Hanford City Council
March 18, 2025

City Council Meeting
Agenda
March 18, 2025
7:00 PM – Regular Meeting
Council Chambers
400 N. Douty St.

Council Members will meet in-person in the Council
Chambers. The meeting will also be lived streamed on the City’s website: http://livestream.hanford.city/
5:00 PM CALL TO ORDER STUDY SESSION AND CLOSED SESSION:

ROLL CALL BY THE CITY CLERK:

PUBLIC COMMENT:

Study Sessions are considered Special Meetings under the Brown Act. Accordingly, comments from the public are limited to items listed on the agenda (GC 54954.3a). Public Comment will be accepted during each agenda item. A maximum of three minutes is allowed for each speaker. Please begin your comments by stating your name and providing your city of residence.

STUDY SESSION:

A. Annual Comprehensive Financial Report presentation for the year ending June 30, 2024 (Fiscal Year 2024)
B. Council overview of the Fiscal Year 2026/27 (FY27) and 2027/28 (FY28) Budget Outlook C. Review of Hanford Municipal Code Chapter 6.10 - Keeping of Chickens and discussion of possible changes to the Municipal Code related to the number of Chickens allowed in Residential zones.

CLOSED SESSION FOR DISCUSSION OF THE FOLLOWING:

A. CONFERENCE WITH LEGAL COUNSEL-ANTICIPATED LITIGATION (54956.9 (d)(2)) 1 Potential Case.

CALL TO ORDER REGULAR SESSION:

ROLL CALL:

INVOCATION:

FLAG SALUTE:

CLOSED SESSION ACTION REPORT:

COUNCIL REPORTS/GENERAL REPORTS:

Brief information-only reports from City Council and/or Staff, including committee reports and reports by City Council related to meetings attended at City expenses (AB1234).

PUBLIC COMMENT:

This is the time for citizens to comment on subject matters within the jurisdiction of the Hanford City Council. This is also the public’s opportunity to request an item from the Consent Calendar be pulled for discussion purposes or to comment on any item on the agenda. State law does not allow the Council to discuss or take action on issues not on the agenda, except that members of the Council or staff may briefly respond to statements made or questions posed by persons exercising their public testimony rights (Gov. Code sec. 54954.2). A maximum of three minutes is allowed for each speaker. Please begin your comments by stating your name and providing your city of residence.

CONSENT CALENDAR:

Consent Calendar items are considered routine and will be enacted in one motion. There will be no separate discussion of these matters unless a request is made and then the item will be removed from the Consent Calendar to be discussed and voted upon by a separate motion.

A. Waive reading in full of resolutions and ordinances and approval and adoption of same by reading the title only.

B. City Clerk: Approval of the Minutes of the January 21, 2025, Meeting.

C. City Clerk: Approval of the Minutes of the February 4, 2025, Meeting.

D. Administration: Authorization for the City to accept and appropriate an FAA Airport Infrastructure Grant (AIG), once the grant offer is received, for the Hanford Municipal Airport, in the amount of $228,551 for the design of a new fuel island and fuel tank storage area and Authorization for the Airport Manager to execute the Grant Agreement.

A total appropriation in the Airport Fund of $245,580 ($17,029 of local match) is required contingent on grant award.

E. Community Development: Community Development: Acceptance of the mandated General Plan Annual Progress Report for Calendar Year 2024 and Authorization for the submittal to the Governor’s Office of Planning and Research F. Community Development: Approval of Historic Resources Permit HRA0017-25, a request by BMO Bank to install a new gate and fence at a secondary entrance facing the alley and perform very minor civil improvements. The property is designated as a noncontributing building within the Historic Overlay Zone. The project is located at 230 W. Seventh Street (APN 012-052-014).

G. Utilities and Engineering: Adoption of Resolution Nos. 25-10-R, 25-11-R, and 25-12-R pertaining to the establishment of Community Facilities Districts (CFDs) for the Billingsley Subdivision (Tract 937) and the Lunaria Subdivision (Tract 938).

H. Public Works: Approval of a change order to increase Purchase Order 22500223, with Parts Authority, to a total of $70,000 to provide for the procurement of various parts and supplies necessary for servicing city-owned equipment. Additionally, Approval of the reallocation of $20,005 from Purchase Order 22500222 with Hanford Auto and Truck Parts, Inc. to fund these purchases.

PUBLIC HEARING:

A. Community Development: A Public Hearing to receive public input on Annexation 161: A request to annex 88.89 acres into the City of Hanford from the Kings County jurisdiction.

Prezone No. 0005-23: A request to prezone the land proposed to be annexed as R-L-5 Low-Density Residential, in accordance with the General Plan designation for the territory, Low-Density Residential. Vesting Tentative Tract 943 (Silicon Valley Ranch): A request, by Marc Frelier, to subdivide 75.02 acres proposed to be prezoned R-L-5 LowDensity Residential into 326 single-family residential lots, a 3.58-acre park, and threeacre storm basin. Focused Environmental Impact Report (EIR) State Clearinghouse Number (SCH) 2024060956: A request to certify the Final Focused Environmental Impact Report for the project and adopt a Statement of Overriding Considerations for the project’s significant impact to Transportation/Traffic. The Project is located south of Hanford Armona Road, between 12th and 13th Avenues (APN 011-040-008, -010, and - 027).

GENERAL BUSINESS:

A. Community Development: Approval of pre-qualified consultants for Environmental Consulting Services, Peer Review for Environmental Consulting Services, and, Planning and Environmental Services (directly for the City of Hanford) for up to five years with a cost up to $300,000 annually. Approval of appropriation in the General Fund for the current fiscal year (FY25) for up to $100,000 combined for all three services.

B. Community Development: Authorization to Enter into a Memorandum of Understanding (MOU) with the Kings County Association of Governments (KCAG) to Receive REAP 2.0 Funds for the Updates to the Hanford Planning Documents Project ($250,000) and Modernizing Hanford’s GIS and Permitting Processes Project ($455,000), and to Award Contracts to Mintier Harnish ($250,000) and Langan ($455,000) for Consulting Services.

Approve appropriation of $705,000, to be reimbursed by REAP 2.0 grant funds.

C. Administration: Approval of a Professional Services Agreement with Hawk on Hand, in the amount of $53,600 to continue to provide Falconer services in Downtown Hanford and areas outside the Business Improvement District for Calendar Year 2025 services.

ITEMS FOR FUTURE AGENDAS:

At this time, any Council Member may ask a question for clarification or may request a matter, which is not otherwise scheduled on a City Council agenda, to be placed on a future agenda. The Council Member referring the item shall provide sufficient information as to the nature of the item. The City Council, by concurrence of a majority, may direct the City Manager to put the item on a future agenda. (GOV. CODE SEC. 54954.2) A. Council Future Agenda Items
B. Upcoming Events and Important Dates:

April 1: Regual City Council Meeting
April 15: Regular City Council Meeting
Wednesdays: Food Truck Take over in Civic Park 11:00am - 2:00pm.

ADJOURNMENT:

Materials related to an item on this Agenda submitted to the City Council after distribution of the agenda packet are available to public inspection in the City Clerk’s Office located at 319 N. Douty Street, Hanford, California 93230, during normal business hours. Such agendas are also available at the city’s website, www.cityofhanfordca.com subject to staff’s ability to post the agenda before the meeting. If you need a disability-related modification or accommodation, including

auxiliary aids or services, to participate in this meeting, please contact the City Clerk’s office, 559-585-2515, 319 N. Douty Street, Hanford, California 93230, at least 2 days prior to the meeting {28 CFR 35.102.35.104 ADA Title II}

4.A.

AGENDA

STAFF REPORT
MEETING DATE: 3/18/2025 AGENDA SECTION: STUDY SESSION
SUBJECT:

Annual Comprehensive Financial Report presentation for the year ending June 30, 2024 (Fiscal Year 2024)
RECOMMENDATION:

Recommendation: Staff recommends that City Council review the Annual Comprehensive Financial Report (ACFR) for the City of Hanford, for the year ended June 30, 2024 (Fiscal Year 2024).

Recommended Motion: This is an informational item, no action is required.

BACKGROUND:

RECOMMENDATION:

Recommendation: Staff recommends that City Council review the Annual Comprehensive Financial Report (ACFR) for the City of Hanford, for the year ended June 30, 2024 (Fiscal Year 2024).

Recommended Motion: This is an informational item, no action is required.

BACKGROUND:

State law requires the City of Hanford to prepare audited financial statements for each fiscal year.

The City is engaged in its second year of its agreement with Rogers, Anderson, Malody and Scott, LLP (RAMS) for assistance in the preparation of an Annual Comprehensive Financial Report (ACFR) with an independent auditor's report. The City received an unqualified opinion (clean) in relation to the 2023/2024 financial statements for the fiscal year ending June 30, 2024 by its' independent auditors, RAMS. The ACFR presented for fiscal year 2023/2024 is the City's first ACFR completed.

An ACFR is a step above the required basic financial statements, and has been completed in order to provide the city with as much information as possible in accordance to the highest industry standards.

The audit can be summarized as follows:
- Auditors have issued an unqualified opinion (clean)
- Financial condition of the General Fund improved (due to one-time revenues and budget savings) - Enterprise Funds show there potential need for rate adjustments - General Fund Reserve at approximately 28% of General Fund Budgeted Expenditures

Since 2020, the City Council (Council) has established some key financial policies to improve the financial condition of the City. The policies as memorialized in Resolution 2020-29-R and 2022-20-R look to:
- Adopt a balanced budget
- Establish General Fund Reserve of 35% for operating reserves and contingency reserve for fiscal emergencies
- Minimum 15% reserves in proprietary and internal service funds unless other requirements exist For the fiscal year 2023/2024 (FY24) the City Council passed a balanced budget. The General Fund last year grew to near a 28% reserve and generally, fund balances were positive in FY24.

Regularly, during the course of an audit, auditors may also identify issues or concerns regarding internal control or reporting as outlined below:

Material Weakness - Deficiency or a combination of deficiencies in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented or detected and corrected on a timely basis.

Significant Deficiency - 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.

The City had no material weaknesses or deficiencies identified in FY24.

In the Management Letter on Internal Control, there was one recommendation listed as 'Finding 1- Payroll'. This crosses over from Fiscal Year 2023, as the process for correction did not occur until mid 2023/2024.

Finding 1- Payroll
Condition and context:

During our audit, we noted that payroll registers are not reviewed by an individual outside of the payroll process for accuracy. This could result in payroll error or an increase in unauthorized payroll transactions going undetected.

Recommendation:

We recommend that the City implement a formal payroll review process that includes an independent review of payroll registers by an individual outside of the payroll process along with proof of their review by signatures and dates to strengthen internal controls over this process.

Management Response was:

Management concurs with this recommendation and will immediately implement segregation of duties by requiring someone outside the payroll process will input or verify salary changes in the system each pay period. Additionally, an outside review of the payroll register prior to finalization will be added as a standard procedure. This will add greater internal control over payroll registers in addition to a second staff person in the Payroll Division that occurred this fiscal year to mitigate control one person could have.

Fund Summary - Outlook

Table A "Governmental Fund Financial Results" below, summarizes how these funds performed and a snapshot of their conditions as of June 30, 2024. The General Fund shows just over $12.6 million in fund balance, most of which is unrestricted and available for Council's use. This increase in General Fund unrestricted fund balance is partially due to one-time revenue adjustment from ARPA funding and budget expenditure savings. This represents an approximate 28% reserve, based on General Fund expenditures for FY24. Staff recommends continuing to build this reserve to reach the minimum 35% goal. This can be achieved through careful consideration of excess spending from General Fund available balance and limiting special projects in the General Fund that were not included in the original balanced budget.

The City has four major proprietary (business-like) funds summarized in Table B. These funds provide essential services for customers for water, sewer, storm drain and refuse. In addition, some minor funds are included as follows; airport, courthouse and intermodal facility operations.

The City should continue to pursue cost reductions, operational efficiencies, cost recovery, and minimize staffing additions. In order to maintain long-term planning goals, financial resources must be accounted for and set aside in order to fulfill Council goals.

Staff will be working on the upcoming two-year budget to adequately address the financial needs of the City and work with the Council on the adoption of a balanced and sustainable budget. Thankfully, with the passage of Measure H in November 2024, there will be ability to add some of the needs that otherwise would not be afforded. With many pressing needs across the City, the General Fund is not in a position to add otherwise.

City Council has in place a comprehensive Reserve and Pension Funding Policy (Resolution 2022- 20-R) which will continue to help the City year by year improve its financial standing. It is important to keep in mind, there are significant demands on the General Fund, including unfunded pension costs and costs to operate the City continue to increase. Current budget projections do not show huge increases in revenues in upcoming years, which will limit efforts of the City to build up reserves, take care of deferred capital needs or increase services. To address deferred capital needs or increase services, other revenue such as Measure H will be needed to address more immediate needs per the Expenditure Plan, or a significant amount of time to accumulate funding.

FISCAL IMPACT:

This item is informational, there is no fiscal impact from this report. It is an accomplishment for the City at FY24 to now have a 28% reserve (about $12.6 million). In accordance with the adopted Reserve Policy in Resolution 2022-20-R no additional funds will be transferred to capital funds, pension trust fund or internal service funds as the General Fund is not at its 35% goal. Council's adopted goal is 35% (20% in operating reserve and 15% in Economic Uncertainty/Contingency Reserve), of which the City has made progress in FY24 primarily due to having a balanced budget and one-time revenue/revenue adjustment.

