruments and agreements provided by the City are executed by the Purchaser and recorded, as appropriate, at Developer' ssale of the Affordable Units. c) The " Affordable Sales Price" for the Affordable Units at initial sale by the Developer shall be determined by the City within 60 days ofthe Developer' snotice of intent to sell, after consultation with the Developer, based on a reasonable down payment and total monthly costs as those costs exist on the date of City' s determination) that do not exceed Maximum Monthly Rent. Total monthly costs shall include mortgage interest and principal, property taxes, mortgage insurance, homeowner' sinsurance, and homeowners' association dues. d) Developer shall comply with all applicable provisions of the Subdivision Map Act, the Subdivided Lands Act, and other applicable law ifDeveloper elects to place the Affordable Units on the market for sale.
11. Violation ofAgreement.
11. Events of Default. An Event ofDefault shall arise hereunder if Developer fails to perform any obligation under this Agreement and fails to cure such default within 30 days after the City has notified the Developer in writing of the default, or ifthe default cannot be cured within 30 days, has failed to commence to cure within 30 days and thereafter diligently pursued such cure and completed such cure within a reasonable time.
11. 2 Remedies. Upon the occurrence of an Event of Default and its continuation beyond any applicable cure period, City may proceed with any of the following remedies:
a) Bring an action for equitable relief seeking the specific performance ofthe terms and conditions of this Agreement, and/ or enjoining, abating, or preventing any violation of such terms and conditions, and/ or seeking declaratory relief; b) In the event that the Developer' sbreach, non- performance or violation involves the rents to Tenants or other charges in excess of those permitted under this Agreement, the City shall be entitled to require, as an additional remedy, the return of such excess rents or other charges to the affected households, if such households can be located within a reasonable amount of time by Developer' sgood faith search for such households. If in fact such households cannot be found within a reasonable amount of time after Developer' sgood faith search, then Developer shall return such excess rents or other charges to the City. c) Pursue any other remedy allowed at law or in equity.
Each of the remedies provided herein is cumulative and not exclusive. City may exercise from time to time any rights and remedies available to it under applicable law or in equity, in addition to, and not in lieu of, any rights and remedies expressly provided in this Agreement. Any failure or delay by City in asserting any of its rights or remedies, including specific performance, as to any Event of Default shall not operate as a waiver of any default or of any such rights or 13 46
remedies (Dv deprive City of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies.
11. 3 Violations by the City. Any violation, non- performance or breach by the City of any representation, obligation, warranty or covenant hereunder, which is not cured within 30 days after notice thereof given by the Developer, or where cure is not possible within 30 days, whose cure is not commenced within 30 days and diligently prosecuted to completion shall constitute an Event ofDefault, in which event the Developer' ssole remedy shall be to seek specific performance of the Agreement.
12. Miscellaneous.
12. Amendments. This Agreement may be amended or modified only by a written instrument signed by both Parties and recorded thereafter.
12. 2 No Waiver. Any waiver by City or Developer of any term or provision of this Agreement must be in writing. No waiver shall be implied from any delay or failure by City or Developer to act on any breach or default hereunder or to pursue any remedy allowed under this Agreement or applicable law. Except as otherwise provided herein, no failure or delay by City at any time to require strict performance by Developer of any provision of this Agreement or to exercise any election contained herein or any right, power or remedy hereunder shall be construed as a waiver of any other provision or any succeeding breach of the same or any other provision hereof or arelinquishment for the future of such election.
12. 3 Notices. Except for any notice, demand or communication required under applicable law to be given in another matter, all notices, demands and communications to be sent pursuant to this Agreement shall be made in writing, and sent to the parties at their respective addresses specified below or to such other address as a party may designate by written notice delivered to the other parties in accordance with this Section. All notices demands or communications shall be shall be sent by personal delivery, by reputable overnight delivery service ( which provides a delivery receipt), or by certified or registered mail, return receipt requested, postage prepaid. Any notice, demand or communication shall be deemed given, received, made or communicated on the date personal delivery is effected or, ifmailed in the manner herein specified, on the delivery date or date delivery is refused by the addressee, as shown on the return receipt. Either party may change its address at any time by giving written notice of such change to City or Developer as the case may be, in the manner provided herein, at least 10 days prior to the date such change is desired to be effective.
Any notice to be delivered to City shall be addressed to:
City of Half Moon Bay
501 Main Street
Half Moon Bay, CA 94019
Attn: City Manager
With copy to:
14 47
Shute, Mihaly & Weinberger, LLP
Catherine Engberg, City Attorney
396 Hayes Street
San Francisco, CA 94102
Any notice to be delivered to Developer shall be addressed to:
Gibraltar Capital Inc.
6 Ashdown Place
Half Moon Bay, CA 94019
Attn: Cameron Jeffs
12. 4 Further Assurances. The Parties shall execute, acknowledge and deliver to the other such other documents and instruments, and take such other actions, as either shall reasonably request as may be necessary to carry out the intent of this Agreement.
12. 5 Parties Not Co -Venturers. Nothing in this Agreement is intended to or shall establish the Parties as partners, co -venturers, or principal and agent with one another.
12. 6 Action by the City. Except as may be otherwise specifically provided herein, whenever any approval, notice, direction, consent or request by the City is required or permitted under this Agreement, such action shall be in writing, and such action may be given, made or taken by the City Manager or by any person who shall have been designated by the City Manager, without further approval by the City Council.
12. 7 Non -Liability of City and City Officials, Employees and Agents. No member, official, employee or agent of City shall be personally liable to Developer or any successor in interest, in the event of any default or breach by City, or for any amount of money which may become due to Developer or its successor or for any obligation of City under this Agreement.
12. 8 Indemnification. Developer agrees to indemnify, protect, defend with counsel selected by the City, and hold harmless, the City, and any agency or instrumentality thereof, and its elected and appointed officials, officers, employees and agents, from and against an and all liabilities, claims, actions, causes of action, proceedings, suits, damages, judgments, liens, levies, costs and expenses of whatever nature, including reasonable attorney' sfees and disbursements arising out of or in any way relating to the Project,
performance, non- performance under this Agreement,
the
or
Affordable
its failure
Units,
to comply
or Developer' s
with any of its
obligations contained in this Agreement ( collectively, " Claims"). The indemnification shall include any Claims that may be asserted by any person or entity, including Developer, whether or not there is concurrent, passive or active negligence on the part ofthe City, and any agency or instrumentality thereof, and its elected and appointed officials, officers, employees and agents.
Developer' sduty to defend the City shall not apply in those instances when Developer has asserted the Claims, although the Developer shall still have a duty to indemnify, protect and hold harmless the City.
This indemnification shall include, but not be limited to, City costs required to respond to any Claim, any damages awarded against the City, the City' s attorneys' fees and cost of suit, any 15 48
award of opposing counsel' sattorneys' fees or costs of suit, and any other liabilities and expenses incurred in connection with such proceeding, whether incurred by Developer, the City, and/ orthe parties initiating or bringing such proceeding. Developer acknowledges that the City may elect to retain its own counsel to represent it in such proceeding and agrees to reimburse the City for associated attorneys' fees and costs of suit. Developer further agrees to indemnify the City for all costs, attorneys' fees, and damages, which the City incurs in enforcing this Agreement.
12. 9 Headings; Construction. The headings of the sections and paragraphs of this Agreement are for convenience only and shall not be used to interpret this Agreement. The language ofthis Agreement shall be construed as a whole according to its fair meaning and not strictly for or against any Party.
12.0 Time is ofthe Essence. Time is ofthe essence in the performance of this Agreement.
12.1 Governing Law; Venue. This Agreement shall be construed in accordance with the laws of the State of California without regard to principles of conflicts of law. Any action to enforce or interpret this Agreement shall be filed and heard in the Superior Court of San Mateo County, California or in the Federal District Court for the Northern District of California.
12.2 Attorneys' Fees and Costs. If any legal or administrative action is brought to enforce the terms of this Agreement, the prevailing party shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action.
12.3 Severability. If any provision of this Agreement is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired thereby.
12.4 Entire Areement• Exhibits. This Agreement contains the entire agreement of Parties with respect to the subject matter hereof, and supersedes all prior oral or written agreements between the Parties with respect thereto. Exhibit A attached hereto is incorporated herein by this reference.
12.5 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be an original and all of which together shall constitute one agreement.
12.6 No Third Party Beneficiaries. Except as otherwise provided herein, City and Developer hereby renounce the existence of any third party beneficiary to this Agreement and agree that nothing contained herein shall be construed as giving any other person or entity third party beneficiary status.
SIGNATURES ON FOLLOWING PAGE( S)
16 49
IN WITNESS WHEREOF, the Parties have executed this Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants as of the date first written above.
CITY
CITY OF HALF MOON BAY
A California Municipal Corporation
APP `- VE:' AS TO FORM:
CATHERINE ENGBERG
City Attorney
TTEST:
SICA BLAIR
City Clerk
By:
ROBERT NISBET
City Manager
signature must be notarized]
DEVELOPER
Gilbraltar Capital, Inc.
A California Corporation
By:
CAMERON JEFFS
Chief Financial Officer
signature must be notarized]
17 50
ACKNOWLEDGMENT
A notary public or other officer completing this
certificate verifies only the identity of the individual who signed the document to which this certificate is
attached, and not the truthfulness, accuracy, or
validity of that document.
State of California
County of San Mateo
On November(, f/ , 2021
C (
insert name and title of the officer)
personally appeared a (Y1 e r O N fr,
who proved to me on the basis of satisfactory evidence to be the person( s) whose name( s) is/ are subscribed to the within instrument and acknowledged to me that he/ she/ they executed the same in his/er/ their authorized capacity( ies), and that by his/er/ their signature( s) on the instrument the person( s), or the entity upon behalf of which the person( s) acted, executed the instrument. before me,
Carlos Garcia, Notary Public
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature Seal)
SEa or, rN CARLOS GARCIA
T.' s Notary Public • California _
San Mateo County g
Commission # 2375381
My Comm. Expires Oct 15, 2025
Title or Type of Document: 4 " Tor dab le- Hpu` s' j,j
U+fa' 4,r /46ilt
c1nr(, L CIQ+ rdio/ ® RCS ' Pic' i V Cove" AAs
51 CALIFORNIA ALL- PURPOSE ACKNOWLEDGMENT CIVIL CODE § 1189 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
State of California
County of .., ; 4/ Y1 44a* o
On NOVe!' Y1her 3, 202 % before me,
Date
personally appeared
Sheri Sal SI , / NIOtGrlj
Here Insert Name and Title of the Officer
T- Obei- NIsbeJName( s) of Signer( s)
who proved to me on the basis of satisfactory evidence to be the person( s) whose name( s) is/ are subscribed to the within instrument and acknowledged to me that he/ she/ they executed the same in his/er/ their authorized capacity( ies), and that by his/er/ their signature( s) on the instrument the person( s), or the entity upon behalf of which the person( s) acted, executed the instrument.
SHERI SAISI
Notary Public - California
San Mateo County
Commission* 2222900
My Comm. Expires Nov 23, 2021
Place Notary Seal and/ or Stamp Above
I certify under PENALTY OF PERJURY under the
laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal.
Signature
OPTIONAL
Signature of Notary Public
Completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. k:5/( COU ?2.r.• .fe? , A-3L HOUS / " 1 G 12 - roxY
Description of Attached Document ,' G/ aNl, /V7- ,4-/ N/ E) Title or Type of Document: OP 57/ 2)G` j"JV, CoY& 4,1\ iTi Document Date: ( JL LY 21, 202 I Number of Pages: 2/
Signer( s) Other Than Named Above: )' 4 ' N
Capacity( ies) Claimed by Signer( s)
Signer' s
Name:
Corporate Officer — Title( s):
Partner — Limited General
Individual o Attorney in Fact
Trustee Guardian of Conservator
Other: G /rY MA. NAiEp,
Signer is Representing: C /rYOF f1, rLF
MOD N BAY
Signer' s
Name:
Corporate Officer — Title( s):
Partner — Limited General
Individual Attorney in Fact
Trustee Guardian of Conservator
Other:
Signer is Representing:
2017 National Notary Association
52 Exhibit A
Legal Description of the Property
insert description of the Property]
20 53
Exhibit A
Legal Description of the Property
Lot 1 of the Creekside Court Final Map No. 16- 02 as recorded in the Offices of the San Mateo County Recorder.
54
BUSINESS OF THE COUNCIL OF THE CITY OF HALF MOON BAY
AGENDA REPORT
For meeting of: December 2, 2025
TO: Honorable Mayor and City Council
VIA: Matthew Chidester, City Manager
FROM: Dale Leda, Interim City Engineer
TITLE: SAFE STREET FOR ALL – AWARD OF PROFESSIONAL SERVICES AGREEMENT _____________________________________________________________________________ RECOMMENDATION:
Adopt a resolution authorizing the City Manager to execute a Professional Services Agreement with Kittelson & Associates, Inc. in an amount not to exceed $149,880 for the preparation of a Safe Streets for All Road Safety Action Plan.
FISCAL IMPACT:
The project is funded by a $120,000 Federal Safe Streets for All (SS4A) grant and a $30,000 local match. The local match was included in the FY 2024-25 adopted budget. No additional funding is required.
STRATEGIC ELEMENT:
This action supports the Infrastructure and Environment and Healthy Communities and Public Safety element of the Strategic Plan.
BACKGROUND:
The Safe Streets for All (SS4A) program providesfederal funding to develop comprehensive safety action plans addressing roadway fatalities and serious injuries through a Safe System Approach.
The City was awarded a $120,000 SS4A planning grant with a $30,000 local match (total budget $150,000). The grant agreement was executed July 24, 2024, and requires completion within 36 months.
Half Moon Bay has experienced significant roadway safety challenges. The Road Safety Action Plan will provide comprehensive crash analysis, identify high-priority locations, develop evidence-based countermeasures, and create grant-ready projects positioning the City for future SS4A Implementation funding (up to $25 million). The plan is also intended to supplement other existing and in-progress planning studies and will be focused primarily on local streets. 55
DISCUSSION:
Request for Proposals (RFP) Process
On August 15, 2025, the City issued an RFP for consultant services to prepare the SS4A Road Safety Action Plan, with proposals due September 26, 2025. The scope included project management, data collection and analysis, identification of potential projects with conceptual designs, and preparation of a final SS4A-compliant action plan with public meetings.
The City received six proposals from: Kimley-Horn and Associates, Kittelson & Associates (with BKF Engineers), Mead & Hunt, Minager & Associates, TJKM Transportation Consultants, and TYLin International. A three-member City staff evaluation panel reviewed all proposals based on clarity, project understanding and approach, qualifications and experience, similar projects, and references. The top two scoring firms, Kittelson and Kimley-Horn, were invited to interviews.
Consultant Interviews
The top two firms participated in 30-minute interviews on October 23, 2025, addressing outreach strategy, coordination with the concurrent South Corridor Study, lessons learned from other SS4A projects, and approach to delivering an implementable action plan. Following interviews, the panel unanimously recommended Kittelson & Associates based on their direct experience with the C/CAG 2024 Countywide Local Road Safety Plan (which included Half Moon Bay), ongoing work with Caltrans on District Road Safety Infrastructure Plans, demonstrated track record of SS4A-compliant plans in similar California communities, and competitive fee proposal.
Recommended Consultant
Kittelson & Associates is a nationally recognized transportation planning and engineering firm with 40 years of experience. The firm led development of the AASHTO Highway Safety Manual, authored the FHWA Road Safety Audit Guidebook, and has completed 40+ safety planning projects in California. The project team includes experienced transportation safety professionals with California PE and TE licenses, meeting all RFP requirements. BKF Engineers will provide conceptual design and cost estimating services.
Kittelson's proposed scope of work fully addresses all RFP requirements including project management, data collection and analysis, identification of potential projects with conceptual designs and cost estimates, and preparation of a final SS4A-compliant Action Plan. The Professional Services Agreement includes detailed task descriptions and deliverables.
Project Schedule
Work is anticipated to commence in December 2025 with completion expected in November 2026. Kittelson & Associates demonstrated the highest qualifications, most relevant experience, and best understanding of project needs. Their familiarity with Half Moon Bay and involvement in regional planning efforts positions them to deliver an implementable, grant-ready action plan ATTACHMENTS:
1. Resolution
2. Scope of Work and Fee Schedule
56 Resolution No. C-2025-____
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HALF MOON BAY
AUTHORIZING THE CITY MANAGER TO EXECUTE A PROFESSIONAL SERVICES AGREEMENT WITH KITTELSON & ASSOCIATES, INC. FOR PREPARATION OF A SAFE STREETS FOR ALL ROAD SAFETY ACTION PLAN, IN THE AMOUNT OF $149,880
WHEREAS, the Safe Streets for All (SS4A) program provides federal funding to develop comprehensive safety action plans addressing roadway fatalities and serious injuries through a Safe System Approach; and
WHEREAS, the City was awarded a $120,000 SS4A planning grant with a $30,000 local match, and the grant agreement was executed July 24, 2024; and WHEREAS, the Road Safety Action Plan will provide comprehensive crash analysis, identify high-priority locations, develop evidence-based countermeasures, and create grantready projects positioning the City for future SS4A Implementation funding; and WHEREAS, on August 15, 2025, the City issued a Request for Proposals (RFP) for consultant services to prepare the SS4A Road Safety Action Plan, and received six proposals from qualifying firms; and
WHEREAS, following interviews on October 23, 2025, an evaluation panel made up of city staff unanimously recommended Kittelson & Associates based on their direct experience with the C/CAG 2024 Countywide Local Road Safety Plan, ongoing work with Caltrans on District Road Safety Infrastructure Plans, demonstrated track record of SS4A-compliant plans in similar California communities, and competitive fee proposal; and WHEREAS, the professional services agreement with Kittelson & Associates includes detailed task descriptions and deliverables for project management, data collection and analysis, identification of potential projects with conceptual designs and cost estimates, and preparation of a final SS4A-compliant Action Plan; and
NOW, THEREFORE, BE IT RESOLVED THAT the City Council of the City of Half Moon Bay hereby authorizes the City Manager to execute a professional services agreement with Kittelson & Associates, Inc., for preparation of a Safe Streets for All Road Safety Action Plan, in the not-toexceed amount of $149,880. ***************************************************************** I, the undersigned, hereby certify that the foregoing Resolution was duly passed and adopted on the 2nd day of December 2025, by the City Council of Half Moon Bay by the following vote:
57 AYES, Councilmembers:
NOES, Councilmembers:
ABSENT, Councilmembers:
ABSTAIN, Councilmembers:
ATTEST: APPROVED:
___________________________ _____________________________ Maggie Rodriguez, Assistant City Clerk Robert Brownstone, Mayor 58 59
60 61
62 63
64 65
66 67
BUSINESS OF THE COUNCIL OF THE CITY OF HALF MOON BAY
AGENDA REPORT
For meeting of: December 2, 2025
TO: Honorable Mayor and City Council
VIA: Matthew Chidester, City Manager
FROM: Kenneth Stiles, Interim Administrative Services Director TITLE: ADOPT THE ANNUAL COMPREHENSIVE FINANCIAL REPORT (ACFR) FOR THE FISCAL YEAR ENDED JUNE 30, 2025
______________________________________________________________________________ RECOMMENDATION:
Adopt a resolution receiving the City of Half Moon Bay Annual Comprehensive Financial Report (ACFR) for the fiscal year ended June 30, 2025.
FISCAL IMPACT:
There is no fiscal impact associated with the adoption of this resolution.
STRATEGIC ELEMENT:
This recommendation supports the Fiscal Sustainability and Inclusive Governance Elements of the Strategic Plan.
BACKGROUND:
The City of Half Moon Bay annually conducts an independent audit of financial transactions and issues the Annual Comprehensive Financial Report (ACFR). The Final draft ACFR Report has been prepared in conformity with the Governmental Accounting and Financial Reporting Standards.
An independent audit was conducted by the auditing firm Maze & Associates (Maze) in conformity with General Accepted Auditing Standards. The City received a clean audit opinion on the financial statements.
The City’s ACFR presents an easily readable and organized report of the City’s financial transactions and provides users of government financial statements with a wide variety of information needed to help them evaluate the financial condition of the City. The final step in preparing these financial statements is to present them to the City Council for acceptance.
The ACFR document (Attachment 2) is composed of the following parts:
• Introductory Section including letter of transmittal
• Independent Auditors’ Report
68 • Management Discussion and Analysis
• Basic City-wide and fund-level financial statements
• Explanatory notes to financial statements and supplemental schedules • Statistical section
The transmittal letter included in the ACFR provides information on the City’s profile, financial planning and budgeting, and the local economy.
DISCUSSION:
The General Fund is the City’s primary operating fund. It receives unrestricted revenues and provides general administrative services, law enforcement and animal control services, and land development-related activities such as planning, building, and engineering. The City’s General Fund balance on June 30, 2025, was $13.9 million, of which $8.6 million was committed for reserves and the balance of $5.2 million was unassigned. The fund balance on June 30, 2025, shows a decrease of $456 thousand, or 3%, from the prior year.
The Management Discussion & Analysis (MD&A) section of the ACFR summarizes the financial results for the fiscal year ended June 30, 2025, and provides additional explanations for changes from the prior fiscal year.
The City of Half Moon Bay was the honored recipient of the “Certificate of Achievement for Excellence in Financial Reporting” award presented by the Government Finance Officers Association (GFOA) of the United States and Canada in recognition for the City’s FY 2023-24 ACFR. The City believes that this year’s ACFR document continues to conform to the highest standards in government accounting and financial reporting requirements and will qualify for another Certificate of Achievement. Following acceptance by the Council, the document will be submitted to GFOA for consideration for the award this year.
Looking Forward
During the budget development for Fiscal Year 2025-26, the City estimated that the fund balance on June 30, 2025, would be $10.3 million. With the audit complete, an updated fund balance summary is detailed below:
69 The City initially planned for no available unassigned balances at the end of FY 2025-26. With the audited beginning fund balance of $13.9 million, the City anticipates unassigned balances to be $3.5 million on June 30, 2026. This gain in unassigned balances is primarily due to revenues performing better than expectations and the City having less operational spending than initially anticipated during the prior fiscal year. More information on the budget-to-actual performance of the General Fund can be found on pages 18 and 79 of the ACFR.
Unassigned balances represent funds that have not yet been programmed for a particular purpose. Although higher than anticipated, Staff recommends deployment of such funds to be discussed during a formal mid-year review or annual budget process, where all options available are presented to Council. Given that general fund reserves are currently underfunded, Staff will recommend committing all or a portion of unassigned funds to reserves.
ATTACHMENTS:
1. Resolution
2. Draft Annual Comprehensive Financial Report (ACFR) Fiscal Year Ended June 30, 2025 FY 2025-26
Adopted with Est.
Beginning Balance
FY 2025-26
Revised with Audited
Beginning Balance
Beginning Fund Balance (1) 10,304,900 13,902,421
Revenues 23,858,488 23,858,488
Expenditures (25,329,607) (25,359,607)
Net Change to Fund Balance (1,471,119) (1,501,119)
Ending Fund Balance 8,833,781 12,401,302
General Fund Reserve 7,303,382 7,303,382
Economic Uncertainty 1,530,399 1,530,399
Unassigned - 3,567,521
(1) At the time of budget adoption, the beginning fund balance was unavailable. With the completion of the audit that number has been finalized
70 Resolution No. C-2025-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HALF MOON BAY TO ACCEPT THE CITY’S ANNUAL COMPREHENSIVE FINANCIAL REPORT (ACFR) FOR THE FISCAL YEAR ENDING JUNE 30, 2025
WHEREAS, the City of Half Moon Bay contracted with the audit firm of Maze & Associates to conduct an audit of the City’s financial records in accordance with Governmental Accounting Standards Board (GASB) Statement 34; and
WHEREAS, the financial statements for the Fiscal Year ending June 30, 2025, as prepared by said firm have been completed; and
WHEREAS, it is recommended that the City Council accept the financial statements, known as the Annual Comprehensive Financial Report (ACFR).
NOW, THEREFORE, BE IT RESOLVED THAT the City Council of the City of Half Moon Bay hereby adopts a resolution to accept the City’s Annual Comprehensive Financial Report (ACFR) as prepared by Maze & Associates for the Fiscal Year ending June 30, 2025. ***************************************************************** I, the undersigned, hereby certify that the foregoing Resolution was duly passed and adopted on the 2nd day of December 2025, by the City Council of Half Moon Bay by the following vote:
AYES, Councilmembers:
NOES, Councilmembers:
ABSENT, Councilmembers:
ABSTAIN, Councilmembers:
ATTEST: APPROVED:
___________________________ _____________________________ Maggie Rodriguez, Assistant City Clerk Robert Brownstone, Mayor 71 72
73 CITY OF HALF MOON BAY, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
Fiscal Year Ended June 30, 2025
Prepared by
Finance Department
74 75
CITY OF HALF MOON BAY, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2025
Table of Contents
Page
INTRODUCTORY SECTION:
Letter of Transmittal ...................................................................................................................................... i GFOA Certificate of Achievement .............................................................................................................. ix City Limits of Half Moon Bay ...................................................................................................................... x City Council ................................................................................................................................................. xi Executive Team .......................................................................................................................................... xii Organizational Chart .................................................................................................................................. xiii FINANCIAL SECTION:
Independent Auditors’ Report ................................................................................................................... 1 Management’s Discussion and Analysis ................................................................................................... 7 Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Position ........................................................................................................... 23 Statement of Activities ............................................................................................................... 24 Fund Financial Statements:
Governmental Funds:
Balance Sheet ......................................................................................................................... 26 Reconciliation of the Governmental Funds-Balance Sheet with the Statement of Net Position ................................................................................................... 28 Statement of Revenues, Expenditures and Changes in Fund Balance .................................... 30 Reconciliation of the Net Change in Fund Balances – Total Governmental Funds with the Statement of Activities.......................................................................................... 32 Proprietary Funds:
Statement of Net Position ....................................................................................................... 33 Statement of Revenues, Expenses and Changes in Fund Net Position ................................... 34 Statement of Cash Flows ........................................................................................................ 35 Notes to the Basic Financial Statements ........................................................................................... 37 76 CITY OF HALF MOON BAY, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2025
Table of Contents
Page
FINANCIAL SECTION (Continued):
Required Supplementary Information:
Cost-Sharing Employer-Defined Pension Plan
Schedule of the Plan’s Proportionate Share of the Net Pension Liability and Related Ratios as of the Measurement Date – Miscellaneous Rate Plan ......................... 81 Schedule of Contributions – Miscellaneous Rate Plan .............................................................. 81 Schedule of the Plan’s Proportionate Share of the Net Pension Liability and Related Ratios as of the Measurement Date – Safety Rate Plan ...................................... 82 Schedule of Contributions – Safety Rate Plan ........................................................................... 82 Other Post-Employment Benefits Plan (OPEB)
Schedule of Changes in the Net OPEB Liability and Related Ratios ........................................ 83 Schedule of Contributions .......................................................................................................... 84 Schedule of Revenues and Expenditures and Changes in Fund Balance – Budget and Actual:
General Fund .............................................................................................................................. 85 Streets and Roads Special Revenue Fund .................................................................................. 86 Lot Acquisition and Retirement Special Revenue Fund ............................................................ 87 Affordable Housing Special Revenue Fund ............................................................................... 88 Parks Development Special Revenue Fund ............................................................................... 89 Note to Required Supplementary Information .................................................................................. 90 Supplementary Information:
Capital Projects Fund ................................................................................................................. 92 Non-Major Governmental Funds:
Combining Balance Sheet .................................................................................................... 94 Combining Statement of Revenues, Expenditures and Changes in Fund Balances ............. 96 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual:
Special Revenue Funds:
Police Grants .................................................................................................................. 98 Storm Drain Operating .................................................................................................. 99 Traffic Mitigation ........................................................................................................ 100 CZI Grant ..................................................................................................................... 101 Opportunity Center Coastside ...................................................................................... 102 77 CITY OF HALF MOON BAY, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2025
Table of Contents
Page
FINANCIAL SECTION (Continued):
Debt Service Fund:
Judgment Obligations Bonds ....................................................................................... 103 Capital Project Funds:
Library ......................................................................................................................... 104 Public Facilities ........................................................................................................... 105 Storm Drain Improvements ......................................................................................... 106 Internal Service Funds:
Combining Statement of Net Position ...................................................................................... 108 Combining Statement of Revenues, Expenses and Changes in Fund Net Position ................. 109 Combining Statement of Cash Flows ....................................................................................... 110 STATISTICAL SECTION:
Financial Trends:
Net Position by Component ............................................................................................................ 116 Changes in Net Position .................................................................................................................. 118 Fund Balances of Governmental Funds .......................................................................................... 122 Changes in Fund Balances of Governmental Funds ....................................................................... 124 Revenue Capacity:
Transient Occupancy Tax (TOT) Rate............................................................................................ 126 Transient Occupancy Tax (TOT) by Lodging Type (BASE) ......................................................... 128 Transient Occupancy Taxpayers by Type of Establishment ........................................................... 130 Debt Capacity:
Ratios of Outstanding Debt by Type .............................................................................................. 131 Ratio of General Bonded Debt Outstanding ................................................................................... 132 Direct and Overlapping Debt .......................................................................................................... 133 Legal Debt Margin Information. ..................................................................................................... 134 Demographic and Economic Information:
Principal Employers. ....................................................................................................................... 136 78 CITY OF HALF MOON BAY, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2025
Table of Contents
Page
STATISTICAL SECTION (Continued):
Operating Information:
Full-Time Equivalent City Employees by Function. ...................................................................... 138 Operating Indicators by Function. .................................................................................................. 140 Capital Asset Statistics by Function. .............................................................................................. 142 Property Tax Information:
2024/25 Use Category Summary .................................................................................................... 144 Property Tax Dollar Breakdown ..................................................................................................... 145 2024/25 Roll Summary ................................................................................................................... 146 Net Taxable Assessed Value History .............................................................................................. 147 Assessed Value of Taxable Property .............................................................................................. 148 2024/25 Top Ten Property Taxpayers ............................................................................................ 149 2015/16 Top Ten Property Taxpayers ............................................................................................ 150 Direct & Overlapping Property Tax Rates ...................................................................................... 151 Demographic and Economic Statistics ........................................................................................... 152 Sales Value History......................................................................................................................... 153 Independent Auditor Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ....................................................................... 155 79 INTRODUCTORY SECTION
80 81
December 2, 2025
Honorable Mayor,
Members of the City Council,
And Citizens of Half Moon Bay
It is a pleasure to submit the Annual Comprehensive Financial Report (ACFR) of the City of Half Moon Bay (the City) for the fiscal year ended June 30, 2025. The intent of this report is to provide a full and transparent understanding of the City’s financial activities and position during that fiscal year. The report is prepared in compliance with California Government Sections 25250 and 25253, in accordance with Generally Accepted Accounting Principles (GAAP) set by the Governmental Accounting Standards Board (GASB), and continuing disclosure requirements of the Securities and Exchange Commission (SEC) related to the City’s debt.
This report consists of management’s representations concerning the finances of the City of Half Moon Bay. Consequently, responsibility for both the accuracy of the data and the fairness of this presentation, including all disclosures, rests with the City’s management. To present a reasonable basis for making these representations, management personnel of the City have established and maintained a comprehensive internal control structure designed to ensure that the assets of the City are protected from loss, theft, or misuse; and to ensure that adequate accounting data is compiled to allow for the preparation of financial statements in conformity with GAAP. The internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that the cost of a control should not exceed the benefits likely to be derived and that the valuation of costs and benefits requires estimates and judgment by management. To the best of our knowledge and belief, the enclosed data is accurate in all material respects and is reported in a manner designed to represent fairly the financial position and results of operation of the various funds of the City. All disclosures necessary to enable the reader to gain an understanding of the City’s financial activities have been included.
State statutes require an annual audit by independent certified public accountants. The City’s financial statements have been audited by Maze & Associates, a firm of licensed certified public accountants in Pleasant Hill, California. The independent auditor has issued an unmodified (or “clean”) opinion on the City’s financial statements for the year ended June 30, 2025.
CITY OF HALF MOON BAY
501 Main Street
Half Moon Bay, CA 94019
i
82 GAAP requires that management provide a narrative of introductions, overview, and analysis to accompany the basic financial statement in the form of Management’s Discussion and Analysis (MD&A). The MD&A can be found immediately following the report of the independent auditors in the financial section. This letter complements the MD&A and should be read in conjunction with it.