ATTACHMENTS:

1. Annual Comprehensive Financial Report Fiscal Year 2024

2. GAGAS - Hanford

3. Management Comment letter- Hanford

4. SAS 114 - Hanford

City of Hanford
Hanford, California
Annual Comprehensive Financial Report
For the year ended June 30, 2024

City of Hanford, California

ANNUAL COMPREHENSIVE

FINANCIAL REPORT
For the year ended June 30, 2024
Prepared by the Finance Department

CITY OF HANFORD
Annual Comprehensive Financial Report
For the year ended June 30, 2024
Table of Contents
-iPage

INTRODUCTORY SECTION
Letter of transmittal .................................................................................................................... iv Principal Officials ........................................................................................................................ x Organization Chart ................................................................................................................... xi

FINANCIAL SECTION
Independent Auditor's Report ................................................................................................ 1 Management's Discussion and Analysis ............................................................................... 5 Basic Financial Statements:

Government-Wide Financial Statements:

Statement of Net Position ............................................................................................ 16 Statement of Activities ................................................................................................. 17

Fund Financial Statements:

Balance Sheet – Governmental Funds ........................................................................ 18 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position ...................................................................................... 19 Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds ............................................................................................. 20 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities ................... 21

Proprietary Funds:

Statement of Net Position ............................................................................................ 22 Statement of Revenues, Expenses and Changes in Fund Net Position ....................... 23 Statement of Cash Flows ............................................................................................. 24

Fiduciary Funds:

Statement of Fiduciary Net Position ............................................................................. 28 Statement of Changes in Fiduciary Net Position .......................................................... 29

Notes to the Financial Statements ..................................................................................... 30 Required Supplementary Information (Unaudited):

Schedule of Changes in the Net Pension Liability and Related Ratios .............................. 79 Schedule of the City's Proportionate Share of the Net Pension Liability ............................ 80 Schedule of Plan Contributions ......................................................................................... 81 Schedule of Changes in Total OPEB Liability and Related Ratios ..................................... 82 Schedule of Contributions - OPEB .................................................................................... 83 Budgetary Comparison Schedules (GAAP Basis):

General Fund .............................................................................................................. 84

CITY OF HANFORD
Annual Comprehensive Financial Report
For the year ended June 30, 2024
Table of Contents
-iiPage
FINANCIAL SECTION (continued)
Required Supplementary Information (Unaudited) (continued):

CDBG Home/Housing Fund ........................................................................................ 85 Transportation Development Act Fund ........................................................................ 86 American Rescue Plan Act Fund ................................................................................. 87 Notes to Budgetary Comparison Required Supplementary Information .............................. 88 Supplementary Information:

Non-Major Special Revenue Governmental Funds:

Combining Balance Sheet ........................................................................................... 89 Combining Statement of Revenues, Expenditures and Changes in Fund Balances ..... 93

Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual (GAAP Basis):

CMAQ Transportation Fund .......................................................................................... 97 Park Impact Fees Fund ................................................................................................ 98 Parking Fund ............................................................................................................... 99 Downtown Reinvestment Fund .................................................................................. 100 Landscaping Assessment District Fund ..................................................................... 101 City Housing Fund ..................................................................................................... 102 Central Parking and Business Improvement Fund ...................................................... 103 Fire Protection Impact Fee Fund ............................................................................... 104 Police Protection Impact Fees Fund .......................................................................... 105 Traffic Safety Fund .................................................................................................... 106 State Gas Tax Fund .................................................................................................. 107 Public Housing Authority Fund .................................................................................. 108 Transportation Impact Fees ....................................................................................... 109 Cannabis Operations Fund ........................................................................................ 110 Capital Projects Fund ................................................................................................ 111 Non-major Enterprise Funds:

Combining Statement of Net Position ........................................................................ 112 Combining Statement of Revenues, Expenses and Changes in Net Position ............ 113 Combining Statement of Cash Flows ......................................................................... 114 Internal Service Funds:

Combining Statement of Net Position ........................................................................ 115 Combining Statement of Revenues, Expenses and Changes in Net Position ............ 117 Combining Statement of Cash Flows ......................................................................... 119

Custodial Funds:

Combining Statement of Fiduciary Net Position ......................................................... 121 Combining Statement of Changes in Fiduciary Net Position ...................................... 122

CITY OF HANFORD
Annual Comprehensive Financial Report
For the year ended June 30, 2024
Table of Contents
-iiiPage

STATISTICAL SECTION (UNAUDITED)
Net Position by Component 123
Changes in Net Position ................................................................................................. 125 Governmental Activities Tax and Assessment Revenue by Source ................................. 129 Fund Balances of Governmental Funds ......................................................................... 130 Changes in Fund Balances of Governmental Funds ....................................................... 132 General Fund Tax Revenue by Source ........................................................................... 134 Top 25 Sales Tax Producers ........................................................................................... 135 Assessed Value and Estimated Actual Value of Taxable Property .................................. 136 Direct and Overlapping Property Tax Rates .................................................................... 137 Principal Property Taxpayers .......................................................................................... 138 Property Tax Levies and Collections ............................................................................... 139 Assessed Value of Property by Use Code ....................................................................... 140 Ratios of Outstanding Debt by Type ............................................................................... 142 Ratios of General Bonded Debt Outstanding ................................................................... 143 Direct and Overlapping Governmental Activities Debt ..................................................... 144 Computation of Legal Debt Margin .................................................................................. 145 Pledge Revenue Coverage ............................................................................................. 147 Demographic and Economic Statistics ............................................................................ 149 Principal Employers......................................................................................................... 150 Full-Time Equivalent City Government Employees by Function ...................................... 151 Operating Indicators by Function ..................................................................................... 152 Capital Asset Statistics by Function ................................................................................. 153

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-viiiPage 19 of 1543
-ixPage 20 of 1543
-xCITY OF HANFORD

PRINCIPAL CITY OFFICIALS
JUNE 30, 2024

CITY COUNCIL

NAME POSITION
Travis Paden Mayor
Mark Kairis Vice Mayor
Vacant Council Member
Vacant Council Member
Lou Martinez Council Member

ADMINISTRATION
Mario Cifuentez City Manager
Griswold, LaSalle, Cobb, Dowd & Ginn, LLP City Attorneys Natalie Corral City Clerk
Christopher Tavarez Treasurer/Finance Director
Jason Waters Community Development Director
Daniel Perkins Fire Chief
Stephanie Huddleston Police Chief
Russell Sterling Public Works Director
Francisco Senteno Utilities & Engineering Director
Bradley Albert Parks and Community Services Director
Sarah Cardoza Human Resources Manager

ORGANIZATIONAL CHART

CITY OF HANFORD
City Manager
City Council
Citizens of
Hanford
City Attorney
Finance
Accounting
Utility Billing
Payroll
Information Technology
Fire
Suppression
Prevention
Public Works
Admin/Engineering
Water
Wastewater
Refuse
Storm Drainage
Street Maintenance
Fleet
Facilities
Maintenance
Administration
Human Resources
Risk Management
City Clerk
Airport
Community Relations
Police
Parks and Community Services
Parks
Recreation
Community Events
LADs
Community Development
Building Safety
Planning
Code Compliance
Housing
Support Services
Records
Communications
Operations
HART
Park Resource
Traffic Unit
Multi-Agency Task Force
School Resource Officer
Animal Control
K-9
Evidence
-xiPage 22 of 1543
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735 E. Carnegie Dr. Suite I 00
San Bernardino. CA 92408
909 889 0871 T
909 889 5361 F
ramscpa. net

PARTNERS
Scott W Manno. CPA. CGMA
Leena Shanbhag, CPA. MST. CGMA
Bradferd A. Welebir. CPA. MBA. CGMA
Jenny W. Liu. CPA, MST
Ga,·denya Duran, CPA, CGMA
Brianna Schultz, CPA. CGMA
Brenda L. Odle. CPA. MST (Partne, Emeritus)
Te, ry P Shea, CPA (Panner Emenws)

MANAGERS/ STAFF
Seong-Hyea Lee. CPA. MBA
Evelyn Morenlin-Barcena. CPA
Vernnica Hernandez, CPA
Laura A1v1zu. CPA
John Maldonado, CPA, MSA
Julia Rodriguez Fuentes. CPA, MSA
Dem, Hite. CPA
Jeffrey McKennan. CPA
Mornca Wysock,, CPA
Jacob Weatherb,e. CPA, MSA
Bolim Han. CPA. MAcc
Anny Gonzalez, CPA

MEMBERS
Amencan lnsutuce of
Certified Public Accountants
PCPS The A/CPA Alliance
(01 CPA Fi,ms
Governmental Audit
Q11C1/1ty Cenre,
Califot nia Society of
Certified Public Accountants
•
Proud Member of
AlliottGlobalAlliance~

ROGERS, ANDERSON , MALODY & SCOTT, LLP
CERTIFIED PUBLIC ACCOUNTANTS. SINCE 1948
STABILITY. ACCURACY. TRUST.
-1-
Independent Auditor’s Report
To the Honorable Mayor and Members of the City Council
City of Hanford, California
Report on the Audit of the Financial Statements
Opinions
We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Hanford (the City), as of and for the year ended June 30, 2024, 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, the accompanying financial statements present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2024, and the respective changes in financial position and, where applicable, cash flows thereof for the fiscal year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States (Government Auditing Standards). 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 requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

-2-
Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the 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 financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about 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 GAAS 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 GAAS 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.

-3-
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the required supplementary information, including the management’s discussion and analysis and the schedules 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 combining and individual nonmajor fund financial statements and schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The 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 GAAS. In our opinion, the accompanying 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 comprehensive financial report (ACFR). The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditor's report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.

In connection with our audit of the basic financial 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.

-4-
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated February 13, 2025 on our consideration of the City of Hanford’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 internal control over financial reporting or on compliance.

That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering City of Hanford’s internal control over financial reporting and compliance.

San Bernardino, California
February 13, 2025

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City of Hanford
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2024
-5-
This discussion and analysis of the City of Hanford’s (the City) financial performance provides an overview of the City’s financial activities for the fiscal year ended June 30, 2024. We encourage readers to consider the information presented here in conjunction with the accompanying basic financial statements and the accompanying notes to those financial statements.

FINANCIAL HIGHLIGHTS
 Assets and deferred outflows of the City exceed its liabilities and deferred inflows at the close of the most recent fiscal year 2024 by $381.1 million. Of this amount, about $42.8 million in unrestricted net position may be used to meet the City’s ongoing obligation to citizens and creditors.
 As of June 30, 2024, the City’s governmental funds reported combined ending fund balances of $74.8 million.
 Approximately 17% of the combined governmental fund balances is considered available for spending at the City’s discretion.
 As of June 30, 2024, unassigned fund balance in the General Fund was $12.6 million, or 28% of total General Fund Expenditures.
 The City’s total debt decreased by $4.6 million during fiscal year 2024, which is due to the normal maturity of debt in the water system, the wastewater system, the citywide solar energy system, and the Pension Obligation Bond.
 The following pension liabilities totaling $24,554,484 are included in the financial statements as required by generally accepted accounting principles: General Government $21,716,597; Water System Enterprise $644,974; Wastewater Enterprise $515,979; Storm Drainage $257,990; Refuse Enterprise $773,969; Computer Maintenance $128,995; Building $257,990; and Fleet Management $257,990.

THE FINANCIAL STATEMENTS
The financial statements presented herein include all of the activities of the City of Hanford, California (the City) and its component units, using the integrated approach as prescribed by generally accepted accounting principles. The City’s basic financial statements 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 other supplementary information in addition to the basic financial statements themselves.

These Government-Wide Financial Statements are designed to provide readers with a broad overview of the City’s finances, in a manner similar to a private-sector business. The statements present the financial picture of the City from the economic resources measurement focus using the accrual basis of accounting. They present governmental activities and business-type activities separately. Additionally, certain eliminations have occurred as prescribed by the GASB statements regarding interfund activity, payables and receivables.

City of Hanford
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2024
-6-
The Fund Financial Statements include statements for each of the three categories of activities governmental, business-type and fiduciary. The governmental activities are prepared using the current financial resources measurement focus and modified accrual basis of accounting. The business-type activities are prepared using the economic resources measurement focus and the accrual basis of accounting. The fiduciary activities are agency funds, which report a fiduciary net position and a statement of changes in net position and do not have a measurement focus.

Reconciliations of the Fund Financial Statements to the Government-Wide Financial Statements are provided to explain the differences created by the integrated approach.

OVERVIEW OF THE FINANCIAL STATEMENTS
Government-Wide Financial Statements
The Statement of Net Position and the Statement of Activities The Statement of Net Position and the Statement of Activities report information about the City as a whole and about its activities. These statements included all assets and liabilities of the City using the accrual basis of accounting, which is similar to the accounting used by most privatesector companies. All of the current year’s revenue and expenses are taken into account, regardless of when cash is received or paid.

These two statements reports the City’s net position and changes in them. Net position is the difference between assets and liabilities, which is one way to measure the City’s financial health, or financial position. Over time, increases or decreases in the City’s net position are one indicator of whether its financial health is improving or deteriorating. Other factors to consider are changes in the City’s property tax base and sales tax base.

In the Statement of Net Position and the Statement of Activities, we separate the City activities as follows:

Governmental Activities - Most of the City’s basic services are reported in this category, including General Government, Police, Fire, Public Works, Parks and Community Services, and Community Development. Property and sales taxes, user fees, interest income, franchise fees, and state and federal shared revenues and grants generally finance these activities.

Business-Type Activities - The City charges a fee to customers to cover all or most of the cost of certain services it provides. The City’s Water, Sewer, Storm Drain, Refuse, Airport, Intermodal, Courthouse Square Funds and Building Safety are reported in this category.

FUND FINANCIAL STATEMENTS
The City, like other state and local governments, uses fund accounting to account for a number of funding sources and activities. In general, fund accounting provides a mechanism for separately accounting for a variety of different funding sources, and enables the City to demonstrate compliance with legal and/or contractual requirements that may be associated with these funds.

City of Hanford
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2024
-7-
Thus, the accompanying fund financial statements present individual funds, organized into one of three groups based on the nature of the activities and their purpose: Governmental, funds. In addition, the fund financial statements include a schedule that reconciles the fund financial statements to the Government-Wide Financial Statements. This is designed to explain the difference created by the integrated approach.