PROFILE OF THE CITY
Named San Benito in the 1840’s and later Spanishtown, Half Moon Bay received its current name in 1874 and is the oldest settlement in San Mateo County. Considered a rural coastal community, the City is home to approximately 11,000 people. There is a rich culture of different traditions and multi-generational families who have lived in Half Moon Bay for well over 100 years. In any given neighborhood you will find farmers, high tech entrepreneurs, and artists living together. At the crossroads of Highway 1 and Highway 92, Half Moon Bay is approximately 25 miles south of San Francisco and at-most a 45-minute drive from almost anywhere in the Bay Area.
The City and Coastside are a thriving agricultural, fishing, and tourism destination. The local and growing organic agricultural community hosts a Saturday farmers’ market and many rural roadside stands sell the bounty of the local farms and nurseries. About 3,000 tons of pumpkins are grown on the Coastside every year and the ripening pumpkins are featured in the Art and Pumpkin Festival held each October on the downtown historic Main Street. The annual festival draws more than 70,000 visitors for the two-day event.
As a popular tourist destination, Half Moon Bay offers a wide variety of public and private attractions. Main Street is home to shops, art galleries, and fine dining. The Coastal Trail provides recreation for biking, pedestrian, and equestrian users. Golf can be enjoyed at two acclaimed golf courses. Half Moon Bay boasts truly unique lodging with breathtaking ocean views, world-class hotels, and quaint cottages, and the enduring natural beauty of the beaches is enjoyed by all.
The City of Half Moon Bay was incorporated in 1959 and operates under a Council-Manager form of government. Policy-making and legislative authority are vested in the governing City Council, which consists of five Councilmembers representing five districts. Councilmembers are elected to overlapping four-year terms and, from amongst themselves, select a Mayor and Vice Mayor each December. The Council is responsible for passing ordinances, adopting the budget, appointing Planning Commission and Volunteer Committee members, and hiring the City Manager and City Attorney. The City Manager is responsible for carrying out the policies and ordinances of the City Council, providing leadership to the City’s programs, overseeing the dayto-day operations of the City, and appointing City staff.
By means of its own employees and through other shared or contract services, the City provides a variety of municipal services including law enforcement; library; disaster preparedness; recreation programs; maintenance of streets, parks and buildings; sanitary sewer utility treatment, distribution and maintenance; planning, zoning and building inspection; storm drain maintenance; code and parking enforcement; engineering; and general administrative services. Fire protection and water infrastructure services are provided by special districts that are not part of the City’s reporting entity.
ii
83 FINANCIAL OPERATIONS
BUDGET PROCESS
The annual budget serves as the foundation for the City’s financial planning and control of expenditures. The City’s budget document also reflects the One-Year and Five-Year Capital Improvement Program and the Five-Year Forecast.
The City prepares and adopts its budget in accordance with California Government Sections 29000 and 29143. The Council holds a public hearing on the proposed budget and adopts a final budget by the end of June, the close of the City’s fiscal year.
A program budget is used to plan, prioritize, and guide municipal operations. The City uses the modified accrual basis of accounting for all Governmental Funds and the accrual basis of accounting for Propriety Funds and Fiduciary Funds. Budgetary controls ensure compliance with the annual appropriated budget approved by the City Council. The City Council may amend the annual budget by resolution. Transfers of appropriations between departments or programs within the same fund can be approved administratively by the City Manager and Finance Director. Transfers between funds require the approval of the City Council. Accordingly, the lowest level of budgetary control established by the City Council is at the fund level.
Budget-to-actual comparisons are presented in the supplementary section of the accompanying financial statements for each individual governmental fund for which an appropriated annual budget has been adopted.
FINANCIAL CONTROL
The Administrative Services Department of the City is responsible for establishing and maintaining an appropriate internal control structure. The internal control system is designed to ensure that the assets of the City are protected from loss, theft, or misuse and to ensure that adequate accounting data is compiled to allow for the preparation of financial statements in conformity with GAAP. The internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that: (1) the cost of a control should not exceed the benefits likely to be derived; and (2) the valuation of costs and benefits requires estimates and judgments by management. We believe the City’s systems of internal accounting controls adequately safeguard assets and provide reasonable assurance that financial transactions are properly recorded.
The City’s Reserve Policy per Resolution C-2020-60 states that a reserve equal to 50% of General Fund annual operating expenditures is to be set aside to: reduce the risk of financial impacts from catastrophic disasters; respond to the challenges of changing economic environment, including prolonged downturns in the local, state, and national economy; and demonstrate continued prudent fiscal management and creditworthiness.
iii
84 MAJOR INITIATIVES AND ACCOMPLISHMENTS
Several important initiatives were delivered in the past year. These projects included increased engagement with the community, continued work on affordable housing, and improvement of infrastructure. Accomplishments include:
1. City Operations:
x Supported the completion and opening of the Stone Pine Cove farmworker housing community and collaborated in the continued support of households displaced by the tragic 2023 mass shooting, until they are able to move into the new community. x With financial support from the County, continued operation of the Opportunity Center of the Coastside to support small businesses, entrepreneurs, jobseekers, and job growth; as well as a business incubator, Coastside Venture Studio, with a focus on resiliency tech.
x Continued the Community Services Financial Assistance Grant Program to support local non-profits who serve the Half Moon Bay Community; provided technical assistance to the cohort of grant recipients in the areas of collective impact and healthcare access expansion.
x Completed the development, implementation, and management of the City's rental registry and rent stabilization ordinances and programs. x Completed the draft Housing Element development, conducted outreach, and presented at City meetings.
x Conducted the 2024 general municipal election for Districts 2 and 3. x Received the Distinguished Budget Presentation Award from the Government Finance Officers Association (GFOA) for the FY 2024-25 Operating and Capital Budget documents, representing compliance with best practices in budgeting. x Completed the annual audit, prepared the City’s Annual Comprehensive Financial Report (ACFR), and received a clean audit opinion from the independent auditors. x Continued to work collaboratively with the Psychiatric Emergency Response Team (PERT) and the Crisis Assistance Response and Evaluation Services (CARES) Team to reduce tragic outcomes, divert hospitalization and incarceration, reduce recidivism, and connect those with mental illness and addiction to community resources. x Updated and reprioritized the City’s Five-Year Capital Improvement Program (CIP) to reflect evolving community needs and Council priorities to reflect the “Back to Basics” shift to maintain current capital assets.
x Developed and implemented the City's internal Geographic Information System (GIS), compiling zoning, planning, utility, and other maps/information into one platform for City staff.
x Adopted the Get There Together TDM plan, a collaboration with the County of San Mateo to address transportation demand on the Coastside. x Completed the Climate Change Vulnerability Assessment and second round of public outreach for the Safety Element update and adopted the Local Hazard Mitigation Plan into the Safety Element.
2. Major Capital Projects in Progress:
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85 x Pedestrian and Bicycle Connection to Hatch Elementary x Highway 1 Safety – North
x Storm Water Master Plan Update
x Eastside Parallel Trail North – Segment 4
x Coastal Trail Overlay from Poplar to Central
Much of the work focuses on enhancing and improving infrastructure, as well as creating processes and organizational improvements which allow Staff to better carry out their core functions in serving the public. The 2024-25 through 2028-29 Five-Year Capital Improvement Program (CIP) provides in depth project-by-project information and how it aligns with the City’s Strategic Plan.
FACTORS AFFECTING FINANCIAL CONDITION
The information in the financial statements is best understood within the context of the City’s operating environment. The City continues to face long-term structural imbalances, as ongoing expenditures are projected to outpace ongoing revenues.
Local Economy
Employment in Half Moon Bay is concentrated in three major sectors: professional services; farm and agriculture; and retail/food services. The 2024 average unemployment rate for California was
5.3%, San Mateo County was 3.6%, and Half Moon Bay was 1.6%. Due to the COVID-19 pandemic, the unemployment rate peaked as high as 11.4% for San Mateo County during the month of April 2020. Since then, the unemployment rate has decreased to pre-pandemic levels in Half Moon Bay.
A significant driver of the economy has continued to be the local real estate market, which saw another year-over-year increase in assessed value. Half Moon Bay’s total assessed value for FY 2024-25 is $3.9 billion, which is a 4.9% increase over FY 2023-24. Housing prices continue to remain strong, reflecting a continued stable foundation for property tax revenues.
The City faces two major challenges: heavy reliance on Transient Occupancy Tax (TOT) revenues and rising costs of existing services. For the fiscal year ending June 30, 2025, TOT revenues accounted for 42% of all General Fund revenues. While this provides significant support for City services, it also exposes the City to sharp swings in the tourism economy.
The City also saw an increase in costs for existing services, resulting in expenditures surpassing revenues and creating a structural deficit. Ongoing operating costs rose by $607 thousand, or 3%, primarily due to public safety expenses. Consequently, the City anticipates continued deficits in future years and continues to review both cost-containment and revenue-enhancement strategies.
Existing obligations that are still likely to increase in future years include public safety, sewer obligations, and pension costs. These costs coupled with increased demand for essential City services and enhanced infrastructure investment, to maintain and enhance City assets, will strain v
86 City finances. Staff will continue to monitor these conditions moving forward, and make budgetary adjustments as necessary, to ensure the City can sustain long-term financial health.
Long-Term Financial Planning
The City’s long-term financial plan remains focused on cost containment, cost recovery, revenue enhancements, and maintaining adequate reserves to secure its financial health. These proactive measures reflect the City’s commitment to responsible financial management. While the City faces a structural deficit, these strategies are designed to guide the City toward achieving sustainable fiscal balance.
The City entered FY 2024-25 with a budgeted deficit of $4.0 million, a reflection of its structural imbalance where ongoing expenditures exceed ongoing revenues. Without intervention, this shortfall was expected to increase in future years.
To address this challenge, the City pursued both revenue enhancement and cost containment strategies. On the revenue side, voters approved Measure R, a sales tax increase effective April 2025, and the City completed a comprehensive fee study to improve cost recovery. On the expenditure side, the City held certain vacancies open, restructured debt service payments, and limited discretionary spending.
These actions, combined with stronger-than-expected performance in Transient Occupancy Tax and initial revenues from Measure R, allowed the City to end the fiscal year with an actual deficit of only $465,000—far less than the amended $4.8 million projection. While this outcome reflects proactive financial management and near-term adjustments, it also underscores the City’s heavy reliance on TOT, a revenue source that can fluctuate sharply from year to year.
Despite this progress, the City continues to face a structural deficit driven by rising costs for core services, public safety, and infrastructure investment. If TOT revenues remain strong and new revenue and cost recovery measures are fully realized, the City’s long-term fiscal position could significantly strengthen. However, continued vigilance and disciplined planning will be essential to ensure stability.
The City’s long term strategic plan, adopted on March 15, 2018, addresses the following four Strategic Elements:
x Fiscal Sustainability
x Healthy Communities and Public Safety
x Inclusive Governance
x Infrastructure and Environment
Based on these Strategic Elements, the City Council annually adopts strategic initiatives to guide the City’s actions, work plans, and efforts on addressing the City’s priorities. The Council addresses the City’s long-term fiscal sustainability by safeguarding reserves, investing in infrastructure, and marketing the City to visitors to improve key revenue sources, such as vi
87 Transient Occupancy and Sales Tax. The City continues to work toward a long-term balance between ongoing revenues and expenditures as part of its overall strategic financial planning.
Risk Management
Comprehensive general liability coverage is provided through the Pooled Liability Assurance Network Joint Powers Authority (PLAN JPA). The PLAN consists of a self-insurance pool involving a number of cities in the San Francisco-Oakland area. The cities contract with the PLAN through a liability coverage agreement that is very similar to a comprehensive general liability, commercial auto, and public officials’ errors and omissions policy. The City’s limit in the pool is $35,000,000 for general liability claims, with a $50,000 per occurrence deductible for which it self-insures.
For Workers' Compensation coverage, the City participates in the Cities Group, created by a joint powers agreement to provide workers compensation coverage of up to $10,000,000 per occurrence in excess of $1,000,000 for miscellaneous employees. The Group acts as administrator, claim adjuster and provides other risk management services as required by State law. Each member of the Group pays a premium commensurate with the level of coverage requested and shares surpluses and deficits proportionate to its participation in the Group. Additional information concerning the City's participation in risk pools for liability and workers' compensation is provided in Note 11 to the financial statements.
The City focuses on identification of hazards and dangerous conditions and provides on-going training in an effort to reduce exposure and ensure public safety and welfare.
AWARDS AND ACKNOWLEDGEMENTS
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Half Moon Bay for its annual comprehensive financial report for the fiscal year ended June 30, 2024. 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 pleased to submit it to the GFOA to determine its eligibility.
We would like to take this opportunity to thank the Administrative Services Department staff.
Special thanks to Kenneth Stiles, Finance Manager; Bryan Lopez, Senior Management Analyst; Ernest Azevedo, Management Analyst; Raymond Cruz, Payroll Technician; Margaret Jeanne Geiger, Accounting Technician; and Whitney Rescino, Administrative Assistant for their efforts during the annual audit process and contribution to this report. We also would like to express deep appreciation to the audit team from Maze and Associates for their professional work and assistance during the audit process and throughout the year.
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88 Finally, we would like to express our appreciation to the City Council, the operating departments, and the Council Finance Committee for their interest and support toward conducting the financial operations of the City in a responsible manner with emphasis on transparency, ethics, and fiscal responsibility.
Respectfully submitted,
Signed: _______________________ __________________________ Matthew Chidester Lisa Rossi
City Manager Administrative Services Director
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89 Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Half Moon Bay
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2024
Executive Director/CEO
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90 x
91 City Council
Mayor
Robert Brownstone
Vice Mayor
Debbie Ruddock
Council Member
Patric Jonsson
Council Member
Paul Nagengast
Council Member
Deborah Penrose
xi
92 Executive Team
City Manager
Matthew Chidester
City Attorney
Catherine Engberg
PHOTO COMING SOON PHOTO COMING SOON
Assistant City Manager
[Vacant]
Communications / City Clerk
[Interim]
Public Works Director
Maziar Bozorginia
Administrative Services Director
Lisa Rossi
Community Development Director
Leslie Lacko
San Mateo County Sheriff
Captain Richard Cheechov
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93 Community
City
Council
City
Committees
City
Commissions
City
Attorney
City
Manager
Assistant City
Manager
Public
Safety
Community
Development
Public
Works
Communications
& City Clerk
Administrative
Services
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Control
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City of Half Moon Bay Organizational Chart
Economic &
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Vitality
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FINANCIAL SECTION
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INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and City Council
City of Half Moon Bay, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Half Moon Bay, California (City), as of and for the year ended June 30, 2025, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the Table of Contents.
In our opinion, based on our audit and the report of the other auditors, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining funds information of the City as of June 30, 2025, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.
We did not audit the financial statements of Sewer Authority Mid-Coastside (SAM) as of and for the year ended June 30, 2024, related to the calculation of the Investment in SAM. The Investment in SAM, represents 52%, 55% and 9%, respectively, of the assets, net position and revenues of the City’s businesstype activities. The financial statements of SAM were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the calculation of the Investment in SAM, is based solely on the report of the other auditors.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirement relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Responsibility of Management for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.
Accountancy Corporation
3478 Buskirk Avenue, Suite 217
Pleasant Hill, CA 94523
T 925.228.2800
E [email protected]
w mazeassociates.com
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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 Responsibilities 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 the 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 an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Change in Accounting Principle
Management adopted the provisions of Governmental Accounting Standards Board Statement No. 101, Compensated Absences, which became effective during the year ended June 30, 2025 and required the restatement of net position as discussed in Note 7g to the financial statements.
The change in accounting principle does not constitute a modification to our opinions. 2 99
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that Management’s Discussion and Analysis and other Required Supplementary Information as listed in the Table of Contents be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
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 Supplementary Information, as listed in the Table of Contents, is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the Supplementary Information is 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 report. The other information comprises the Introductory Section and Statistical Section listed in the Table of Contents, but does not include the basic financial statements and our auditor’s report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.
In connection with our audit of the basic financial 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.
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Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated November 20, 2025, 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 to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.
Pleasant Hill, California
November 20, 2025
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MANAGEMENT’S DISCUSSION AND ANALYSIS
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CITY OF HALF MOON BAY, CALIFORNIA
MANAGEMENT’S DISCUSSION AND ANALYSIS
As management of the City of Half Moon Bay (the City), we offer readers of the City of Half Moon Bay’s financial statements this overview of the financial activities of the City for the fiscal year ended June 30, 2025. We encourage readers to consider the information presented here in conjunction with additional information that we have provided in our letter of transmittal and the City’s basic financial statements.
Financial Highlights
The City’s government-wide assets and deferred outflows exceed its liabilities and deferred inflows at June 30, 2025, by $168.7 million, which is a 4.4% or $7.1 million increase from the prior year.
Of this amount, $43.5 million may be used to meet the City’s ongoing obligations to citizens and creditors, which is a 4.5% increase from the prior year’s unrestricted net position of $41.6 million. The City’s cash and investments on June 30, 2025, totaled $50.2 million, of which $45.9 million is classified as government activities and $4.3 million as Business-type activities. The City’s cash and investments decreased by $1.2 million, or 2.3% compared to the prior year. At June 30, 2025, the City had outstanding long-term obligations of $18.5 million, of which $17.9 million is classified as governmental activities and $567 thousand as business activities.
Obligations have decreased by $1.9 million or 9.6% compared to the prior year. This decrease is primarily due to a decrease in the restructuring of the long-term note for 880 Stone Pine. During the 2014-15 fiscal year, the City implemented the Government Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for Pension Plans, an amendment of GASB Statement No. 27, which resulted in adjustments to pension expenses and reporting the City’s long-term net pension liability of $14.2 million on the FY 2024-25 Statement of Net Position.
GASB No. 68 is intended to improve accounting and financial reporting by state and local governments that provide pension benefits. The Net Pension Liability decreased by $333 thousand from the $14.6 million recorded last year. This decrease is due to an increase in the fair value of pension assets held at CalPERS on the measurement date of June 30, 2024. City-wide revenues were $39.4 million, of which $31.1 million was generated by governmental activities and $8.3 million by Business-type activities. Revenues increased by 1.6% from the prior year primarily due to an increase in charges for services and operating contributions. City-wide expenditures were $32.2 million, of which $25.5 million was incurred by governmental activities and $6.7 million by Business-type activities. Expenditures decreased by 8% from the prior year mostly due to decreases in public works and general government expenditures. The City’s General Fund balance as of June 30, 2025, was $13.9 million, a decrease of $465 thousand as compared to the prior year’s amount of $14 million. This decrease is due to expenditures exceeding revenues.
For the fiscal year ended June 30, 2025, Governmental Funds revenues exceeded expenditures and net transfers by $38 thousand, primarily attributed to decreases in capital outlay expenditures. The governmental funds’ combined ending fund balance as of June 30, 2025, is $68 million, less than 1% increase from the prior year.
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CITY OF HALF MOON BAY, CALIFORNIA
MANAGEMENT’S DISCUSSION AND ANALYSIS
OVERVIEW OF THE FINANCIAL STATEMENTS
This management’s discussion and analysis section is intended to serve as an introduction to the City’s basic financial statements, which are comprised of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains a transmittal letter, other required supplementary information, an optional section that presents combining statements for non-major governmental funds and internal service funds, and a statistical section.
Government-wide Financial Statements
The government-wide financial statements include the statement of net position and the statement of activities. Both are designed to provide readers with a broad overview of the City’s finances, in a manner similar to a private-sector business.
The statement of net position presents information on all of the City’s assets and liabilities, with the difference between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of the City’s financial condition.
The statement of activities presents information showing how the government’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g. uncollected taxes and earned but unused vacation and sick leave).
These two statements that comprise the government-wide financial statements both distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (Business-type activities). The governmental activities of the City include its general government, public safety, public works and building regulation, parks and recreation, and planning programs. The sole Business-type activity of the City is the City’s sewer utility.
The government-wide financial statements normally include, not only the City of Half Moon Bay itself (known as the primary government), but also a legally separate Community Development Agency of the City of Half Moon Bay for which the City of Half Moon Bay is financially accountable. Although the Agency is an integral part of the primary government, no financial information has been included for this component unit since it has been inactive for over ten years.
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 City of Half Moon Bay uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into two categories: governmental funds and proprietary funds. 8 105
CITY OF HALF MOON BAY, CALIFORNIA
MANAGEMENT’S DISCUSSION AND ANALYSIS
Governmental Funds
Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. Both the governmental fund balance sheet and governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.
The City of Half Moon Bay maintains sixteen individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the General Fund, the Streets and Roads Fund, Lot Acquisition and Retirement Fund, Affordable Housing Fund, Parks Development Fund, Land Asset Fund, and Capital Projects Fund, all of which are considered to be major funds. Data from the other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of the non-major governmental funds is provided in the form of combining statements in the Combining Balance Sheet and Individual Fund Statements of Revenues, Expenditures and Changes in Fund Balances sections of the report.
The City of Half Moon Bay adopts an annual appropriated budget for each of its governmental funds. A budgetary comparison schedule has been provided for each governmental fund to demonstrate compliance with this budget.
The basic governmental fund financial statements can be found on pages 26-32 of this report. The budgetary comparison schedule for the General Fund can be found on page 85.
Proprietary Funds
The City of Half Moon Bay maintains two types of proprietary funds: Internal Service funds and Enterprise (Proprietary) funds.
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CITY OF HALF MOON BAY, CALIFORNIA
MANAGEMENT’S DISCUSSION AND ANALYSIS
Internal Service Funds
Internal Service funds are used to accumulate resources and allocate costs internally among the City’s various functions. The City uses internal service funds to account and reserve for the purchase and maintenance of City vehicles and equipment, to account and reserve for risk management activities, and to stabilize for fluctuations in pension costs. Because these services exclusively benefit the governmental functions, they have been included within governmental activities in the government-wide financial statements.
Enterprise Funds
Enterprise funds are used to account for operations that are financed and operated in a manner similar to private business enterprises. The intent is that the costs of providing goods or services to the general public on a continuing basis be financed or recovered primarily by user charges. The City uses an enterprise fund to account for the financial activity of the City’s sewer operation.
The internal service funds are combined into a single, aggregated presentation in the proprietary fund financial statements. The enterprise funds are also combined into a single, aggregated presentation in the proprietary fund financial statements that can be found on pages 33-35 of this report.
Notes to the Basic Financial Statements
The notes provide additional information essential to the full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found on pages 37-78 of this report.
Other Information.
In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information including schedule of proportionate share of the net pension liability, contributions, funding progress for the City’s obligation to provide other post-employment benefits to its employees and budgetary comparison schedules for the General Fund and the other funds. Required supplementary information can be found on pages 80-90 of this report.
The combining statements for non-major governmental funds and internal service funds are presented on pages 94-110, and the Statistical Section follows on page 113. 10 107
CITY OF HALF MOON BAY, CALIFORNIA
MANAGEMENT’S DISCUSSION AND ANALYSIS
GOVERNMENT-WIDE FINANCIAL ANALYSIS
Statement of Net Position
The following table provides a condensed statement of net position as of June 30, 2025, and 2024:
Note: Total assets + deferred outflows – total liabilities – deferred inflows = total net position 2025 2024 2025 2024 2025 2024
Current and other assets 51,729,653 $ 51,986,855 $ 16,602,787 $ 15,482,216 $ 68,332,440 $ 67,469,071 $ Land held for resale 26,823,920 26,823,920 - - 26,823,920 26,823,920 Capital Assets 86,275,167 82,889,996 6,695,345 6,831,129 92,970,512 89,721,125 Total assets 164,828,740 161,700,771 23,298,132 22,313,345 188,126,872 184,014,116 Related to OPEB 79,511 78,302 5,332 5,290 84,843 83,592 Related to pension 4,160,104 5,308,118 208,982 235,072 4,369,086 5,543,190 Total deferred outflows of
resources 4,239,615 5,386,420 214,314 240,362 4,453,929 5,626,782 Long-term liabilities
outstanding 17,924,126 19,882,281 567,598 564,424 18,491,724 20,446,705 Other liabilities 4,035,801 6,392,443 623,056 114,068 4,658,857 6,506,511 Total liabilities 21,959,927 26,274,724 1,190,654 678,492 23,150,581 26,953,216 Related to OPEB 113,397 99,786 8,910 8,489 122,307 108,275 Related to pension 540,207 684,592 64,111 68,596 604,318 753,188 Total deferred inflows of
resources 653,604 784,378 73,021 77,085 726,625 861,463 Net Position:
Net investment in capital
assets 82,018,427 76,826,570 6,695,345 6,831,129 88,713,772 83,657,699 Restricted 24,235,493 25,081,978 12,190,425 11,397,062 36,425,918 36,479,040 Unrestricted 40,200,904 38,119,541 3,363,001 3,569,939 43,563,905 41,689,480 Total Net Position $ 146,454,824 $ 140,028,089 $ 22,248,771 $ 21,798,130 $ 168,703,595 $ 161,826,219 Governmental
Activities
Business Type
Activities
Total
CITY OF HALF MOON BAY
Comparative Statement
Statement of Net Position
Year Ended on June 30, 2025
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CITY OF HALF MOON BAY, CALIFORNIA
MANAGEMENT’S DISCUSSION AND ANALYSIS
Net Position reflects the difference between assets and liabilities. Net position may serve over time as a useful indicator of a government’s financial position. In the case of the City of Half Moon Bay, assets exceeded liabilities by $168.7 million on June 30, 2025, with invested capital assets of $88.7 million, $36.4 million restricted and an unrestricted net position of $43.6 million. Portions of the unrestricted net position may by law or contract be used only for specified purposes and may not necessarily be used for any general governmental purpose.
The net investment in capital assets reflecting the investment in capital assets (e.g. land, buildings, facilities, vehicles, equipment, and infrastructure) is $88.7 million and represents 53% percent of the City’s net position. This portion has increased by $5 million or 6%. The City uses capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the net investments in capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources since the capital assets themselves cannot be used to liquidate these liabilities.
The restricted net position accounts for $36.4 million, or 22% percent, of the City’s total net position. The restricted net position decreased by $53 thousand or less than 1% percent in fiscal year 2024-25. This portion of the net position can only be spent for specific purposes stipulated by external resource providers or legislation. This increase is from restricted revenues exceeding allowed expenditures in the governmental funds. Restricted revenues generally include grants, project specific capital contributions and other intergovernmental funding.
The unrestricted net position of $43.6 million, or 25% percent of the City’s total net position, increased by $1.8 million or 4% percent. The increase is primarily from the City completing the fiscal year with expenditures under budget. This portion of the net position may be used to meet the government’s ongoing obligations to residents and creditors, although portions of the unrestricted net position may by law or contract be only used for specified purposes and may not necessarily be used for any general governmental purpose.
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MANAGEMENT’S DISCUSSION AND ANALYSIS
Statement of Activities
The following table provides a condensed statement of activities for the fiscal year ended June 30, 2025, as compared to June 30, 2024:
Variance
2025 2024 2025 2024 2025 2024
Program revenues:
Charges for services 3,409,225 $ 2,505,538 $ 7,339,424 $ 6,207,200 $ 10,748,649 $ 8,712,738 $ 23% Operating grants and
contributions 3,296,210 1,285,182 - - 3,296,210 1,285,182 156% Capital grants and
contributions 2,037,451 6,738,537 783,631 1,304,480 2,821,082 8,043,017 -65% Subtotal 8,742,886 10,529,257 8,123,055 7,511,680 16,865,941 18,040,937 -7% General revenues:
Property taxes 3,757,360 4,283,589 - - 3,757,360 4,283,589 -12% Sales and use taxes 4,182,742 3,665,449 - - 4,182,742 3,665,449 14% Transient occupancy taxes 9,616,592 8,167,938 - - 9,616,592 8,167,938 18% Other taxes 1,440,676 1,343,633 - - 1,440,676 1,343,633 7% Other general revenues 3,386,673 3,092,976 207,823 242,911 3,594,496 3,335,887 8% Subtotal 22,384,043 20,553,585 207,823 242,911 22,591,866 20,796,496 9% Total revenues 31,126,929 31,082,842 8,330,878 7,754,591 39,457,807 38,837,433 2% Expenses
General government 5,848,016 7,811,794 - - 5,848,016 7,811,794 -25% Public safety 7,703,127 6,875,457 - - 7,703,127 6,875,457 12% Public works 4,122,393 6,255,645 - - 4,122,393 6,255,645 -34% Recreation Services 1,336,891 1,534,752 - - 1,336,891 1,534,752 -13% Planning 4,301,102 3,931,872 - - 4,301,102 3,931,872 9% Community and Economic
Development 2,188,174 1,894,276 - - 2,188,174 1,894,276 16% Interest on long-term debt 10,256 - - - 10,256 - 0%
Sewer Utility - - 6,767,752 6,685,640 6,767,752 6,685,640 1% Total expenses 25,509,959 28,303,796 6,767,752 6,685,640 32,277,711 34,989,436 -8% Increase (Decrease) in net
position before transfers 5,616,970 2,779,046 1,563,126 1,068,951 7,180,096 3,847,997 87% Transfers 1,112,485 982,301 (1,112,485) (982,301) - - 0% Increase (Decrease) in net
position 6,729,455 3,761,347 450,641 86,650 7,180,096 3,847,997 87% Net position - As of July 1 140,028,089 136,266,742 21,798,130 21,711,480 161,826,219 157,978,222 2% Adjustment to Net Position (302,720) - - - (302,720) -
Net position - As of July 1, as
adjusted 139,725,369 136,266,742 21,798,130 21,711,480 161,523,499 157,978,222 2% Net position - As of June 30 146,454,824 $ 140,028,089 $ 22,248,771 $ 21,798,130 $ 168,703,595 $ 161,826,219 $ 4% Governmental Activities Total Business-type Activities
CITY OF HALF MOON BAY
Comparative Statement
Statement of Activities
Year Ended on June 30, 2025
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MANAGEMENT’S DISCUSSION AND ANALYSIS
Governmental Activities
The City’s Governmental net position increased by $6.7 million or 4.8% in fiscal year 2025, primarily due to revenues exceeding expenditures.
Revenues Highlights:
Total governmental revenues increased by $44 thousand or less than 1% from the prior year, a net effect of increases in general revenues but decreases in program revenues. o Program revenues decreased by $1.7 million or 17%. This decrease is primarily from decreases in capital grants and contributions. These receipts are generally project specific and/or one-time funds. In the prior year, the City received three grants totaling $4.7 million. These were one-time funds that did not repeat in fiscal year 2025. o Transient Occupancy Tax (TOT), the City’s largest source of general revenue, increased by $1.4 million or 18% from the prior year. This is primarily due to returning tourism to the coast.
o Sales Tax, the second largest source of general revenue, increased by $517 thousand or 14% from the prior year. This is primarily improvements to tourism and a sales tax increase going into effect in April 2025.
o Property Tax, the third largest source of general revenue, decreased by $526 thousand or 12% from the prior year. This decrease is primarily due decreases in vehicle-in-lieu fees.
o Other General Revenues include investment income and other miscellaneous revenues.
The amount from government activities increased by $293 thousand or 9% from the prior year. This is primarily due to increases in investment income and gains from sale of property.
Expenses for Government Activities decreased by $2.8 million from the prior year primarily due to decreases in public works and general government expenditures.
Business-type Activities
The City’s sole Business-type activity is the sewer fund. The City’s total Business-type net position increased by $450 thousand. This is primarily due to the following factors:
• The City is a member of the SAM joint power authority and exercises significant influence over SAM’s operations; therefore, the share of the City’s investment in SAM’s net position is reflected in the City’s financial statements. For the fiscal year 2024-25 the City recognized a gain on this investment of $783 thousand. However, this gain is non-cash transaction, contributing no additional liquidity.
• Charges for Services revenues increased by $1.1 million or 18% from the prior year. This increase is primarily due to the sewer rate changes as adopted by voters in fiscal year 2019-2020. Rates are scheduled to remain the same year over year through fiscal year 2025-26. • Expenses from Business-type Activities increased by $82 thousand as compared to fiscal year 2024-25. This is primarily due to increases in sewer treatment and contributions to the SAM joint power authority.
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MANAGEMENT’S DISCUSSION AND ANALYSIS
FUND FINANCIAL ANALYSIS
As noted above, the City uses fund accounting to ensure and demonstrate compliance with governmental finance-related legal requirements.