Governmental Funds – Most of the City’s basic services are reported in governmental funds, which focus on how money flows into and out of those funds and the balances left at year-end that are available for spending. These funds are reported using an accounting method called modified accrual accounting, which measures cash and all other financial assets that can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the City’s general governmental operation and the basic services it provides. Governmental fund information helps determine whether there are more or fewer financial resources that can be spent in the near future to finance the City’s programs. The differences between the results shown in the governmental fund financial statements and those shown in the government-wide financial statements are explained in a reconciliation schedule following each governmental fund financial statement.

Proprietary Funds – When the City charges customers for the services it provides, whether to outside customers or to other units of the City, these services are generally reported in proprietary funds. Proprietary funds are reported in the same way that all activities are reported in the Statement of Net Position and the Statement of Revenues, Expenses and Changes in Fund Net Position. In fact, the City’s enterprise funds are the same as the business-type activities reported in the government-wide statements, but provide more detail and additional information, such as cash flows, for proprietary funds. We use internal service funds (the other component of proprietary funds) to report activities that provide supplies and services for the City’s other programs and activities – such as the City’s self-insurance, fleet maintenance, and computer maintenance funds. The internal service funds are reported with governmental activities in the government-wide financial statements.

Fiduciary Funds – The City is the trustee, or fiduciary, for certain funds held on behalf of various third parties. The City’s fiduciary activities are reported in a separate Statement of Fiduciary Net Assets. We exclude these activities from the City’s other financial statements because the City cannot use these assets to finance its operations. The City is responsible for ensuring that the assets reported in these funds are used for their intended purposes.

Notes to the Financial Statement – The notes to the financial statements provide information that is essential to a full understanding of the data provided in the government-wide and fund financial statements.

Other Information – In addition to the basic financial statements and accompanying notes, this report also presents certain “required supplementary information” concerning the City’s progress in funding its obligation to provide pension benefits to its employees, budgetary comparison schedules for the general fund and other major funds.

City of Hanford
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2024
-8-

GOVERNMENT-WIDE FINANCIAL ANALYSIS
The City presents its financial statements under the reporting model required by Governmental Accounting Standards Board (GASB) Statement No. 34. The City is presenting prior fiscal years’ data for the purpose of providing comparative information for the Management Discussion and Analysis (MD&A).

Statement of Net Position
As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the City, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $381,065,202 at the close of the 2023-2024 fiscal year.

By far, the largest portion of the City’s net position, 81%, reflects its investment in capital assets (e.g., land, buildings, machinery, infrastructure and equipment), less any outstanding debt used to acquire those assets. The City uses these capital assets to provide services to citizens; consequently, their value is not available for future spending. Although the City’s investment in the capital assets is reported net of related debt, it should be noted that the sources needed to repay this debt must be provided from other sources since the capital assets themselves cannot be used to liquidate these liabilities.

Of the total current assets totaling $139,375,396, approximately 86.7% or $120,823,563, consists of unrestricted cash and investments. These funds are invested in accordance with State law and the City’s investment policy and include funds legally and/or contractually restricted as to their use.
2024 2023 2024 2023 2024 2023
ASSETS
Current assets 84,679,531 $ 72,898,212 $ 54,695,865 $ 48,793,546 $ 139,375,396 $ 121,691,758 $ Capital and non-current
assets (net of depreciation) 191,642,952 183,061,930 143,660,523 141,608,046 335,303,475 324,669,976 Total Assets 276,322,483 255,960,142 198,356,388 190,401,592 474,678,871 446,361,734 Deferred outflows of resources 18,945,144 23,984,845 1,903,416 4,251,547 20,848,560 28,236,392 LIABILITIES Current and other liabilities 13,613,178 16,763,306 5,559,050 6,912,906 19,172,228 23,676,212 Long-term liabilities 56,560,553 52,567,500 26,112,733 32,258,119 82,673,286 84,825,619 Total Liabilities 70,173,731 69,330,806 31,671,783 39,171,025 101,845,514 108,501,831 Deferred inflows of resources 11,762,775 15,349,043 853,940 856,016 12,616,715 16,205,059 NET POSITION Net investment in capital assets 165,368,191 155,203,294 121,203,106 141,608,046 286,571,297 296,811,340 Restricted 29,207,622 23,285,547 - 4,743 29,207,622 23,290,290 Unrestricted 18,755,308 16,776,297 46,530,975 13,013,309 65,286,283 29,789,606 Total Net Position 213,331,121 $ 195,265,138 $ 167,734,081 $ 154,626,098 $ 381,065,202 $ 349,891,236 $

STATEMENT OF NET POSITION
Governmental Activities Business-Type Activities Total

City of Hanford
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2024
-9-
An additional portion of the City’s net position of $29,207,622 represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net position, $42,828,866, may be used to meet the government’s ongoing obligations to citizens and creditors.

At the end of the current fiscal year, the City is able to report an overall positive balance in net position. This means the City has sufficient current assets to satisfy both its current and longterm liabilities and fulfill its obligations pursuant to external restriction imposed on City assets. In short, the City is in sound financial condition.

Statement of Activities
As discussed earlier, the Statement of Net Position provides a measure of the financial health of an entity at a specific date in time. The Statement of Activities provides details of how net position changed from the beginning of the year to the end of the year, and whether net assets increased or decreased. From June 30, 2023 to June 30, 2024, the net position of the City as a whole increased, due to decrease in expenses in General Government and Public Safety. 2024 2023 2024 2023 2024 2023 REVENUES Program Revenues:

Charges for services 4,544,558 $ 6,491,551 $ 32,097,134 $ 26,733,436 $ 36,641,692 $ 33,224,987 $ Operating grants and contributions 12,658,886 8,160,718 - - 12,658,886 8,160,718 Capital grants and contributions 16,354,756 15,030,908 4,431,308 5,154,104 20,786,064 20,185,012 General Revenues: Taxes 35,942,896 35,942,897 - - 35,942,896 35,942,897 Investment earnings 2,947,174 976,872 2,735,869 871,114 5,683,043 1,847,986 Other revenues 558,387 413,009 2,701,155 2,384,559 3,259,542 2,797,568 Lease revenue - - 111,166 193,373 111,166 193,373 Total Revenues 73,006,657 67,015,955 42,076,632 35,336,586 115,083,289 102,352,541 EXPENSES Governmental Activities: General government 7,755,643 8,647,803 - - 7,755,643 8,647,803 Public safety 26,472,385 36,761,886 - - 26,472,385 36,761,886 Public works 10,096,705 4,151,802 - - 10,096,705 4,151,802 Parks and recreation 5,483,946 4,163,652 - - 5,483,946 4,163,652 Community development 2,890,465 2,468,828 - - 2,890,465 2,468,828 Interest expense 1,086,925 1,140,021 - - 1,086,925 1,140,021 Business-type Activities:

Water system - - 7,711,131 10,805,234 7,711,131 10,805,234 Wastewater system - - 7,506,365 7,127,609 7,506,365 7,127,609 Storm drain - - 1,680,905 1,624,217 1,680,905 1,624,217 Refuse - - 10,852,999 10,388,974 10,852,999 10,388,974 Airport - - 558,304 671,372 558,304 671,372 Intermodal - - 56,256 56,589 56,256 56,589 Courthouse square - - 107,624 63,436 107,624 63,436 Building safety - - 1,649,670 - 1,649,670 - Total Expenses 53,786,069 57,333,992 30,123,254 30,737,431 83,909,323 88,071,423 Increase in Net Position Before Transfers 19,220,588 9,681,963 11,953,378 4,599,155 31,173,966 14,281,118 Transfers (1,154,605) (243,210) 1,154,605 243,210 - - Loss on lease termination - - - (724,690) - (724,690) Change in Net Position 18,065,983 9,438,753 13,107,983 4,117,675 31,173,966 13,556,428 Net Position, Beginning of Year, Restated 195,265,138 185,826,385 154,626,098 150,508,423 349,891,236 336,334,808 Net Position, End of Year 213,331,121 $ 195,265,138 $ 167,734,081 $ 154,626,098 $ 381,065,202 $ 349,891,236 $ Governmental Activities Business-Type Activities Total

STATEMENT OF ACTIVITIES

City of Hanford
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2024
-10-
The City’s revenue totaled $115,083,289 with 31.8% generated from charges for services and

31.2% generated from taxes. The largest source of revenues in governmental activities comes from taxes at 49.2%. This is typical in that traditional services provided by a city, such as public safety, parks, recreation, and public works, are primarily funded from property, sales, transient occupancy, and other local taxes. The largest source of revenues in Business-Type Activities comes from charges for services at 76.3%. The Business-Type Activities include enterprise fund operations, such as Water, Sewer, Refuse, Storm Drain, Airport, Courthouse Square, Intermodal Funds and Building Safety, all of which recover their costs through fees and charges just like a normal business.

Expenses of the City totaled $83,909,323. The two largest categories of expenses in governmental activities are public safety, which represents 31.6% of total costs, and public works which represents 12% of total costs. However, in relation to Governmental Activity totals only, public safety makes up 49.2% of the total and public works makes up 18.8% of the total.

As shown in the Statement of Activities, net position increased from the prior year. In the funds included within the Governmental Activities category, net position increased by $18,065,983, or

9.3% due to revenues exceeding expenses. In the funds included within the Business-Type Activities category, net position increased by $13,107,983, or 8.5% mostly due to the increase in charges for services and investment earnings.

FINANCIAL ANALYSIS OF THE GOVERNMENT’S FUNDS
As previously noted, the City of Hanford uses fund accounting to demonstrate compliance with legal and contractual requirements. This section provides an analysis and discussion of individual funds and fund types presented in the financial statements.

Governmental Funds – The focus of the City of Hanford’s governmental funds is on short-term inflows and outflows and balances of spendable resources. Such information is useful in assessing the City’s financial requirements. In particular, unreserved fund balance may serve a spending at the end of the fiscal year. The remainder of fund balance is reserved or designated to indicate that it is not available for new spending because it has already been committed to a specific future use.

The General Fund is the primary operating fund of the City of Hanford. At the end of the fiscal year, unassigned fund balance of the General Fund was $12,610,835 while total fund balance was $12,942,192. As a measure of the General Fund’s liquidity, it may be useful to compare both unreserved fund balance and total fund balance to total expenditures. The unassigned fund balance of the General Fund represents approximately 28% of General Fund expenditures.

Capital Improvement Funds, which are categorized as governmental funds, show fluctuations in their ending fund balances because they are primarily used to account for capital improvement projects that span more than one year. Therefore, the change in fund balance is generally due to the timing of funding, which generally occurs in one year, in relation to the timing of expenditures, which occur over more than one year. Any remaining fund balances are either reserved or earmarked specifically for the continuing cost of the related projects.

City of Hanford
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2024
-11-
CDBG/HOME/Housing Fund- The Community Development Block Grant (CDBG) and Home Investment Partnerships Program (HOME) are federal grants that fund affordable housing and community development projects. The grants are administered by the U.S. Department of Housing and Urban Development (HUD). Funds are used for developing and maintaining affordable housing, financing public improvements, funding public service agencies that serve lower income households, etc.

Transportation Development Act Fund- A state level funding sources that provides funding for public transit operations, including bus and rail projects, as well as some non-transit related transportation projects like bike paths and specialized services for people with disabilities, funded through a dedicated quarter-cent sales tax collected statewide; it consists of two main components: the Local Transportation Fund (LTF) and the State Transit Assistance (STA) fund.

American Resue Plan Act- In March of 2021, the ARPA or also known as the COVID-19 Stimulus Package was signed into law to aid to aid economic recovery and emergency response to COVID19, The City of Hanford was allocated $13,077,740 million in federal aid. The Act states that funding can be used to respond to COVID-19 or its economic impacts.

Proprietary Funds - The City’s proprietary funds include the Water, Wastewater, Storm Drain, Refuse, Airport, Intermodal, Courthouse Square Funds and Building Safety. All of the proprietary funds are highly capital intensive, requiring a significant investment in capital equipment and facilities to conduct their operations, whether it be in water and sewer lines, water and wastewater treatment facilities or runways.

The Water System Fund has a total net position of $71,127,519 at the end of the fiscal year. Total net position includes $54,346,048 invested in capital assets which are not available to pay for current expenses. The remaining net position of $16,781,471 is unrestricted and available to pay for current operating and capital needs of the fund.

The Wastewater Fund has a total net position of $46,196,128 at the end of the fiscal year. Total net position includes $53,022,768 invested in capital assets, which are not available to pay for current expenses.

The Storm Drain Fund has a total net position of $28,529,759 at the end of the fiscal year. Total net position includes $22,947,657 invested in capital assets, which are not available to pay for current expenses. The remaining net position of $5,582,102 is unrestricted and available to pay for current operating and capital needs of the fund.

The Refuse Fund has a total net position of $3,650,778 at the end of the fiscal year. Total net position includes $6,322,922 invested in capital assets, which are not available to pay for current expenses.