Governmental Funds
The Governmental Funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. The focus of the City’s governmental funds is to provide information on near-term inflows, outflows and balance of resources that are available for spending.
Such information is useful in assessing the City’s financial requirements. In particular, the unassigned fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year. Consequently, the governmental fund financial statements provide a detailed short-term view that helps the readers determine whether there are more or fewer financial resources that can be spent in the near future to finance the City’s programs.
The following is a schedule of revenues, expenditures, and changes in fund balances for each of the major governmental and aggregate non-major governmental funds recorded on the modified accrual basis of accounting:
As of June 30, 2025, the City’s governmental funds reported combined fund balances of $68 million, an increase of $38 thousand in comparison with June 30, 2025. This is primarily attributed to revenues exceeding expenditures. The governmental funds expenditures were $28.7 million in fiscal year 2024-25, a $4.3 million decrease from the prior year which is primarily due to decreases in capital expenditures and debt service payments.
2025 2024 Variance
Revenues $ 30,417,180 $ 30,506,165 0%
Expenditures (28,694,696) (32,988,058) -13%
Other Financing Sources (Uses) (1,684,300) 1,972,994 -185% Net Change in Fund Balances 38,184 (508,899) -108%
Fund balances at beginning of year 68,016,030 68,524,929 -1% Fund balances at end of year 68,054,214 68,016,030 0%
Non-spendable 26,823,920 26,823,920
Restricted 23,746,527 24,590,954 -3%
Committed 8,651,749 11,091,587 -22%
Assigned 3,581,346 2,233,226 60%
Unassigned 5,250,672 3,276,343 60%
Total fund balances $ 68,054,214 $ 68,016,030 0%
CITY OF HALF MOON BAY
Comparative Statement
Governmental Funds Statement of Revenues, Expenditures and Fund Balance Year Ended on June 30, 2025
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MANAGEMENT’S DISCUSSION AND ANALYSIS
The governmental funds’ fund balance is comprised of the following:
• Non-spendable is $26.8 million (39.4% of total balance) which represents the value of land held by the City. There has been no change in this amount from the prior year. • Restricted is $23.7 million (34.9% of the total balance), which can only be spent for specific purposes, set by external resource providers, or enabling legislation. The balance is primarily for restricted street funds, development fees, and reserves required by debt covenants. • Committed balance is $8.6 million (12.7% of the total balance), which can only be spent for specific purposes as determined by formal action of the City Council. This amount is to satisfy the City’s general fund reserve policy, which states that the target is 50 percent of budgeted operating expenditures for the year to be committed for contingencies and economic uncertainty. • Assigned balance is $3.5 million (5.3% of the total balance), which indicates City Council’s intent to use these funds toward capital improvements in the future. This balance represents funds remaining in the capital project funds for future capital expenditures. • Unassigned is $5.2 million (7.7% of the total balance), which is available for any use.
FINANCIAL ANALYSIS OF CITY’S FUNDS
General Fund
The General Fund is the primary operating fund of the City of Half Moon Bay. All unrestricted revenues such as general taxes, fees and other revenues that are not allocated by law or contractual agreement to some other funds are accounted for in this fund. The General Fund provides for the cost of operating City government and includes the services of the City Attorney, City Clerk, City Council, City Manager, Citywide costs (such as debt service), Finance and Risk Management, Human Resources and Information Technology, Recreation, Building and Planning, Public Works, Economic Vitality and Public Safety. In addition, the General Fund expenditures include transfers to fund capital projects and reserve funding.
As of June 30, 2025, the total General Fund balance was $13.9 million, which includes an unassigned portion of $5.2 million. The General Fund balances decreased by $465 thousand for the fiscal year ended June 30, 2025.
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MANAGEMENT’S DISCUSSION AND ANALYSIS
The following table compares General Fund revenues and expenditures by category:
General Fund Revenues
General Fund revenues for the year ended June 30, 2025, increased by $2.2 million or 11%, from the prior year. The preceding chart summarizes revenues into major categories for comparative purposes across two fiscal years. Total tax revenues increased by $1.5 million or 9% from the prior year primarily from an increase in transient occupancy taxes.
General Fund Expenditures
General Fund expenditures for the 2024-25 fiscal year decreased by $2.4 million, or 11%. This decrease is primarily attributed to a decrease in general administration expenditures and debt service payments. 2025 2024 Variance
Revenues
Taxes 18,536,875 $ 16,991,811 $ 9%
License and permits 463,053 306,282 51%
Fines and forfeitures 124,109 81,445 52%
Charges for services 1,658,117 1,454,141 14%
Rents and Leases 71,670 78,135 -8%
Investment Income 706,359 804,188 -12%
Intergovernmental revenues 35,166 117,400 -70%
Miscellaneous 1,321,891 833,965 59%
Total 22,917,240 20,667,367 11%
Expenditures
General government 3,153,123 3,138,896 0%
General administration 1,780,377 2,134,173 -17%
Public safety 7,301,251 6,452,977 13%
Public works 2,163,096 2,174,611 -1%
Recreation Services 537,796 538,827 0%
Planning 3,169,566 2,879,532 10%
Community and Economic
Development 910,036 1,008,276 -10%
Debt Service 582,942 3,725,598 -84%
Total 19,598,187 22,052,890 -11%
Other financing sources (uses) (3,784,562) (474,451) 698% Net Change in Fund Balances (465,509) (1,859,974) 720%
Fund Balances at beginning of year 14,367,930 16,227,904 -11% Fund Balances at end of year $ 13,902,421 $ 14,367,930 -3%
CITY OF HALF MOON BAY
Comparative Statement
General Fund Statement of Revenues, Expenditures and Fund Balance Year Ended on June 30, 2025
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MANAGEMENT’S DISCUSSION AND ANALYSIS
General Fund Budgetary Highlights
The final budget for the General Fund planned for a net decrease of fund balance by $4.8 million, however the ending fund balance decreased by $465 thousand. This is primarily due to better performance in tax revenues. Additionally, the City also came under budget by $1.7 million, primarily from less spending on planning and general administration expenditures.
Other Major Governmental Funds
The following table compares governmental fund balances:
Final Budget Actual Variance
Revenues $ 20,309,315 $ 22,917,240 $ 2,607,925
Expenditures (21,343,762) (19,598,187) 1,745,575
Other Financing Sources (Uses) (3,784,562) (3,784,562) - Net Change in Fund Balance (4,819,009) (465,509) 4,353,500 Fund balances at beginning of year 14,367,930 14,367,930 - Fund balances at end of year $ 9,548,921 $ 13,902,421 4,353,500
CITY OF HALF MOON BAY
Budget to Actual Statement
General Fund Statement of Revenues, Expenditures and Fund Balance Year Ended on June 30, 2025
2025 2024 Variance
Major Governmental Funds:
General Fund $ 13,902,421 $ 14,367,930 -3%
Streets and Road 7,897,305 7,263,726 9%
Lot Acquisition 1,313,892 1,420,599 -8%
Affordable Housing 5,218,156 5,954,709 -12%
Parks Development 276,263 894,568 -69%
Land Asset 26,823,920 26,823,920 0%
Capital Project Fund 3,091,511 1,784,042 73%
Non-Major Governmental Funds 9,530,746 9,506,536 0%
Total Fund Balances $ 68,054,214 $ 68,016,030 0%
CITY OF HALF MOON BAY
Comparative Statement
Governmental Funds Statement of Revenues, Expenditures and Fund Balance Year Ended on June 30, 2025
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MANAGEMENT’S DISCUSSION AND ANALYSIS
Streets and Roads Funds
The Streets and Roads Special Revenue funds provide for all proceeds of Gas Tax funds, Measure A/W Local Transportation Ordinance Tax funds and other grants. These funds are restricted for the purpose of these taxes and mainly used for streets and road maintenance and improvements. As of June 30, 2025, the Street and Road Funds had a fund balance of $7.9 million, a $633 thousand increase from the prior year, primarily due to restricted revenues exceeding allowed expenditures.
Lot Acquisition / Retirement Fund
The Lot Acquisition and Retirement fund is a fund used to account for in-lieu fees and expenses within the purpose of acquiring and retiring development rights on existing legal parcels. As of June 30, 2025, the fund had a fund balance of $1.3 million, a $106 thousand decrease from the prior year primarily due to the purchase of parcels.
Affordable Housing Fund
The Affordable Housing fund accounts for proceeds of construction and development fees, including in lieu fees with the restricted purpose of the development of affordable housing. As of June 30, 2025, the fund balance was $5.2 million, which is a $736 thousand decrease from the prior year. This is primarily due to increased expenditures relating to affordable housing efforts and renters protection programs.
Parks Development
The Parks Development Fund which accounts for development impact fees, Federal, State and County grants, and is restricted for acquisition, development and capital improvements of the City’s parks and trails This fund decreased by $618 thousand, primarily due capital projects and expenditures. As of June 30, 2025, the fund balance was $276 thousand.
Land Asset Fund
This is a restricted fund which was created in Fiscal Year 2014-15 for the purposes of recording land assets held for resale. The fund balance as of June 30, 2025 is $26.8 million, which consists of transfers of land assets for Glencree and Beechwood properties from the General Fund and the Judgment Obligation Bond Funds. The Glencree property was donated to the City. The Beechwood property was acquired by the City as part of the settlement of the Yamagiwa litigation in 2007. With the receipt of the insurance settlement payments, the Beechwood properties are no longer required for the Judgement Obligation Bonds. There was no activity in this fund in fiscal year 2024-25.
Capital Project Funds
Capital Projects Funds accounts for capital projects as detailed in the City’s Capital Improvement Plan. As of June 30, 2025, the fund balance was $3 million, a $1.3 million increase from the prior year, primarily due to increases to transfers in to fund future capital expenditures.
Non-Major Funds
Non-Major funds are comprised of Special Revenue, Debt Service and Capital Project funds.
Special Revenue funds include:
• Police Grants Fund that accounts for revenues received and expenditures made for police services, • Storm Drain Operating Fund that accounts for the maintenance of the existing storm drain system, • Traffic Mitigation Fund that provides for all proceeds from traffic mitigation fees imposed on new development and restricted to defray the cost of constructing improvements to mitigate traffic, • CZI Grant Fund accounts for proceeds relating to the CZI Grant. These funds can be used to support learning and evaluation activities for groups currently engaged in the operation and implementation of economic advancement centers.
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MANAGEMENT’S DISCUSSION AND ANALYSIS
• Opportunity Center Coastside Fund accounts for proceeds and expenditures as they relate to the operation of the Opportunity Center Coastside. This fund is primarily sourced from American Rescue Plan Act (ARPA) funds.
Debt Service Funds include:
• Judgement Bonds Fund account for debt service on the judgment obligation bonds. The City has no outstanding bonds.
Capital Project Funds:
• Library Fund is used to account for the design, development, and construction of the new library and the maintenance thereafter.
• Public Facilities accounts for expenditures related to public facilities improvements. • Storm Drain Improvements accounts for all proceeds from storm drainage improvement fees assessed against new and remodeled construction and used for drainage improvements.
As of June 30, 2025, the Non-Major Funds had a fund balance of $9.5 million, a $24 thousand increase from the prior year. This increase is primarily due revenues exceeding expenditures.
Proprietary Fund Financial Statement Analysis
As of June 30, 2025, the City’s Proprietary Funds net position was $29.4 million ($6.9 million invested in capital assets; $12.1 million restricted for investment in Sewer Authority; $12 thousand restricted for other post-retirement benefits and $10.3 million in unrestricted net position). Additional information on this investment can be found in Note 6 of the financial statements. Unrestricted net position of $6.9 million in the Internal Service Funds is primarily reserved for vehicle and equipment replacement, risk management and general liability claims, and pension cost stabilization.
CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets
The City’s total net investment in capital assets for its Governmental and Business-type activities (net of accumulated depreciation) as of June 30, 2025, was $92.9 million, an increase of $3.2 million as compared to June 30, 2024.
Capital assets include land, buildings, equipment, vehicles and infrastructure. The following table presents summarized information on capital assets net of depreciation for fiscal years 2025 and 2024:
2025 2024 2025 2024 2025 2024 Variance
Land $ 4,891,370 $ 4,756,385 $ - $ - $ 4,891,370 $ 4,756,385 3% Rights of Way 6,990,396 6,990,396 - - 6,990,396 6,990,396 0% Construction in progress 15,837,906 11,212,437 - - 15,837,906 11,212,437 41% Buildings and improvements 28,039,654 28,935,520 6,666,698 6,801,334 34,706,352 35,736,854 -3% Machinery and equipment 451,896 410,966 28,647 29,795 480,543 440,761 9% Infrastructure 30,063,945 30,584,292 - - 30,063,945 30,584,292 -2% Total $ 86,275,167 $ 82,889,996 $ 6,695,345 $ 6,831,129 $ 92,970,512 $ 89,721,125 4% Activities Activities Total
CITY OF HALF MOON BAY
Comparative Statement
Capital Assets (net of depreciation)
Year Ended on June 30, 2025
Governmental Business Type
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MANAGEMENT’S DISCUSSION AND ANALYSIS
Construction in progress increased by $4.6 million primarily due to the improvements to Carter Park, Poplar Street, and other capital projects. Additional information regarding the City’s capital assets can be found in Note 4 in Notes to the Basic Financial Statements.
Long-term Obligations
As of June 30, 2025, the City’s long-term obligations totaled $19.5 million, primarily comprised of net pension liability and loans related to the library and the corporation yard.
Library Loan: During the fiscal year ending June 30, 2017, the City entered into a $6 million interest-free loan agreement with the County of San Mateo to ensure completion of the Library Project. The City began repayment in fiscal year 2020. In fiscal year 2021, due to budgetary constraints caused by the Covid-19 pandemic, the loan was amended so the City would not be required to make the two loans payments due in that fiscal year. The City resumed loan repayments in fiscal year 2021-2022, including the additional amount that was deferred. Since then, the City continues to make its an annual scheduled payment of $572 thousand.
880 Stone Pine Loan: Since 2009, the City has leased a 21-acre property for its corporation yard facility. In fiscal year 2020-21, the City entered into a $3.2 million financing agreement to purchase the property. In fiscal year 2023-24, the City refinanced the loan with the County of San Mateo to lift restrictions, allowing affordable housing efforts on unused portions of the site to proceed. In fiscal year 2024-25, the City split and sold a portion of the property to the County to create 830 Stone Pine Cove. Under the new loan terms, the principal was reduced by $1.2 million, and no payment was due in fiscal year 2024-25, with debt service payments scheduled to begin in fiscal year 2025-26.
Net Pension Liability: The City participates in one retirement plan through the California Public Employees' Retirement System (CalPERS). The measured net pension liability is measured as a proportionate share of the total net pension liability as reported by the CalPERS Financial Office. As of June 30, 2025, the City’s share of the pension liability was measured to be $14.2 million. This is an decrease of $333 thousand or 2%. This decrease in net pension liability is from a increase in the fair value of plan assets held at CalPERS.
Additional information about the City’s pension liability can be found in Note 8 to the Notes to the Basic Financial Statements.
State statutes limit the amount of general obligation debt a governmental entity may issue to 15 percent of its total assessed valuation. The current debt limit for the City is approximately $153 million. At June 30, 2025, the City had no debt applicable to this limit. Additional information about the City’s long-term obligations can be found in Note 5 to the Notes to the Basic Financial Statements. 2025 2024 2025 2024 2025 2024 Variance
Library Loan 2,290,740 2,863,426 - - 2,290,740 2,863,426 -20% 880 Stone Pine Loan 1,966,000 3,200,000 - - 1,966,000 3,200,000 -39% Claims liability 73,283 1,670,731 - - 73,283 1,670,731 -96% Employee compensated
absences 942,148 670,764 - - 942,148 670,764 40%
Net Pension Liability 13,692,251 14,029,383 567,598 564,424 14,259,849 14,593,807 -2% Total $ 18,964,422 $ 22,434,304 $ 567,598 $ 564,424 $ 19,532,020 $ 22,998,728 -15% Activities Activities Total
CITY OF HALF MOON BAY
Comparative Statement
Long Term Obligations
Year Ended on June 30, 2025
Governmental Business-type
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MANAGEMENT’S DISCUSSION AND ANALYSIS
Currently Known Facts, Conditions, and Decisions
Outlined below is key information expected to significantly impact the City’s financial position and operational outcomes as of this report.
The City continues to face a structural deficit as ongoing costs outpace ongoing revenues. While FY 2024- 25 began with a projected $4.8 million deficit, cost-containment actions, vacancy management, debt restructuring, strong Transient Occupancy Tax performance, and initial revenues from a sales tax increase reduced the actual shortfall to about $465 thousand. Despite this improvement, the City remains highly dependent on volatile TOT revenues and must continue pursuing long-term financial strategies focused on cost recovery, revenue enhancements, and disciplined spending to move toward structural balance.
Fiscal sustainability remains a top priority for Half Moon Bay. To that end, staff will continue monitoring these conditions closely and seeking the most efficient ways to provide public services. Staff looks forward to working with the City Council and community to address financial challenges ahead. In addition, staff will continue identifying operational efficiencies, potential economic development opportunities, and alternative revenue options to maintain high-quality services for residents and visitors of Half Moon Bay.
Requests for Information
This financial report is designed to provide all those with an interest in the government’s finances with a general overview of the City of Half Moon Bay financial position and to show the City's accountability for the money it receives. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to:
City of Half Moon Bay
Finance Department
501 Main Street
Half Moon Bay, CA 94019.
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CITY OF HALF MOON BAY
STATEMENT OF NET POSITION
Governmental Business-Type
Activities Activities Total
Assets
Cash and investments (Note 2) $45,883,591 $4,358,667 $50,242,258 Accounts receivable, net 4,942,214 10,952 4,953,166
Interest receivable 414,882 42,743 457,625
Prepaids
Loan receivable (Note 1r) 300,000 300,000
Land held for resale (Note 1i) 26,823,920 26,823,920
Investment in Sewer Authority
Mid-Coastside (Note 6) 12,180,693 12,180,693
Net OPEB Asset (Note 9) 188,966 9,732 198,698
Capital assets, not depreciated (Note 4) 27,719,672 27,719,672 Capital assets, depreciated, net (Note 4) 58,555,495 6,695,345 65,250,840 Total assets 164,828,740 23,298,132 188,126,872
Deferred outflows of resources
Related to OPEB (Note 9) 79,511 5,332 84,843
Related to pensions (Note 8) 4,160,104 208,982 4,369,086 Total deferred outflows of resources 4,239,615 214,314 4,453,929 Liabilities
Accounts payable 407,622 623,056 1,030,678
Accrued liabilities 1,743,386 1,743,386
Deposits payable 769,497 769,497
Unearned revenue 75,000 75,000
Claims liabilities, due within one year (Note 11) 73,283 73,283 Compensated absences (Note 1j):
Due within one year 215,181 215,181
Due in more than one year 726,967 726,967
Long-term debt (Note 5):
Due within one year 751,832 751,832
Due in more than one year 3,504,908 3,504,908
Net pension liability, due in more than one year (Note 8) 13,692,251 567,598 14,259,849 Total liabilities 21,959,927 1,190,654 23,150,581
Deferred inflows of resources
Related to OPEB (Note 9) 113,397 8,910 122,307
Related to pensions (Note 8) 540,207 64,111 604,318
Total deferred inflows of resources 653,604 73,021 726,625 Net position (Note 7)
Net investment in capital assets 82,018,427 6,695,345 88,713,772 Restricted for:
Investment in Sewer Authority 12,180,693 12,180,693
Other Post-Employment Benefits 188,966 9,732 198,698
Capital Projects 8,007,709 8,007,709
Debt Service 6,779 6,779
Housing and Economic Development 5,652,714 5,652,714
Special Revenues 2,482,020 2,482,020
Streets and Roads 7,897,305 7,897,305
Total restricted net position 24,235,493 12,190,425 36,425,918 Unrestricted 40,200,904 3,363,001 43,563,905
Total net position $146,454,824 $22,248,771 $168,703,595 See accompanying notes to financial statements
JUNE 30, 2025
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CITY OF HALF MOON BAY
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2025
Net (Expense) Revenue and
Changes in Net Position
Operating Capital
Charges for Grants and Contributions Governmental Business-type Functions/Programs Expenses Services Contributions and Grants Activities Activities Total Governmental Activities:
General government $5,848,016 $835,628 $1,274,322 ($3,738,066) ($3,738,066) Public safety 7,703,127 175,777 194,663 (7,332,687) (7,332,687) Public works 4,122,393 816,264 1,827,225 $2,037,451 558,547 558,547 Recreation 1,336,891 1,255,256 (81,635) (81,635)
Planning 4,301,102 326,300 (3,974,802) (3,974,802)
Community and economic development 2,188,174 (2,188,174) (2,188,174) Interest on long-term debt 10,256 (10,256) (10,256)
Total governmental activities 25,509,959 3,409,225 3,296,210 2,037,451 (16,767,073) (16,767,073) Business-type Activities:
Sewer 6,767,752 7,339,424 783,631 $1,355,303 1,355,303
Total $32,277,711 $10,748,649 $3,296,210 $2,821,082 (16,767,073) 1,355,303 (15,411,770) General revenues:
Taxes:
3,757,360 3,757,360
4,182,742 4,182,742
9,616,592 9,616,592
Franchise 1,032,641 1,032,641
408,035 408,035
Investment income 2,148,567 207,823 2,356,390
Miscellaneous 45,610 45,610
Gain on sale of property (Note 5) 1,192,496 1,192,496
Transfers (Note 3) 1,112,485 (1,112,485)
Total general revenues and transfers 23,496,528 (904,662) 22,591,866 Change in Net Position 6,729,455 450,641 7,180,096
Net Position at beginning of year, previously reported 140,028,089 21,798,130 161,826,219 Adjustment to Beginning Net Position (Note 7G):
Change in accounting policy - compensated absences (302,720) (302,720) Net Position at beginning of year, as adjusted 139,725,369 21,798,130 161,523,499 Net Position at end of year $146,454,824 $22,248,771 $168,703,595 See accompanying notes to financial statements
Business license tax
Program Revenues
Property
Sales and use
Transient occupancy
24 121
122
CITY OF HALF MOON BAY
GOVERNMENTAL FUNDS
BALANCE SHEET
JUNE 30, 2025
Special Revenue Funds
General Streets and Lot Acquisition Affordable
Fund Roads and Retirement Housing
Assets
Cash and investments (Note 2) $11,444,751 $7,968,554 $1,301,714 $5,176,149 Receivables:
Accounts, net 3,712,779 115,035 34,513
Interest 96,728 69,931 12,178 48,341
Loan (Note 1r) 300,000
Land held for resale (Note 1i)
Due from other funds (Note 3a) 604,053
Total assets $15,858,311 $8,153,520 $1,313,892 $5,559,003 Liabilities, Deferred Inflows of
Resources and Fund Balances
Liabilities:
$1,278
1,185,115 $181,215 $40,847
769,497
Due to other funds (Note 3a)
75,000
Total Liabilities 1,955,890 256,215 40,847
Deferred Inflows of Resources:
Unavailable revenue - loan 300,000
Fund Balances (Note 7):
Nonspendable
Restricted 7,897,305 $1,313,892 5,218,156
Committed 8,651,749
Assigned
Unassigned 5,250,672
Total fund balances 13,902,421 7,897,305 1,313,892 5,218,156 Total liabilities, deferred inflows of
resources and fund balances $15,858,311 $8,153,520 $1,313,892 $5,559,003 See accompanying notes to financial statements
Unearned revenue
Deposits payable
Accounts payable
Accrued liabilities
26 123
Special Revenue
Fund Capital Projects Funds Non-major
Parks Capital Projects Governmental
Development Land Asset Fund Funds Total
$393,752 $3,143,734 $9,463,381 $38,892,035
241,879 835,182 4,939,388
6,004 27,197 90,677 351,056
300,000
$26,823,920 26,823,920
604,053
$641,635 $26,823,920 $3,170,931 $10,389,240 $71,910,452 $348,955 $9,069 $5,000 $364,302
16,417 70,351 249,441 1,743,386
769,497
604,053 604,053
75,000
365,372 79,420 858,494 3,556,238
300,000
$26,823,920 26,823,920
276,263 9,040,911 23,746,527
8,651,749
3,091,511 489,835 3,581,346
5,250,672
276,263 26,823,920 3,091,511 9,530,746 68,054,214
$641,635 $26,823,920 $3,170,931 $10,389,240 $71,910,452 27 124
CITY OF HALF MOON BAY
Reconciliation of the
GOVERNMENTAL FUNDS - BALANCE SHEET
with the
STATEMENT OF NET POSITION
JUNE 30, 2025
Fund balances of governmental funds $68,054,214
Amounts reported for governmental activities in the statement of net position are different because:
Capital assets have not been included as financial resources in governmental fund activity:
Capital assets, non depreciable 27,719,672
Capital assets, depreciated, net 58,261,432
Revenues which are unavailable on the Fund Balance Sheets because they are not available currently are taken into revenue in the Statement of Activities Deferred outflows below are not current assets of financial resources and the deferred inflows are not due and payable in the current period and therefore are not reported in the Governmental Funds.
Deferred outflows of resources 4,238,471
Deferred inflows of resources (352,633)
Long-term notes payable (4,256,740)
Compensated absences (942,148)
Net pension liability (13,692,251)
Net OPEB asset 186,459
7,238,348
Net position of governmental activities $146,454,824
See accompanying notes to financial statements
funds. The assets and liabilities of the internal service funds must be added to the statement of net position.
Long-term assets and liabilities that have not been
included in governmental fund activity
Internal service funds are used by management to charge the costs of certain activities, such as equipment management, to individual 28 125
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CITY OF HALF MOON BAY
GOVERNMENTAL FUNDS
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE FOR THE YEAR ENDED JUNE 30, 2025
Special Revenue Funds
General Streets and Lot Acquisition Affordable
Fund Roads and Retirement Housing
REVENUES
Taxes $18,536,875 $578,726
License and permits 463,053
Fines and forfeitures 124,109
Charges for services 1,658,117 $141,226
Impact fees
Rents and leases 71,670
Investment income 706,359 391,534 $69,782 290,426
Intergovernmental revenues 35,166 1,763,479 5,398
Miscellaneous 1,321,891
Total revenues 22,917,240 2,733,739 69,782 437,050
EXPENDITURES
Current:
General government 3,153,123
General administration 1,780,377
Public safety 7,301,251
Public works 2,163,096 188,250
Recreation services 537,796
Planning 3,169,566 1,173,603
Community and economic development 910,036
Capital outlay 2,024,097 176,489
Debt service:
Principal 572,686
Interest and fees 10,256
Total expenditures 19,598,187 2,212,347 176,489 1,173,603 Excess (deficiency) of revenues
over (under) expenditures 3,319,053 521,392 (106,707) (736,553) Other financing sources (uses):
Transfers in (Note 3) 587,760 120,124
Transfers (out) (Note 3) (4,372,322) (7,937)
Total other financing
sources (uses) (3,784,562) 112,187
Net change in fund balances (465,509) 633,579 (106,707) (736,553) Fund balance at beginning of year, as previously reported 14,367,930 7,263,726 1,420,599 Adjustments:
Changes from major to nonmajor fund
Changes from nonmajor to major fund 5,954,709
Fund balances at beginning of year, as adjusted 14,367,930 7,263,726 1,420,599 5,954,709 Fund balances at end of year $13,902,421 $7,897,305 $1,313,892 $5,218,156 See accompanying notes to financial statements
30 127
Special Revenue Debt Service
Fund Fund Capital Projects Funds
(Formerly Major) (Formerly Major)
Judgment Capital Non-Major
Parks Obligation Projects Governmental
Development Bonds Library Land Asset Fund Funds Total
$19,115,601
463,053
124,109
$7,481 1,806,824
$78,041 79,708 157,749
31,804 103,474
62,096 $114,008 514,362 2,148,567
1,764,596 158,454 1,448,819 5,175,912
1,321,891
1,904,733 272,462 2,082,174 30,417,180
107,790 3,260,913
1,780,377
174,088 7,475,339
82,765 2,434,111
537,796
4,343,169
1,278,138 2,188,174
3,009,742 674,709 206,838 6,091,875
572,686
10,256
3,009,742 674,709 1,849,619 28,694,696
(1,105,009) (402,247) 232,555 1,722,484
487,784 2,073,284 159,538 3,428,490
(1,080) (363,568) (367,883) (5,112,790)
486,704 1,709,716 (208,345) (1,684,300)
(618,305) 1,307,469 24,210 38,184
$6,425 $449,184 $26,823,920 1,784,042 15,900,204 68,016,030 (6,425) (449,184) 455,609
894,568 (6,849,277)
894,568 26,823,920 1,784,042 9,506,536 68,016,030
$276,263 $26,823,920 $3,091,511 $9,530,746 $68,054,214
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CITY OF HALF MOON BAY
Reconciliation of the
NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUNDS
with the
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2025
Changes in fund balances of governmental funds $38,184
Amounts reported for governmental activities in the statement of activities are different because:
When capital assets that are to be used in governmental activities are purchased or constructed, the resources expended for those assets are reported as expenditures in governmental funds. However, in the statement of activities, the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. As a result, fund balance decreases by the amount of financial resources expenses, whereas net position decrease by the amount of 5,579,885
(2,054,697)
Retirements (63,997)
Assets transferred to Internal Service Funds (7,570)
Debt proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the Statement of Net Position.
Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position.
Repayment of debt principal 572,686
Debt restructuring - reduction of principal 1,234,000
The amounts below included in the Statement of Activities do not provide or require the use of current financial resources and therefore are not reported as revenue of expenditures in governmental funds (net change).
OPEB expenses (35,558)
Compensated absences 31,336
Pension expenses (666,497)
Internal service funds are used by management to charge the costs of certain activities, such as equipment management, to individual funds. The net revenues (expenses) of the internal services funds is reported with governmental activities. 2,101,683
Changes in net position of governmental activities $6,729,455 See accompanying notes to financial statements
depreciation expense charged for the year.