City of Hanford
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2024
-12-

CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets – The City of Hanford’s investment in capital assets for governmental and business type activities as of June 30, 2024 amounts to $315,801,507 (net of accumulated depreciation). This investment in capital assets includes land, buildings and system, improvements, machinery and equipment, park facilities and roads. The net increase in the City’s investment in capital assets for the current fiscal year was $11,509,805. This increase is a net result of annual depreciation, land acquisition, normal equipment replacement, and construction of typical capital assets. Significant capital asset events during the fiscal year included the following:

CIP OBJ # DESCRIPTION PROJECT COST
822649 HEROES PARK 4,471,714 $
824301 FIRE ENGINE PUMPER/REPL 161 1,008,656 824312 FIRE ENGINE PUMPER/REPL 960,544 823609 PARK DEV OVERSIZING REQUIREMNT 672,608 823606 CIVIC AUD IMPROVEMENTS 638,409
824613 T929 U1 PARK LAND ACQ&IMP 546,798
823618 PAVEMENT RESURFACING TREATMENT 711,743
824309 REFUSE FRONT LOAD TRUCK#1 457,669
824310 REFUSE FRONT LOAD TRUCK#2 457,669
824311 REFUSE FRONT LOAD TRUCK#3 457,669
2024 2023 2024 2023 2024 2023
Land 61,094,107 $ 60,455,620 $ 11,966,873 $ 11,950,873 $ 73,060,980 $ 72,406,493 $ Construction in progress 6,947,608 817,424 509,213 4,044,330 7,456,821 4,861,754 Buildings and improvements 14,572,268 15,049,886 115,852,898 111,167,236 130,425,166 126,217,122 Infrastructure 80,766,404 76,738,687 - - 80,766,404 76,738,687 Machinery and equipment 7,635,602 9,193,868 15,311,073 14,445,607 22,946,675 23,639,475 Right to use leased asset 927,235 33,223 20,466 - 947,701 33,223 Right to use SBITA asset 197,760 394,948 - - 197,760 394,948 Total Capital Assets 172,140,984 $ 162,683,656 $ 143,660,523 $ 141,608,046 $ 315,801,507 $ 304,291,702 $

CAPITAL ASSETS
(Net of Depreciation)
Governmental Activities Business-Type Activities Total
Long-Term Debt - At the end of the current fiscal year, the City had a total debt outstanding of $51,203,654.
2024 2023 2024 2023 2024 2023
Pension obligation bonds payable 23,922,715 $ 25,460,230 $ 4,006,284 $ 4,263,770 $ 27,928,999 $ 29,724,000 $ Bonds payable - - 12,725,000 14,530,000 12,725,000 14,530,000 Unamortized bond premium - - 409,811 483,118 409,811 483,118 Lease payable 638,867 34,041 20,742 - 659,609 34,041 SBITA payable 178,371 353,827 - - 178,371 353,827 Notes payable - - 3,890,840 4,306,151 3,890,840 4,306,151 Finance purchase arrangement - - 5,411,024 6,341,947 5,411,024 6,341,947 Total Outstanding Debt 24,739,953 $ 25,848,098 $ 26,463,701 $ 29,924,986 $ 51,203,654 $ 55,773,084 $ Governmental Activities Business-Type Activities Total

OUTSTANDING DEBT

City of Hanford
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2024
-13-
In the Business-Type Activities, the revenue bonds payable consists of four bond issues. In 2013, for the water system, the City received $12,725,000 from the issuance of Water Revenue Bonds for the purpose of refinancing a 2003 Revenue Bond and 2007 note payable, of which $4,125,000 remains. For the sewer system there remains a 2015 $2,220,000 Refunding Revenue Bond, and a 2012 $6,379,998 Refunding Revenue Bond. In 2022, the City issued Pension Obligation Bonds of which $4,006,286 is payable from the Business-Type Activities.

The notes payable portion of the outstanding debt totaling $3,890,840 consists of one loan. In 2002, the City obtained a $10,000,000 loan for the purpose of expanding the wastewater treatment plant.

The outstanding lease purchase amount, $5,411,024, is comprised of two different finance purchase arrangements. The first lease was for an energy efficient solar tracker system at the wastewater treatment plant for $4,325,556. The second lease was for a second energy efficient solar tracking system in the amount of $8,495,138. This system is located at the wastewater treatment plant but is serving the whole city.

For detail information regarding each of these bonds or notes, please refer to Note 5 Long-Term Debt.

GENERAL FUND BUDGETARY HIGHLIGHTS
The fiscal year budget did not have significant net changes throughout the year with the exception of appropriation roll-over for capital projects or capital projects appropriated in the 5-year Capital Improvement Plan. However, if funding is not available to pay for projects or a grant to cover the expense of the capital project is not received as forecasted in the plan, then the purchase is not approved.

Actual revenues were $7.5 million over estimated budget amounts. This was mainly due to grant reimbursement and an increase in interest income.

Federal funding in the amount of $833,334 was used to cover eligible costs of public safety workers performing essential work during Covid-19.

Expenditures were significantly under budget in the amount of $8.8 million. This was primarily due to capital projects are budgeted but expenditures have not occurred. In addition, unfilled positions throughout the year and some operational savings also attributed to lower expenditures.

Overall, the unrestricted fund balance of the General Fund increased by approximately $2.4 million.

City of Hanford
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2024
-14-
ECONOMIC FACTORS AND NEXT YEAR’S BUDGET AND RATES
The key assumptions and considerations in the General Fund revenue forecast for fiscal year 2024-2025 budget process were:
- Budget was balanced per Resolution 23-19-R
- Conservative revenue projections due to limited financial resources and fiscal prudence - Reduction of non-essential expenditures
- No annual increases in staffing (unless offset by grants or revenue increases) - Budget salaries at projected steps versus top step
- Limited allocations to infrastructure reserves
- Limited options to engage in special projects or one-time expenses Per policy, continue to strive for 35% goal of General Fund Reserve of unrestricted fund balance to budgeted expenditures in preparation of financial pressures or emergencies. As of fiscal year 2024 reserve increased from 26.1% to 28%.

Items addressed in the budget were:

General Fund Operations – Maintain current services and increase efficiency in operations, decrease expenses where possible and anticipate minimal revenue growth with no draw from reserves. No capital projects unless offset by grants or related revenue. Accumulated capital outlay fund was used when a special revenue or restricted fund was not available for use.

Parks and Community Services – Continue with a variety of recreation programs and activities.

Budget was increased for City’s third annual Winter Wonderland Event, which drew in many visitors from the region. Completed installing parks cameras and solar powered lights for overall park safety, funded by grant. Purchased the Heroes Park land for approximately $4.6 million.

Reimbursed developers for park development oversizing requirements and other contributed park capital as required by the City.

Fire – Purchased two new fire engine pumpers as replacements at approximately $2 million dollars total. Grant funding was received for one of them. Delivery takes approximately 36 months Purchased a new Chevy Tahoe for daily operations and emergency response. Land purchased for a future Station 5.

Police – Completed parking lot improvements at the Police Activities League Building and purchased a new citation system software. With grant funding purchased a new traffic message board.

Community Development – Purchased four new electric vans for inspections with grant funding.

Currently working on scanning project of historical building plans.

Airport – Replaced roof at the Fixed Base Operations building.

City of Hanford
Management’s Discussion and Analysis
For the Fiscal Year Ended June 30, 2024
-15-
Water – The completion of various water main replacements and additions, and the continuation of meter replacement and automated meter reading device replacement. There were several well repairs/rehabs and media filtration necessary and new water supply wells as this is an ongoing project.

Wastewater – Sewer main oversizing, extension and replacement, sewer video inspection, manhole repair/coating, maintain inventory of interchangeable spare pumps, purchased truck for daily operations monitoring.

Refuse – Replaced automated refuse containers and commercial/recycle dumpsters. Purchased three new front load trucks and a front loader as a replacement.

Storm Drain – Continued curb and gutter installation, increased flow capacity in Peoples Ditch, storm drain repairs, tree trimming and removal for the effectiveness of drains.

Streets – Resurfacing, sealing, and maintenance on several streets, replacing curb, gutters, and sidewalks, lane widening, installing/replacing traffic signals at various locations. Replaced streets water truck.

Building – Renovated the Civic Auditorium including interior re-paint, new hardwood floors, and acoustic ceiling replacement.

REQUESTS FOR INFORMATION
This Financial Report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the City’s finances and to show the City’s accountability for the money it receives. Questions concerning any of the information provided in the report or requests for additional financial information can be sent via e-mail to [email protected].

Formal written requests should be addressed to: City of Hanford, Attn: Finance Department, 315 N. Douty Street, Hanford, California 93230.

FINANCIAL STATEMENTS

GOVERNMENT-WIDE FINANCIAL STATEMENTS

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City of Hanford
Statement of Net Position
June 30, 2024
The accompanying notes are an integral part of these financial statements. -16-
Governmental Business-Type
Activities Activities Total
ASSETS
Cash and investments 80,056,658 $ 40,766,905 $ 120,823,563 $ Receivables 11,306,307 4,617,606 15,923,913 Leases receivables 854,343 602,175 1,456,518 Interest receivable 1,038 1,275 2,313
Internal balances (8,396,369) 8,396,369 -
Inventory 309,722 248,482 558,204 Deposits 289,500 14,000 303,500 Prepaid expenses and other assets 258,332 49,053 307,385 Loan receivables 19,501,968 - 19,501,968 Capital Assets:

Capital assets, not being depreciated 68,041,715 12,476,086 80,517,801 Capital assets, net of accumulated depreciation 104,099,269 131,184,437 235,283,706 Total assets 276,322,483 198,356,388 474,678,871

DEFERRED OUTFLOWS OF RESOURCES
Deferred outflows related to pensions 17,717,762 1,372,128 19,089,890 Deferred outflows related to OPEB 1,227,382 531,288 1,758,670 Total deferred outflows of resources 18,945,144 1,903,416 20,848,560 LIABILITIES Accounts payable 2,059,111 1,195,388 3,254,499 Salary and benefits payable 464,738 110,229 574,967 Accrued interest payable 3,105 242,355 245,460 Deposits and unearned revenue 5,093,744 265,847 5,359,591 Compensated absences - current portion 360,581 39,483 400,064 Compensated absences - noncurrent portion 1,055,394 279,383 1,334,777 Long-term debt - current 1,744,484 3,667,580 5,412,064 Long-term debt - noncurrent 22,995,469 22,796,121 45,791,590 Claims payable 6,999,000 - 6,999,000 Total OPEB liability - current 137,415 38,168 175,583 Total OPEB liability - noncurrent 3,149,118 844,317 3,993,435 Net pension liability 22,361,572 2,192,912 24,554,484 Settlement liability - current 3,750,000 - 3,750,000 Total liabilities 70,173,731 31,671,783 101,845,514 DEFERRED INFLOWS OF RESOURCES Deferred inflows related to pensions 10,358,579 125,579 10,484,158 Deferred inflows related to OPEB 575,657 172,527 748,184 Deferred inflows related to leases 828,539 555,834 1,384,373 Total deferred inflows of resources 11,762,775 853,940 12,616,715 NET POSITION Net investment in capital assets 165,368,191 121,203,106 286,571,297 Restricted for:

Street and Roads 20,079,629 - 20,079,629 Recreation 5,975,177 - 5,975,177 Landscape Maintenance 2,046,521 - 2,046,521 Public Safety 1,106,295 - 1,106,295
Unrestricted 18,755,308 46,530,975 65,286,283 Total net position 213,331,121 $ 167,734,081 $ 381,065,202 $

City of Hanford
Statement of Activities
For the Year Ended June 30, 2024
The accompanying notes are an integral part of these financial statements. -17-
Charges Operating Capital
for Grants and Grants and Governmental Business-type
Expenses Services Contributions Contributions Activities Activities Total Primary Government: Governmental activities: General government 7,755,643 $ 209,316 $ 1,285,867 $ - $ (6,260,460) $ - $ (6,260,460) $ Public safety 26,472,385 1,000,728 3,366,256 10,153,425 (11,951,976) - (11,951,976) Public works 10,096,705 1,175,292 2,770,198 4,695,118 (1,456,097) - (1,456,097) Recreation 5,483,946 886,951 4,844,105 1,506,213 1,753,323 - 1,753,323 Community development 2,890,465 1,272,271 392,460 - (1,225,734) - (1,225,734) Interest expense 1,086,925 - - - (1,086,925) (1,086,925) Total governmental activities 53,786,069 4,544,558 12,658,886 16,354,756 (20,227,869) - (20,227,869) Business-type activities:

Water system 7,711,131 11,504,822 - 2,090,441 - 5,884,132 5,884,132 Wastewater system 7,506,365 6,721,978 - 1,233,324 - 448,937 448,937 Storm drain 1,680,905 1,445,451 - 1,015,237 - 779,783 779,783 Refuse 10,852,999 9,915,250 - - - (937,749) (937,749) Airport 558,304 154,968 - 75,000 - (328,336) (328,336) Intermodal 56,256 706 - - - (55,550) (55,550) Courthouse square 107,624 55,016 - - - (52,608) (52,608) Building safety 1,649,670 2,298,943 - 17,306 - 666,579 666,579 Total business-type activities 30,123,254 32,097,134 - 4,431,308 - 6,405,188 6,405,188 Total Primary Government 83,909,323 $ 36,641,692 $ 12,658,886 $ 20,786,064 $ (20,227,869) 6,405,188 (13,822,681) General Revenues: Taxes: Property taxes 15,019,781 - 15,019,781 Sales and use tax 16,772,531 - 16,772,531 Franchise taxes 1,310,678 - 1,310,678 Transfer taxes 235,563 - 235,563 Transient occupancy taxes 750,696 - 750,696 Other taxes 1,853,648 - 1,853,648
Investment earnings 2,947,174 2,735,869 5,683,043
Gain on disposal of capital assets 18,741 85,400 104,141 Miscellaneous/other 539,645 2,615,755 3,155,400 Lease revenue - 111,166 111,166 Transfers - interfund (1,154,605) 1,154,605 - Total General Revenues and Transfers 38,293,852 6,702,795 44,996,647 Change in Net Position 18,065,983 13,107,983 31,173,966 Net Position Beginning of year 195,265,138 154,626,098 349,891,236 End of year 213,331,121 $ 167,734,081 $ 381,065,202 $ Net (Expense) Revenue and Changes in Net Position
Functions/Programs
Program Revenues

GOVERNMENTAL FUNDS

FINANCIAL STATEMENTS

City of Hanford
Balance Sheet – Governmental Funds
June 30, 2024
The accompanying notes are an integral part of these financial statements. -18-
General Fund

CDBG/HOME/
Housing Fund
Transportation
Development
Act Fund
American Rescue
Plan Act
All Other NonMajor
Governmental
Funds Total
Cash and investments 8,050,776 $ 2,516,511 $ 7,737,365 $ 5,016,996 $ 27,276,749 $ 50,598,397 $ Receivables, net:

Accounts 7,259,133 183,359 - - 2,635,637 10,078,129
Interest 1,038 - - - - 1,038 Taxes - - 1,213,113 - - 1,213,113 Leases 854,343 - - - - 854,343 Loans - 17,695,752 - - 1,806,216 19,501,968 Due from other funds 2,311,944 - - - - 2,311,944 Deposits 104,500 - - - - 104,500 Prepaid expenses and other assets 226,857 - - - 1,100 227,957 Advances to other funds - - - - 1,659,026 1,659,026 Total assets 18,808,591 $ 20,395,622 $ 8,950,478 $ 5,016,996 $ 33,378,728 $ 86,550,415 $ Liabilities:

Accounts payable 876,100 $ 55,657 $ - $ 73,099 $ 411,387 $ 1,416,243 $ Accrued wages payable 408,625 - - - 3,136 411,761 Advance from other governments - - - 5,090,609 - 5,090,609 Consumer deposits 3,135 - - - - 3,135 Settlement liability 3,750,000 - - - - 3,750,000 Due to other funds - - - - 207,346 207,346 Total liabilities 5,037,860 55,657 - 5,163,708 621,869 10,879,094 Deferred inflows from leases 828,539 - - - - 828,539 Total deferred inflows of resources 828,539 - - - - 828,539 Nonspendable:

Loans receivable - 17,695,752 - - 1,806,216 19,501,968 Prepaid expenses 226,857 - - - 1,100 227,957 Deposits 104,500 - - - - 104,500 Restricted for:

Street and roads - 2,644,213 8,950,478 - 8,484,938 20,079,629 Recreation - - - - 5,975,177 5,975,177 Landscape maintenance - - - - 2,046,521 2,046,521 Public Safety - - - - 1,106,295 1,106,295 Committed for:

Parking and business improvement - - - - 2,986,008 2,986,008 Community development - - - - 10,152,998 10,152,998 Cannabis - - - - 197,606 197,606 Unassigned 12,610,835 - - (146,712) - 12,464,123 Total fund balances 12,942,192 20,339,965 8,950,478 (146,712) 32,756,859 74,842,782 Total liabilities and fund balances 18,808,591 $ 20,395,622 $ 8,950,478 $ 5,016,996 $ 33,378,728 $ 86,550,415 $ Fund Balances (deficit):

ASSETS

LIABILITIES AND FUND BALANCES
Special Revenue
Deferred Inflows of Resources:

City of Hanford
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position June 30, 2024
The accompanying notes are an integral part of these financial statements. -19-
Total Fund Balances Governmental Funds 74,842,782 $
Amounts reported for governmental activities in the statement of net position are different because:

Capital assets at historical cost 319,976,880 $
Right to use asset 1,462,696 Accumulated depreciation (148,960,891) Accumulated amortization (337,701) Adjustments for Internal Service Fund capital assets, net (5,955,555) 166,185,429 14,585,741
Compensated absences (1,415,975) Pension obligation bonds (23,922,715) Lease payable (638,867) SBITA payable (178,371) OPEB liability (3,286,533) Net pension liability (22,361,572) Adjustments for Internal Service Fund long term debt 1,876,924 (49,927,109) Deferred outflows related to pensions and OPEB 18,945,144 Adjustment for Internal Service Fund Deferred outflows related to pension (403,565) 18,541,579 Deferred inflows related to pensions and OPEB (10,934,236) Adjustment for Internal Service Fund Deferred inflows related to pension 36,935 (10,897,301) Total Net Position - Governmental Activities 213,331,121 $ Capital assets: In governmental funds, only current assets are reported. in the Statement of Net Position, all assets are reported, including capital assets and accumulated depreciation:

Internal service funds are used by management to charge the costs of fleet maintenance, purchasing, risk management, building usage, and computer maintenance to individual funds.

The assets and liabilities of the internal service funds are included in the governmental activities in the Statement of Net Position.

Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported as liabilities in the governmental funds. Long-term liabilities at year-end consist of:

City of Hanford
Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds
For the Year Ended June 30, 2024
The accompanying notes are an integral part of these financial statements. -20-
General
Fund

CDBG/HOME/
Housing Fund
Transportation
Development Act
Fund
American
Rescue Plan
Act
All Other NonMajor
Governmental
Funds Total

REVENUES
Taxes and special assessments 33,745,197 $ - $ 1,213,113 $ - $ 9,236,203 $ 44,194,513 $ Aid from other government agencies 8,365,595 625,740 - 1,267,331 186,562 10,445,228 Licenses and permits 86,270 - - - - 86,270 Fines and forfeitures 132,724 - - - 48,591 181,315 Charges for services 2,991,009 - - - - 2,991,009 Lease revenue 137,197 - - - - 137,197 Revenue from use of money and property 694,590 (290,281) 488,629 - 1,767,702 2,660,640 Miscellaneous 73,625 1,193 - - 436,579 511,397 Total revenues 46,226,207 336,652 1,701,742 1,267,331 11,675,637 61,207,569 EXPENDITURES Current:

General government 3,781,636 - 41,589 - 27,499 3,850,724 Public safety 23,950,549 - - - - 23,950,549 Public works 2,548,966 - - - 729,738 3,278,704 Recreation 4,995,392 - - - - 4,995,392 Community development 963,665 665,994 - 50,000 351,756 2,031,415 Debt service:

Principal 1,596,228 - - - - 1,596,228
Interest 1,086,925 - - - - 1,086,925 Capital outlay 6,073,304 - 239,075 383,997 3,522,336 10,218,712 Total expenditures 665,994 44,996,665 280,664 433,997 4,631,329 51,008,649 Excess (deficiency) of revenues over (under) expenditures 1,229,542 (329,342) 1,421,078 833,334 7,044,308 10,198,920 OTHER FINANCING SOURCES (USES) Transfers in 1,817,486 - - - 359,387 2,176,873 Transfers out (1,318,520) (155,640) - (833,334) (1,001,663) (3,309,157) Lease and SBITA acquisition 675,857 - - - - 675,857 Proceeds from sale of assets 18,741 - - - - 18,741 Total other financing sources (uses) 1,193,564 (155,640) - (833,334) (642,276) (437,686) Net change in fund balances (484,982) 2,423,106 1,421,078 - 6,402,032 9,761,234 FUND BALANCE (DEFICIT) Beginning of year 10,519,086 20,824,947 7,529,400 (146,712) 26,354,827 65,081,548 End of year 12,942,192 $ 20,339,965 $ 8,950,478 $ (146,712) $ 32,756,859 $ 74,842,782 $ Special Revenue

City of Hanford
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities
Governmental Funds
For the Year Ended June 30, 2024
The accompanying notes are an integral part of these financial statements. -21-
Total net changes in fund balances - governmental funds 9,761,234 $ $ 8,481,781
10,594,267 (7,690,893)
1,775,356
1,099,499 (675,857)
1,139,310
26,030
(4,198,610)
(355,747)
Changes in net position of governmental activities 18,065,983 $ payments. In the statement of activities, OPEB expense includes the net change in the net OPEB liability and related change in OPEB amounts for deferred outflows deferred inflows of resources.

Capital outlay expense, net of disposals
Depreciation expense (net of internal service funds)
Principal payments on long term liabilities, net of internal service funds use of current financial resources and, therefore, are not reported as expenditures in the governmental funds.

Pension expenditures reported in the governmental funds includes the annual required contributions. In the statement of activities, pension expense includes the net change in the net pension liability, and related change in pension amounts for deferred outflows of resources and deferred inflows of resources.

OPEB expenditures reported in the governmental funds includes the actual premium purchasing, employee welfare, workers' compensation, general and unemployment insurance to individual funds. The net revenue of certain activities of internal service funds is reported with governmental activities:

Compensated absences expenses reported in the statement of activities do not require the Governmental funds report capital outlays as expenditures. However, in the statement of activities, the cost of those assets is allocated over the estimated useful lives as depreciation expense. This is the amount by which capital outlay exceeded depreciation and disposals in the current period.

The issuance of long term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of issuance cost, discounts and similar items when the debt is first issued, whereas these amounts are deferred and amortized in the statement of activities.

These amounts are the net effect of these differences in the treatments of long-term debt and related items.

Amounts reported for governmental activities in the statement of activities are different because:

Internal Service funds are used by management to charge the costs of fleet maintenance, Lease & SBITA acquisition, net of internal service funds

Governmental Funds

PROPRIETARY FUNDS

FINANCIAL STATEMENTS

City of Hanford
Statement of Net Position
Proprietary Funds
June 30, 2024
The accompanying notes are an integral part of these financial statements. -22-
Sewer Improvement Funds Total Governmental
Water System Wastewater Storm Drain Refuse Total Non-major Enterprise Activities Internal Fund Fund Fund Fund Enterprise Funds Funds Service Funds Current assets: Cash and investments 26,167,474 $ 7,416,092 $ 5,829,038 $ 462,672 $ 891,629 $ 40,766,905 $ 29,458,261 $ Receivables, net:

Accounts 1,903,621 1,089,675 210,929 1,296,189 117,192 4,617,606 15,065 Leases 437,641 - - - 164,534 - 602,175 Interest 946 - - - 329 - 1,275 Deposits 10,000 4,000 - - - 14,000 185,000 Prepaid expenses 9,879 39,064 55 55 - 49,053 30,375 Inventory 248,482 - - - - 248,482 309,722 Total current assets 28,339,456 8,987,418 6,040,022 1,758,916 1,173,684 46,299,496 29,998,423 Noncurrent assets: Capital Assets:

Land 362,350 4,141,540 4,587,476 - 2,875,507 11,966,873 - Construction in progress - 408,989 26,177 7,816 66,231 152,733 509,213 Buildings and improvements 68,372,226 90,402,005 24,542,025 1,400,645 11,429,558 196,146,459 670,777 Machinery and equipment 18,313,421 2,480,484 1,182,028 11,200,033 416,111 33,592,077 15,803,447 Right to use assets 25,726 - - - - 25,726 237,867 Less accumulated depreciation/amortization (33,136,664) (44,001,261) (7,390,049) (6,285,572) (7,766,279) (98,579,825) (10,909,269) Capital assets, net 54,346,048 53,022,768 22,947,657 6,322,922 7,021,128 143,660,523 5,955,555 Total noncurrent assets 54,346,048 53,022,768 22,947,657 6,322,922 7,021,128 143,660,523 5,955,555 Total assets 82,685,504 62,010,186 28,987,679 8,081,838 8,194,812 189,960,019 35,953,978 DEFERRED OUTFLOWS OF RESOURCES Deferred outflows related to pensions 403,568 322,853 161,426 484,281 - 1,372,128 403,565 Deferred outflows related to OPEB 163,573 137,893 - 229,822 - 531,288 - Total Deferred Outflows of Resources 567,141 460,746 161,426 714,103 - 403,565 1,903,416 Current liabilities: Accounts payable 631,803 185,507 6,369 326,454 45,255 1,195,388 642,868 Salaries and benefits payable 29,947 25,352 9,132 34,230 11,568 110,229 52,977 Interest payable 72,034 170,321 - - - 3,105 242,355 Deposits and unearned revenue 264,708 420 275 444 - 265,847 - Due to other funds - - - 1,890,481 214,117 2,104,598 - Advances to other funds - - - - 1,659,026 1,659,026 - Compensated absences - current portion 9,083 12,820 1,416 13,415 2,749 39,483 12,181 Bonds and notes payable - current portion 1,816,193 1,731,616 19,202 95,586 - 3,662,597 63,247 Total OPEB liability - current portion 12,070 9,847 - 16,251 - 38,168 - Lease payable 4,983 - - - - 4,983 - SBITA payable - - - - - - 77,208 Total current liabilities 2,840,821 2,135,883 36,394 2,376,861 1,932,715 9,322,674 851,586 Noncurrent liabilities: Compensated absences payable 91,254 44,567 23,459 85,316 34,787 279,383 55,632 Claims payable - - - - - - 6,999,000 Lease payable 15,759 - - - - 15,759 - SBITA payable - - - - - - 79,275 Bonds and notes payable, net 8,175,518 12,890,811 286,729 1,427,304 - 22,780,362 944,406 Total OPEB liability 267,047 214,697 - 362,573 - 844,317 - Net pension liability 644,974 515,979 257,990 773,969 - 2,192,912 644,975 Total noncurrent liabilities 9,194,552 13,666,054 568,178 2,649,162 34,787 26,112,733 8,723,288 Total liabilities 12,035,373 15,801,937 604,572 5,026,023 1,967,502 35,435,407 9,574,874 DEFERRED INFLOWS OF RESOURCES Deferred inflows related to pensions 36,935 29,548 14,774 44,322 - 125,579 36,935 Deferred inflows related to OPEB 52,818 44,891 - 74,818 - 172,527 - Deferred inflows related to leases - 398,428 - - 157,406 555,834 - Total deferred inflows of resources 89,753 472,867 14,774 119,140 157,406 853,940 36,935 NET POSITION (DEFICIT) Net investment in capital assets 45,679,885 39,231,514 22,947,657 6,322,922 7,021,128 121,203,106 5,955,555 Unrestricted 25,447,634 6,964,614 5,582,102 (2,672,144) (951,224) 34,370,982 20,790,179 Total net position 71,127,519 $ 46,196,128 $ 28,529,759 $ 3,650,778 $ 6,069,904 $ 155,574,088 26,745,734 $ Adjustment to reflect the consolidation of internal service fund activities 12,159,993 Net Position of Business-type Activities $ 167,734,081