Capital asset additions
Depreciation expense
32 129
CITY OF HALF MOON BAY
PROPRIETARY FUNDS
STATEMENT OF NET POSITION
JUNE 30, 2025
Govermental
ActivitiesSewer Internal
Enterprise Service
Fund Funds
Assets:
Current Assets:
Cash and investments (Note 2) $4,358,667 $6,991,556
Accounts receivable 10,952 2,826
Interest receivable 42,743 63,826
Total Current Assets 4,412,362 7,058,208
Noncurrent Assets:
Investment in Sewer Authority Mid-Coastside (Note 6) 12,180,693 Net OPEB Asset (Note 9) 9,732 2,507
Depreciable capital assets, net of accumulated depreciation (Note 4) 6,695,345 294,063 Total Non-Current Assets 18,885,770 296,570
Total Assets 23,298,132 7,354,778
Deferred Outflows of Resources
Related to OPEB (Note 9) 5,332 1,144
Related to pensions (Note 8) 208,982
Total Deferred Outflows of Resources 214,314 1,144
Current Liabilities:
Accounts payable 623,056 43,320
Claims liability (Note 11) 73,283
Total Current Liabilities 623,056 116,603
Noncurrent liabilities:
Net pension liability (Note 8) 567,598
Total Liabilities 1,190,654 116,603
Deferred Inflows of Resources
Related to OPEB (Note 9) 8,910 971
Related to pensions (Note 8) 64,111
Total Deferred Inflows of Resources 73,021 971
Net Position (Note 7):
Net investment in capital assets 6,695,345 294,063
Restricted for investment in Sewer Authority 12,180,693 Restricted for other post employment benefits 9,732 2,507 Unrestricted 3,363,001 6,941,778
Total Net Position $22,248,771 $7,238,348
See accompanying notes to financial statements
Liabilities:
33 130
CITY OF HALF MOON BAY
PROPRIETARY FUNDS
STATEMENT OF REVENUES, EXPENSES AND CHANGES
IN FUND NET POSITION
FOR THE YEAR ENDED JUNE 30, 2025
Governmental
ActivitiesSewer Internal
Enterprise Service
Fund Funds
Operating revenues:
Charges for services $7,339,424
Impact fees $10,713
Change in claims liability 1,597,448
Total operating revenues 7,339,424 1,608,161
Operating expenses:
Salaries and wages 332,033 832,261
6,283,593 39,027
Supplies 317,504
Repairs and maintenance 1,152 25,727
Insurance 536,847
Pensions 793,534
Depreciation 150,974 76,020
Other charges 700
Total operating expenses 6,767,752 2,621,620
Total operating income (loss) 571,672 (1,013,459)
Non-operating revenues:
Investment income 207,823 310,787
Total non-operating revenues 207,823 310,787
Income before contributions and transfers 779,495 (702,672) Capital contributions 7,570
Gain on investment in Sewer Authority Mid-Coastside (Note 6) 783,631 Transfers in (Note 3) 2,796,785
Transfers (out) (Note 3) (1,112,485)
Total capital contributions and transfers (328,854) 2,804,355 Change in net position 450,641 2,101,683
Net position at beginning of year 21,798,130 5,136,665
Net position at end of year $22,248,771 $7,238,348
See accompanying notes to financial statements
Contract services
34 131
CITY OF HALF MOON BAY
PROPRIETARY FUNDS
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2025
Governmental
ActivitiesSewer Internal
Enterprise Service
Fund Funds
Cash flows from operating activities:
Cash received from customers $7,345,710 $10,713
Cash payments to suppliers for goods and services (5,775,757) (918,858) Cash payments to employee services (306,014) (1,625,409) Net cash provided by operating activities 1,263,939 (2,533,554) Cash flows from non-capital and related financing activities:
Cash collected from other funds 2,796,785
Cash paid to other funds (1,112,485)
Net cash (used for) non-capital and related financing activities (1,112,485) 2,796,785 Cash flows from capital and related financing activities:
Acquisition of capital assets (15,190)
Net cash provided by capital and related financing activities (15,190) Cash flows from investing activities:
Interest received on investments 210,609 307,755
Net cash provided by investing activities 210,609 307,755 Net increase in cash and cash equivalents 346,873 570,986 Cash and cash equivalents at beginning of year 4,011,794 6,420,570 Cash and cash equivalents at end of year $4,358,667 $6,991,556 Reconciliation of operating income (loss) to net cash provided by (used for) Provided by (used for) operating activities:
Operating income (loss) $571,672 ($1,013,459)
Adjustments to reconcile operating income (loss) to net cash provided by operating activities:
Depreciation 150,974 76,020
Change in assets and liabilities:
Accounts receivable 6,286 (2,826)
Accounts payable 508,988 3,773
Deferred outflows of resources 26,048
Deferred inflows of resources (4,064) 386
Claims liability (1,597,448)
Net OPEB asset 861
Net pension liability 3,174
Net cash provided by operating activities $1,263,939 ($2,533,554) Non-cash transactions:
Gain on investment in Sewer Authority Mid-Coastside $783,631 Capital contributions $7,570
See accompanying notes to financial statements
35 132
133
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
1. Significant Accounting Policies
The City of Half Moon Bay (the City) is located next to the Pacific Ocean in San Mateo County, approximately twenty-five miles south of San Francisco. The City and coast side area is a thriving agricultural, fishing and tourism destination. In addition, about 3,000 tons of pumpkins are grown on the coast side each year and the ripening pumpkin heralds the Annual Arts and Pumpkin Festival held in October on the downtown historic Main Street. The annual festival draws more than 200,000 visitors for the two-day event.
The City is a general law city operating under the Council-Manager form of government, with a five-member City Council elected for four-year overlapping terms. The City Manager is appointed by the City Council to serve as administrator of the staff and to carry out the Council's policies.
Fire, water, library and certain sewer services are provided by separate districts or authorities which are not controlled by the City.
a) Blended Component Unit
The financial statements of the City include the financial activities of the City, as well as the Community Development Agency of the City of Half Moon Bay (Agency), which is controlled by and dependent on the City. The Agency is a separate government entity created in 1986 whose purpose is to prepare and implement plans for improvement, rehabilitation, and development of certain areas within the City. The Agency has the same governing board as the City, which also performs all accounting and administrative functions for the Agency, and has a financial relationship with the City. The financial activities of the Agency have been aggregated and merged (termed “blending”) with those of the City. The Agency is currently inactive for the fiscal year ended June 30, 2025. b) Government-wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the non-fiduciary activities of the primary government. The effect of interfund activity has been eliminated from these statements to minimize the double counting of internal activities. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support.
The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include: 1) charges to customers or applicants who purchase, use or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues.
Fund financial statements for the primary government's governmental and proprietary funds are presented after the government-wide financial statements. These statements display information about major funds individually and non-major funds in aggregate for governmental and proprietary funds.
37 134
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
1. Significant Accounting Policies, continued
b) Government-wide and Fund Financial Statements, continued The City reports the following major governmental funds:
The General Fund (Fund 101) is the general operating fund of the City. All general tax revenues and other receipts that are not allocated by law or contractual agreement to some other fund are accounted for in this fund. The major revenue sources for this fund are transient occupancy tax, property taxes, sales taxes, unrestricted revenues from the State, and interest income. Expenditures are made for public safety, planning, building, engineering, and other general government services.
The Streets and Roads Special Revenue Fund was established to account for all proceeds of Gas Tax funds (Fund 122), Measure A Local Transportation Ordinance Tax funds (Fund 124), Main Street Bridge fund (Fund 121) and other grants (Fund 123) that are restricted to purposes of these taxes.
The Lot Acquisition and Retirement Special Revenue Fund (Fund 133) is used to account for in-lieu fees and expenses within the purpose of acquiring and retiring development rights on existing legal parcels.
The Affordable Housing Special Revenue Fund (Fund 126) was established to account for proceeds of construction and development fees, including in lieu fees, whose purpose is for the development of affordable housing for very low, low, and moderate income households to rent or buy.
The Parks Development Special Revenue Fund (Fund 125) was established to account for proceeds of construction and development fees, whose purpose is for the acquisition, development, improvement, and expansion of parks and recreational areas, including equipment for recreation purposes and for capital expenditures such as infrastructure construction projects. In addition, this fund also includes the Library Fund (Fund 113) which accounts for the operations of the public library and is funded by contributions from the City and the San Mateo County Library Joint Powers Authority.
The Land Asset Capital Projects Fund (Fund 154) was established to account for the two land parcels held for resale.
The Capital Projects Fund (Fund 151) is used to fund Capital Improvement Program projects, including construction, technology, and other infrastructure improvements.
The City reports the following major enterprise fund:
The Sewer Enterprise Fund is used to account for the financial activity of the City's sewer utility. The costs of providing these services to the general public are financed or recovered primarily through user charges (Fund 201 is Sewer Operating Fund; Fund 202 is Sewer Capital Fund).
38 135
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
1. Significant Accounting Policies, continued
b) Government-wide and Fund Financial Statements, continued The City also reports the following fund types:
Internal Service Funds:
Internal Service Funds are used to account for financing of goods or services provided by one department or agency to other departments or agencies of the City on a costreimbursement basis. The City operates an Equipment and Vehicle Replacement Fund, a Risk Management Fund, and Pension Stabilization Fund.
c) Basis of Accounting and Financial Statement Presentation The government-wide and proprietary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when the liability is incurred, regardless of the timing of the related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.
Governmental fund financial statements 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. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers revenues to be available if they are collected within 60 days of the end of the current fiscal year.
Expenditures generally are recorded when a liability is incurred, as under accrual accounting.
However, debt service expenditures, as well as expenditures related to compensated absences, claims and judgments are not recognized until due. As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this general rule are payments-in-lieu of taxes and other charges between the government's sewer functions and various other functions of the government. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned.
Property taxes, sales taxes, transient occupancy taxes, and charges for services and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. All other revenue items are considered to be measurable and available only when cash is received by the government.
Amounts reported as program revenues include: 1) charges to members, customers or applicants for goods, services, or privileges provided; 2) operating grants and contributions; and 3) capital grants and contributions, including special assessments. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes.
Proprietary funds distinguish operating revenues and expenses from non-operating items.
Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. 39 136
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
1. Significant Accounting Policies, continued
c) Basis of Accounting and Financial Statement Presentation, continued The principal operating revenues of the Sewer Fund and of the government's Internal Service Funds are charges to customers for services. Operating expenses for the Sewer Fund and Internal Service Funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses.
When both restricted and unrestricted resources are available for use, it is the City's policy to use restricted resources first, and then use unrestricted resources as needed. d) Cash and Investments
Investments are reported in the accompanying statement of net position at fair value. Changes in fair value that occur during a fiscal year are recognized as investment income reported for that fiscal year. Investment income includes interest earnings, changes in fair value, and any gains or losses realized upon the liquidation, maturity, or sale of investments.
The City pools cash and investments of all funds, except for assets held by fiscal agents. Each fund's share in this pool is displayed in the accompanying financial statements as cash and investments. Investment income, earned by the pooled investments, is allocated to the various funds based on each fund's average cash and investment balance.
For purposes of the statement of cash flows, the City considers all highly liquid investments (including restricted assets) with a maturity of three months or less when purchased to be cash equivalents. Cash invested in the City's investment pools is also considered to be cash equivalents.
e) Cash and Investments with Fiscal Agents
The City has monies held by trustees or fiscal agents pledged to the payment or security of certain bonds. The California Government Code provides that these monies, in the absence of specific statutory provisions governing the issuance of bonds, may be invested in accordance with the ordinance, resolutions or indentures specifying the types of investments its trustees or fiscal agents may make.
40 137
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
1. Significant Accounting Policies, continued
f) Fair Value Measurements
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The fair value hierarchy categorizes the inputs to valuation techniques used to measure fair value into three levels based on the extent to which inputs used in measuring fair value are observable in the market.
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 inputs are inputs – other than quoted prices included within level 1 – that are observable for an asset or liability, either directly or indirectly.
Level 3 inputs are unobservable inputs for an asset or liability.
If the fair value of an asset or liability is measured using inputs from more than one level of the fair value hierarchy, the measurement is considered to be based on the lowest priority level input that is significant to the entire measurement. g) Interfund Receivables and Payables
Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year is referred to "due to/from other funds" (i.e., the current portion of interfund loans).
h) Capital Assets
Capital assets, which include property, plant, equipment and infrastructure assets, are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets, donated works of art and similar items, and capital assets received in a service concession arrangement are reported at estimated acquisition value on the date donated. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets' lives are not capitalized.
In addition, the City does not capitalize the allocation of capital costs related segments of projects maintained by other entities. The City utilizes a capitalization threshold of $5,000.
Depreciation is charged to operations using the straight-line method over the estimated useful lives of the assets as follows:
Building and Improvements 40 years
Sewer Mains and Laterals 60 years
Infrastructure 20 to 50 years
Vehicles 5 to 10 years
Equipment 5 to 20 years
41 138
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
1. Significant Accounting Policies, continued
i) Land Held for Resale
Lands held for resale are recorded in the Land Asset Capital Projects Fund at the lower of acquisition cost or estimated resale value. Fund balances are reserved in amounts equal to the carrying value of land held for resale since such assets are not available to finance the City's current operations.
Land held for resale of $26,823,920 at June 30, 2025 is stated at the lower of historical cost or net realizable value.
j) Compensated Absences
Depending upon length of employment, City employees earn 12 to 27 vacation days a year.
Sick leave is accrued at the rate of 12 days per year. Employees can carry forward two to three years-worth of earned but unused vacation leave benefits to subsequent years depending on employee group. Upon termination, the City is obligated to compensate employees for all earned but unused vacation days. The earned but unused sick leave benefits are payable for some employees, when vested, in the event of employee termination.
In the government-wide financial statements, a liability is accrued for all earned but unused vacation leave benefits, as well as vested amounts of sick leave relating to the operations of the funds. General Fund is typically used to liquidate the liability for compensated absences.
This liability will be liquidated as either additional cash payments in the event of employee termination or as part of budgeted salary expenditures if used by employees as compensated leave time while still employed by the City. In the fund financial statements, governmental funds report compensated absences only if they have matured, i.e. unused reimbursable leave still outstanding at fiscal year-end following an employee's resignation or retirement. Noncurrent amounts will be recorded as fund expenditures in the year in which they are paid or become due on demand to terminated employees.
The changes in compensated absences for the year ended June 30, 2025, is as follows:
Beginning Balance (as restated) $973,484
Additions 814,682
Payments (846,018)
Ending Balance $942,148
Current Portion $215,181
Non-current Portion $726,967
42 139
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
1. Significant Accounting Policies, continued
k) Long-term Obligations
In the government-wide financial statements, and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net position. Bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life of the bonds using the straight-line method. Bonds payable are reported net of the applicable bond premium or discount.
In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources, while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as service expenditures.
l) Claims and Judgments
The City records a liability for litigation, judgments and claims when it is probable that an asset has been impaired, or a liability has been incurred prior to year-end and the probable amount of loss (net of any insurance coverage) can be reasonably estimated. This liability is recorded in the Internal Service Funds, which account for the City's risk management activities.
m) Property Taxes
State of California (State) Constitution Article XIIIA provides that the combined maximum property tax rate on any given property may not exceed 1% of its assessed value ($1 per $100 of assessed value) plus an additional amount for general obligation debt approved by voters.
Assessed value is calculated at 100% of market value as defined by Article XIIIA and may be adjusted by no more than 2% per year unless the property is sold or transferred. The state legislature has determined the method of distribution of receipts from the $1.00 tax levy among the counties, cities, school districts and other districts.
The County of San Mateo assesses properties and bills for and collects property taxes as follows:
Secured Unsecured
Valuation/lien dates January 1 January 1
Levy dates On or before November 1 July 1
Due dates (delinquent after) 50% on November 1 (December 10) July 1 (August 31) 50% on February 1 (April 10)
The term "unsecured" refers to taxes on personal property other than land and buildings.
These "unsecured" taxes are secured by liens on the personal property being taxed. The County of San Mateo distributes to the City the entire amount of each year's levy and in return receives all penalties and interest on delinquent payments.
43 140
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
1. Significant Accounting Policies, continued
n) Estimates
The preparation of basic financial statements in conformity with generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
o) Pensions and OPEB (Other Post-Employment Benefits)
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the City’s California Public Employees’ Retirement System (CalPERS) plans (Plans) and additions to/deductions from the 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.
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the City’s Public Agency Retirement Services (PARS) plan and additions to/deductions from the OPEB Plan’s fiduciary net position have been determined on the same basis as they are reported by PARS.. For this purpose, benefit payments are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value.
p) Leases
As clarified by the Government Accounting Standards Board (GASB) Statement No. 87, a lease is defined as a contract that conveys control of the right to use another entity’s nonfinancial asset (the underlying asset) as specified in the contract for a period of time in an exchange or exchange-like transaction. Examples of nonfinancial assets include buildings, land, vehicles, and equipment. The City recognizes lease receivables or liabilities with an initial, individual value of $200,000 or more, based on the future lease payments remaining at the start of the lease.
The City had no leases subject to GASB #87 for the fiscal year 2025. q) Subscription-Based Information Technology Arrangements (SBITAs) Accounting As clarified by the Government Accounting Standards Board (GASB) Statement No. 96, a Subscription-Based Information Technology Arrangement (SBITA) is a contract that conveys control of the right to use another party’s (a SBITA vendor’s) IT software, alone or in combination with tangible capital assets (the underlying IT assets), as specified in the contract for a period of time in an exchange or exchange-like transaction.
44 141
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
1. Significant Accounting Policies, continued
q) Subscription-Based Information Technology Arrangements (SBITAs) Accounting, continued
At the commencement of a SBITA, the City initially measures the subscription liability at the present value of payments expected to be made during the contract term. Subsequently, the subscription liability is reduced by the principal portion of payments made. The subscription asset is initially measured as the initial amount of the subscription liability, adjusted for payments made at or before the SBITA commencement date, plus certain initial direct costs.
Subsequently, the subscription asset is amortized on a straight‐line basis over the shorter of the subscription term or the useful life of the underlying IT assets. The City recognizes SBITA liabilities with an initial, individual value of $200,000 or more for all funds, based on the future SBITA payments remaining at the start of the contract.
Key estimates and judgments related to SBITAs include how the City determines (1) the discount rate it uses to discount the expected subscription payments to present value, (2) subscription term, and (3) subscription payments as follows:
• The City uses the interest rate charged by the IT vendor as the discount rate. When the interest rate charged by the IT vendor is not provided, the City uses its estimated incremental borrowing rate as the discount rate for subscription liabilities. • The subscription term includes the noncancellable period of the subscription. • Subscription payments included in the measurement of the subscription 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 subscription and will remeasure the subscription asset and liability if certain changes occur that are expected to significantly affect the amount of the subscription liability. Subscription assets are reported with other capital assets and subscription liabilities are reported with liabilities on the statement of net position.
The City had no SBITA subject to GASB #96 for the fiscal year 2025. r) Loan Receivable
In June 2020, the City loaned $300,000 from the Affordable Housing Special Revenue Fund to the Abundant Grace Coastside Worker (AGCW) for the acquisition of property for the development of a workforce Development Center. The loan is secured by a recorded deed of trust on the property, does not bear interest and is due December 31, 2034.
45 142
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
1. Significant Accounting Policies, continued
s) New GASB Pronouncements
Management adopted the provisions of the following Governmental Accounting Standards Board (GASB) Statement, which became effective during the year ended June 30, 2025.
Effect of New Governmental Accounting Standards Board (GASB) Pronouncements GASB 101 – Compensated Absences
The objective of this Statement is to better meet the information needs of financial statement users by updating the recognition and measurement guidance for compensated absences. That objective is achieved by aligning the recognition and measurement guidance under a unified model and by amending certain previously required disclosures.
This Statement requires that liabilities for compensated absences be recognized for (1) leave that has not been used and (2) leave that has been used but not yet paid in cash or settled through noncash means. A liability should be recognized for leave that has not been used if (a) the leave is attributable to services already rendered, (b) the leave accumulates, and (c) the leave is more likely than not to be used for time off or otherwise paid in cash or settled through noncash means. Leave is attributable to services already rendered when an employee has performed the services required to earn the leave. Leave that accumulates is carried forward from the reporting period in which it is earned to a future reporting period during which it may be used for time off or otherwise paid or settled. In estimating the leave that is more likely than not to be used or otherwise paid or settled, a government should consider relevant factors such as employment policies related to compensated absences and historical information about the use or payment of compensated absences. However, leave that is more likely than not to be settled through conversion to defined benefit postemployment benefits should not be included in a liability for compensated absences.
This Statement requires that a liability for certain types of compensated absences—including parental leave, military leave, and jury duty leave—not be recognized until the leave commences. This Statement also requires that a liability for specific types of compensated absences not be recognized until the leave is used.
This Statement also establishes guidance for measuring a liability for leave that has not been used, generally using an employee’s pay rate as of the date of the financial statements. A liability for leave that has been used but not yet paid or settled should be measured at the amount of the cash payment or noncash settlement to be made. Certain salary-related payments that are directly and incrementally associated with payments for leave also should be included in the measurement of the liabilities.
The pronouncement became effective, and as disclosed in Note 7G to the financial statements required a prior period restatement for the cumulative effect on the financial statements.
GASB 102 – Certain Risk Disclosures
State and local governments face a variety of risks that could negatively affect the level of service they provide or their ability to meet obligations as they come due. Although governments are required to disclose information about their exposure to some of those risks, essential information about other risks that are prevalent among state and local governments is not routinely disclosed because it is not explicitly required. The objective of this Statement is to provide users of government financial statements with essential information about risks related to a government’s vulnerabilities due to certain concentrations or constraints.
46 143
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
1. Significant Accounting Policies, continued
s) New GASB Pronouncements, continued
GASB 102 – Certain Risk Disclosures, (continued)
This Statement defines a concentration as a lack of diversity related to an aspect of a significant inflow of resources or outflow of resources. A constraint is a limitation imposed on a government by an external party or by formal action of the government’s highest level of decision-making authority. Concentrations and constraints may limit a government’s ability to acquire resources or control spending.
This Statement requires a government to assess whether a concentration or constraint makes the primary government reporting unit or other reporting units that report a liability for revenue debt vulnerable to the risk of a substantial impact. Additionally, this Statement requires a government to assess whether an event or events associated with a concentration or constraint that could cause the substantial impact have occurred, have begun to occur, or are more likely than not to begin to occur within 12 months of the date the financial statements are issued.
If a government determines that those criteria for disclosure have been met for a concentration or constraint, it should disclose information in notes to financial statements in sufficient detail to enable users of financial statements to understand the nature of the circumstances disclosed and the government’s vulnerability to the risk of a substantial impact. The disclosure should include descriptions of the following:
• The concentration or constraint.
• Each event associated with the concentration or constraint that could cause a substantial impact if the event had occurred or had begun to occur prior to the issuance of the financial statements.
• Actions taken by the government prior to the issuance of the financial statements to mitigate the risk.
The City implemented the provisions of the Statement, but it did not have an effect on the fiscal year 2025 financial statements.
2. Cash, Cash Equivalents, and Investments
Cash and investments as of June 30, 2025, consist of the following:
Cash on hand $305
Deposits with financial institutions 4,072,450
Investments 46,169,503
Total cash and investments $50,242,258
47 144
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
2. Cash, Cash Equivalents, and Investments, continued
a) Custodial Credit Risk - Deposits
Custodial credit risk is the risk that in the event of a bank failure, the City's deposits may not be returned. The City does not have a policy for custodial credit risk on deposits. As of June 30, 2025, the carrying amount of the City's deposits was $4,072,450 and the bank balance was $ 4,172,949 The difference between the bank balance and the carrying amount represents outstanding checks and deposits in transit. Of the bank balance, $250,000 was covered by federal depository insurance and the balance was collateralized by the pledging financial institutions as required by Section 53652 of the California Government Code.
Under the California Government Code, a financial institution is required to secure deposits in excess of $250,000 made by state or local governmental units by pledging securities held in the form of an undivided collateral pool. The fair value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies.
California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits. Such collateral is considered to be held in the name of the City.
b) Investments Authorized by the City's Investment Policy The City maintains a cash and investment pool that is available for use by all funds. The table below identifies the investment types that are authorized for the City by the California Government Code (or the City's investment policy, where more restrictive). The table also identifies certain provisions of the California Government Code that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustees that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City's investment policy.
Minimum Maximum Maximum
Maximum Credit Percentage Investment
Authorized Investment Type Maturity Quality Allowed In One Issuer U.S. Treasury Obligations 5 Years None None None
U.S. Government Sponsored
Enterprise Obligations 5 Years None None None
Bankers' Acceptances 180 Days None 20% 5%
Commercial Paper 180 Days Highest Rating 15% 2%
Negotiable Certificates of Deposit 2 Years None 30% None Repurchase Agreements 1 year None 10% 5%
California Local Agency Investment Fund None None None $75 million per account San Mateo County Investment Pool None None None None
Time Certificates of Deposit 2 years None 10% None
Medium-Term Corporate Notes 5 Years Highest Rating 10% 10% (A) Money Market Mutual Funds None Highest Rating 20% 5%
(A) Commercial paper holdings are to be included when calculating the 10% limitation. 48 145
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
2. Cash, Cash Equivalents, and Investments, continued
c) Investments Authorized by Debt Agreements
Investments of debt proceeds held by bond trustee are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City's investment policy. The table below identifies the investment types that are authorized for investments held by bond trustee. The table also identifies certain provisions of these debt agreements that address interest rate risk, credit risk, and concentration of credit risk.
Minimum Maximum Maximum
Maximum Credit Percentage Investment
Authorized Investment Type Maturity Quality Allowed In One U.S. Treasury Obligations None None No Limit No Limit
U.S. Agency Securities None None No Limit No Limit
State Obligations None AAA No Limit No Limit
Municipal Obligations None AAA No Limit No Limit
Bankers' Acceptances 360 Days A1 No Limit No Limit
Commercial Paper 270 Days A1+ No Limit No Limit
Money Market Mutual Funds None Aam No Limit No Limit
California Local Agency Investment Fund None None No Limit No Limit Repurchase Agreements None None No Limit No Limit
d) Fair Value Hierarchy
The City adopted GASB Statement No. 72, Fair Value Measurement and Applications, which required governmental entities to measure investments at fair value. The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation input used to measure the fair value of asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs.
Total
Investments exempt from Fair Value Hierarchy:
San Mateo County Investment Pool $37,575,868
California Local Agency Investment Fund 8,593,635
Total Investments $46,169,503
49 146
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
2. Cash, Cash Equivalents, and Investments, continued
e) Interest Rate Risk
Interest Rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. The City monitors the interest rate risk inherent in its portfolio by measuring the weighted average maturity of its portfolio.
The City has no specific limitations with respect to this metric. 12 Months
Investment Type Or Less Total
Available for Operations
California Local Agency Investment Fund $8,593,635 $8,593,635 San Mateo County Investment Pool 37,575,868 37,575,868
Total Investments $46,169,503 $46,169,503
Remaining Maturity (in Months)
f) Custodial Credit Risk - Investment
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. All of the City’s investments in securities are held in the name of the City. The City’s custody agreement policy prohibits counterparties holding securities not in the City’s name. g) Credit Risk – Investments
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 ratings by nationally recognized statistical rating organization (S&P).
Investment Type AA Not Rated Total
Held by City
California Local Agency Investment Fund $8,593,635 $8,593,635 San Mateo County Investment Pool $37,575,868 37,575,868 Total Investments $37,575,868 $8,593,635 $46,169,503
50 147
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
2. Cash, Cash Equivalents, and Investments, continued
h) Investments in San Mateo County Investment Pool
The City is also a voluntary participant in the San Mateo County Investment Fund (County Pool) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the County of San Mateo. The City reports its investment in the County Pool at the fair value amount provided by the County. The balance available for withdrawal is based on the accounting records maintained by the County Pool which are recorded on an amortized cost basis. Included in the County Pool's investment portfolio are U.S. Treasury Notes, Obligations issued by agencies of the United States Government, LAIF, Corporate Notes, Commercial Paper, collateralized mortgage obligations, mortgage-backed securities, repurchase agreements, other asset-backed securities, and floating rate securities issued by federal agencies, government-sponsored enterprises, and corporations. At June 30, 2025, these investments matured in an average of 2.28 years.
i) Investments in State Treasurer’s Local Agency Investment Pool The City is also 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 financial statements at amounts based upon the City's pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis. At June 30, 2025, these investments matured in an average of 248 days.
3. Interfund Transactions
a) Current Balances
Current interfund balances arise in the normal course of business and are expected to be repaid shortly after the end of the fiscal year. The purpose of these balances is to eliminate negative cash balances at year end in various funds. At June 30, 2025, the Opportunity Center Coastside Special Revenue Fund owed the General Fund $604,053. 51 148
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
3. Interfund Transactions, continued
b) Transfers
Transfers between funds during the fiscal year ended June 30, 2025, were as follows:
Transfer To Transfer From Amount
General Fund Sewer Enterprise Fund $587,760 (a)
Streets and Roads Special Revenue Fund Non-Major Governmental Funds 120,124 (b) Parks Development Special Revenue Fund General Fund 132,604 (b) Capital Projects Fund 315,180 (b)
Non-Major Governmental Funds 40,000 (b)
Capital Projects Fund General Fund 1,880,100 (b)
Parks Development Fund 1,080 (b)
Non-Major Governmental Funds 192,104 (b)
Non-Major Governmental Funds General Fund 100,000 (b)
Capital Projects Fund 48,388 (b)
Non-Major Governmental Funds 11,150 (b)
Internal Service Funds General Fund 2,259,618 (c)
Streets and Roads Special Revenue Fund 7,937 (c)
Non-Major Governmental Funds 4,505 (c)
Sewer Enterprise Fund 524,725 (c)
$6,225,275
Interfund transfers were principally used for the following purposes:
(a) Sewer management expenditures
(b) Capital program expenditures
(c) Program expenditures
4. Capital Assets
a) Capital Assets Activity
A Summary of changes in capital assets for the year ended June 30, 2025, is as follows:
Balance Balance
June 30, 2024 Additions Retirements Transfers June 30, 2025 Governmental activities:
Capital assets not being depreciated:
Land $4,756,385 $176,489 ($41,504) $4,891,370
Rights of way 6,990,396 6,990,396
Construction in progress 11,212,437 5,271,988 (22,493) ($624,026) 15,837,906 Total capital assets not being depreciated 22,959,218 5,448,477 (63,997) (624,026) 27,719,672 Capital assets being depreciated:
Buildings & improvements 38,579,987 24,819 38,604,806
Machinery & equipment 1,559,221 121,584 37,852 1,718,657 Infrastructure 50,435,431 9,824 561,355 51,006,610
Total capital assets being depreciated 90,574,639 131,408 624,026 91,330,073 Less accumulated depreciation for:
Buildings & improvements 9,644,467 920,685 10,565,152
Machinery & equipment 1,148,255 118,506 1,266,761
Infrastructure 19,851,139 1,091,526 20,942,665
Total accumulated depreciation 30,643,861 2,130,717 32,774,578 Net depreciable assets 59,930,778 (1,999,309) 624,026 58,555,495 Governmental activities capital assets, net $82,889,996 $3,449,168 ($63,997) $86,275,167 52 149
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
4. Capital Assets, continued
a) Capital Assets Activity, continued
Balance Balance
June 30, 2024 Additions June 30, 2025
Business-type activities:
Capital assets being depreciated:
Buildings & improvements $9,099,769 $15,190 $9,114,959
Machinery & equipment 763,646 763,646
Total capital assets being depreciated 9,863,415 15,190 9,878,605 Less accumulated depreciation for:
Buildings & improvements 2,298,435 149,826 2,448,261
Machinery & equipment 733,851 1,148 734,999
Total accumulated depreciation 3,032,286 150,974 3,183,260 Net depreciable assets 6,831,129 (135,784) 6,695,345
Business-type activities capital assets, net $6,831,129 ($135,784) $6,695,345 b) Depreciation
Depreciation expense was charged to governmental functions as follows:
Governmental Activities:
General government $114,798
Recreation 820,003
Public safety 32,468
Public works 1,087,428
Depreciation on capital assets held by the City's
Internal Service Funds is charged to the various
functions based on their usage of the assets 76,020
Total Governmental Activities $2,130,717
Business-Type Activities:
Sewer Fund $150,974
53 150
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
5. Long-Term Debt
The following is a summary of long-term debt transactions for the year ended June 30, 2025:
Original Issue Balance Balance Current
Amount June 30, 2024 Retirements June 30, 2025 Portion
Governmental Activity Debt
Direct borrowings:
San Mateo County Advance $5,726,855 $2,863,426 $572,686 $2,290,740 $572,686 San Mateo County Loan 3,200,000 3,200,000 1,234,000 1,966,000 179,146 Total Governmental Activity $6,063,426 $1,806,686 $4,256,740 $751,832 a) Library Loan – Advance Agreement with the County of San Mateo During the fiscal year ended June 30, 2017, the City entered into a $6 million Interest-free loan agreement with the County of San Mateo to ensure completion of the Library Project.
The Project includes design, environmental review, demolition of existing library, construction, and construction management. The terms of repayment are directly from the property tax apportionments in two installments on December 15 and April 15 per fiscal year for a ten-year period beginning no later than December 15, 2019 and final payment is to be made no later than April 15, 2030. As of June 30, 2025, the City had drawn down $5,726,855. Repayments began in fiscal year 2020.
b) Financed Purchase Agreement with the County of San Mateo In August 2023, the City entered into a Memorandum of Understanding (MOU) with the County of San Mateo related to an affordable housing development at a portion of 880 Stone Pine Road. Under the terms of the MOU, in September 2023 the City and the County also entered into a lease and sublease agreement under which the County made a one-time upfront lease payment to the City in the amount of $3.2 million that the City used to discharge the iBank Loan discussed above to remove financing restrictions and continue affordable housing efforts at the location. The lease is for property at Correas Street and Purissima Street that will be used for as a library and other recreational functions and simultaneously, the City will sublease the property back from the County with annual rental payments over a lease term of 10 years, at a fixed interest rate of 3.13% per year. The Sublease is secured by secured property taxes collected by the General Fund. While the pledge of repayment of the Sublease is from secured property taxes, repayment can be made from any source. Under the terms of the sublease, The City is also responsible for paying the County’s costs associated with the property that will be billed periodically and are due within 30 days of receipt of the invoice.
To terminate the Sublease after having fully paid all installment payments through and including the year seven payment, the City may prepay the sublease at any time with five days’ notice to the County. Interest and principal on the sublease was to be payable semiannually December 15 and April 15 through 2033, with the first payment due in December 2024.
In November 2024 and March 2025, the City and County executed two addendums to the sublease to defer the fiscal year 2025 principal and interest payments to December 15, 2025.