LIABILITIES
ASSETS

City of Hanford
Statement of Revenues, Expenses and Changes in Fund Net Position Proprietary Funds
For the Year Ended June 30, 2024
The accompanying notes are an integral part of these financial statements. -23-
Governmental
Water Wastewater Storm Drain Refuse Total Non-major Total Activities Internal Fund Fund Fund Fund Enterprise Funds Enterprise Service Funds

OPERATING REVENUES
Charges for services 11,504,822 $ 6,721,978 $ 1,445,451 $ 9,915,250 $ 2,509,633 $ $ 12,707,902 32,097,134 $ Other revenues 868,877 900,946 238,849 234,276 372,807 58,610 2,615,755 Total operating revenues 12,373,699 7,622,924 1,684,300 10,149,526 2,882,440 34,712,889 12,766,512 OPERATING EXPENSES Personnel services 1,791,068 1,543,120 664,958 2,468,577 840,731 1,801,714 7,308,454 Services and supplies 3,332,116 3,698,443 850,399 7,689,529 1,174,835 9,549,369 16,745,322 Depreciation and amortization 2,323,115 1,818,715 379,462 723,599 370,523 1,157,139 5,615,414 Total operating expenses 7,446,299 7,060,278 1,894,819 10,881,705 2,386,089 29,669,190 12,508,222 Operating income (loss) 4,927,400 562,646 (210,519) (732,179) 496,351 5,043,699 258,290 NONOPERATING REVENUES (EXPENSES) Interest income 339,502 933,551 216,963 88,728 8,880 1,075,153 1,587,624 Unrealized gain (loss) on investments 237,398 755,627 188,112 (37,909) 5,017 901,815 1,148,245 Interest expense (523,544) (385,153) (14,294) (71,152) - (50,184) (994,143) Lease revenue 71,810 - - - 39,356 - 111,166 Gain/(loss) on disposal of capital assets - - - 85,400 - (483,364) 85,400 Federal grant - - - - 75,000 - 75,000 Total Nonoperating Revenues (Expenses) 1,304,025 125,166 390,781 65,067 128,253 2,013,292 1,443,420 Income (Loss) Before Capital Contributions
and Transfers 687,812 6,231,425 180,262 (667,112) 624,604 7,056,991 1,701,710 CAPITAL CONTRIBUTIONS AND TRANSFERS Capital contributions 1,233,324 2,090,441 1,015,237 - 17,306 - 4,356,308 Transfers in (out) (28,125) 252,903 - 934,839 (5,012) (22,321) 1,154,605 Total Capital Contributions and Transfers 1,205,199 2,343,344 1,015,237 934,839 12,294 5,510,913 (22,321) Change in Net Position 8,574,769 1,893,011 1,195,499 267,727 636,898 12,567,904 1,679,389 NET POSITION (DEFICIT) Beginning of year 62,552,750 44,303,117 27,334,260 5,433,006 3,383,051 25,066,345 End of year 71,127,519 $ 46,196,128 $ 28,529,759 $ 3,650,778 $ 6,069,904 $ 26,745,734 $ Adjustment to reflect the consolidation of internal service fund activities 380,143 Net Position of Business-type Activities
$ 12,948,047
Sewer Improvement Funds

City of Hanford
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2024
The accompanying notes are an integral part of these financial statements. -24-
Sewer Improvement Funds
Water System Wastewater Storm Drain Refuse
Fund Fund Fund Fund

CASH FLOWS FROM OPERATING ACTIVITIES
Cash received for current services $ 6,323,640 10,936,998 $ 1,423,254 $ 9,769,231 $ Cash received for other operating revenues 900,946 868,877 238,849 234,276 Cash paid to suppliers for goods and services (4,863,117) (3,329,559) (856,385) (7,615,244) Cash paid for salaries and benefits (2,090,387) (1,627,913) (614,508) (2,637,914) Net cash provided (used) by operating activities 4,852,371 2,267,114 191,210 (249,651) CASH FLOWS FROM NONCAPITAL AND

RELATED FINANCING ACTIVITIES
Transfers (to) from other funds 252,903 (28,125) - 934,839 Loans from/(to) other funds - (316,887) - 1,890,481 Intergovernmental revenue - - - - Net cash provided (used) by noncapital financing activities 252,903 (345,012) - 2,825,320 CASH FLOWS FROM CAPITAL AND

RELATED FINANCING ACTIVITIES
Principal payments on long-term debt (1,672,920) (1,618,263) (19,662) (97,877) Interest payments on long-term debt (437,221) (570,091) (14,294) (71,152) Payments for capital asset acquisition (403,226) (98,655) (41,769) (2,349,482) Lease payments 20,742 - - - SBITA payments - - - - Lease income - 31,651 - - Proceeds from the sale of capital assets - - - - Net cash provided (used) by capital and related financing activities (2,492,625) (2,255,358) (75,725) (2,518,511) CASH FLOWS FROM INVESTING ACTIVITIES Unrealized gain (loss) on investments 755,627 237,398 188,112 (37,909) Interest received on investments 933,551 339,502 216,963 88,728 Net cash provided (used) by investing activities 1,689,178 576,900 405,075 50,819 Net increase (decrease) in cash and investments 4,301,827 243,644 520,560 107,977 Cash and investments, beginning of year 21,865,647 7,172,448 5,308,478 354,695 Cash and investments, end of year 26,167,474 $ 7,416,092 $ 5,829,038 $ 462,672 $ Reconciliation to Statement of Net Position:

Cash and investments 26,167,474 $ 7,416,092 $ 5,829,038 $ 462,672 $ Total cash and investments 26,167,474 $ 7,416,092 $ 5,829,038 $ 462,672 $

City of Hanford
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2024
The accompanying notes are an integral part of these financial statements. -25-
Total Governmental
Total Non-major Enterprise Activities Internal
Enterprise Funds Funds Service Funds

CASH FLOWS FROM OPERATING ACTIVITIES
Cash received for current services 2,435,186 $ 30,888,309 $ 12,794,559 $ Cash received for other operating revenues 372,807 2,615,755 58,610 Cash paid to suppliers for goods and services (1,136,488) (17,800,793) (8,752,917) Cash paid for salaries and benefits (792,290) (7,763,012) (2,345,498) Net cash provided (used) by operating activities 879,215 7,940,259 1,754,754 CASH FLOWS FROM NONCAPITAL AND

RELATED FINANCING ACTIVITIES
Transfers (to) from other funds (5,012) 1,154,605 (22,321) Loans from/(to) other funds 61,055 1,634,649 (475,636) Intergovernmental revenue 75,000 75,000 - Net cash provided (used) by noncapital financing activities 131,043 2,864,254 (497,957) CASH FLOWS FROM CAPITAL AND

RELATED FINANCING ACTIVITIES
Principal payments on long-term debt - (3,408,722) (64,762) Interest payments on long-term debt - (1,092,758) (47,079) Payments for capital asset acquisition (333,051) (3,226,183) (383,370) Lease payments - 20,742 - SBITA payments - - (81,384) Lease income 38,421 70,072 - Proceeds from the sale of capital assets - - 17,306 Net cash provided (used) by capital and related financing activities (294,630) (7,636,849) (559,289) CASH FLOWS FROM INVESTING ACTIVITIES Unrealized gain (loss) on investments 1,148,245 5,017 901,815 Interest received 1,587,295 8,551 1,075,153 Net cash provided (used) by investing activities 13,568 2,735,540 1,976,968 Net increase (decrease) in cash and investments 729,196 5,903,204 2,674,476 Cash and investments, beginning of year 162,433 34,863,701 26,783,785 Cash and investments, end of year 891,629 $ 40,766,905 $ 29,458,261 $ Reconciliation to Statement of Net Position:

Cash and investments 891,629 $ 40,766,905 $ 29,458,261 $ Total cash and investments 891,629 $ 40,766,905 $ 29,458,261 $

City of Hanford
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2024
The accompanying notes are an integral part of these financial statements. -26-
Sewer Improvement Funds
Water System Wastewater Storm Drain Refuse
Fund Fund Fund Fund

RECONCILIATION OF OPERATING INCOME (LOSS) TO NET

CASH PROVIDED (USED) BY OPERATING ACTIVITIES
Operating income (loss) 4,927,400 $ 562,646 $ (210,519) $ (732,179) $ Adjustments to reconcile operating income (loss)
to net cash provided (used) by
operating activities:

Depreciation 2,323,115 1,818,715 379,462 723,599 Changes in assets, liabilities, and deferred resources in:

Receivables (492,293) (397,940) (22,062) (145,490) Prepaid expenses (1,744) 321,750 (55) (55) Inventory 116,667 - - - Deferred outflows of resources 990,832 512,787 (10,991) 855,503 Accounts payable (1,645,924) 47,134 (5,931) 74,340 Salaries and benefits payable (1,783) 4,998 3,503 (2,188) Interest payable (15,720) - - - Compensated absences (27,835) 2,293 (1,584) 1,333 Deposits and unearned revenue (59,811) (398) (135) (529) Claims payable - - - - Net OPEB liability 391,777 305,285 - 434,479 Net pension liability (1,507,024) (830,277) 64,346 (1,327,305) Deferred inflows of resources (145,286) (79,879) (4,824) (131,159) Net cash provided (used) by operating activities 4,852,371 $ 2,267,114 $ 191,210 $ (249,651) $

SCHEDULE OF NON-CASH CAPITAL AND RELATED

FINANCING ACTIVITIES
Contributed Capital 2,090,441 $ 1,233,324 $ 1,015,237 $ - $

City of Hanford
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2024 (concluded)
The accompanying notes are an integral part of these financial statements. -27-
Governmental
Total Activities
Total Non-major Enterprise Internal
Enterprise Funds Funds Fund

RECONCILIATION OF OPERATING INCOME (LOSS) TO NET

CASH PROVIDED (USED) BY OPERATING ACTIVITIES
Operating income (loss) 496,351 $ 5,043,699 $ 258,290 $ Adjustments to reconcile operating income (loss)
to net cash provided (used) by
operating activities:

Depreciation 370,523 5,615,414 1,157,139 Changes in assets, liabilities, and deferred resources in:

Receivables (71,966) (1,129,751) 86,657 Prepaid expenses - 319,896 (25,575) Inventory - 116,667 9,987 Deferred outflows of resources - 2,348,131 246,765 Accounts payable 38,347 (1,492,034) (410,960) Salaries and benefits payable 10,905 15,435 (559,554) Interest payable - (15,720) - Compensated absences 37,536 11,743 8,941 Deposits and unearned revenue (2,481) (63,354) - Claims payable - - 1,223,000 Net OPEB liability - 1,131,541 - Net pension liability - (3,600,260) (192,147) Deferred inflows of resources - (361,148) (47,789) Net cash provided (used) by operating activities 879,215 $ 7,940,259 $ 1,754,754 $

SCHEDULE OF NON-CASH CAPITAL AND RELATED

FINANCING ACTIVITIES
Contributed Capital 17,306 $ - $

FIDUCIARY FUNDS

FINANCIAL STATEMENTS

City of Hanford
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2024
The accompanying notes are an integral part of these financial statements. -28-
Redevelopment
Successor Agency
Private Purpose Trust and
Trust Fund Custodial Funds
ASSETS
Cash and investments 258,181 $ 1,323,931 $
Accounts receivable - 488,539
Assets held for resale 38,192 - Total assets 296,373 1,812,470 LIABILITIES Accounts payable - 1,382,916 Deposits held for others - 415,697 Total liabilities - 1,798,613 FIDUCIARY NET POSITION Held in trust for the retirement of obligations of the
former Hanford Redevelopment Agency and
other purposes 296,373 - Restricted - 13,857 Total fiduciary net position 296,373 $ 13,857 $

City of Hanford
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
For the Year Ended June 30, 2024
The accompanying notes are an integral part of these financial statements. -29-
Redevelopment
Successor Agency
Private-Purpose Trust and
Trust Fund Custodial Fund

ADDITIONS
Investment earnings 9,629 $ - $
Unrealized gain/(loss) on investments 8,569 - Total additions 18,198 - DEDUCTIONS General government 97,268 9,887
Total deductions 97,268 9,887 Change in fiduciary net position (79,070) (9,887) NET POSITION (DEFICIT) Beginning of year 375,443 23,744
End of year 296,373 $ 13,857 $

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City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-30-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements of the City of Hanford, California (the City) have been prepared in conformity with U.S. Generally Accepted Accounting principles as prescribed by the Governmental Accounting Standards Board (GASB).

The accompanying financial statements present the financial position of the City and the various funds and fund types, the results of operations of the City and the various funds and fund types, and the cash flows of the proprietary funds. The financial statements are presented as of June 30, 2024 and for the year then ended.

Description of the Reporting Entity
The City was incorporated as a General Law city in 1891. The City operates under a CouncilAdministrator form of government and provides the following services: Public safety (police and fire), community development, community services, public works, cultural, general administrative services, and capital improvements.

As required by accounting principles generally accepted in the United States of America, these financial statements present the City (the primary government) and its component units. The component units discussed below is included in the City’s reporting entity because of the significance of their operational or financial relationship with the City. However, elected officials of the City have a continuing accountability for fiscal matters of the other entities. The financial reporting entity consists of: (1) the City (2) organizations for which the City is financially accountable and (3) organizations for which the nature and significance of their relationship with the City are such that exclusion would cause the City’s financial statements to be misleading or incomplete.

An organization is fiscally dependent on the primary government if it is unable to adopt its budget, levy taxes or set rates or charges, or issue bonded debt without approval by the primary government.

In a blended presentation, component unit balances and transactions are reported in a manner similar to the balances and transactions of the City. A component unit is presented on a blended basis component unit’s governing body is substantially the same as the City’s or the component unit provides services almost entirely to the City; otherwise, the component unit is presented discretely.

Blended Component Unit
The financial statements of the City include the financial activities of the City as well as of the Hanford Improvement Corporation. Although the Hanford Improvement Corporation is a legally distinct unit from the City, their financial operations are overseen by the City and the City Council is the board of directors of the Corporation.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-31-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Basis of Presentation
Government-Wide Financial Statements
The Government-wide financial statements (the Statement of Net Position and the Statement of Activities) report information of all of the non-fiduciary activities of the primary government and its component units. For the most part, eliminations have been made to minimize the double counting on internal activities. These statements distinguish between the governmental and business type activities of the City. 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 charged to external parties.

The Statement of Activities presents a comparison between direct expenses and program revenues for each segment of the business-type activities of the City and of reach function of the City’s governmental activities. Direct expenses are those that are specifically associated with a program or function and; therefore, are clearly identifiable to a particular function. Program revenues include 1) charges paid by the recipients of goods or services offered by the programs and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented instead as general revenues.

Net Position are restricted when constraints placed on them are either externally imposed or are imposed by constitutional provisions or enabling legislation. Internally imposed designations of resources are not presented as restricted net position. When both restricted and unrestricted resources are available for use, generally it is the City’s policy to use restricted resources first, then unrestricted resources as they are needed.

Governmental Fund Financial Statements
The fund financial statements provide information about the City’s funds, with separate statements presented for each fund category - governmental, proprietary, and fiduciary. The emphasis of fund financial statements is on major governmental and enterprise funds, each displayed in a separate column. All remaining governmental and enterprise funds are separately aggregated and reported as non-major funds.

Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values. Non-operating revenues, such as subsidies and investment earnings, result from nonexchange transactions or ancillary activities.

The City reports the following major governmental funds:

General Fund – The General Fund is the principle operating fund of the City. It is used to account for all financial resources except those required to be accounted for in other funds. For the City, the General Fund includes basic governmental activities such as general government, public safety, public works, recreation and community development.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-32-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Basis of Presentation (Continued)
CDBG Home/Housing Fund – This fund is used to receive and disburse funds in accordance with grants received from the Department of Housing and Urban Development for the repair and improvement of targeted housing areas.

Transportation Development Act Fund – This fund is used to account for financial resources to be used for transit and non-transit related purposes that comply with regional transportation plans. The City has elected to present this fund as a major fund.

American Rescue Plan Act Fund – This fund is used to account for financial resources provided by the American Rescue Plan Act.

The City reports the following major enterprise funds:

Water System Fund – The Water System Fund is used to account for the financial activities of water utility of the City.

Wastewater Fund – The Wastewater Fund is used to account for financial activities of sewage collection and wastewater treatment utility of the City.

Storm Drain Fund – The Storm Drain Fund is used to account for the financial activities of the City’s storm drains.

Refuse Fund – The Refuse Fund is used to account for the financial activities of the collection of solid waste and disposal utility of the City.

The City presents the following non-major enterprise funds:

Airport Fund – To account for all activities necessary to provide an airport to the residents of the City and surroundings areas.

Intermodal Fund – The Intermodal Fund is used to account for the financial activities of a building used to support state regional and local transportation.

Courthouse Square Fund – The Courthouse Square Fund is used to account for the financial activities of the maintenance and improvement of the property known as the Courthouse Square in downtown Hanford.

Building Safety Fund – The Building Safety Fund is used to account for the financial activities of the City’s review of building plans from developers, contractors and/or property owners and inspectors of buildings. Revenue is provided by the permit and review fees.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-33-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Basis of Presentation (Continued)
The City reports the following fund types in aggregate as part of other non-major governmental funds:

Special Revenue Funds – Special Revenue Funds are used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes.

Capital Projects Fund – Capital Projects Funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities other than those finances by proprietary funds.

Additionally, the City reports the following fund types:

Internal Service Funds – Internal Service Funds are used to account for the financing of goods or services provided by one department or agency of the City to another on a cost-reimbursement basis.

Private-Purpose Trust Fund – The Private Purpose Trust Fund is used to account for the activities of the former Hanford Redevelopment Agency during the wind down period.

Custodial Funds – Custodial Funds are used to account for assets held by the City in a purely custodial capacity or as an agent for individuals, private organizations and/or other governments.

Measurement Focus, Basis of Accounting, and Financial Statement Presentation In accordance with generally accepted accounting principles the Statement of Net Position reports separate sections for Deferred Outflows of Resources and Deferred Inflows of Resources, when applicable.

Deferred Outflows of Resources – This amount represents outflows of resources (consumption of net assets) that apply to future periods and that, therefore, will not be recognized as an expense until that time.

Deferred Inflows of Resources – This amount represents inflows of resources (acquisition of net assets) that apply to future periods and that, therefore, are not recognized as a revenue until that time.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-34-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Basis of Presentation (Continued)
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 at the time liabilities are incurred, regardless of when the related cash flows take place. Non-exchange transactions, in which the City gives (or receives) value without directly receiving (or giving) equal value in exchange, include property and sales taxes, grants, entitlements and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenues from sales tax are recognized when the underlying transactions take place. Revenues from grants, entitlements and donations are recognized in the fiscal year in which all eligible requirements have been satisfied.

Governmental funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. Property and sales taxes, interest, certain state and federal grants and charges for services are accrued when their receipt occurs within sixty days after the end of the accounting period so as to be both measurable and available. Expenditures are generally recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments are recorded only when payment is due. General capital assets acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term debt and capital leases are reported as other financing sources.

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 operation. Revenues and expenses not meeting this definition are reported as non-operating.

Assets, Liabilities, Net Assets or Fund Balance, and Other Financial Statement Items Cash and Cash Equivalents
For purposes of the Statement of Cash Flows, the City considers all short term and highly liquid investments (including restricted assets) to be cash and cash equivalents, as reported on the Statement of Net Position and Balance Sheet as cash and investments.

Investments
Investments are stated at fair value (the value at which a financial instrument could be exchanged in a current transaction between willing parties, other than a forced or liquidation sale).

Further cash and investment disclosures are presented in Note 2.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-35-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Assets, Liabilities, Net Assets or Fund Balance, and Other Financial Statement Items (Continued)
Interfund Transactions
Interfund transactions are reflected as either loans, services provided, reimbursements or transfers.

Loans are reported as receivables and payables as appropriate, are subject to elimination upon consolidation and are referred to as either “due to/from other funds” (i.e., the current portion of interfund loans) or “advances to/from other funds” (i.e., the non-current portion of interfund loans).

Any residual balances outstanding between the governmental activities and the business-type activities are reported in the government wide financial statement as “internal balances.” Advances between funds, as reported in the fund financial statements, are offset by a fund balance reserve account in applicable governmental funds to indicate that they are not available for appropriation and are not available financial resources.

Services provided, deemed to be a market or near market rates, are treated as revenues and expenditures/expenses. Reimbursements are when one fund incurs a cost, charges the appropriate benefiting fund and reduces its related cost as a reimbursement. All other interfund transactions are treated as transfers. Transfers between governmental or proprietary funds are netted as part of the reconciliation to the government-wide presentation.

Receivables
In the government-wide statements, receivables consist of all revenues earned at year-end and not yet received. Allowances for uncollectible accounts receivable are based upon historical trends and the periodic aging of accounts receivable. Major receivable balances for the governmental activities include intergovernmental and tax revenue receivable. Business-type activities report trade and intergovernmental revenue as their major receivables.

Inventory
Inventories of materials and supplies in the proprietary and internal services funds are valued at the lower of cost or market, carried on a first-in, first-out (FIFO) basis.

Capital Assets
The accounting treatment over property, plant, and equipment (capital assets) depends on whether the assets are used in governmental fund operations or proprietary fund operations and whether they are reported in the government-wide or fund financial statements.

In the government-wide financial statements and proprietary fund statements, capital assets are presented on the statement of net position and valued at historical cost or estimated historical cost if actual is unavailable, except for donated capital assets which are recorded at acquisition value at the date of acquisition.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-36-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Assets, Liabilities, Net Assets or Fund Balance, and Other Financial Statement Items (Continued)
The City’s capitalization threshold is $10,000. In other words, capital assets are capitalized only if they have a cost in excess of $10,000 and have an expected useful life of three years or more.

Capital assets that have a cost below $10,000 are expended during the fiscal year they are acquired.

The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Betterments and major improvements which significantly increase values, change capacities or extend useful lives are capitalized.

Upon sale or retirement of capital assets, the cost and related accumulated depreciation are removed from the respective accounts and any resulting gain or loss is included in the results of operations.

Depreciation of all exhaustible capital assets is recorded as an allocated expense in the Statement of Activities, with accumulated depreciation reflected in the Statement of Net Position estimated useful lives using the straight-line method of depreciation. The range of estimated useful lives by type of assets is as follows:

Infrastructure 20 to 50 years
Buildings 20 to 50 years
Improvements other than buildings 20 to 50 years
Machinery and equipment 3 to 20 years
Major outlays for capital assets and improvements are capitalized as projects are constructed.

Interest incurred during the construction phase of capital assets of business-type activities is included as part of the capitalized value of the assets constructed.

In the fund financial statements, capital assets used in governmental fund operations are accounted for as capital outlay expenditures of the governmental fund upon acquisition. Capital assets used in proprietary fund operations are accounted for the same as in the government-wide statements.

Compensated Absences
It is the City’s policy to permit employees to accumulate earned but unsaved vacation, sick pay benefits and compensatory time. All vacation and compensatory pay is accrued when incurred in the government-wide, proprietary, and fiduciary fund financial statements. A liability for these amounts is reported in governmental funds only if they have matured, for example, as a result of employee resignations or retirements. For additional information regarding compensated absences, see Note

7.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-37-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Assets, Liabilities, Net Assets or Fund Balance, and Other Financial Statement Items (Continued)
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.

Debt principal payments of both government and business-type activities are reported as decreases in the balance of the liability on the Statement of Net Position. Bond premiums and discounts are deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are expensed when incurred.

In the fund financial statements, however, debt principal payments of governmental funds are recognized as expenditures when paid. 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 withheld from the actual debt proceeds received or not, are reported as debt service expenditures.

Leases
The City is a lessee for noncancelable leases of copiers and recognizes the liability and an intangible right-to-use lease asset at the inception of the lease agreement at the current present value of future payments, in the government-wide and proprietary fund financial statements. The City recognizes lease liabilities with an initial, individual value of $25,000 or more.

At the commencement of a lease, the City initially measures the lease liability at the present value of payments expected to be made during the lease term. Subsequently, the lease liability is reduced by the principal portion of 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.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-38-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Assets, Liabilities, Net Assets or Fund Balance, and Other Financial Statement Items (Continued)
Key estimates and judgements related to leases include how the City determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments.
 The City uses the interest rate charged by the lessor as the discount rate. When the interest rate charged by the lessor is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for leases, which it has determined is the prime rate at the inception of the lease.
 The lease term includes the noncancellable period of the lease. Lease payments included in the measurement of the lease liability are composed of fixed payments and purchase option price that the City is reasonably certain to exercise.

The City monitors changes in circumstances that would require a remeasurement of its lease and will remeasure the lease asset and liability if certain changes occur that are expected to significantly affect the amount of the lease liability. Lease assets are reported with other capital assets and lease liabilities are reported with long-term debt on the Statement of Net Position.

The City is a lessor for noncancelable leases of the Hanford train station, hotel parking spaces, and agricultural ground leases. The City recognizes a lease receivable and a deferred inflow of resources in the government-wide, proprietary fund, and governmental fund financial statements at the inception of the lease agreement at current present value of all future payments.

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.

Key estimates and judgements 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.  The City uses the interest rate charges to the lessees as the discount rate. When the interest rate charged the lessees is not provided, the City generally uses the implied rate of return as the discount rate for leases. When the implied rate of return cannot be determined, the City uses its estimated incremental borrowing rate which it has determined is the prime rate at the inception of the lease.
 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.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-39-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Assets, Liabilities, Net Assets or Fund Balance, and Other Financial Statement Items (Continued)
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 lease receivable.

Right-to-Use Lease / Subscription Based Information Technology Arrangements (SBITA) Assets Right-to-use lease/SBITA assets are recorded at the amount of the initial measurement of the lease/SBITA liabilities and modified by any lease payment made to the lessor at or before the commencement of the lease term, less any lease incentives received from the lessor at or before the commencement of the lease term along with any initial direct costs that are ancillary charges necessary to place the lease assets into service.

Right-to-use lease/SBITA assets are amortized using the straight-line method over the shorter of the lease term or the useful life on the underlying asset, unless the lease contains a purchase option that the City has determined is reasonably certain of being exercised.

Other Post-employment Benefits (OPEB)
For purposes of measuring the total OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, have been determined by an independent actuary.

For this purpose, benefit payments are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value.

Generally accepted accounting principles require that the reported results must pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used:

OPEB
Valuation Date June 30, 2023
Measurement Date June 30, 2024
Measurement Period June 30, 2023 to June 30, 2024

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-40-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Assets, Liabilities, Net Assets or Fund Balance, and Other Financial Statement Items (Continued)
Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Plan and additions to/deductions from the Plan’s fiduciary net position have been determined on the same basis. For this purpose, benefit payments (including refunds of employee contributions) are recognized when currently due and payable in accordance with the benefit terms.

Investments are reported at fair value.

Generally accepted accounting principles require that the reported results must pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used.

CalPERS
Valuation Date June 30, 2022
Measurement Date June 30, 2023
Measurement Period June 30, 2022 to June 30, 2023
Net Position
In the government-wide financial statements and proprietary fund financial statements, net position is classified as follows:
 Net investment in capital assets – This category groups all capital assets, including infrastructure, into one component of net position. Accumulated depreciation and the outstanding balances of debt that are attributable to the acquisition, construction or improvement of these assets reduce the balance in this category.  Restricted net position – This category presents external restrictions imposed by creditors, grantors, contributors or laws and regulations of other governments and restrictions imposed by law through constructional provisions or enabling legislation.  Unrestricted net position – This category represents net position of the City, not restricted for any project or other purpose.