54 151
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
5. Long-Term Debt, continued
April 2025, the City and the County entered into a purchase and sale agreement for a 6.867- acre portion of the property at 880 Stone Pine Road in the amount of $1.234 million. The purchase price is to be satisfied though the application of the prepayment credit under the above sublease. As a result, the principal balance of the sublease was reduced in that same amount. Although the sublease amendment was not executed until July 3, 2025, since the amendment reduced the City’s liability under the sublease and revised the payment schedule on the sublease, the City has recorded the transaction as of June 30, 2025.
The amended sublease bears an interest rate of 3.13%. Interest and principal on the sublease is payable semi-annually December 15 and April 15 through 2033, with the first payment due in December 2025. The County did not bill the City for any additional costs incurred during the year ended June 30, 2025.
c) Debt Service
As of June 30, 2025, annual debt service to maturity for the private placements is as follows:
Governmental Activities
Year ending Direct Borrowings
June 30 Principal Interest Total
2026 $751,832 $166,764 $918,596
2027 767,712 150,884 918,596
2028 784,999 133,597 918,596
2029 803,814 114,778 918,592
2030 251,620 94,290 345,910
2031-2033 896,763 140,967 1,037,730
Total $4,256,740 $801,280 $5,058,020
55 152
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
6. Investment in Sewer Authority Mid-Coast side
The City, along with the Montara Water and Sanitary District and El Granada Sanitary District, established the Sewer Authority Mid-Coastside (SAM) in 1976 to build and operate a sewage treatment facility for its members. SAM is controlled by a six-member board consisting of two representatives from each member. The board appoints management and employees of SAM and is responsible for SAM's budget, operations and finances. As one of SAM's member agencies, the City makes contributions to SAM in the form of collections assessments and operations and maintenance assessments. The City exercises significant influence over SAM's operations; therefore, the City's share of SAM's net position has been recorded as an investment in the City's financial statements. The City's share of SAM's net position is calculated annually, based on the proportion of SAM's total assessed valuation within the City limits. Complete financial statements for SAM can be obtained from the SAM at 1000 North Cabrillo Highway, Half Moon Bay, California 94019-1466. Based on SAM’s audited financial statements for June 30, 2024, the City recorded its investment in SAM in the amount of $12,180,693 at June 30, 2025.
7. Net Position/Fund Balances
a) Fund Balances
In the fund financial statements, governmental funds report the following fund balance classifications: non-spendable, restricted, committed, assigned, and unassigned. The City Council, as the highest level of decision-making authority for the City, has the ability to commit fund balances through the adoption of a formal resolution. The same action must be taken to modify or rescind the commitment. The City Council has approved a policy (Resolution No. C44-11) authorizing the City Manager to assign fund balances for specific purposes up to $8,000,000. Assignments of amounts over $8,000,000 require the approval of City Council. b) Stabilization Arrangements
City Council adopted a resolution (No. C-44-11) to establish a contingency reserve in the amount of 30% of the following fiscal year’s budgeted operating expenditures. City Council adopted a resolution (No. C-2020-60) that renamed the reserve to the General Fund Reserve and revised the policy to a minimum of 30% of the budgeted annual General Fund operating expenditures with no maximum. Changes to the reserve amount require City Council approval.
Appropriations from the General Fund Reserve commitment can only be made for the following specific circumstances:
1. Meeting cash flow needs during the fiscal year.
2. Closing a projected short-term revenue-expenditure gap.
3. Responding to unexpected expenditure requirements or revenue shortfalls.
4. When an economic downturn results in a short-term budgetary shortfall and where reasonable cuts to expenditures are not adequate to meet revenue without the use of the reserve.
5. Unfunded liabilities such as self-insurance, pensions and retiree health obligations.
6. Institutional changes, such as State budget takeaways and unfunded mandates.
56 153
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
7. Net Position/Fund Balances, continued
b) Stabilization Arrangements, continued
The City Council also established an Economic Uncertainty Reserve in the amount of a minimum of 20% of the budgeted annual General Fund operating expenditures with no maximum. Funds held in the Economic Uncertainty Reserve assignment are held for the following uses:
1. When a fiscal forecast shows an ongoing structural gap due to an economic downturn to providing a strategic bridge to future economic stability.
2. When during a declared emergency, expenditures exceed revenues and where the reserve will meet economic shortfalls due to a related economic downturn.
3. When an economic downturn results in a long-term budgetary shortfall and where reasonable cuts to expenditures are not adequate to meet revenue without the use of the reserve.
4. Where its use will prevent a reduction of required services.
The reserves can only be used in accordance with the policies above and at the direction of the City Council. It is the intent of the City to limit use of the reserves to address unanticipated, non-recurring needs or known, planned future obligations. Reserves shall not normally be applied to recurring annual operating expenditures. The reserves may, however, be used to allow time for the City to restructure its operations in a deliberate manner (such as might be required in the case of a severe economic downturn), but such use will only take place in the context of an adopted long-term plan to reach a sustainable structure.
The General Fund Reserve and Economic Uncertainty Reserve will be funded from excess ongoing and one-time funds when available. If reserve fund balances fall below established thresholds, the City will replenish reserves in the priority of the General Fund Reserve, followed by the Economic Uncertainty Reserve. Where funding of the General Fund Reserve and Economic Uncertainty Reserve exceeds the established thresholds, the City Council may authorize the use of those funds for any budgetary need.
In the event the City Council authorizes use of the reserves, the City Manager is to propose a plan for the replenishment of the reserves to the City Council during City budget hearings. The City will make every reasonable effort to fully replenish the reserves within five years. If, based on the Finance Director’s analysis and forecasting, the target balance is not being met or is likely not going to be met at some point within a five-year period, a plan to meet the target balance will be developed and presented to the City Council for consideration.
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CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
7. Net Position/Fund Balances, continued
c) Classifications
As prescribed by GASB Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions, governmental funds report fund balance in classifications based primarily on the extent to which the City is bound to honor constraints on the specific purposes for which amounts in the funds can be spent. As of June 30, 2025, fund balances for government funds are made up of the following:
• Non-spendable Fund Balance – includes amounts that are (a) not in spendable form, or (b) legally or contractually required to be maintained intact. The "not in spendable form" criterion includes items that are not expected to be converted to cash, for example:
inventories, prepaid amounts, long-term notes receivable and land. • Restricted Fund Balance – includes amounts that can be spent only for the specific purposes stipulated by external resource providers, constitutionally or through enabling legislation.
Restrictions may effectively be changed or lifted only with the consent of resource providers. • Committed Fund Balance – includes amounts that can only be used for the specific purposes determined by a formal action (resolution) of the City's highest level of decision-making authority, the City Council. Commitments may be changed or lifted only by the City taking the same formal action that imposed the constraint originally. • Assigned Fund Balance – comprises amounts intended to be used by the City for specific purposes that are neither restricted nor committed. Intent is expressed by (a) the City Council or (b) the City Manager. The City Council has delegated the authority for the City Manager to assign amounts of up to $8 million to be used for specific purposes (Resolution C-44-11). • Unassigned Fund Balance – is the residual classification and includes all amounts not contained in the other classifications. Unassigned amounts are technically available for any purpose. General Fund is the only fund that reports a positive unassigned fund balance. d) Policies
The standard also requires governments to disclose the accounting policies that indicate the order in which restricted, committed, assigned and unassigned amounts are spent.
The City considers restricted amounts to have been spent first when an expenditure is incurred for purposes of which both restricted and unrestricted fund balance is available. Additionally, the City considers committed amounts to have been spent first, assigned amounts to have been spent second, and unassigned amounts to have been spent last when an expenditure is incurred for purposes of which committed, assigned, and unassigned fund balance is available.
In circumstances when an expenditure is made for a purpose for which amounts are available in multiple fund balance classifications, fund balance is generally depleted in the order of restricted, committed, assigned, and unassigned.
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CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
7. Net Position/Fund Balances, continued
d) Policies, continued
Fund balances for all the major and non-major governmental funds as of June 30, 2025, were distributed as follows:
Non-major
General Streets and Lot Acquisition Affordable Parks Land Capital Governmental Fund Roads and Retirement Housing Development Asset Projects Funds Total Nonspendable:
Land held for resale $26,823,920 $26,823,920
Total nonspendable 26,823,920 26,823,920
Restricted:
Streets & roads $7,897,305 7,897,305
Community development $1,313,892 1,313,892
Economic/Community Grants $134,558 134,558
Park development improvements $276,263 276,263
Debt service 6,779 6,779
Police grants 1,168,128 1,168,128
Storm drain
maintenance improvements 1,567,000 1,567,000
Traffic mitigation 4,737,555 4,737,555
Affordable housing $5,218,156 5,218,156
Public facilities 1,426,891 1,426,891
Total restricted 7,897,305 1,313,892 5,218,156 276,263 9,040,911 23,746,527 Committed:
General Fund reserve $7,017,113 7,017,113
Economic uncertainty reserve 1,634,636 1,634,636
Total committed 8,651,749 8,651,749
Assigned:
San Mateo County Library 489,835 489,835
Capital projects $3,091,511 3,091,511
Total assigned 3,091,511 489,835 3,581,346
Unassigned: 5,250,672 5,250,672
Total Fund Balances $13,902,421 $7,897,305 $1,313,892 $5,218,156 $276,263 $26,823,920 $3,091,511 $9,530,746 $68,054,214 e) Net Position
Net Position is the excess of all assets and deferred outflows of resources over all liabilities and deferred inflows of resources. Net Position is divided into three categories. These categories apply only to Net Position, which is determined only at the Government-wide level, and are described below:
Net Investment in Capital Assets describes the portion of Net Position which is represented by the current net book value of the City's capital assets, less the outstanding balance of any debt issued to finance these assets.
Restricted describes the portion of Net Position which is restricted as to use by the terms and conditions of agreements with outside parties, governmental regulations, laws, or other restrictions which the City cannot unilaterally alter. These principally include developer fees received for use on capital projects, debt service requirements, and successor agency assets.
Unrestricted describes the portion of Net Position which is not restricted as to use.
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CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
7. Net Position/Fund Balances, continued
f) Net Investment in Capital Assets
The balances related to Net Investment in Capital Assets are comprised of the following as of June 30, 2025:
Governmental Business-Type
Activities Activities Total
Capital Asset, net of accumulated depreciation: $86,275,167 $6,695,345 $92,970,512 Less: Capital debt: (4,256,740) (4,256,740)
$82,018,427 $6,695,345 $88,713,772
g) Adjustment of Net Position
Adjustments to and restatements of beginning balances during fiscal year 2025 related to changes in accounting principles, as follows:
Change in
Accounting
June 30, 2024 Principle
As Previously (GASB 101 June 30, 2024
Reported Implementation) As Adjusted
Government-Wide
Governmental Activities $140,028,089 ($302,720) $139,725,369 Change in Accounting Principle – GASB 101 – The provisions of GASB Statement No. 101, Compensated Absences, were effective for the fiscal year ended June 30, 2025, and implementation requires the restatement of the balances of compensated absences as of July 1, 2024.
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CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
8. Pension Plans
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 Plan and additions to/deductions from the Plan’s fiduciary net position have been determined on the same basis as they are reported by the CalPERS Financial Office. For this purpose, benefit payments (including refunds of employee contributions) are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value. a) General Information about the CalPERS Pension Plan
Plan Description – All qualified permanent and probationary employees are eligible to participate in the City’s separate Safety and Miscellaneous Employee Pension Rate Plans.
The City’s Safety and Miscellaneous Rate Plans are part of the public agency cost-sharing multiple-employer defined benefit pension plan (PERF C), which is administered by the California Public Employees’ Retirement System (CalPERS). PERF C consists of a miscellaneous pool and a safety pool (also referred to as “risk pools”), which are comprised of individual employer miscellaneous and safety rate plans, respectively. Individual employers may sponsor more than one miscellaneous and safety rate plan. The employer participates in one cost-sharing multiple-employer defined benefit pension plan regardless of the number of rate plans the employer sponsors. The City sponsors three rate plans (two miscellaneous and one safety). Benefit provisions under the Plan are established by State statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plan regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.
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CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
8. Pension Plans, continued
a) General Information about the CalPERS Pension Plan, continued Benefits Provided – CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied as specified by the Public Employees’ Retirement Law.
The Plan’s provisions and benefits in effect at June 30, 2025, are summarized as follows:
Miscellaneous
Hire date
Prior to
January 1, 2013
On or after
January 1, 2013
Benefit formula 2% @ 55 PEPRA 2% @ 62
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50 - 67+ 52 - 67+
Monthly benefits, as a % of eligible compensation 1.426% to 2.418% 1.000% to 2.500% Required employee contribution rates 7% 8.25%
Required employer contribution rates 13.31% 8.18%
Required UAL Contribution $542,226 $10,672
Safety
Hire date
Prior to
January 1, 2013
Benefit formula 3% @ 50
Benefit vesting schedule 5 years service
Benefit payments monthly for life
Retirement age 50 - 55+
Monthly benefits, as a % of eligible compensation 3%
Required employee contribution rates 0%
Required employer contribution rates 0%
Required UAL Contribution $793,534
Beginning in fiscal year 2016, CalPERS collects employer contributions for the Plan as a percentage of payroll for the normal cost portion as noted in the rates above and as a dollar amount for contributions toward the unfunded liability (UAL). The dollar amounts are billed on a monthly basis or can be paid in a lump sum reduced amount. The City elected to make the lump sum contributions and the required contribution for the unfunded liability was $1,346,432 in fiscal year 2025, as show in the table above.
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CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
8. Pension Plans, continued
a) General Information about the CalPERS Pension Plan, continued Contributions – Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. Funding contributions for the Plan are determined annually on an actuarial basis as of June 30 by 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. Employer contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions.
For the year ended June 30, 2025, the contributions recognized as part of pension expense for the Plan were as follows:
Miscellaneous Safety Total
Contributions - employer $1,040,989 $793,534 $1,834,523 b) Pension Liabilities, Pension Expense and Deferred Outflows/Inflows of Resources Related to 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 Plan and additions to/deductions from the Plan’s fiduciary net position have been determined on the same basis as they are reported by the CalPERS Financial Office. For this purpose, benefit payments (including refunds of employee contributions) are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value. The governmental activities net pension liability is liquidated primarily by the General Fund.
As of June 30, 2025, the City reported net pension liability for its proportionate share of the net pension liability of the Plan as follows:
Proportionate Share
of Net Pension Liability
Miscellaneous $7,279,524
Safety 6,980,325
Total Net Pension Liability $14,259,849
63 160
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
8. Pension Plans, continued
b) Pension Liabilities, Pension Expense and Deferred Outflows/Inflows of Resources Related to Pensions, continued
The City’s net pension liability for the Plan is measured as the proportionate share of the net pension liability. The net pension liability of the Plan is measured as of June 30, 2024, and the total pension liability for the Plan used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2023 rolled forward to June 30, 2024 using standard update procedures. The City’s proportion of the net pension liability was based on a projection of the City’s long-term share of contributions to the pension plan relative to the projected contributions of all participating employers, actuarially determined.
The City’s proportionate share of the net pension liability for the Plan as of June 30, 2023 and 2024 was as follows:
Miscellaneous Safety Total
Proportion - June 30, 2023 0.14628% 0.09738% 0.24366%
Proportion - June 30, 2024 0.15051% 0.09574% 0.24625%
Change - Increase (Decrease) 0.00423% (0.00164%) 0.00259% For the year ended June 30, 2025, the City recognized pension expense of $1,470,419 for Miscellaneous Rate Plan and $1,055,380 for Safety Rate Plan, with a total pension expense of $2,525,799.
At June 30, 2025, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
Miscellaneous Safety Total
Deferred Outflows Deferred Inflows Deferred Outflows Deferred Inflows Deferred Outflows Deferred Inflows of Resources of Resources of Resources of Resources of Resources of Resources Pension contributions subsequent to measurement date $1,040,989 $793,534 $1,834,523 Changes in assumptions 187,099 171,981 359,080
Differences between actual and expected experience 629,382 ($24,558) 569,657 ($18,522) 1,199,039 ($43,080) Net change in Proportion DIDO and Net Pension Liability 33,664 (83,637) 8,444 (284,707) 42,108 (368,344) Net difference in actual contribution and proportion
contributions 154,112 (23,053) 23,754 (169,841) 177,866 (192,894) Net differences between projected and actual earnings on plan investments 419,073 337,397 756,470
Total $2,464,319 ($131,248) $1,904,767 ($473,070) $4,369,086 ($604,318) 64 161
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
8. Pension Plans, continued
b) Pension Liabilities, Pension Expense and Deferred Outflows/Inflows of Resources Related to Pensions, continued
$1,834,523 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the following fiscal year. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:
Year Ended
June 30 Miscellaneous Safety Total
2026 $412,045 $199,150 $611,195
2027 991,421 640,536 1,631,957
2028 32,227 (86,081) (53,854)
2029 (143,611) (115,442) (259,053)
Total $1,292,082 $638,163 $1,930,245
Actuarial Assumptions – For the measurement period ended June 30, 2024, the total pension liability was determined by rolling forward the June 30, 2023 total pension liability. The June 30, 2023 total pension liability was based on the following actuarial methods and assumptions:
Miscellaneous & Safety
Valuation Date June 30, 2023
Measurement Date June 30, 2024
Actuarial Cost Method Entry-Age Normal Cost Method
Actuarial Assumptions:
Discount Rate 6.90%
Inflation 2.30%
Projected Salary Increases Varies by Entry Age, Service and Type of Employment Investment Rate of Return 6.90% net of pension plan investment expenses, including inflation
Mortality Derived using CalPERS Membership Data for all Funds (1) Post Retirement Benefit Increase
Lessor of the contract COLA or 2.30% until Purchasing Power Allowance floor on purchasing power applies, 2.30% thereafter (1) The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. Mortality rates incorporate full generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries. For more details on this table, please refer to the 2021 experience study report from November 2021 that can be found on the CalPERS website.
The underlying mortality assumptions and all other actuarial assumptions used in the June 30, 2023 valuation were based on the results of a November 2021 actuarial experience study for the period 2001 to 2019. Further details of the Experience Study can be found on the CalPERS website.
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CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
8. Pension Plans, continued
b) Pension Liabilities, Pension Expense and Deferred Outflows/Inflows of Resources Related to Pensions, continued
Discount Rate – The discount rate used to measure the total pension liability was 6.90%. The projection of cash flows used to determine the discount rate assumed that contributions from all plan members in the Public Employees Retirement Fund (PERF) will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
The long-term expected rate of return on pension plan investments was determined using a building-block method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.
In determining the long-term expected rate of return, CalPERS took into account both shortterm and long-term market return expectations. Using historical returns of all of the funds’ asset classes, expected compound (geometric) returns were calculated over the next 20 years using a building-block approach. The expected rate of return was then adjusted to account for assumed administrative expenses of 10 basis points.
The table below reflects the long-term expected real rate of return by asset class.
Asset Class(1)
Assumed
Asset
Allocation Real Return (1), (2)
Global Equity-Cap-Weighted 30.0% 4.54%
Global Equity-Non-Cap-Weighted 12.0% 3.84%
Private Equity 13.0% 7.28%
Treasury 5.0% 0.27%
Mortgage-Backed Securities 5.0% 0.50%
Investment Grade Corporates 10.0% 1.56%
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%
(1) An expected inflation of 2.30% used for this period. (2) Figures are based on the 2021 Asset Liability Management Study. 66 163
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
8. Pension Plans, continued
b) Pension Liabilities, Pension Expense and Deferred Outflows/Inflows of Resources Related to Pensions, continued
Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate - The following presents the City’s proportionate share of the net pension liability for the Plan, calculated using the discount rate for the Plan, as well as what the City’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower or 1-percentage point higher than the current rate:
Miscellaneous Safety Total
1% Decrease 5.90% 5.90% 5.90%
Net Pension Liability $11,092,968 $10,097,507 $21,190,475 Current Discount Rate 6.90% 6.90% 6.90%
Net Pension Liability $7,279,524 $6,980,325 $14,259,849 1% Increase 7.90% 7.90% 7.90%
Net Pension Liability $4,140,498 $4,430,909 $8,571,407
Pension Plan Fiduciary Net Position – Detailed information about each pension plan’s fiduciary net position is available in the separately issued CalPERS financial reports. c) Deferred Compensation Plans
City employees may defer a portion of their compensation under two separate, optional City sponsored Deferred Compensation Plans created in accordance with Internal Revenue Code Section 457. Under these Plans, participants are not taxed on the deferred portion of their compensation until distributed to them; distributions may be made only at termination, retirement, death or in an emergency as defined by the Plans.
The Plans are part of public agency agent multiple-employer defined contribution plans that are administered by Mission Square Retirement (formerly ICMA RC) and California Public Employees Retirement System. Benefit provisions under the Plans are established by City resolution. The City has no liability for any losses incurred by the Plans and does not participate in any gains, but does have the duty of due care that would be required of an ordinary prudent investor. The City has contracts with each company to manage and invest the assets of the Plans. The administrators pool the assets of each Plan with those of other participants and do not make separate investments for the City. The assets in each Plan are the sole property of the participants or their beneficiaries. Since the assets held under each Plan are not the City’s property and are not subject to claims by general creditors of the City, they have been excluded from these financial statements. The Plans require investments to be stated at fair value and it requires all gains and losses on Plan investments to accrue directly to participant accounts.
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CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
8. Pension Plans, continued
c) Deferred Compensation Plans, continued
Employer contributions to the Plans are based on an employee’s bargaining unit. For employees under the Local 39, Unrepresented Executive Employees, Non-Represented Confidential Employees, and Represented Management Team bargaining units, who have completed one year of service with the City, the City will match 50 cents for every dollar that the employee contributes towards their 457 Plan account, up to an employee contribution of six percent (6.0%) of the employee’s salary. For example, if an employee contributes 6.0% or more of their salary towards their 457 Plan account, they will receive a 3.0% match from the City.
In addition to the employees in the groups listed above, the City Manager receives contributions to the employee’s Plan accounts of $10,000 annually, based on the contract between the City and the individual filling the Council Appointee position.
The City’s required contributions for the year ended June 30, 2025 totaled $93,298.
9. Other Post Employment Healthcare Benefits
a) Post-Employment Benefits Plan
Plan Description: The City provides medical insurance benefits to eligible retirees and their spouses in accordance with various labor agreements through its defined benefit plan. The City pays the minimum amount provided under Government Code Section 22892 of the Public Employees Medical and Hospital Care Act. The City currently pays $158 per month for any health coverage. the City joined the Public Agencies Post- Retirement Health Care Plan, an agent multiple-employer plan administered by Public Agency Retirement Services (PARS). The City established an irrevocable trust with PARS, managed by an appointed board not under the control of City Council. This trust is not considered a component unit of the City and has been excluded from these financial statements. Separately issued financial statements for PARS may be obtained from PARS at 4350 Von Karman Ave., Suite 200, Newport Beach, CA 92660.
City's Funding Policy: The contribution requirements of plan members and the City are established and may be amended by City Council. The contributions required to be made are under City Council and labor agreement requirements. When the City established the irrevocable retiree benefit trust with PARS, the City continued with the same funding policy of payment to a full ADC contribution. The long-term portion of governmental activities OPEB liabilities are liquidated primarily by the General Fund.
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CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
9. Other Post Employment Healthcare Benefits, continued b) Employees covered by benefit terms
Plan membership varies based on different employee bargaining groups. As of the June 30, 2023 actuarial valuation (the most recent available), membership in the Plan consisted of the following:
Number of
members
Active employees 41
Inactive employees, spouses, or beneficiaries
currently receiving benefit payments 11
Total 52
c) Net OPEB Liability (Asset)
The components of the net OPEB liability of the City at June 30, 2025, were as follows:
Total OPEB Plan Fiduciary Net Net OPEB
Liability Position Liability/(Asset)
(a) (b) (c) = (a) - (b)
$599,378 $822,479 ($223,101)
Changes Recognized for the Measurement Period:
Service Cost 42,100 42,100
Interest 37,636 37,636
Expected investment income
Contributions:
Employer - City's contribution -
Employer - Implicit subsidy (12,529) (a) 12,529
Net investment income 89,472 (89,472)
Benefit payments (28,429) (28,429)
Actual vs. expected experience 854 854
Changes of assumptions 18,680 18,680
Administrative expenses (2,076) 2,076
Net Changes during Fiscal Year 2025 70,841 46,438 24,403 $670,219 $868,917 ($198,698)
Increase (Decrease)
Balance at Fiscal Year Ending 6/30/2025:
Balance at Fiscal Year Ending 6/30/2024:
(a) Comprised of benefit payments of $28,429, net of reimbursement from the trust for current and prior contributions of $40,958.
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CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
9. Other Post Employment Healthcare Benefits, continued d) Sensitivity of the Net OPEB Liability (Asset) to Changes in the Discount Rate and Healthcare Cost Trend Rates
The following table presents the net OPEB liability of the Plan as of June 30, 2025, calculated using the discount rate of 5.73%, as well as what the Plan’s net OPEB liability (asset) would be if it were calculated using a discount rate or healthcare cost trend rate that is 1-percentage-point lower or 1- percentage point higher than the current rate:
Net OPEB Liability/(Asset)
Discount Rate -1% Discount Rate Discount Rate +1%
(4.73%) (5.73%) (6.73%)
($121,503) ($198,698) ($263,900)
Net OPEB Liability/(Asset)
Healthcare Cost
1% Decrease Trend Rates 1% Increase
($290,064) ($198,698) ($84,672)
e) Actuarial Assumptions
The City’s net OPEB liability (asset) was measured as of June 30, 2025, and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation dated June 30, 2023, rolled forward to June 30, 2025, based on the following actuarial methods and assumptions:
Actuarial Assumptions
Valuation Date June 30, 2023
Measurement Date June 30, 2025
Contribution Policy Trust contributions are made on an ad-hoc basis.
Actuarial Cost Method Entry Age Normal. Level percentage of payroll Actuarial Assumptions:
Discount Rate 5.73%
Long Term Expected Rate 6.00%
Rate of Return on Assets 6.00%
Inflation 2.50%
Payroll Growth 3.00%
Mortality Rate
Based on assumptions for Public Agency Miscellaneous
members published in the 2021 CalPERS Experience
Study.These tables include generational mortality
improvement using 80% of scale MP-2020.
Healthcare Cost Trend Rate 7.6% for FY2024, gradually decreasing over several decades to an ultimate rate of 3.9% in FY2076 and later years.
Healthcare participation for future retirees 45% if covered; 45% if waived PEMHCA Minimum Increases 3.50% annually
70 167
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
9. Other Post Employment Healthcare Benefits, continued f) Changes of Assumptions
Effective with the June 30, 2025 measurement date, the following assumption changes were implemented:
• The accounting discount rate was decreased from 6.00% to 5.73%, based on updated long-term investment return assumptions.
g) OPEB Expense and Deferred Inflows and Outflows of Resources Related to OPEB For the fiscal year ended June 30, 2025, the City recognized OPEB expense of $24,655. At June 30, 2025, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:
Deferred Outflows Deferred Inflows
of Resources of Resources
Differences between actual and expected experience $2,881 ($76,443) Changes in assumptions 81,962 (17,352)
Net difference between projected and actual earnings
on OPEB plan investments (28,512)
Total $84,843 ($122,307)
Amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:
Year Annual
Ended June 30 Amortization
2026 $8,897
2027 (18,254)
2028 (17,147)
2029 (10,393)
2030 (4,115)
Thereafter 3,548
Total ($37,464)
71 168
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
9. Other Post Employment Healthcare Benefits, continued g) OPEB Expense and Deferred Inflows and Outflows of Resources Related to OPEB, continued
Plan Administration
The City is the plan administrator. The Public Agency Retirement Services (PARS) administers the trust for the City’s retiree healthcare benefit plan – a single-employer defined benefit OPEB plan that provides healthcare benefits for eligible general and public safety employees of the City.
Fiscal Year ended
June 30, 2025
Plan Type Agent Multiple Employer
OPEB Trust Yes
Special Funding Situation No
Nonemployer Contributing Entity No
Contribution Information
PARS established rates for each employer based on an actuarially determined rate for each employer. Plan members are not required to contribute to the plan. The City did not make any contributions to the Trust in fiscal year 2025.
Investment Policy
PARS offers different investment portfolios as part of the investment vehicle. The City invests in the “Moderate” portfolio; the primary goal of the Moderate objective is to provide current income and moderate capital appreciation. It is expected that dividend and interest income will comprise a significant portion of total return, although growth through capital appreciation is equally important. Assets are invested in both equity securities and fixed income. The portfolio is constructed to control risk through four layers of diversification – asset classes (cash, fixed income, equity), investment styles (large cap, small cap, international, value, growth), managers and securities. Disciplined mutual fund selection and monitoring process helps to drive return potential while reducing portfolio risk.
72 169
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
9. Other Post Employment Healthcare Benefits, continued g) OPEB Expense and Deferred Inflows and Outflows of Resources Related to OPEB, continued
The following is the City adopted asset allocation policy as of June 30, 2025:
PARS PARS
Long-Term Long-Term
Target Expected Real Expected Nominal
Asset Class Allocation Rate of Return Rate of Return
U.S. Equity - large cap 26.50% 5.20% 7.70%
U.S. Equity - mid cap 5.00% 5.50% 8.00%
U.S. Equity - small cap 7.50% 6.00% 8.50%
International Equity 6.00% 5.00% 7.50%
Emerging Market Equity 3.25% 5.00% 7.50%
REIT's 1.75% 4.10% 6.60%
Short-Term Bond 10.00% 0.80% 3.30%
Intermediate-Term Bond 33.50% 1.50% 4.00%
High Yield Bond 1.50% 3.20% 5.70%
Cash and Equivalents 5.00% 0.10% 2.60%
Total 100.00% 6.18%
Assumed Long-Term Rate of Inflation 0.00%
Adjusted Total Expected Return 6.18%
Reduction for Assumed Investment Expense -0.25%
Expected Long-Term Net
Rate of Return, Rounded 6.00%
10. Leases
a) Policies
A lease is defined as a contract that conveys control of the right to use another entity’s nonfinancial asset (the underlying asset) as specified in the contract for a period of time in an exchange or exchange-like transaction. Examples of nonfinancial assets include buildings, land, vehicles, and equipment. The City recognizes lease receivable or liabilities with an initial, individual value of $300,000 or more for all funds, based on the future lease payments remaining at the start of the lease.
Lessor
The City is a lessor for noncancellable leases of buildings and facilities. If the lease receivable is over the capitalization threshold, the City will recognize a lease receivable and a deferred inflow of resources in the government‐wide and fund financial statements.
At the commencement of a lease, the City initially measures the lease receivable at the present value of payments expected to be received during the lease term. Subsequently, the lease receivable is reduced by the principal portion of lease payments received. The deferred inflow of resources is initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred inflow of resources is recognized as revenue over the life of the lease term. 73 170
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
10. Leases, continued
a) Policies, continued
Key estimates and judgments include how the City determines (1) the discount rate it uses to discount the expected lease receipts to present value, (2) lease term, and (3) lease receipts as follows:
• The City uses bond interest rate as the discount rate for leases. • The lease term includes the noncancellable period of the lease. • Lease receipts included in the measurement of the lease receivable is composed of fixed payments from the lessee.
The City monitors changes in circumstances that would require a remeasurement of its lease, and will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable.
Lessee
The City is a lessee for miscellaneous leases. If the lease is over the threshold, the City will recognize a lease liability and an intangible right‐to‐use lease asset (lease asset) in the government‐wide financial statements.
At the commencement of a lease, 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 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 judgments related to leases include how City determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments as follows:
• The City uses the interest rate charged by the lessor as the discount rate. When the interest rate charged by the lessor is not provided, City generally uses bond interest 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 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 other capital assets and lease liabilities are reported with longterm debt on the Statement of Net Position. 74 171
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
10. Leases, continued
b) Leases Receivable (City as Lessor) and Leases Payable (City as Lessee) As of June 30, 2025, the City has no leases over the threshold subject to GASB 87 as a lessor or lessee.
11. Risk Management
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees and others; and natural disasters. The Pooled Liability Assurance Network Joint Powers Authority covers general liability claims in an amount up to $35,000,000. The City has a deductible or uninsured liability of up to $50,000 per claim.
Once the City's deductible is met The Plan becomes responsible for payment of all claims up to the limit. The Cities Group covers workers compensation claims up to $1,000,000 for miscellaneous employees and $1,500,000 for safety employees and has coverage above that limit to a maximum of $10,000,000 per incident in excess. The City has no deductible for these claims.
Through the Sewer Authority Mid-Coastside, the City also belongs to the California Sanitation Risk Management Authority, which insures the City up to $500,000 per property against sewer backup damages. The City is liable for only one claim per property and is not liable for any future damages, as the property owner is then required to install a back flow valve on their line, with the exception of properties in certain low lying areas.
The City provides for the uninsured portion of claims and judgments in the General Fund and Risk Management Internal Service Fund. Claims and judgments, including a provision for claims incurred but not reported, are recorded when a loss is deemed probable of assertion and the amount of the loss is reasonably determinable.
Settled claims have not exceeded the City's excess coverage in any of the past three fiscal years.
Claims expenses and liabilities are reported for self-insured deductibles when it is probable that a loss has occurred, the amount of that loss can be reasonably estimated and includes incremental claim expenses. Allocated and unallocated claims adjustment expenses are included in the claims liability balance. These losses include an estimate of claims that have been incurred but not reported. The liability for general liability self-insurance claims is the City's best estimate based on available information.
75 172
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
11. Risk Management, continued
a) The Cities Group
The City, along with five other governments located within San Mateo County, is a member of The Cities Group, a public entity risk pool and a provider of workers' compensation insurance coverage, claims management, risk management services and legal defense to each participating member. The Cities Group is governed by a Board of Directors, which comprises officials appointed by each participating member. Premiums paid to The Cities Group may be modified by Board decision according to the loss experience of each member.
This loss experience mechanism will operate to ensure that each member returns over a period of time to The Cities Group the funds paid out on its behalf as paid losses. In the opinion of City management, premiums paid represent the best available estimate of the ultimate cost of the City's participation in The Cities Group and, accordingly, the accompanying basic financial statements of the City includes no provisions for possible refunds or additional assessments. For the year ended June 30, 2025, the City paid premiums of $23,281 to The Cities Group. Financial statements may be obtained from The Cities Group at P.O. Box 111, Burlingame, CA 94011-0111.
b) PLAN JPA
Prior to January 2018 the City participated in ABAG Plan Corporation, a non-profit public benefit corporation established to provide liability insurance coverage, claims and risk management, and legal defense to its participating members. On January 16, 2018, ABAG Plan Corporation transitioned to Pooled Liability Assurance Network Joint Powers Authority (PLAN JPA), a self-funded pooled insurance corporation established by a joint powers authority in which the City is one of 28 members. The rights and responsibilities of the member agencies are governed by the bylaws of the PLAN JPA, the risk coverage agreement, and a related memorandum of coverage. Each member chooses its self-insured liability retention at a level between $25,000 and $250,000. Each member has a vote in approving the pool’s self-insured retention level, in setting the coverage limit, in establishing the level of pool reserves, approving the premium allocation methodology for setting premiums for each member, and in approving the methodology for returning disbursable equity to members.
PLAN JPA is responsible for administering the insurance program. PLAN JPA provides claims administration and risk management services to the members. Audited financial information may be obtained from PLAN JPA at 1750 Creekside Oaks Drive, Suite 200, Sacramento, CA 95833.
For the year ended June 30, 2025, the City paid premiums of $501,836 to PLAN JPA.
Financial statements may be obtained from Plan JPA at 1750 Creekside Oaks Drive, Suite 200, Sacramento, CA 95833.
76 173
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
11. Risk Management, continued
c) Liability for Uninsured Claims
The City's liability for uninsured claims was estimated by management based on prior year claims experience as follows:
June 30, 2025 June 30, 2024
Beginning balance of claims payable $1,670,731 $1,064,830 Increase in estimated liability (1,531,028) 1,883,998
Claims paid (66,420) (1,278,097)
Ending balance of claims payable $73,283 $1,670,731
12. Commitments and Contingencies
a) Litigation
The City is subject to litigation arising in the normal course of business. In the opinion of the City Attorney there is no pending litigation, which is likely to have a material adverse effect on the financial position of the City.
b) Grant Programs
The City participates in Federal, State and local grant programs. These programs have been audited by the City’s independent accountants in accordance with the provisions of the Federal Single Audit Act as amended and applicable State requirements. No cost disallowances were proposed as a result of these audits; however, these programs are still subject to further examination by the grantors and the amount, if any, of expenditures which may be disallowed by the granting agencies cannot be determined at this time. The City expects such amounts, if any, to be immaterial.
c) JobTrain – Conflict of Interest
As part of its commitment to provide relief to individuals and businesses impacted by COVID and to position the coastside economy for long-term resiliency, the City Council sponsored the Coastside Recovery Initiative. That effort resulted in a public report, Building a More Equitable, Vibrant and Resilient Coastside Economy. Substantiated by findings and recommendations from that report, the San Mateo County Board of Supervisors approved a $2,500,000 funding allocation to support the development of the Opportunity Center of the Coastside (OCC) – a first-of-its-kind service center for job seekers, small businesses, and entrepreneurs.
After entering the agreement with the County and securing a space for the OCC, staff onboarded qualified service providers in each of the following areas: rapid employment services and career training (provided by JobTrain), small business development and support services (provided by Renaissance Entrepreneurship Center), and a new business incubator to support startups focused on resiliency tech (provided by American Energy Society).
77 174
CITY OF HALF MOON BAY, CALIFORNIA
NOTES TO THE BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2025
12. Commitments and Contingencies, continued
c) JobTrain – Conflict of Interest, continued
On November 7, 2023, the City Council adopted a resolution authorizing the City Manager to execute a professional services agreement with JobTrain, up to $337,000. Under the Agreement, JobTrain would provide Job Seeker workforce development program services via the OCC. That agreement was set to expire on September 30, 2024, unless the contract was amended.
An amendment for the professional services agreement with JobTrain was originally included in the staff recommendation from the Council meeting on September 17. The amendment for the JobTrain contract was excluded from Resolution No. C-2024-72 in order to provide additional time to analyze potential conflicts of interest pertaining to the employment of the Regional Director position at JobTrain which is currently held by an elected Half Moon Bay councilmember. The councilmember was Vice-Mayor and participated in approval of the original contract in 2023, but was not an employee of JobTrain at that time.
The City Attorney prepared a legal opinion that indicates, in summary, under the applicable conflict of interest laws, in particular Government Code section 1090, the Mayor has a conflict of interest in the JobTrain contract by virtue of his financial interest in his employer.
However, the Mayor’s interest is subject to the “remote interest” exception, which applies to officers and employees of nonprofit entities. Therefore, the City may enter into the JobTrain contract so long as the Mayor discloses his interest to the City Council, the interest is noted in the official records, and the Mayor recuses from the decision, including leaving the room during consideration of the contract, pursuant to the Political Reform Act’s recusal requirements.
The City Council voted to amend the professional services agreement with JobTrain with a contract term ending September 30, 2025, and in a contract amount not to exceed $350,372, and the Mayor recused from the vote.
78 175
REQUIRED SUPPLEMENTARY INFORMATION
176
REQUIRED SUPPLEMENTARY INFORMATION
COST-SHARING EMPLOYER DEFINED PENSION PLAN:
SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY This schedule reports the proportion (percentage) of the collective net pension liability, the proportionate share (amount) of the collective net pension liability, the employer’s covered employee payroll, the proportionate share (amount of the collective net pension liability as a percentage of the employer’s covered employee payroll and the pension plan’s fiduciary net position as a percentage of the total pension liability.
SCHEDULE OF CONTRIBUTIONS
This schedule reports the cost sharing employer’s contributions to the plan which are actuarially determined, the employer’s actual contributions, the difference between the actual and actuarially determined contributions, and a ratio of the actual contributions divided by covered employee payroll.
SCHEDULE OF FUNDING PROGRESS – OTHER POST-EMPLOYMENT BENEFITS PLAN
This schedule presents trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liability for benefits. 80 177
REQUIRED SUPPLEMENTARY INFORMATION
Miscellaneous Rate Plan
Cost-Sharing Multiple-Employer Defined Pension Plan
Last 10 Years
SCHEDULE OF THE PLAN'S PROPORTIONATE SHARE OF THE
NET PENSION LIABILITY AND RELATED RATIOS AS OF
THE MEASUREMENT DATE
Measurement date: 6/30/2015 6/30/2016 6/30/2017 6/30/2018 6/30/2019 6/30/2020 6/30/2021 6/30/2022 6/30/2023 6/30/2024 Plan's proportion of the Net Pension
Liability (Asset) 0.10917% 0.11869% 0.12281% 0.12663% 0.13120% 0.13584% 0.18148% 0.14468% 0.14628% 0.15051% Plan's proportionate share of the Net
Pension Liability (Asset) $2,994,972 $4,123,054 $4,841,079 $4,772,172 $5,254,057 $5,729,928 $3,445,863 $6,769,868 $7,314,381 $7,279,524 Covered Payroll $1,986,876 $2,014,025 $2,423,106 $3,177,604 $3,415,448 $3,945,078 $3,974,973 $4,318,701 $4,671,261 $5,144,449 Plan's Proportionate Share of the Net
Pension Liability/(Asset) as a Percentage of
its Covered Payroll 150.74% 204.72% 199.79% 150.18% 153.83% 145.24% 86.69% 156.76% 156.58% 141.50% Plan's Proportionate Share of the Fiduciary
Net Position as a Percentage of the Plan's
Total Pension Liability 78.40% 74.06% 73.31% 75.26% 75.26% 75.10% 88.29% 76.68% 76.21% 78.08% Miscellaneous Rate Plan
Cost-Sharing Multiple Employer Defined Pension Plan
As of fiscal year ending June 30,
Last 10 Years
SCHEDULE OF CONTRIBUTIONS
Fiscal year ended June 30: 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Actuarially determined contribution $168,511 $344,215 $435,299 $525,289 $649,405 $728,503 $819,301 $905,657 $937,025 $1,040,989 Contributions in relation to the actuarially
determined contributions (168,511) (344,215) (435,299) (525,289) (649,405) (728,503) (819,301) (905,657) (937,025) (1,040,989) Contribution deficiency (excess) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Covered payroll $2,014,025 $2,423,106 $3,177,604 $3,415,448 $3,945,078 $3,974,973 $4,318,701 $4,671,261 $5,144,449 $5,155,958 Contributions as a percentage of covered
payroll 8.4% 14.2% 13.7% 15.4% 16.5% 18.3% 19.0% 19.4% 18.2% 20.2% Notes to Schedule
Valuation date: 6/30/2013 6/30/2014 6/30/2015 6/30/2016 6/30/2017 6/30/2018 6/30/2019 6/30/2020 6/30/2021 6/30/2022 81 178
REQUIRED SUPPLEMENTARY INFORMATION
Safety Rate Plan
Cost-Sharing Multiple-Employer Defined Pension Plan
Last 10 Years
SCHEDULE OF THE PLAN'S PROPORTIONATE SHARE OF THE
NET PENSION LIABILITY AND RELATED RATIOS AS OF
THE MEASUREMENT DATE
Measurement date: 6/30/2015 6/30/2016 6/30/2017 6/30/2018 6/30/2019 6/30/2020 6/30/2021 6/30/2022 6/30/2023 6/30/2024 Plan's proportion of the Net Pension
Liability (Asset) 0.10493% 0.10385% 0.10143% 0.10417% 0.10123% 0.03615% 0.12006% 0.10285% 0.09738% 0.09574% Plan's proportionate share of the Net
Pension Liability (Asset) $4,323,582 $5,378,768 $6,060,745 $6,112,200 $6,319,361 $6,550,836 $4,213,402 $7,067,692 $7,279,426 $6,980,325 Covered Payroll N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Plan's Proportionate Share of the Net
Pension Liability/(Asset) as a Percentage of
its Covered Payroll N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Plan's Proportionate Share of the Fiduciary
Net Position as a Percentage of the Plan's
Total Pension Liability 78.40% 74.06% 73.31% 75.26% 75.26% 75.10% 88.29% 76.68% 76.21% 78.08% Safety Rate Plan
Cost-Sharing Multiple Employer Defined Pension Plan
As of fiscal year ending June 30,
Last 10 Years
SCHEDULE OF CONTRIBUTIONS
Fiscal year ended June 30: 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Actuarially determined contribution $414,500 $249,322 $445,240 $551,942 $555,649 $594,797 $612,617 $660,198 $457,721 $793,534 Contributions in relation to the actuarially
determined contributions (414,500) (249,322) (445,240) (551,942) (555,649) (594,797) (612,617) (660,198) (457,721) (793,534) Contribution deficiency (excess) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Covered payroll N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Contributions as a percentage of covered
payroll N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Notes to Schedule
Valuation date: 6/30/2013 6/30/2014 6/30/2015 6/30/2016 6/30/2017 6/30/2018 6/30/2019 6/30/2020 6/30/2021 6/30/2022 82 179
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES
IN THE NET OPEB LIABILITY AND RELATED RATIOS
An Agent Multiple-Employer Defined Benefit OPEB Plan
Last 10 fiscal years*
Measurement Date 6/30/2017 6/30/2018 6/30/2019 6/30/2020 6/30/2021 6/30/2022 6/30/2023 6/30/2024 6/30/2025 Total OPEB Liability
Service Cost $25,533 $27,065 $27,877 $28,713 $30,749 $31,671 $35,261 $36,231 $42,100 Interest 24,624 26,373 28,268 30,256 32,113 32,877 26,723 28,516 37,636 Differences between expected and actual experience - - - - - - - - - Benefit payments (22,522) (22,553) (22,788) (24,885) (29,523) (33,272) (37,150) (23,577) (28,429) Actual vs. expected experience - - - 5,947 - (122,083) - - 854 Changes of assumptions - - - (8,808) 30,158 (22,718) - 64,176 18,680 Net change in total OPEB liability 27,635 30,885 33,357 31,223 63,497 (113,525) 24,834 105,346 70,841 Total OPEB liability - beginning 396,126 423,761 454,646 488,003 519,226 582,723 469,198 494,032 599,378 Total OPEB liability - ending (a) $423,761 $454,646 $488,003 $519,226 $582,723 $469,198 $494,032 $599,378 $670,219 OPEB fiduciary net position
Net investment income $48,425 $32,087 $41,937 $29,170 $136,486 ($91,716) $44,412 $73,905 $89,472 Contributions:
Employer - City's contribution 22,522 39,261 22,928 26,083 (5,366) 33,410 37,336 20,975 - Employer - Implicit subsidy - - - - - - - 2,602 (12,529) Administrative expense (2,071) (1,552) (1,745) (2,911) (2,934) (2,117) (1,983) (1,926) (2,076) Actual vs. expected experience - - - - - - - - -
Benefit payments (22,522) (22,553) (22,788) (24,885) (29,523) (33,272) (37,150) (23,577) (28,429) Net change in plan fiduciary net position 46,354 47,243 40,332 27,457 98,663 (93,695) 42,615 71,979 46,438 Plan fiduciary net position - beginning 541,531 587,885 635,128 675,460 702,917 801,580 707,885 750,500 822,479 Plan fiduciary net position - ending (b) $587,885 $635,128 $675,460 $702,917 $801,580 $707,885 $750,500 $822,479 $868,917 Net OPEB liability (asset) - ending (a)-(b) ($164,124) ($180,482) ($187,457) ($183,691) ($218,857) ($238,687) ($256,468) ($223,101) ($198,698) Plan fiduciary net position as a percentage of
the total OPEB liability 138.73% 139.70% 138.41% 135.38% 137.56% 150.87% 151.91% 137.22% 129.65% Covered-employee payroll (A) N/A ** $3,009,829 $4,157,271 $4,976,211 $4,806,006 $5,072,966 $6,658,959 $5,233,729 $5,327,818 Total OPEB liability as a percentage of
covered-employee payroll N/A ** -6.00% -4.51% -3.69% -4.55% -4.71% -3.85% -4.26% -3.73% * Fiscal year 2018 was the first year of implementation of GASB 75 Administrative expenses are included in investment expenses. **Fiscal year 2017 was the first year of GASB 74 implementation. (A) City's contributions to OPEB plan are not based on a measure of pay 83 180
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CONTRIBUTIONS
An Agent Multiple-Employer Defined Benefit OPEB Plan
Last 10 fiscal years*
Fiscal Year Ended June 30, 2017 2018 2019 2020 2021 2022 2023 2024 2025 Actuarially Determined Contribution (ADC) $16,708 $17,251 $15,539 $16,054 $15,992 $16,392 $3,915 $2,371 $32,669 Less: Contributions in Relation to the ADC (22,522) (39,261) (22,928) (26,083) (5,366) 0 (37,336) (23,577) (12,529) Contribution deficiency (excess) ($5,814) ($22,010) ($7,389) ($10,029) $10,626 $16,392 ($33,421) ($21,206) $20,140 Covered-employee payroll N/A ** $3,009,829 $4,157,271 $4,976,211 $4,806,006 $5,072,966 $6,658,959 $5,233,729 $5,327,818 Contributions as a percentage of
Covered-employee payroll N/A ** 1.30% 0.55% 0.52% 0.11% 0.00% 0.56% 0.45% 0.24% Notes to Schedule:
Valuation Date
Actuarial Cost Method
Amortization Period
Asset Valuation Method
Actuarial Assumptions:
Discount Rate
Inflation
Medical Trend
PEMHCA Minimum 3.50% annually
Mortality
Mortality Improvement
* Fiscal year 2018 was the first year of implementation of GASB 75. **Fiscal year 2017 was the first year of GASB 74 implementation.
7.6% for FY2024, gradually decreasing over several
decades to an ultimate rate of 3.9% in FY2076 and
later years.
The Actuarial Value of Assets is a 5-year smoothed fair value.Gains and losses are recognized over a five year
period and limited to a corridor of 80% to 120% of the
fair value of assets.
Mortality generational improvement using 80% of
scale MP-2020.
5.73%
June 30, 2023
2.50%
Entry Age Normal, level percentage of payroll
Based on assumptions for Public Agency
Miscellaneous members published in the 2021
CalPERS Experience Study.
Each year's gain or loss is straight-line amortized over 5 years.
84 181
CITY OF HALF MOON BAY
GENERAL FUND
SCHEDULE OF REVENUES AND EXPENDITURES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Budgeted Amounts Final Budget
Positive
Original Final Actual Amounts (Negative)
Revenues:
Taxes $17,169,077 $16,656,081 $18,536,875 $1,880,794
Licenses and permits 267,000 303,500 463,053 159,553
Fines and forfeitures 37,000 81,400 124,109 42,709
1,290,916 1,450,562 1,658,117 207,555
Rents and leases 60,000 75,800 71,670 (4,130)
480,000 480,000 706,359 226,359
Intergovernmental revenues 5,000 5,000 35,166 30,166
Miscellaneous 1,213,772 1,256,972 1,321,891 64,919
Total revenues 20,522,765 20,309,315 22,917,240 2,607,925 Expenditures:
Current operations:
General government 3,146,138 3,223,138 3,153,123 70,015 General administration 2,012,649 2,022,649 1,780,377 242,272 Public safety 7,556,837 7,556,837 7,301,251 255,586
Public works 2,284,900 2,284,900 2,163,096 121,804
Recreation services 643,824 643,824 537,796 106,028
3,537,272 3,663,272 3,169,566 493,706
Community and economic development 1,003,364 1,003,364 910,036 93,328 Debt service:
Principal 945,778 945,778 572,686 373,092
Interest and fiscal charges 10,256 (10,256)
Total expenditures 21,130,762 21,343,762 19,598,187 1,745,575 (607,997) (1,034,447) 3,319,053 4,353,500
Other financing sources (uses):
Issuance of debt
Transfers in 587,760 587,760 587,760
Transfers out (4,019,718) (4,372,322) (4,372,322)
Total Other Financing Sources (Uses) (3,431,958) (3,784,562) (3,784,562) Net change in fund balance ($4,039,955) ($4,819,009) (465,509) $4,353,500 Fund balance at beginning of year 14,367,930
Fund balance at end of year $13,902,421
AND CHANGES IN FUND BALANCE
Planning
Excess of revenues over
expenditures
Charges for services
Investment income
85 182
Variance with
Budgeted Amounts Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Taxes $588,171 $588,171 $578,726 ($9,445)
Investment income 187,920 270,165 391,534 121,369
Intergovernmental revenue 3,944,042 10,016,044 1,763,479 (8,252,565) Total revenues 4,720,133 10,874,380 2,733,739 (8,140,641) Expenditures:
Current:
Public works 218,906 218,906 188,250 30,656
Capital outlay 6,061,103 13,771,201 2,024,097 11,747,104 Total expenditures 6,280,009 13,990,107 2,212,347 11,777,760 Excess (deficiency) of revenues
over (under) expenditures (1,559,876) (3,115,727) 521,392 3,637,119 3,249,215 120,124 (3,129,091)
Transfer out (112,938) (242,938) (7,937) 235,001
sources (uses) (112,938) 3,006,277 112,187 (2,894,090)
Net change in fund balance ($1,672,814) ($109,450) 633,579 $743,029 Fund balance at beginning of year 7,263,726
Fund balance at end of year $7,897,305
Other financing sources (uses):
Transfer in
Total other financing
CITY OF HALF MOON BAY
STREETS AND ROADS SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
86 183
Variance with
Budgeted Amounts Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Investment income $42,840 $42,840 $69,782 $26,942
Total revenues 42,840 42,840 69,782 26,942
Expenditures:
Capital outlay 176,489 (176,489)
Total expenditures 176,489 (176,489)
Excess (deficiency) of revenues
over (under) expenditures 42,840 42,840 (106,707) (149,547) Net change in fund balance $42,840 $42,840 (106,707) ($149,547) Fund balance at beginning of year 1,420,599
Fund balance at end of year $1,313,892
CITY OF HALF MOON BAY
LOT ACQUISITION AND RETIREMENT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
87 184
CITY OF HALF MOON BAY
AFFORDABLE HOUSING SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Budgeted Amounts Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Charges for services $85,500 $141,226 $55,726
Investment income $69,027 $215,661 290,426 74,765
Intergovernmental revenues 5,398 5,398
Total revenues 69,027 301,161 437,050 135,889
Expenditures:
Current:
Planning 2,164,239 1,173,603 990,636
Total expenditures 2,164,239 1,173,603 990,636
Excess of revenues over expenditures 69,027 (1,863,078) (736,553) 1,126,525 Other financing sources:
Transfers out
Net change in fund balance $69,027 ($1,863,078) (736,553) $1,126,525 Fund balance at beginning of year 5,954,709
Fund balance at end of year $5,218,156
88 185
CITY OF HALF MOON BAY
PARKS DEVELOPMENT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Budgeted Amounts Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Impact fees/recreation fees $38,800 $78,041 $39,241
Investment income 57,279 57,279 $62,096 4,817
Intergovernmental revenues 3,323,733 3,872,846 1,764,596 (2,108,250) Total revenues 3,381,012 3,968,925 1,904,733 (2,064,192) Expenditures:
Capital outlay 3,733,851 4,845,833 3,009,742 1,836,091
Total expenditures 3,733,851 4,845,833 3,009,742 1,836,091 Excess of revenues over expenditures (352,839) (876,908) (1,105,009) (228,101) Other financing sources:
Transfers in 487,785 487,784 (1)
Transfers out (175,000) (1,080) 173,920
Total other financing sources 312,785 486,704 173,919
Net change in fund balance ($352,839) ($564,123) (618,305) ($54,182) Fund balance at beginning of year 894,568
Fund balance at end of year $276,263
89 186
REQUIRED SUPPLEMENTARY INFORMATION
Budget and Budgetary Accounting
The City Council adopts an Annual Budget no later than the second meeting of June of each year for the fiscal year commencing the following July 1. The Annual Budget is adopted on a basis consistent with generally accepted accounting principles. The Capital Projects Funds are budgeted annually, with major capital improvement projects details in a separate Five Year Capital Improvement Program budget document, except that there is no budget adopted for the Land Asset Capital Projects Fund.
The City follows these procedures in establishing the budgetary data reflected in the financial statements.
1. The City Manager submits to the City Council a proposed operating budget for the following fiscal year. The operating budget includes proposed revenues and expenditures.
2. After a review by the City Council, a public hearing is conducted and further comment is received from the City Council and the general public.
3. Upon completion of the hearings and modifications, if any, to the proposed budget, it is adopted by the City Council through passage of an appropriate resolution.
4. Generally, the budget is amended in the middle of the year and at the end of the year. All approved additional appropriations are added to the adopted budget and an amended budget is presented to the City Council, which adopts it after due review.
5. The City Manager is authorized to transfer from time to time budget amounts of operational expenditure categories within divisions as deemed necessary in order to meet the City's needs.
6. City Council approval is required for all fund to fund transfers, fund reserve to appropriations transfers, for new revenue sources with offsetting appropriations, and for transfers to/from the capital expenditure category. The legal level of budgetary control of the City Council is at the fund level. This is the level that management cannot overspend the budget without approval of the City Council.
Expenditures in Excess of Budget
The Lot Acquisition and Retirement Special Revenue Fund, the Police Grants Special Revenue Fund and the Opportunity Center Coastside Special Revenue Fund incurred expenditures in excess of budget in the amounts of $176,489, $74,088 and $103,117, respectively.
Sufficient resources were available in each fund to fund these excesses. 90 187
SUPPLEMENTARY INFORMATION
188
CITY OF HALF MOON BAY
CAPITAL PROJECTS
SCHEDULE OF REVENUES AND EXPENDITURES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
$64,260 $114,008 $49,748
Intergovernmental revenues 413,436 158,454 (254,982)
Total revenues 477,696 272,462 (205,234)
Expenditures:
Capital Outlay 5,338,740 674,709 4,664,031
Total expenditures 5,338,740 674,709 4,664,031
(4,861,044) (402,247) 4,458,797
Other financing sources (uses):
Issuance of debt 986,069 (986,069)
Transfers in 2,460,100 2,073,284 (386,816)
Transfers out (363,568) (363,568)
Total other financing sources (uses) 3,082,601 1,709,716 (1,372,885) Net change in fund balance ($1,778,443) 1,307,469 $3,085,912 Fund balance at beginning of year 1,784,042
Fund balance at end of year $3,091,511
AND CHANGES IN FUND BALANCE
Investment income
Excess of revenues over
expenditures
92 189
CITY OF HALF MOON BAY, CALIFORNIA
NON-MAJOR GOVERNMENTAL FUNDS
FISCAL YEAR ENDED JUNE 30, 2025
Special Revenue Funds
Special Revenue Funds are established to account for revenue derived from specific taxes or other earmarked revenue sources (other than for major capital projects that are restricted by law or administrative action to expenditures for specified purposes).
The Police Grants Fund (Fund 128) was established to account for revenues received and expenditures made for police services. The City receives funds for police services from Federal, State, County and local governmental agencies. These funds are designated for specific police services, activities, and capital equipment.
The Storm Drain Operating Fund (Fund 111) accounts for the maintenance of the existing storm drain system.
The Traffic Mitigation Fund (Fund 112) was established to account for all proceeds from traffic mitigation fees, whose purpose is to defray the actual costs of constructing improvements to mitigate traffic and circulation impacts resulting from proposed new development.
The CZI Grant Fund (Fund 134) was established to account for proceeds relating to the CZI Grant. These funds can be used to support learning and evaluation activities for groups currently engaged in the operation and implementation of economic advancement centers.
The Opportunity Center Coastside Fund (Fund 135) was established to account for proceeds from the American Rescue Plan Act funds where the City is a subrecipient. These funds may only be used to address the negative economic impacts from the COVID-19 public health emergency.
Debt Service Fund
The Judgment Obligation Bonds Fund (Fund 77 Series A; Fund 78 Series B) was established to account for the Judgment Obligation Bond Series 2009A and the Judgment Obligation Bond Series 2009B issued on July 14, 2009.
Capital Projects Funds
Capital Projects Funds are utilized to account for resources used for the acquisition and construction of capital facilities and infrastructure by the City, with the exception of those assets financed by proprietary funds.
The Library Fund (Fund 153) is used to account for the construction and facilities maintenance of the library.
The Public Facilities Fund (Fund 127) accounts for expenditures related to public facilities improvements that are needed - police facilities, the library, the public works yard, etc. The funds are received from various contractual agreements that are one-time in nature and which are not specifically dedicated, as well as grants.
The Storm Drain Improvements Fund (Fund 152) is used to account for all proceeds from storm drainage improvement fees which are assessed against new or remodeled construction and are used for drainage improvements.
93 190
CITY OF HALF MOON BAY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
JUNE 30, 2025
SPECIAL REVENUE FUNDS
Opportunity
Police Storm Drain Traffic CZI Center
Grants Operating Mitigation Grant Coastside
Assets
Cash and investments $1,209,632 $268,870 $4,693,409 $90,810 Accounts receivable 30,000 $805,182
Interest receivable 11,267 2,586 44,146 943
$1,220,899 $271,456 $4,737,555 $121,753 $805,182
Accounts payable
Accrued expenses $52,771
Accrued liabilities $9,726 $178,598
Due to other funds 604,053
52,771 9,726 782,651
Restricted 1,168,128 $271,456 $4,737,555 112,027 22,531 Assigned
1,168,128 271,456 4,737,555 112,027 22,531
$1,220,899 $271,456 $4,737,555 $121,753 $805,182
Total fund balances
Total liabilities and fund balances
Total assets
Total liabilities
Liabilities:
Fund Balances:
94 191
DEBT SERVICE
FUND
Judgement
Obligation Public Storm Drain
Bonds Library Facilities Improvements Total
$6,716 $485,242 $1,418,100 $1,290,602 $9,463,381
835,182
63 4,593 15,265 11,814 90,677
$6,779 $489,835 $1,433,365 $1,302,416 $10,389,240
$5,000 $5,000
1,872 54,643
$6,474 194,798
604,053
6,474 6,872 858,494
$6,779 1,426,891 1,295,544 9,040,911
$489,835 489,835
6,779 489,835 1,426,891 1,295,544 9,530,746
$6,779 $489,835 $1,433,365 $1,302,416 $10,389,240
CAPITAL PROJECTS FUNDS
95 192
CITY OF HALF MOON BAY
NON-MAJOR GOVERNMENTAL FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2025
SPECIAL REVENUE FUNDS
Opportunity
Police Storm Drain Traffic CZI Center
Grants Operating Mitigation Grant Coastside
Revenues:
Charges for services
Impact fees $79,708
Investment income $61,861 $14,610 248,270 $8,754
Rents and leases 31,804
Intergovernmental revenues 194,663 1,239,156
Total Revenues 256,524 14,610 327,978 8,754 1,270,960
Expenditures:
Current:
General government 107,790
Public safety 174,088
Public works 31,839
Community and economic development 1,278,138
Capital outlay
Total Expenditures 174,088 31,839 107,790 1,278,138
Excess (deficiency) of revenues
over (under) expenditures 82,436 14,610 296,139 (99,036) (7,178) Other financing sources:
Transfers in
Transfer (out) (11,150) (120,124)
Total Other Financing Sources (11,150) (120,124)
Net change in fund balances 82,436 3,460 176,015 (99,036) (7,178) Fund balance at beginning of year,
as previously reported 1,085,692 267,996 4,561,540 211,063 29,709 Adjustments:
Changes from major to nonmajor fund
Changes from nonmajor to major fund
Fund balances at beginning of year,
as adjusted 1,085,692 267,996 4,561,540 211,063 29,709
Fund balances at end of year $1,168,128 $271,456 $4,737,555 $112,027 $22,531 96 193
SPECIAL
REVENUE DEBT SERVICE
FUND FUND CAPITAL PROJECTS FUNDS
(Formerly (Formerly Major) (Formerly Major) (Formerly Nonmajor) Nonmajor) Judgement
Affordable Obligation Parks Public Storm Drain
Housing Bonds Library Development Facilities Improvements Total $7,481 $7,481
79,708
$354 $25,651 $83,739 71,123 514,362
31,804
15,000 1,448,819
354 40,651 83,739 78,604 2,082,174
107,790
174,088
50,926 82,765
1,278,138
32,954 173,884 206,838
32,954 224,810 1,849,619
354 40,651 50,785 (146,206) 232,555
100,000 59,538 159,538
(232,104) (4,505) (367,883)
(132,104) 55,033 (208,345)
354 40,651 (81,319) (91,173) 24,210
$5,954,709 $894,568 1,508,210 1,386,717 15,900,204
6,425 449,184 455,609
(5,954,709) (894,568) (6,849,277)
6,425 449,184 1,508,210 1,386,717 9,506,536
$6,779 $489,835 $1,426,891 $1,295,544 $9,530,746
97 194
CITY OF HALF MOON BAY
POLICE GRANTS SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Investment income $40,731 $61,861 $21,130
Intergovernmental revenues 185,000 194,663 9,663
Total revenues 225,731 256,524 30,793
Expenditures:
Current:
Public Safety 100,000 174,088 (74,088)
Total expenditures 100,000 174,088 (74,088)
Excess (deficiency) of revenues
over ( under) expenditures 125,731 82,436 (43,295)
Net change in fund balance $125,731 82,436 ($43,295)
Fund Balance at beginning of year 1,085,692
Fund balance at end of year $1,168,128
98 195
CITY OF HALF MOON BAY
STORM DRAIN OPERATING SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Investment income $10,463 $14,610 $4,147
Total revenues 10,463 14,610 4,147
Other financing sources:
Transfers out (100,000) (11,150) 88,850
Net change in fund balance ($89,537) 3,460 $92,997
Fund balance at beginning of year 267,996
Fund balance at end of year $271,456
99 196
CITY OF HALF MOON BAY
TRAFFIC MITIGATION SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Impact fees $45,000 $79,708 $34,708
Investment income 171,298 248,270 76,972
Total revenues 216,298 327,978 111,680
Expenditures:
Current:
Public works 31,839 31,839
Total expenditures 31,839 31,839
Excess (deficiency) of revenues
over (under) expenditures 184,459 296,139 111,680
Other financing sources:
Transfers out (3,119,215) (120,124) 2,999,091
Net change in fund balance ($2,934,756) 176,015 $3,110,771 Fund balance at beginning of year 4,561,540
Fund balance at end of year $4,737,555
100
197
CITY OF HALF MOON BAY
CZI GRANT SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Investment income $8,971 $8,754 ($217)
Total revenues 8,971 8,754 (217)
Expenditures:
Current:
General government 196,808 107,790 89,018
Total expenditures 196,808 107,790 89,018
Excess of revenues over expenditures (187,837) (99,036) 88,801 Net change in fund balance ($187,837) (99,036) $88,801
Fund balance at beginning of year 211,063
Fund balance at end of year $112,027
101
198
CITY OF HALF MOON BAY
OPPORTUNITY CENTER COASTSIDE SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Investment income
Rents and leases 31,200 31,804 604
Intergovernmental revenues 1,618,510 1,239,156 (379,354) Total revenues 1,649,710 1,270,960 (378,750)
Expenditures:
Current:
Community and economic development 1,175,021 1,278,138 (103,117) Net change in fund balance $474,689 (7,178) ($481,867)
Fund balance at beginning of year 29,709
Fund balance at end of year $22,531
102
199
CITY OF HALF MOON BAY
JUDGMENT OBLIGATION BONDS DEBT SERVICE FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Investment income $354 $354
Total revenues 354 354
Net change in fund balance 354 $354
Fund balance at beginning of year 6,425
Fund balance at end of year $6,779
103
200
CITY OF HALF MOON BAY
LIBRARY CAPITAL PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Investment income $13,129 $25,651 $12,522
Intergovernmental revenues 15,000 15,000
Total revenues 28,129 40,651 12,522
Net change in fund balance $28,129 40,651 $12,522
Fund balance at beginning of year 449,184
Fund balance at end of year $489,835
104
201
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Investment income $57,294 $83,739 $26,445
Total revenues 57,294 83,739 26,445
Expenditures:
Capital outlay 576,554 32,954 543,600
Total expenditures 576,554 32,954 543,600
Excess (deficiency) of revenues
over (under) expenditures (519,260) 50,785 570,045
Other financing sources (uses):
Transfers in 100,000 100,000
Transfers out (320,000) (232,104) 87,896
Total other financing sources (uses) (220,000) (132,104) 87,896 Net change in fund balance ($739,260) (81,319) $657,941 Fund balance at beginning of year 1,508,210
Fund balance at end of year $1,426,891
CITY OF HALF MOON BAY
PUBLIC FACILITIES CAPITAL PROJECT FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
105
202
CITY OF HALF MOON BAY
STORM DRAIN IMPROVEMENTS CAPITAL PROJECT FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2025
Variance with
Final Budget
Final Positive
Budget Actual (Negative)
Revenues:
Charges for services $7,481 $7,481
Investment income $52,036 71,123 19,087
Total revenues 52,036 78,604 26,568
Expenditures:
Current:
Public works 58,712 50,926 7,786
Capital outlay 1,481,913 173,884 1,308,029
Total expenditures 1,540,625 224,810 1,315,815
Excess of revenues over expenditures (1,488,589) (146,206) 1,342,383 Other financing sources:
Transfers in 148,388 59,538 (88,850)
Transfers out (24,504) (4,505) 19,999
Total other financing sources 123,884 55,033 (68,851)
Net change in fund balance ($1,364,705) (91,173) $1,273,532 Fund balance at beginning of year 1,386,717
Fund balance at end of year $1,295,544
106
203
CITY OF HALF MOON BAY, CALIFORNIA
INTERNAL SERVICE FUNDS
FISCAL YEAR ENDED JUNE 30, 2025
Internal Service Funds are used to account for the financing of goods and services provided by one City department or agency to other departments or agencies of the City, or to other government units on a cost- reimbursement basis (including depreciation).
The Equipment (Fund 302) and Vehicle Replacement (Fund 301) Fund is used to account for replacement of furniture, fixtures, equipment, and vehicles. These funds cover the cost of repair, maintenance and replacement of City vehicles and provide for the service, maintenance of the management information systems, leased copiers and leased postage meter. Revenues are derived from charges to user departments (al funds) based on usage.
The Risk Management Fund (Fund 303) administers the City's general insurance and workers compensation programs with the goals of reducing insurance-related costs, maintain appropriate levels of coverage and to build for contingent legal reserves.
The Pension Stabilization Fund (Fund 304) stabilizes major fluctuations in annual pension costs driven by market factors and actuarial changes.
107
204
CITY OF HALF MOON BAY
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF NET POSITION
JUNE 30, 2025
Equipment and
Vehicle Risk Pension
Replacement Management Stabilization Total
Assets
Current Assets:
Cash and investments $1,282,205 $4,155,643 $1,553,708 $6,991,556 Accounts receivable 2,826 2,826
Interest receivable 11,178 38,355 14,293 63,826
Total Current Assets 1,293,383 4,196,824 1,568,001 7,058,208 Non-current assets:
Net OPEB asset 2,507 2,507
Capital assets, net of
accumulated depreciation 294,063 294,063
Total Non-current Assets 294,063 2,507 296,570
Total Assets 1,587,446 4,199,331 1,568,001 7,354,778
Deferred outflow of resources
related to OPEB 1,144 1,144
Total Deferred Outflows of Resources 1,144 1,144
Liabilities
Current Liabilities:
Accounts payable 36,485 6,835 43,320
Claims liability 73,283 73,283
Total Liabilities 36,485 80,118 116,603
Deferred inflow of resources
Related to OPEB 971 971
Total Deferred Inflows of Resources 971 971
Net Position
Net position:
Invested in capital assets 294,063 294,063
Restricted for OPEB 2,507 2,507
Unrestricted 1,256,898 4,116,879 1,568,001 6,941,778
Total Net Position $1,550,961 $4,119,386 $1,568,001 $7,238,348 108
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CITY OF HALF MOON BAY
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN FUND NET POSITION
FOR THE YEAR ENDED JUNE 30, 2025
Equipment and
Vehicle Risk Pension
Replacement Management Stabilization Total
Operating revenues:
Impact fees $10,713 $10,713
Change in claims liability $1,597,448 1,597,448
Total operating revenues 10,713 1,597,448 1,608,161
Operating expenses:
Salaries and wages 109,723 169,640 $552,898 832,261
Contract services 35,234 3,793 39,027
Services and supplies 317,448 56 317,504
Repairs and maintenance 25,727 25,727
Insurance expense 536,847 536,847
Pension 793,534 793,534
Depreciation 76,020 76,020
Other charges 700 700
Total operating expenses 564,152 711,036 1,346,432 2,621,620 Operating income (loss) (553,439) 886,412 (1,346,432) (1,013,459) Non-operating revenues (expenses):
Investment income 57,473 194,853 58,461 310,787
Total non-operating revenues 57,473 194,853 58,461 310,787 Capital contributions 7,570 7,570
Transfers in 610,177 840,176 1,346,432 2,796,785
Change in net position 121,781 1,921,441 58,461 2,101,683 Net position at beginning of year 1,429,180 2,197,945 1,509,540 5,136,665 Net position at end of year $1,550,961 $4,119,386 $1,568,001 $7,238,348 109
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CITY OF HALF MOON BAY
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2025
Equipment and
Vehicle Risk Pension
Replacement Management Stabilization Total
Cash flows from operating activities:
Cash received from customers $10,713 $10,713
Cash payments to suppliers of goods and services (374,461) ($544,397) (918,858) Cash payments to employees for services (109,723) (169,254) ($1,346,432) (1,625,409) Net cash provided by (used for) operating activities (473,471) (713,651) (1,346,432) (2,533,554) Cash flows from non-capital financing activities:
Transfer in 610,177 840,176 1,346,432 2,796,785
Net cash provided by (used for) non-capital
financing activities 610,177 840,176 1,346,432 2,796,785 Cash flows from investing activities:
Interest received on investments 56,107 193,253 58,395 307,755 Net cash provided by investing activities 56,107 193,253 58,395 307,755 Net increase (decreased) in cash and cash equivalents 192,813 319,778 58,395 570,986 Cash and cash equivalents at beginning of year 1,089,392 3,835,865 1,495,313 6,420,570 Cash and cash equivalents at end of year $1,282,205 $4,155,643 $1,553,708 $6,991,556 Reconciliation of operating income to net cash flows
provided by operating activities:
Operating income (loss) ($553,439) $886,412 ($1,346,432) ($1,013,459) Adjustments to reconcile operating income
to net cash provided by operating activities:
Depreciation 76,020 76,020
(Increase) in accounts receivable (2,826) (2,826)
Increase (Decreased) in accounts payable 3,948 (175) 3,773 Increase (Decreased) in employees benefits 386 386
Increase (Decreased) in claims liability (1,597,448) (1,597,448) Net cash provided by (used for) operating activities ($473,471) ($713,651) ($1,346,432) ($2,533,554) Non-cash transactions:
Capital contributions from governmental funds $7,570 $7,570 110
207
STATISTICAL SECTION
208
209
CITY OF HALF MOON BAY, CALIFORNIA
STATISTICAL SECTION
FISCAL YEAR ENDED JUNE 30, 2025
This part 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
These schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time.
Debt Capacity
These schedules present information to help the reader assess the affordability of the City's current level of outstanding debt and the ability to issue additional debt in the future.
Revenue Capacity
These schedules contain information to help the reader assess the City's most significant local revenue sources.
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 data to help the reader understand how the information in the City's financial report relates to the services the City's provides and the activities it performs.
Property Tax Information
These schedules contain information to help the reader assess the City's property tax sources and changes.
Note: Unless otherwise noted, the information in these schedules is derived from the annual comprehensive financial reports for the relevant years. 113
210
211
212
CITY OF HALF MOON BAY
Net Position by Component
Last Ten Fiscal Years
(Accrual Basis of Accounting)
2016 2017 2018 2019
Governmental activities:
Invested in capital assets,
net of related debt $ 40,513,950 $ 46,399,149 $ 63,168,981 $ 60,800,162 Restricted 19,779,956 22,157,470 25,844,530 27,738,822
Unrestricted 34,369,708 28,173,022 17,010,742 25,475,062 Total governmental activities net position 94,663,614 $ $ 96,729,641 $ 106,024,253 $ 114,014,046 Business-type activities:
Invested in capital assets,
net of related debt $ 3,871,356 $ 3,816,994 $ 4,490,973 $ 4,566,718 Restricted - - 5,946,230 6,385,095
Unrestricted 20,635,855 21,900,766 14,129,580 13,683,606 Total business-type activities net position $ 24,507,211 $ 25,717,760 $ 24,566,783 $ 24,635,419 Primary government:
Invested in capital assets,
net of related debt $ 44,385,306 $ 50,216,143 $ 67,659,954 $ 65,366,880 Restricted 19,779,956 22,157,470 31,790,760 34,123,917
Unrestricted 55,005,563 50,073,788 31,140,322 39,158,668 Total primary government net position (1) $ 119,170,825 $ 122,447,401 $ 130,591,036 $ 138,649,465 (1)
commence during fiscal year 2016-17.
and capital projects.
capital projects.
general revenues.
expected revenues and lower expenditures budgeted.
tax revenues.
contributions, other revenues and the sewer charges as approved through the Prop 218 process in fiscal year 2019-20.
The $7.8 million increase in primary government net position in FY 2022-23 is primarily due to increased operating grants and The $7.1 million increase in primary government net position in FY 2024-25 is primarily due to a decrease general government and public work expenses.
The $12.5 million increase in primary government net position in FY 2015-16 is primarily attributable to higher tax revenues and a contribution of $6.0 million from the County of San Mateo for the library construction capital project that is scheduled to The $3.5 million increase in primary government net position in FY 2016-17 is primarily attributable to investment in infrastructure The $8.4 million increase in primary government net position in FY 2017-18 is primarily attributable to investment in The $8.0 million increase in primary government net position in FY 2018-19 is primarily attributable to higher tax and The $700 thousand increase in primary government net position in FY 2019-20 is primarily attributable to increased investments in capital assets.
The $5.2 million increase in primary government net position in FY 2020-21 is primarily attributable to a higher than The $4.9 million increase in primary government net position in FY 2021-22 is primarily attributable to a higher than expected The $3.8 million increase in primary government net position in FY 2023-24 is primarily due to a increasedcapital contributions and grants.
116
213
2020 2021 2022 2023 2024 2025
$ 62,744,013 $ 67,193,002 $ 68,275,626 $ 71,854,949 $ 76,826,570 $ 82,018,427 16,416,110 19,871,245 21,340,221 22,502,708 25,081,978 24,235,493 35,553,961 34,061,834 38,471,511 41,909,085 38,119,541 40,200,904 $ 114,714,084 $ 121,126,081 $ 128,087,358 $ 136,266,742 $ 140,028,089 $ 146,454,824 $ 4,587,090 $ 6,199,508 $ 6,948,434 $ 6,981,850 $ 6,831,129 $ 6,695,345 8,692,609 9,377,687 9,554,843 10,092,582 11,397,062 12,190,425 11,937,949 8,461,534 5,502,097 4,637,048 3,569,939 3,363,001 $ 25,217,648 $ 24,038,729 $ 22,005,374 $ 21,711,480 $ 21,798,130 $ 22,248,771 $ 67,331,103 $ 73,392,510 $ 75,224,060 $ 78,836,799 $ 83,657,699 $ 88,713,772 25,108,719 29,248,932 30,895,064 32,595,290 36,479,040 36,425,918 47,491,910 42,523,368 43,973,608 46,546,133 41,689,480 43,563,905 $ 139,931,732 $ 145,164,810 $ 150,092,732 $ 157,978,222 $ 161,826,219 $ 168,703,595 117
214
CITY OF HALF MOON BAY
Changes in Net Position
Last Ten Fiscal Years
(Accrual Basis of Accounting)
2016 2017 2018 2019
Expenses:
Governmental activities:
General government $ 3,725,642 $ 3,940,242 $ 5,030,648 $ 4,722,479 Public safety 3,449,122 5,183,033 3,878,176 3,975,865
Public works 2,670,228 3,314,879 3,801,624 3,506,195
Recreation services 337,331 348,604 926,730 1,167,467
Planning 1,952,892 2,427,687 2,603,389 2,784,468
Community and Economic Development
Interest and fiscal charges 937,704 937,704 937,704 937,704 Total governmental activities expenses 13,072,919 16,152,149 17,178,271 17,094,178 Business-type activities:
Sewer 2,943,013 2,966,613 4,757,056 4,562,513
Total business-type activities expenses 2,943,013 2,966,613 4,757,056 4,562,513 Total primary government expenses 16,015,932 19,118,762 21,935,327 21,656,691 Program revenues:
Governmental activities:
Charges for services:
General government 98,171 20,738 29,879 97,755
Public safety 118,204 95,883 961,407 64,011
Public works 407,342 452,260 672,979 392,876
Recreation services 588,890 624,771 841,581 630,725
Planning 560,073 505,373 213,701 293,316
Operating grants and contributions 390,970 1,166,559 932,873 1,390,373 Capital grants and contributions 7,915,220 607,526 6,940,211 5,090,594 Total governmental activities
program revenues 10,078,870 3,473,110 10,592,631 7,959,650 Business-type activities:
Charges for services:
Sewer 4,715,919 4,524,358 4,261,126 4,533,846
Operating grants and contributions - - - -
Capital grants and contributions - - - -
Total business-type activities - - - -
program revenues 4,715,919 4,524,358 4,261,126 4,533,846 Total primary government
program revenues 14,794,789 7,997,468 14,853,757 12,493,496 Net revenues (expenses):
Governmental activities (2,994,049) (12,679,039) (6,585,640) (9,134,528) Business-type activities 1,772,906 1,557,745 (495,930) (28,667) Total net revenues (expenses) (2) (11,121,294) (1,221,143) (7,081,570) (9,163,195) 118
215
2020 2021 2022 2023 2024 2025
$ 4,981,025 $ 5,175,257 $ 6,008,499 $ 6,018,989 $ 7,811,794 $ 5,848,016 4,631,203 4,743,620 5,017,087 5,275,682 6,875,457 7,703,127 3,754,258 2,817,305 2,765,717 4,129,117 6,255,645 4,122,393 1,808,657 1,942,872 2,823,410 597,127 1,534,752 1,336,891 3,286,029 2,764,254 2,779,608 2,965,787 3,931,872 4,301,102 843,267 1,894,276 2,188,174
468,852 - - - - 10,256
18,930,024 17,443,308 19,394,321 19,829,969 28,303,796 25,509,959 5,950,383 5,670,214 6,042,199 5,998,227 6,685,640 6,767,752 5,950,383 5,670,214 6,042,199 5,998,227 6,685,640 6,767,752 24,880,407 23,113,522 25,436,520 25,828,196 34,989,436 32,277,711 94,986 17,962 646,363 687,941 487,874 835,628
159,631 138,299 105,983 79,661 120,980 175,777
332,903 383,211 360,649 442,582 432,066 816,264
494,433 987,511 1,176,088 1,113,689 1,166,447 1,255,256 165,686 314,178 520,110 558,369 298,171 326,300
786,552 4,123,613 2,544,520 3,628,574 1,285,182 3,296,210 627,168 3,145,690 1,647,350 1,677,758 6,738,537 2,037,451 2,661,359 9,110,464 7,001,063 8,188,574 10,529,257 8,742,886 4,540,020 4,477,159 5,005,399 5,994,167 6,207,200 7,339,424 - - - - -
- - - - 1,304,480 783,631
- - - - - -
4,540,020 4,477,159 5,005,399 5,994,167 7,511,680 8,123,055 7,201,379 13,587,623 12,006,462 14,182,741 18,040,937 16,865,941 (16,268,665) (8,332,844) (12,393,258) (11,641,395) (17,774,539) (16,767,073) (1,410,363) (1,193,055) (1,036,800) (4,060) 826,040 1,355,303 (17,679,028) (9,525,899) (13,430,058) (11,645,455) (16,948,499) (15,411,770) (Continued)
119
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CITY OF HALF MOON BAY
Changes in Net Position
Last Ten Fiscal Years
(Accrual Basis of Accounting)
2016 2017 2018 2019
General revenues and other changes in net position:
Governmental activities:
Taxes:
Property taxes $ 3,116,710 $ 3,126,884 $ 3,379,657 $ 3,613,782 Sales and use taxes 4,068,786 2,514,852 2,836,614 2,804,748 Transient occupancy taxes 5,935,558 6,024,855 6,434,808 6,828,108 Other taxes 808,224 919,666 1,038,546 1,242,286
Investment income 811,191 583,497 703,351 1,188,804
Other general revenues and transfers 783,472 1,575,312 1,386,752 1,446,593 Total governmental activities 15,523,941 14,745,066 15,779,728 17,124,321 Business-type activities:
Investment income 93,088 135,003 195,743 332,868
Miscellaneous and transfers (392,817) (482,199) (857,213) (235,565) Total business-type activities (299,729) (347,196) (661,470) 97,303 Total primary government 15,224,212 14,397,870 15,118,258 17,221,624 Changes in net position:
Governmental activities 12,529,892 2,066,027 9,194,088 7,989,793 Business-type activities 1,473,177 1,210,549 (1,157,400) 68,636 Total primary government (1) $ 3,276,576 14,003,069 $ 8,036,688 $ 8,058,429 $ (1) Change in Net Position in Primary Government:
FY 2015-16 increase in net position of $14 million is primarily due to higher tax revenues and timing of sewer-related capital spending.
FY 2016-17 increase in net position of $3.2 million is primarily due to investment in infrastructure and capital projects.
FY 2017-18 increase in net position of $8 million is primarily due to investment in capital projects.
The $8.0 million increase in primary government net position in FY 2018-19 is primarily attributable to higher tax and general revenues.
FY 2020-21 increase in net position of $5.2 million is primarily due to higher revenues from capital and operating grants/contributions.
FY 2021-22 increase in net position of $4.9 million is primarily due to higher revenues from transient occupancy taxes. revenues and the sewer charges as approved through the Prop 218 process in fiscal year 2019-20.
FY 2023-24 increase in net position of $3.8 million is primarily due to increased capital contributions and grants.
FY 2024-25 increase in net position of $7.1 million is primarily due to a decrease general government and public work expenses. (2) Total net expenses in FY 2019-20 increased by $8.5 million primarily for the final $10.9 million payment of the judgement obligation bond.
FY 2022-23 increase in net position of $7.8 million is primarily due to increased operating grants and contributions, other 120
217
2020 2021 2022 2023 2024 2025
$ 3,582,161 3,667,867 $ 4,592,317 $ 4,129,317 $ 4,283,589 $ 3,757,360 $ 3,042,265 2,929,586 3,358,759 3,315,341 3,665,449 4,182,742 5,291,821 4,817,532 9,442,518 8,852,640 8,167,938 9,616,592 1,346,187 1,304,943 1,341,327 1,276,299 1,343,633 1,440,676 2,257,971 (96,482) (702,830) 865,654 2,439,990 2,148,567 1,362,594 2,207,101 1,322,444 1,381,527 1,635,287 2,350,591 16,968,705 14,744,841 19,354,535 19,820,778 21,535,886 23,496,528 382,491 (49,678) (155,664) 129,865 242,911 207,823
1,610,101 63,814 (840,891) (419,699) (982,301) (1,112,485) 1,992,592 14,136 (996,555) (289,834) (739,390) (904,662) 18,961,297 14,758,977 18,357,980 19,530,944 20,796,496 22,591,866 700,040 6,411,997 6,961,277 8,179,383 3,761,347 6,729,455 582,229 (1,178,919) (2,033,355) (293,894) 86,650 450,641 $ 1,282,269 $ 5,233,078 $ 4,927,922 $ 7,885,489 $ 3,847,997 $ 7,180,096 121
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CITY OF HALF MOON BAY
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
2016 2017 2018 2019
General fund:
Nonspendable $ - $ - $ - $ -
Committed 2,909,550 5,070,257 5,070,257 5,146,354
Assigned - - - -
Unassigned 7,829,894 5,986,903 4,892,195 5,809,910
Total general fund (1) $ 11,057,160 10,739,444 $ 9,962,452 $ 10,956,264 $ All other governmental funds:
Nonspendable - $ $ - $ - 26,823,920 $
Restricted 31,602,450 23,288,663 25,844,530 27,738,822
Committed 26,823,920 26,823,920 26,823,920 -
Assigned - 5,611,038 2,161,189 1,244,495
Unassigned - - - 2,364,020
Total all other governmental funds (2) $ 55,723,621 58,426,370 $ 54,829,639 $ 58,171,257 $ (1) General Fund:
FY 2015-16 Unassigned fund balance increase is primarily due to increase in tax revenue.
FY 2016-17 Unassigned fund balance decrease is primarily due to increased investment in capital projects.
FY 2017-18 Unassigned fund balance decrease is primarily due to investment in capital projects.
FY 2018-19 Unassigned fund balance increase is primarily due to in tax and general revenues.
FY 2019-20 Unassigned fund balance decrease is primarily due to lower revenues from TOT.
FY 2020-21 Unassigned fund balance increased primarily due to unexcepted revenue overperformance in TOT.
FY 2021-22 Unassigned fund balance increased primarily due to unexcepted revenue overperformance in TOT and vehicle in-lieu fees.
FY 2022-23 Unassigned fund balance decreased primarily due to a shortfall in Transient Occupancy tax revenues and more funds assigned to committed reverses per the City's Reserve Policy.
FY 2023-24 Unassigned fund balance decreased primarily due to increases in public safety expenditures and decreases in TOT revenues.
FY 2024-25 Unassigned fund balance increased primarily due to the improved operating results, which reduced the need to use reserves budgeted for day-to-day operations.
(2) Other Governmental Funds:
FY 2015-16 Restricted fund balance increase is primarily due to a contribution of $6.0 million from the County of San Mateo for the library construction project.
FY 2016-17 $2.7 million decrease is primarily due to progress on the Library Capital project.
FY 2017-18 $890,000 decrease is primarily due to progress on the Library Capital project.
FY 2018-19 $3.0 M increase is primarily due to progress in capital projects.
FY 2019-20 $12.1 M decrease is primarily due to the final $10.9 million payment of the Judgement Obligation Bond.
FY 2020-21 $3.7 M increase is primarily due to the receipt of an one-time $2.6 million in-lieu fee.
FY 2021-22 $1 million increase is primarily due to capital contributions and funding for future capital expenditures.
FY 2022-23 $1.8 million increase is primarily due to operating grants and funding for future capital expenditures.
FY 2023-24 $1.3 million increase is primarily due to capital grants and contributions towards affordable housing efforts.
FY 2024-25 $38 thousand increase is primarily due decreases in capital outlay. 122
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2020 2021 2022 2023 2024 2025
$ - $ - $ - $ - $ - $ -
7,300,642 7,271,604 8,999,117 9,841,012 11,091,587 8,651,749 - - - - -
3,333,510 3,869,096 6,586,036 6,386,892 3,276,343 5,250,672 $ 10,634,152 $ 11,140,700 $ 15,585,153 $ 16,227,904 $ 14,367,930 $ 13,902,421 $ 26,823,920 $ 26,823,920 $ 26,823,920 $ 26,823,920 $ 26,823,920 $ 26,823,920 16,416,110 19,871,245 21,340,221 22,258,032 24,590,954 23,746,527 - - - - - -
2,806,125 3,069,792 2,288,175 3,215,073 2,233,226 3,581,346 - - - - - -
$ 46,046,155 $ 49,764,957 $ 50,452,316 $ 52,297,025 $ 53,648,100 $ 54,151,793 123
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CITY OF HALF MOON BAY
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
2016 2017 2018 2019
Revenues:
Taxes $ 13,929,278 $ 12,586,257 $ 13,638,171 $ 14,448,702 Licenses and permits 379,749 444,388 370,269 377,873
Fines and forfeitures 102,202 79,132 171,873 189,415
Charges for services 806,642 701,163 1,255,479 1,165,640 Impact Fees 717,469 1,173,275 1,065,005 2,700,943
Investment income 772,575 549,489 703,354 1,225,128
Rents and leases 20,000 10,080 87,536 75,603
Intergovernmental revenues 8,058,785 1,069,157 1,910,615 2,074,855 Miscellaneous 400,376 1,089,034 908,337 1,325,476
Total revenues 25,187,076 17,701,975 20,110,639 23,583,635 Expenditures
Current:
General government 3,582,831 3,143,214 3,968,569 3,445,355 Public safety 1,083,666 3,610,736 3,689,490 3,727,302
Public works 3,208,099 1,639,299 1,768,330 2,147,231
Recreation services 1,347,508 176,497 701,405 896,854
Planning services 183,328 2,353,980 2,505,066 2,686,651 Community and Economic Development
Capital outlay 4,437,029 7,766,781 18,996,455 5,027,468 Debt service:
Principal retirement (1) - - - -
Interest and fiscal charges 937,704 937,704 937,704 937,704 Total expenditures 14,780,165 19,628,211 32,567,019 18,868,565 Excess (deficiency) of
revenues over (under)
expenditures 10,406,911 (1,926,236) (12,456,380) 4,715,070 Other financing sources (uses):
Advanced Proceeds from San Mateo County - - 5,726,855 - Issuance of debt - - - -
Capital grants - - 5,726,855 726,000
Transfers in 5,285,654 5,059,687 5,024,534 3,216,998
Transfers out (6,181,245) (5,518,484) (6,010,554) (4,322,638) Total other financing
sources (uses) (895,591) (458,797) 10,467,690 (379,640) Net change in fund balances (2) $ (2,385,033) 9,511,320 $ (1,988,690) $ $ 4,335,430 Debt service as a percentage of
noncapital expenditures 9.1% 7.9% 6.9% 6.8%
(1) In FY 2019-20 the city paid off the 2009B Judgement Obligation Bond. (2) The net change in fund balance of $9.5 million in FY 2015-16 is primarily due to higher tax revenues and a contribution of $6.0 million from the County of San Mateo for the library construction capital project that is scheduled to commence during fiscal year 2016-17.
The net decrease in fund balance of $2.4 million in FY 2016-17 is primarily due to progress on the Library Capital project.
The net decrease in fund balance of $1.9 million in FY 2017-18 is primarily due to progress on the Library Capital project.
The net increase in fund balance of $4.3 million in FY 2018-19 is primarily due to increase in revenues and decrease in library project expenditures.
The net decrease in fund balance of $12.4 million in FY 2019-20 is primarily due to the final $10.9 million payoff the judgement obligation bond.
The net increase in fund balance of $4.2 million in FY 2020-21 is primarily due to higher revenues than anticipated.
The net increase in fund balance of $5.1 million in FY 2021-22 is primarily due to higher tax revenues.
The net increase in fund balance of $2.4 million in FY 2022-23 is primarily due to increased investment income and intergovernmental revenues.
The net decrease in fund balance of $508 thousand in FY 2023-24 is primarily due to expenditures outpacing revenues.
The net increase in fund balance of $503 thousand in FY 2024-25 is primarily due to decrease general government expenditures and capital outlay. 124
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2020 2021 2022 2023 2024 2025
$ 13,180,918 $ 12,223,462 $ 18,670,447 $ 17,500,650 $ 17,575,488 $ 19,115,601 521,121 597,590 543,965 1,062,066 306,282 463,053
140,238 108,937 70,383 32,232 81,445 124,109
1,173,171 1,306,842 1,552,251 1,432,304 1,454,141 1,806,824 304,827 2,988,507 188,114 296,256 - 157,749
1,164,650 (75,704) (722,249) 869,782 2,139,990 2,148,567 - - - 63,728 91,135 103,474
1,506,209 4,232,648 4,008,756 4,714,737 8,023,719 5,175,912 779,514 1,877,238 1,146,003 970,404 833,965 1,321,891
18,770,648 23,259,520 25,457,670 26,942,159 30,506,165 30,417,180 3,281,719 3,543,362 3,954,480 4,976,923 6,683,350 5,041,290 4,104,603 4,394,717 4,539,399 4,920,995 6,476,428 7,475,339 2,301,920 2,110,852 2,077,238 2,449,832 2,492,143 2,434,111 976,977 1,109,425 1,876,093 524,211 538,827 537,796
3,156,081 2,662,112 2,628,557 2,873,331 4,065,293 4,343,169 843,267 1,894,276 2,188,174
4,088,777 5,955,565 3,038,936 6,442,855 7,112,143 6,091,875 11,487,686 - 1,191,724 620,197 3,628,582 572,686
468,852 - 68,277 55,105 97,016 10,256
29,866,615 19,776,033 19,374,704 23,706,716 32,988,058 28,694,696 (11,095,967) 3,483,487 6,082,966 3,235,443 (2,481,893) 1,722,484 - - - - -
- 2,035,000 421,373 693,387 3,200,000
- - - - -
7,026,829 2,107,524 5,334,717 5,247,526 4,056,898 3,428,490 (8,378,076) (3,400,661) (6,707,244) (6,688,896) (5,283,904) (5,112,790) (1,351,247) 741,863 (951,154) (747,983) 1,972,994 (1,684,300) $ (12,447,214) $ 4,225,350 $ 5,131,812 $ 2,487,460 $ (508,899) $ 38,184
46.4% 0.0% 7.7% 3.9% 14.4% 2.6%
125
222
Fiscal TOT
Year Ended Tax
June 30 Rate
2016 12%
2017 12%
2018 12%
2019 12%
2020 12%
2021 12%
2022 14%
2023 15%
2024 15%
2025 15%
Source: City of Half Moon Bay Finance Department
CITY OF HALF MOON BAY
Transient Occupancy Tax (TOT) Rate
Last Ten Fiscal Years
126
223
224
CITY OF HALF MOON BAY
Transient Occupancy Tax (TOT) by Lodging Type (BASE) (1) Last Ten Fiscal Years
As of June 30th
June 30,
2016 2017 2018 2019
LODGING TYPE
Hotels/Motels 5,643,075 $ 5,785,989 $ 6,078,131 $ 6,409,533 $ B&Bs/ Inns / Cottages 99,062 60,671 68,729 66,079
RV Parks/Camps 148,191 150,019 170,855 159,065
Vacation Rentals 44,230 43,790 115,398 218,561
$ 5,934,558 $ 6,040,468 $ 6,433,114 $ 6,853,237
(1) TOT information by individual establishment is confidential and therefore is not available to the public.
TOT is the City's largest "own-source" revenue, as defined by GASB Statement No. 44.
Source: City of Half Moon Bay Finance Department
Totals
128
225
June 30,
2020 2021 2022 2023 2024 2025
$ 4,161,340 4,852,270 $ 8,309,989 $ 7,988,272 $ 7,248,083 $ 8,964,484 $ 105,823 104,715 441,900 169,545 181,552 228,741
241,705 164,658 233,898 224,713 233,479 228,741
308,664 170,178 456,731 470,110 504,824 194,626
$ 4,817,532 5,291,821 $ 9,442,518 $ 8,852,640 $ 8,167,938 $ 9,616,592 $ 129
226
Percent of Percent of
TOT Total TOT TOT Total TOT
TOT Taxpayer Type Collected Revenues Collected Revenues Hotels/Motels/Lodges $8,964,484 93.22% $ 5,643,075 95.09% Bed & Breakfasts and Inns $228,741 2.38% 99,062 1.67%
RV Parks & Campgrounds $228,741 2.38% 148,191 2.50%
Vacation Rentals $194,626 2.02% 44,230 0.75%
$ 9,616,592 100.00% $ 5,934,558 100.00%
Source: City of Half Moon Bay Finance Department
CITY OF HALF MOON BAY
2024-25 2015-16
Current Year and Nine Years Prior
Transient Occupancy Taxpayers by Type of Establishment
130
227
CITY OF HALF MOON BAY
Ratios of Outstanding Debt by Type (1)
Last Ten Fiscal Years
Fiscal Year Judgment Total Total Percentage Debt
Ended San Mateo Obligation Governmental Primary of Personal Per June 30 Capital Leases County Advance Bonds Activities (2) Government Income (3) Capita (3) 2016 $ - $ - $ 10,915,000 $ 10,915,000 $ 10,915,000 21.35% $ 871.25 2017 - - 10,915,000 10,915,000 10,915,000 20.29% 867
2018 - - 10,915,000 10,915,000 10,915,000 17.32% 864
2019 - - 10,915,000 10,915,000 10,915,000 17.00% 864
2020 - 5,154,170 - 5,154,170 5,154,170 8.14% 399
2021 2,035,000 5,154,170 - 7,189,170 7,189,170 10.27% 584 2022 2,410,020 4,008,798 - 6,418,818 6,418,818 8.23% 568 2023 3,055,896 3,436,112 - 6,492,008 6,492,008 9.55% 581 2024 3,200,000 2,863,426 - 6,063,426 6,063,426 7.58% 546 2025 1,966,000 2,290,740 - 4,256,740 4,256,740 5.25% 372 (1) Details regarding the City's outstanding debt can be found in the notes to the financial statements. (2) The City has no outstanding debt from Business-Type Activities. (3)Personal income and population information was obtained from the United States Census Bureau Governmental Activities
131
228
Fiscal Year Lease Judgment Percent of Debt
Ended Revenue Obligation Assessed Per
June 30 Bonds Bonds Total Value (1) Capita
2016 $ - $ 10,915 $ 10,915 0.0004% $ 871
2017 - 10,915 10,915 0.0004% 867
2018 - 10,915 10,915 0.0004% 864
2019 - 10,915 10,915 0.0004% 864
2020 - - - 0.0000% -
2021 - - - 0.0000% -
2022 - - - 0.0000% -
2023 - - - 0.0000% -
2024 - - - 0.0000% -
2025 - - - 0.0000% -
General bonded debt is debt payable with governmental fund resources and general obligation bonds recorded in enterprise funds (of which, the City has none). (1) Assessed value has been used because the actual value of taxable property is not readily available in the State of California. Percentages less than 0.0000% are not shown.
Outstanding General Bonded Debt
CITY OF HALF MOON BAY
Ratio of General Bonded Debt Outstanding
Last Ten Fiscal Years
(In Thousands, except Per Capita)
132
229
2024-25 Assessed Value $ 4,099,145,237
Percentage Total Debt City's Share of
Applicable (1) 6/30/2025 Debt 06/30/25
Overlapping Tax and Assessment Debt:
San Mateo Community College District 1.259% 655,171,697 $ 8,248,612 $ Cabrillo Unified School District 45.876% 153,605,000 70,467,830 Midpeninsula Regional Open Space District 0.959% 114,920,000 1,102,083 Total Overlapping Tax and Assessment Debt $ 923,696,697 $ 79,818,524 Ratio to Assessed Valuation:
Total Overlapping Tax and Assessment Debt 1.95%
Direct and Overlapping General Fund Debt:
San Mateo County General Fund Obligations 1.259% $ 565,146,645 $ 7,115,196
1.259% 5,735,000 72,204
0.959% 79,795,600 765,240
1.259% 3,404,654 42,865
Direct: City of Half Moon Bay Loan Agreement 100% 2,290,740 2,290,740 Direct: County of San Mateo Financing Agreement (880 Stone Pine) 100% 1,966,000 1,966,000 Total Direct Debt $ 4,256,740
Total Overlapping Debt 87,814,029
Combined Total Debt $ 92,070,769 (2)
(1) The percentage of overlapping debt applicable to the City is estimated using taxable assessed property value.
Applicable percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries of the city divided by the district's total taxable assessed value. (2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded lease obligations.
Ratios to 2024-25 Assessed Valuation:
Total Overlapping Tax and Assessment Debt 1.95%
Total Direct Debt ($4,256,740) 0.10%
Combined Total Debt 2.25%
CITY OF HALF MOON BAY
Direct and Overlapping Debt
June 30, 2025
Obligations
Midpeninsula Regional Open Space District General Fund Obligations San Mateo County Board of Education Certificates of Participation 133
230
CITY OF HALF MOON BAY
Legal Debt Margin Information
Last Ten Fiscal Years
2016 2017 2018 2019
Assessed valuation $ 2,733,242,180 $ 2,755,768,400 $ 2,893,093,932 $ 3,123,075,037 Conversion percentage 25% 25% 25% 25%
Adjusted assessed valuation 683,310,545 688,942,100 723,273,483 780,768,759 Debt limit percentage 15% 15% 15% 15%
Debt limit 102,496,582 103,341,315 108,491,022 117,115,314 Total net debt applicable to limit:
General obligation bonds 10,915,000 10,915,000 10,915,000 10,915,000 Legal debt margin $ 91,581,582 $ 92,426,315 $ 97,576,022 $ 106,200,314 Total debt applicable to the limit
as a percentage of debt limit 10.6% 10.6% 10.1% 9.3%
Sources: City Finance Department
San Mateo County Tax Assessor Combined Tax Roll 650-363-4777 June 30
The Government Code of the State of California provides for a legal debt limit of 15% of gross assessed valuation.
However, this provision was enacted when assessed valuation was based upon 25% of market value. Effective 1981-82 fiscal year, each parcel is now assessed at 100% of market value (as of the most recent change in ownership for the parcel). The computations shown above reflect a conversion of assessed valuation data for each fiscal year from the current full valuation perspective to the 25 % level that was in effect at the time that the legal debt margin was enacted by the State of California for local governments located within the state. 134
231
2020 2021 2022 2023 2024 2025
$3,303,922,465 $3,426,640,450 $3,541,390,900 $3,771,479,639 3,957,919,060 $ $ 4,099,145,237 25% 25% 25% 25% 25% 25%
825,980,616 856,660,113 885,347,725 942,869,910 989,479,765 1,024,786,309 15% 15% 15% 15% 15% 15%
128,499,017 123,897,092 132,802,159 141,430,486 148,421,965 153,717,946 - - - - - -
$ 128,499,017 123,897,092 $ 132,802,159 $ 141,430,486 $ 148,421,965 $ 153,717,946 $
0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
June 30
135
232
Percent of Percent of
Number of Total Number of Total
Employer Employees Employment Employees Employment
Ritz Carlton Hotel 275 9.92% 500 14.37%
Rolling Frito Lay Sales 171 6.17%
New Leaf Community Market 105 3.79% 76 2.18%
Sam's Chowder House 98 3.53% 97 2.79%
Safeway Store 94 3.39% 104 2.99%
Rocket Farms Inc. 59 2.13% 118 3.39%
Salter 54 1.95%
Pasta Moon Inc 49 1.77%
Sea Crest School 49 1.77%
Hassett Hardware 45 1.62%
Cabrillo Unified School District 397 11.41%
Burger King 49 1.41%
Mullins Bar & Grill 49 1.41%
Half Moon Bay Golf Links 48 1.38%
Sea Crest School 43 1.24%
Subtotal Top Ten Employers 999 36.03% 1,481 42.57%
Total Employment 2,773 100.00% 3,479 100.00%
Source: Employer information from City of Half Moon Bay HdL Business License System.
2016
CITY OF HALF MOON BAY
Principal Employers
6/30/2025 and Nine Years Prior
2025
"Total Employment" as used above represents the total employment of all employers with business licenses located within City limits.
136
233
234
CITY OF HALF MOON BAY
Full-time Equivalent City Employees By Function
Last Ten Fiscal Years
June 30
Function 2016 2017 2018 2019
General Government 18 19 19 19
Public Safety (1) - - - -
Public Works/Maintenance 9 10 10 13
Community/Recreation Services 0 2 2 4
Planning 3 5 5 6
Total 31 36 36 42
(1) The City contracts with the San Mateo County Sheriff's Office Note: General government includes five City Council members as well as Administration and Finance staff.
Source: City of Half Moon Bay Finance Department
138
235
June 30
2020 2021 2022 2023 2024 2025
21 17 20 20 21 21
- - - - - -
16 14 16 16 15 15
5 4 5 6 6 6
7 7 8 8 7 7
48 42 48 50 50 50
139
236
CITY OF HALF MOON BAY
Operating Indicators By Function
Last Ten Fiscal Years
June 30
2016 2017 2018 2019
Police: (1)
Arrests - Part 1 crimes 44 38 48 54
Traffic citations - Moving 527 489 921 2,128
Traffic citations - Parking 1,598 1,212 3,994 3,465
Parks and Recreation:
Number of recreation classes 88 75 159 105
Number of facility rentals (2) 110 88 324 397
Building and Code Enforcement: (3)
Number of permits issued (est.) 413 460 413 473
Number of plan checks (est.) 105 220 166 205
Number of inspections (est.) 2,820 2,216 2,520 2,442
Planning:
Planning Commission Meetings 15 12 20 23
Number of permits processed 111 47 43 102
(1) The City started contracting with the San Mateo County Sheriff Office in June 2011. (2) In FY 2016-17, the City re-assumed responsibility for the Parks and Recreation program. The facility rentals count for FY 2016-17 is estimated based on rental revenue received. (3) Information will continue to be added as made available.
Sources: City of Half Moon Bay Departments
140
237
June 30
2020 2021 2022 2023 2024 2025
71 56 78 33 28 32
2,517 1,664 1,819 636 568 518
2,444 1,698 872 553 2,253 2,710
123 41 112 99 91 113
389 200 459 407 552 554
450 352 456 441 405 443
237 185 157 200 150 189
2,057 1,839 1654 1,538 2,138 2,064
20 23 22 13 18 14
145 89 94 154 78 56
141
238
CITY OF HALF MOON BAY
Capital Asset Statistics By Function
Last Ten Fiscal Years
June 30
2016 2017 2018 2019
Police:
Sheriff Substation/EOC 1 1 1 1
Public Works:
Streets (miles) 35 29 29 29
Parks 9 9 9 9
Community Centers 1 1 1 1
Sewer lines (miles) 37 37 37 37
Library 1
Facilities/Buildings 6 6 6 6
Bike Trails (miles) 7 7 7 7
Land (acres) 176 176 176 176
Administration:
Facilities/Buildings 1 1 1 1
Source: City of Half Moon Bay Finance Department
142
239
June 30
2020 2021 2022 2023 2024 2025
1 1 1 1 1 1
28 28 28 28 28 28
9 9 9 9 9 9
1 1 1 1 1 1
38 38 38 38 38 38
1 1 1 1 1 1
6 6 6 6 6 6
7 7 7 7 7 7
176 197 199 199 199 199
1 1 1 1 1 1
143
240
2024/25 USE CATEGORY SUMMARY
THE CITY OF HALF MOON BAY
BASIC PROPERTY VALUE TABLE
Category Parcels Assessed Value Net Taxable Value
Residential 3,819 $3,408,646,486 (80.8%) $3,351,535,909 (81.8%) Commercial 219 $547,504,936 (13.0%) $533,926,048 (13.0%) Industrial 16 $11,843,899 (0.3%) $11,843,899 (0.3%)
Agricultural 38 $32,608,245 (0.8%) $16,322,665 (0.4%)
Govt. Owned 97 $79,492 (0.0%) $0 (0.0%)
Institutional 20 $19,354,663 (0.5%) $870,237 (0.0%)
Miscellaneous 13 $16,983,212 (0.4%) $16,983,212 (0.4%)
Recreational 24 $38,863,163 (0.9%) $38,502,619 (0.9%)
Vacant 1,767 $92,171,312 (2.2%) $79,489,521 (1.9%)
Unsecured [231] $51,007,471 (1.2%) $49,921,495 (1.2%)
TOTALS 6,013 $4,219,062,879 $4,099,395,605
81.8%
Residential
13.0%
Commercial
5.2%
Others
NET TAXABLE VALUE
80.8%
Residential
13.0%
Commercial
2.2%
Vacant
4.0%
Others
ASSESSED VALUE
This report is not to be used in support of debt issuance or continuing disclosure statements without the written consent of HdL, Coren & Cone
Data Source: San Mateo County Assessor 2024/25 Combined Tax Rolls Prepared On 9/5/2025 By MV 144
241
PROPERTY TAX DOLLAR BREAKDOWN
THE CITY OF HALF MOON BAY
$ 0.00330 County Harbor District
$ 0.00195 Bay Area, Air Pollution
$ 0.00041 Resource Conservation
$ 1.0000
$ 0.3591 Cabrillo Unified General Purpose
$ 0.09733 ERAF Share of San Mateo County
$ 0.1242 San Mateo County
$ 0.1869 Coastside Fire
$ 0.01123 ERAF Share of Half Moon Bay General Fund
$ 0.0553 Half Moon Bay General Fund
$ 0.0634 San Mateo Junior College General Purpose
$ 0.0330 County Education Tax
$ 0.0323 County Library
$ 0.0317 Coastside County Water
ATI (Annual Tax Increment) Ratios for Tax Rate Area 017-005, Excluding Redevelopment Factors & Additional Debt Service This report is not to be used in support of debt issuance or continuing disclosure statements without the written consent of HdL, Coren & Cone Data Source: San Mateo County Assessor 2024/25 Annual Tax Increment Tables Prepared On 9/5/2025 By MV 145
242
2024/25 ROLL SUMMARY
THE CITY OF HALF MOON BAY
Taxable Property Values
Secured Nonunitary Utilities Unsecured
2,000,541,666
2,146,751,241
18,563,644
2,198,857
Aircraft
Fixtures
Personal Property
Improvements
Land
TRAs
Parcels
Values
Total Value $4,168,055,408
0 $50,956,991
0 $0
0 50,480
8,808,139
38,032,316
4,028,007
88,529
7 231
0 0
0 0
6,013 0
7 Total Net Value $4,049,474,110
Total Exemptions* $118,581,298
Homeowners* 15,043,000
Aircraft
Fixtures 0
Personal Property 251,875
Real Estate 118,329,423
Exemptions
0 $1,085,976
$49,871,015
0 0
$0
0 $0
7,000
0 334,978
429,641
321,357
0 0
Combined Values Total
Total Values $4,219,012,399
Net Total Values
Total Exemptions
$4,099,345,125
$119,667,274
Net Aircraft Values $50,480
* Note: Homeowner Exemptions are not included in Total Exemptions Totals do not Include Aircraft Values or Exemptions
This report is not to be used in support of debt issuance or continuing disclosure statements without the written consent of HdL, Coren & Cone
Data Source: San Mateo County Assessor 2024/25 Combined Tax Rolls Prepared On 9/5/2025 By MV 146
243
NET TAXABLE ASSESSED VALUE HISTORY
THE CITY OF HALF MOON BAY
2015/16 - 2024/25 Taxable Property Values
Lien Year Secured Unsecured SBE Nonunitary Net Total AV % Change 2015/16 $2,609,284,214 $53,103,728 $0 2,662,387,942
2016/17 $2,716,280,909 $39,462,822 $0 2,755,743,731 3.51% 2017/18 $2,868,900,977 $40,418,385 $0 2,909,319,362 5.57% 2018/19 $3,095,123,190 $44,156,277 $0 3,139,279,467 7.90% 2019/20 $3,261,227,148 $40,695,317 $0 3,301,922,465 5.18% 2020/21 $3,386,815,056 $39,825,394 $0 3,426,640,450 3.78% 2021/22 $3,495,494,766 $45,896,134 $0 3,541,390,900 3.35% 2022/23 $3,722,198,497 $49,344,505 $0 3,771,543,002 6.50% 2023/24 $3,903,910,857 $54,008,203 $0 3,957,919,060 4.94% 2024/25 $4,049,474,110 $49,921,495 $0 4,099,395,605 3.57% Annual Growth Rate % 4.91%
$0
$500,000,000
$1,000,000,000
$1,500,000,000
$2,000,000,000
$2,500,000,000
$3,000,000,000
$3,500,000,000
$4,000,000,000
$4,500,000,000
2015/162016/172017/182018/192019/202020/212021/222022/232023/242024/25 SBE Nonunitary Unsecured Secured
* Net AV changes less than two percent are in purple font. Negative Net AV percent changes are in red.
Annual Growth Rate (CAGR) is calculated as the mean annualized growth rate for compounding values over a given time period.
This report is not to be used in support of debt issuance or continuing disclosure statements without the written consent of HdL, Coren & Cone Data Source: San Mateo County Assessor 0/ - 2024/25 Combined Tax Rolls Prepared On 9/5/2025 By MV 147
244
ASSESSED VALUE OF TAXABLE PROPERTY
THE CITY OF HALF MOON BAY
2015/16 - 2024/25 Taxable Property Values
2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24 2024/25 Residential 2,128,750,156 2,238,878,627 2,365,335,848 2,496,961,916 2,652,141,529 2,769,600,677 2,887,213,237 3,075,165,815 3,228,860,043 3,351,535,909 Commercial 356,041,843 363,813,823 372,002,147 457,418,903 467,790,599 476,253,451 476,165,638 505,408,881 519,423,135 533,926,048 Industrial 6,292,015 6,801,114 7,185,938 8,419,613 9,374,259 9,561,139 9,740,069 10,958,701 12,248,260 11,843,899 Agricultural 17,322,251 16,208,520 15,605,023 15,866,702 16,197,166 16,525,146 16,322,665 Dry Farm 3,786,377 4,241,537 4,358,514
Govt. Owned 0 0 0 0 0 0 0
Institutional 277,456 281,685 309,882 315,819 298,922 1,689,318 1,938,117 314,217 320,500 870,237 Irrigated 5,333,856 4,324,786 4,411,271
Miscellaneous 23,460,537 14,211,644 17,677,501 16,786,985 15,398,633 16,274,069 13,822,133 14,050,543 14,321,066 16,983,212 Recreational 39,568,823 40,290,547 41,062,725 42,118,338 43,356,325 35,379,201 31,885,243 33,842,367 36,361,745 38,502,619 Vacant 45,773,151 43,437,146 56,557,151 55,779,365 56,658,361 62,452,178 58,863,627 66,260,807 75,850,962 79,489,521 Unsecured 53,103,728 39,462,822 40,418,385 44,156,277 40,695,317 39,825,394 45,896,134 49,344,505 54,008,203 49,921,495 Unknown 0
TOTALS 2,662,387,942 2,755,743,731 2,909,319,362 3,139,279,467 3,301,922,465 3,426,640,450 3,541,390,900 3,771,543,002 3,957,919,060 4,099,395,605 Total Direct Rate 0.05818 0.05819 0.05819 0.05821 0.05821 0.05821 0.05819 0.05818 0.05814 0.05817 Category
Notes:
Exempt values are not included in Total.
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.
This report is not to be used in support of debt issuance or continuing disclosure statements without the written consent of HdL, Coren & Cone Prepared On 9/5/2025 By MV Data Source: San Mateo County Assessor 2015/16 - 2024/25 Combined Tax Rolls 148
245
Top Property Owners Based On Net Values
THE CITY OF HALF MOON BAY
2024/25 TOP TEN PROPERTY TAXPAYERS
Owner Secured Unsecured Combined Primary Use &
Primary Agency Parcels Value Value Parcels Value
% of
Net AV
% of
Net AV
% of
Net AV
1) 2 1 $229,569,438 $15,000 $229,584,438
Commercial
5.67% 0.03% 5.60%
Half Moon Bay General Fund
SHC HALF MOON BAY LLC
(Pending Appeals On Parcels)
2) 18 $37,032,061 $37,032,061
Recreational
0.91% 0.90%
Half Moon Bay General Fund
OCEAN COLONY PARTNERS LP
3) 3 $34,000,000 $34,000,000
Commercial
0.84% 0.83%
Half Moon Bay General Fund
S J AMOROSO PROPERTIES COMPANY
4) 1 $23,952,251 $23,952,251
Commercial
0.59% 0.58%
Half Moon Bay General Fund
HALF MOON BAY LODGE LLC
5) 9 $18,292,684 $18,292,684
Commercial
0.45% 0.45%
Half Moon Bay General Fund
PROFESSIONAL PENINSULA PROPERTIES LLC
6) 1 $18,195,986 $18,195,986
Unsecured
36.45% 0.44%
Half Moon Bay General Fund
ROCKET FARMS INC
7) 26 1 $17,556,422 $80,801 $17,637,223
Commercial
0.43% 0.16% 0.43%
Half Moon Bay General Fund
KEET NERHAN
8) 1 $9,660,416 $9,660,416
Commercial
0.24% 0.24%
Half Moon Bay General Fund
LONGS DRUG STORE INC
9) 3 $8,069,512 $8,069,512
Commercial
0.20% 0.20%
Half Moon Bay General Fund
CASTRO PARTNERS LLC
10) 1 $7,451,320 $7,451,320
Commercial
0.18% 0.18%
Half Moon Bay General Fund
ABOLMOLUKI BAHRAM TRUST
36.64% 9.52% $403,875,891 $18,291,787 $385,584,104 3 64 Top Ten Total 9.85% $49,921,495 $4,049,474,110 City Total $4,099,395,605
Top Owners last edited on 9/4/25 by maheav using sales through 06/30/2025 (Version r.1) This report is not to be used in support of debt issuance or continuing disclosure statements without the written consent of HdL, Coren & Cone Prepared On 9/5/2025 By MV Data Source: San Mateo County Assessor 2024/25 Combined Tax Rolls and the SBE Non Unitary Tax Roll 149
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Top Property Owners Based On Net Values
THE CITY OF HALF MOON BAY
2015/16 TOP TEN PROPERTY TAXPAYERS
Owner Secured Unsecured Combined Primary Use &
Primary Agency Parcels Value Value Parcels Value
% of
Net AV
% of
Net AV
% of
Net AV
1) 2 1 $142,308,525 $6,000 $142,314,525
Commercial
5.45% 0.01% 5.35%
Half Moon Bay General Fund
SHC HALF MOON BAY LLC
(Pending Appeals On Parcels)
2) 24 $44,559,080 $44,559,080
Recreational
1.71% 1.67%
Half Moon Bay General Fund
OCEAN COLONY PARTNERS L P
(Pending Appeals On Parcels)
3) 30 2 $21,411,317 $64,585 $21,475,902
Commercial
0.82% 0.12% 0.81%
Half Moon Bay General Fund
KEET NERHAN
4) 6 $15,798,000 $15,798,000
Unsecured
29.75% 0.59%
Half Moon Bay General Fund
COMCAST
5) 3 $14,894,009 $14,894,009
Commercial
0.57% 0.56%
Half Moon Bay General Fund
REGENCY CENTERS LP
6) 3 $12,447,992 $12,447,992
Miscellaneous
0.48% 0.47%
Half Moon Bay General Fund
HMB CAPITAL LLC
7) 1 $11,012,782 $11,012,782
Residential
0.42% 0.41%
Half Moon Bay General Fund
SAN MATEO COU HOUSING AUT LESSOR
8) 1 $10,377,222 $10,377,222
Commercial
0.40% 0.39%
Half Moon Bay General Fund
IWF HALF MOON BAY LLC
9) 1 $8,364,570 $8,364,570
Commercial
0.32% 0.31%
Half Moon Bay General Fund
LONGS DRUG STORE INC
10) 1 $8,129,673 $8,129,673
Unsecured
15.31% 0.31%
Half Moon Bay General Fund
ROCKET FARMS INC
45.19% 10.17% $289,373,755 $23,998,258 $265,375,497 10 65 Top Ten Total 10.87% $53,103,728 $2,609,284,214 City Total $2,662,387,942
Top Owners last edited on 8/3/16 by MaheaV using sales through 06/30/2016 (Version r.1) This report is not to be used in support of debt issuance or continuing disclosure statements without the written consent of HdL, Coren & Cone Prepared On 9/5/2025 By MV Data Source: San Mateo County Assessor 2015/16 Combined Tax Rolls and the SBE Non Unitary Tax Roll 150
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DIRECT & OVERLAPPING PROPERTY TAX RATES
(RATE PER $100 OF TAXABLE VALUE)
THE CITY OF HALF MOON BAY
Last 10 Fiscal Years
Agency 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24 2024/25 Basic Levy¹ 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 Cabrillo Unified Bond 0.07260 0.08320 0.07510 0.07110 0.11510 0.08950 0.07670 0.07910 0.07310 0.08640 Mid-Penninsula Regional Open Space 0.00000 0.00000 0.00000 0.00000 0.00160 0.00150 0.00150 0.00130 0.00120 0.00130 San Mateo Community College 2005 Series B 0.00000 0.00000 0.00000 0.00000 0.00350 0.00370 0.00000 0.00000 0.00000 0.00000 San Mateo Junior College 0.02500 0.02470 0.02350 0.01750 0.02310 0.01760 0.00000 0.00000 0.00000 0.00000 San Mateo Junior Comm College 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.02270 0.01930 0.01900 0.01780 Total Direct & Overlapping² Tax Rates 1.09760 1.10790 1.09860 1.08860 1.14330 1.11230 1.10090 1.09970 1.09330 1.10550 City's Share of 1% Levy Per Prop 13³ 0.05525 0.05525 0.05525 0.05526 0.05526 0.05526 0.05525 0.05525 0.05525 0.05525 Voter Approved City Debt Rate
Redevelopment Rate⁴
Total Direct Rate⁵ 0.05818 0.05819 0.05819 0.05821 0.05821 0.05821 0.05819 0.05818 0.05814 0.05817 Notes:
¹In 1978, California voters passed Proposition 13 which set the property tax rate at a 1.00% fixed amount. This 1.00% is shared by all taxing agencies for which the subject property resides within. In addition to the 1.00% fixed amount, property owners are charged taxes as a percentage of assessed property values for the payment of any voter approved bonds. ²Overlapping 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. ³City'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.
⁴Redevelopment 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 thereafter. ⁵Total 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 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 2012/13. For the purposes of this report, residual revenue is assumed to be distributed to the City/Agency in the same proportions as general fund revenue.
This report is not to be used in support of debt issuance or continuing disclosure statements without the written consent of HdL, Coren & Cone Data Source: San Mateo County Assessor 2015/16 - 2024/25 Tax Rate Table Prepared On 9/5/2025 By MV 151
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DEMOGRAPHIC AND ECONOMIC STATISTICS
THE CITY OF HALF MOON BAY
Median Age
% of Pop 25+ with
High School Degree
% of Pop 25+ with
Bachelor's Degree
Personal Income
(In Thousands)
Calendar
Year Population
Unemployment
Rate
Per Capita
Personal Income
44.7 84.0% 47.3% $640,547 2015 12,528 3.3% $51,129
45.8 83.8% 46.7% $677,251 2016 12,591 2.9% $53,788
47.1 85.8% 48.3% $796,455 2017 12,639 2.3% $63,015
47.3 84.9% 45.5% $810,881 2018 12,631 1.6% $64,197
45.3 87.1% 47.5% $804,495 2019 12,431 1.6% $64,716
46.8 86.2% 50.3% $898,800 2020 12,309 5.6% $73,019
47.8 88.3% 53.3% $881,941 2021 11,308 1.5% $77,992
44.9 87.9% 50.4% $801,565 2022 11,226 1.1% $71,402
48.3 92.1% 54.6% $930,463 2023 11,238 1.4% $82,796
46.5 91.3% 53.2% $928,159 2024 11,303 2.0% $82,116
85,000
80,000
75,000
70,000
65,000
60,000
55,000
50,000
6 5
4 3
2 1
0 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Per Capita Pers Income Unemployment Rate
Per Capita Personal Income
Unemployment Rate
Personal Income and Unemployment
0 8,000
6,000
4,000
2,000
10,000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Less Than High School High School Graduate College Graduate Population
Education Level Attained for Population 25
and Over
Notes and Data Sources:
Population: California State Department of Finance. Unemployment Data: California Employment Development Department 2000-2009 Income, Age, and Education Data: ESRI - Demographic Estimates are based on the last available Census. Projections are developed by incorporating all of the prior census data released to date. Demographic Data is totaled from Census Block Groups that overlap the City's boundaries 2010 and later - Income, Age and Education Data - US Census Bureau, most recent American Community Survey This report is not to be used in support of debt issuance or continuing disclosure statements without the written consent of HdL, Coren & Cone Prepared On 9/5/2025 By MV 152
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SALES VALUE HISTORY
THE CITY OF HALF MOON BAY
Single Family Residential Full Value Sales (01/01/2023 - 6/30/2025) Year Full Value Sales Average Price Median Price Median % Change 2023 92 $1,553,372 $1,492,500
2024 94 $1,759,798 $1,621,250 8.63%
2025 53 $1,685,472 $1,470,000 -9.33%
$0
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
$1,800,000
202320242025
Median Price Avg Price
Year
Sales Price
* Multiparcel and trust transfers, quitclaim deeds, timeshares, and partial sales are excluded from this analysis.
This report is not to be used in support of debt issuance or continuing disclosure statements without the written consent of HdL, Coren & Cone
Data Source: San Mateo County Recorder Prepared On 9/5/2025 By MV 153
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INDEPENDENT AUDITOR REPORT ON
INTERNAL CONTROL OVER FINANCIAL REPORTING
AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN
AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE
WITH GOVERNMENT AUDITING STANDARDS
To the Honorable Members of the City of Council
City of Half Moon Bay, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the basic financial statements of the City of Half Moon Bay (City), California, as of and for the year ended June 30, 2025, and have issued our report thereon dated November 20, 2025. Our report included a Change in Accounting Principle paragraph disclosing the implementation of a new accounting principle.
Report on Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control.
Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the City’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that have not been identified.
Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards.
Accountancy Corporation
3478 Buskirk Avenue, Suite 217
Pleasant Hill, CA 94523
T 925.228.2800
, [email protected]
w mazeassociates.com
155
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We have also issued a separate Memorandum on Internal Control dated November 20, 2025 which is an integral part of our audit and should be read in conjunction with this report.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Pleasant Hill, California
November 20, 2025
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