When expenses are incurred for purposes for which both restricted and unrestricted net position is available, the City's policy is to apply restricted net position first.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-41-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Assets, Liabilities, Net Assets or Fund Balance, and Other Financial Statement Items (Continued)
Fund Balance
In the fund financial statements, governmental funds report fund balances as nonspendable, restricted, committed, assigned or unassigned based primarily on the extent to which the City is bound to honor constraints on how specific amounts can be spent.  Nonspendable fund balance – amounts that cannot be spent because they are either (a) not spendable in form or (b) legally or contractually required to be maintained intact.  Restricted fund balance – amounts with constraints placed on their use that are either (a) externally imposed by creditors, grantors, contributors, or laws and regulations of other governments or (b) imposed by law through constitutional provisions or enabling legislation.  Committed fund balance – amounts that can only be used for specific purposes determined by formal action of the City’s highest level if decision-making authority (the City Council) and that remain binding unless removed in the same manner. The underlying action that imposed the limitation needs to occur no later than the close of the reporting period.  Assigned fund balance – amounts that are constrained by the City’s intent to be used for specific purposes. The intent can be established by either the highest level of decision making, or by a body or an official designated for that purpose.  Unassigned fund balance – the residual classification for the City’s General Fund that includes amounts not contained in the other classifications. In other funds, the unassigned classification is used only if expenditures incurred for specific purposes exceed the amounts restricted, committed, or assigned to those purposes.

The City Council establishes, modifies or rescinds fund balance commitments and assignments by passage of an ordinance or resolution. This is done through adoption of the budget and subsequent budget amendments that occur throughout the year.

When expenditures are incurred for purposes for which both restricted and unrestricted fund balances are available, the City's policy is to apply restricted fund balances first, then unrestricted fund balances as they are needed. When expenditures are incurred for purposes where only unrestricted fund balances are available, the City uses the unrestricted resources in the following order: committed, assigned, and unassigned.

Property Taxes
In 1978, a state constitutional amendment (Proposition 13) provided that the tax rate be limited to 1% of market value, levied only by the County and shared with all other jurisdictions. Such limitation on the rate may only be increased through voter approval. The County Collects property taxes and distributes them to taxing-approved debt. In the fund financial statements, property tax is recorded as revenue in the period levied to the extent they are collected within 60 days of year-end.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-42-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Assets, Liabilities, Net Assets or Fund Balance, and Other Financial Statement Items (Continued)
The property tax calendar for the City is as follows:

Lien date January 1
Levy dates September 1
Due dates November 1 - 1st installment
February 1 - 2nd installment
Collection dates December 10 - 1st installment
April 10 - 2nd installment
Advances from other Governments
The City reports advances from other governments in its financial statements. These advances arise when resources are received by the government before it has legal claim to them.

Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures/expenses during the reporting period. Actual results could differ from those estimates.

Stewardship, Compliance, and Accountability
Budgets and Budgetary Accounting
The procedures established by the City Council in adopting the budgetary data reflected in the financial statements are as follows:

On or before the second meeting in May, the City Manager submits to the City Council a proposed operating and capital projects budget for the fiscal year commencing the following July 1. Following publication and public hearings, the budget is legally enacted by resolution.

The City Manager is authorized to transfer funds appropriated with respect to all classifications within the same department. The City Manager may transfer appropriated funds from any classification within other expenditure categories to existing capital outlay and capital projects classifications within the same department only; however, any revisions that alter the total expenditures of any department or create additional projects must be approved by the City Council.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-43-
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Assets, Liabilities, Net Assets or Fund Balance, and Other Financial Statement Items (Continued)
Supplemental budgetary appropriations were negligible for the fiscal year ended June 30, 2024. All unencumbered appropriations lapse at year-end.

For budgeting purposes, the General Fund is composed of several departments while all other budgeted funds are considered a single department. Revenues are budgeted on a line-item basis.

A comparison of budgeted and actual revenues by line item would be too voluminous for this report.

Budgets for the General and major Special Revenue Funds are presented in the accompanying general purpose financial statements on a basis consistent with accounting principles generally accepted in the United States of America. No budgets are adopted for the Proprietary and Fiduciary Fund types.

Reclassification and Eliminations
Interfund balances must generally be eliminated in the government-wide financial statements, except for net residual amounts due between governmental activities. Amounts involving fiduciary funds should be reported as external transactions. Any allocations must reduce the expense of the function from which the expenses are being allocated, so that expenses are reported only once in the function in which they are allocated.

Implementation of Governmental Accounting Standards Board (GASB) Pronouncements The City has implemented GASB No. 100, Accounting Changes and Error Corrections. There was no effect on the current year financial statements due to this pronouncement.

Governmental Accounting Standards Update
The City is currently analyzing its accounting practices to determine the potential impact on the financial statements for the following GASB statements:

GASB Statement No. 101, Compensated Absences is effective for fiscal years beginning after December 15, 2023.

GASB Statement No. 102, Certain Risk Disclosures is effective for fiscal years beginning after June 15, 2024
GASB Statement No. 103, Financial Reporting Model Changes is effective for fiscal years beginning after June 15, 2025.

GASB Statement No. 104, Disclosure of Certain Capital Assets is effective for fiscal years beginning after June 15, 2025.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-44-
NOTE 2 - CASH AND INVESTMENTS
Cash and investments as of June 30, 2024 are classified in the accompanying financial statements as follows:

Statement of Net Position:

Cash and investments 120,823,563 $
Fiduciary funds:

Cash and investments 1,582,112 Total Cash and Investments 122,405,675 $ Cash and investments as of June 30, 2024 consist of the following:

Cash on hand 1,700 $
Deposits with financial institutions 6,670,591
Investments 115,733,384 Total Cash and Investments 122,405,675 $ 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 (or the City’s investment policy, where more restrictive) 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.

Authorized Investment Type
Maximum
Maturity
Maximum
Percentage of
Portfolio*
Maximum
Investment in
One Issuer
U.S. Treasury Obligations 5 years None None
U.S. Agency Securities 5 years None None
Bankers' Acceptances 180 days 40% 30%
Commercial Paper 270 days 25% 10%
Negotiable Certificates of Deposit 5 years None None
Repurchase Agreements 1 year 30% None
Mutual Funds N/A 20% 10%
Money Market Mutual Funds N/A 20% 10%
Local Agency Investment Fund (LAIF) N/A None None
Corporate Investments N/A None None
County Investment Pool N/A None None

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-45-
NOTE 2 - CASH AND INVESTMENTS (Continued)
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:

Authorized Investment Type
Maximum
Maturity
Maximum
Percentage of
Portfolio*
Maximum
Investment in
One Issuer
U.S. Treasury Obligations 5 years None None
U.S. Agency Securities 5 years None None
Bankers' Acceptances 180 days 40% None
Commercial Paper 270 days 40% None
Negotiable Certificates of Deposit 5 years 30% None
Repurchase Agreements 1 year None None
Mutual Funds N/A 20% None
Money Market Mutual Funds N/A 20% None
Local Agency Investment Fund (LAIF) N/A None None
Disclosure Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of short term and long-term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing and coming close to maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations.

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

Investment Type Total
12 Months
or Less
13 to 24
Months
25 to 60
Months
More than
60 Months
U.S. Treasury Obligations 1,471,830 $ 1,471,830 $ - $ - $ - $ U.S. Agency Securities 17,917,964 10,435,269 4,492,125 2,990,570 - Negotiable Certificates of Deposits 8,563,757 5,291,780 3,271,977 - - Corporate Investments 1,803,518 969,320 - 834,198 - Held by bond trustee:

Money Market Funds 4,003,638 4,000,738 - 2,900 - Local Agency Investment Funds (LAIF) 22,859,838 22,859,838 - - - County Investment Pool 965,090 965,090 - - - California Class 58,147,749 58,147,749 - - - Total 115,733,384 $ 104,141,614 $ 7,764,102 $ 3,827,668 $ - $ Remaining Maturity (in Months)

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-46-
NOTE 2 - CASH AND INVESTMENTS (Continued)
Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented on the following page is the minimum rating required by (where applicable) the California Government Code, the City’s investment policy, or debt agreements and the actual rating as of year-end for each investment type.

Investment Type Amount
Minimum Legal
Rating A/A+ AA+ Unrated
U.S. Treasury Obligations 1,471,830 $ AA - $ - $ 1,471,830 $ U.S. Agency Securities 17,917,964 N/A - 17,917,964 - Negotiable Certificates of Deposits 8,563,757 N/A - - 8,563,757 Corporate Investments 1,803,518 N/A 1,803,518 - - Held by bond trustee:

Money Market Funds 4,003,638 N/A - - 4,003,638 Local Agency Investment Funds (LAIF) 22,859,838 N/A - - 22,859,838 County Investment Pool 965,090 N/A - - 965,090 California Class 58,147,749 N/A - - 58,147,749 Total 115,733,384 $ 1,803,518 $ 17,917,964 $ 96,011,902 $ Standard's & Poor's Ratings as of Year End
Concentration of Credit Risk
The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. The City had no investments in any one issuer (other than U.S. Treasury Securities, mutual funds, and external investment pools) that represent 5% or more of total City investments.

Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party (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 deposits or investments, other than the following provisions for deposits: The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The market 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.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-47-
NOTE 2 - CASH AND INVESTMENTS (Continued)
Investment in State and County Investment Pools
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code under the oversight of the Treasurer of State of California. The fair value of the City’s investment in this pool is reported in the accompanying financial statements at amount 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. For withdrawals over $10,000,000 LAIF requires at least 24‐hour notice. Also, there is a $5,000 minimum and a limit of 15 transactions per month.

The City is also a voluntary participant in the County of Tulare Investment Pool. Assumptions made in determining the fair value of the investment portfolio are available from the County Treasurer.

Fair Value Measurements
The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs.

The City has the following recurring fair value measurements as of June 30, 2024:

Investment type Level 1 Level 2 Level 3 Total
U.S. Treasury Obligations - $ 1,471,830 $ - $ 1,471,830 $ U.S. Agency Securities - 17,917,964 - 17,917,964 Negotiable Certificates of Deposits - 8,563,757 - 8,563,757 Corporate Investments 1,803,518 - 1,803,518 $ 29,757,069 - $ - $ 29,757,069
Investments not subject to fair value hierarchy:

Local Agency Investment Funds (LAIF) 22,859,838
County Investment Pool 965,090 California Class 58,147,749 Money Market Funds 4,003,638 Total 115,733,384 $
Debt securities classified in Level 2 of the fair value hierarchy are valued using a matrix pricing technique. There have been no changes in fair value measurement classifications from the prior year.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-48-
NOTE 3 - RECEIVABLES
Receivables as of June 30, 2024 for the City’s individual major funds, nonmajor funds and internal service funds in the aggregate are as follows:

Accounts Interest Taxes Loans Leases Total
Governmental Funds
General 7,259,133 $ 1,038 $ - $ - $ 854,343 $ 8,114,514 $ CDBG Home/Housing 183,359 - - 17,695,752 - 17,879,111 Transportation Development Act - - 1,213,113 - - 1,213,113 Nonmajor and Other 2,635,637 - - 1,806,216 - 4,441,853 1,038 10,078,129 1,213,113 19,501,968 854,343 31,648,591 Enterprise Funds Water System 1,903,621 - - - - 1,903,621 Wastewater 1,089,675 - - - 437,641 1,527,316 Storm Drain 210,929 - - - - 210,929 Refuse 1,296,189 - - - - 1,296,189 Airport Fund 22,695 - - - - 22,695 Intermodal 39,528 - - - 164,534 204,062 Courthouse Square 5,347 - - - - 5,347 Building Safety 49,622 - - - - 49,622 - 4,617,606 - - 602,175 5,219,781
Internal Service Funds
Risk Management Fund 13,214 - - - - 13,214 Computer Maintenance Fund 57 - - - - 57 Building Fund 1,269 - - - - 1,269 Fleet Management 223 - - - - 223 Medical Fund 302 - - - - 302 - 15,065 - - - 15,065 Total 14,710,800 $ 1,038 $ 1,213,113 $ 19,501,968 $ 1,456,518 $ 36,883,437 $ The remainder of this page left intentionally blank

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-49-
NOTE 4 - CAPITAL ASSETS
Capital assets activities for the year ended June 30, 2024 were as follows:

Balance
July 1, 2023
Additions/
Completions
Retirements/
Adjustments
Balance
June 30, 2024
Governmental Activities
Capital assets not being depreciated:

Land 60,455,620 $ 638,487 $ - $ 61,094,107 $
Construction in progress 817,424 6,140,205 (10,021) 6,947,608 Total capital assets not being depreciated 61,273,044 6,778,692 (10,021) 68,041,715 Capital assets being depreciated/amortized:

Buildings 25,261,269 - - 25,261,269
Infrastructure 193,146,692 10,657,026 - 203,803,718 Equipment 24,280,951 467,565 (1,878,338) 22,870,178 Right to use leased equipment 69,534 998,088 - 1,067,622 Right to use SBITA asset 809,556 237,867 (652,349) 395,074 Total capital assets being depreciated/amortized 243,568,002 12,360,546 (2,530,687) 253,397,861 Less accumulated depreciation/amortization:

Buildings (10,211,383) (477,618) - (10,689,001)
Infrastructure (116,408,005) (6,629,309) - (123,037,314) Equipment (15,087,083) (1,525,161) 1,377,668 (15,234,576) Right to use leased equipment (36,311) (104,076) - (140,387) Right to use SBITA asset (414,608) (111,868) 329,162 (197,314) Total accumulated depreciation/amortization (142,157,390) (8,848,032) 1,706,830 (149,298,592) Total capital assets being depreciated, net 101,410,612 3,512,514 (823,857) 104,099,269 Governmental Activities capital assets, net 162,683,656 $ 10,291,206 $ (833,878) $ 172,140,984 $ Business-type Activities
Capital assets not being depreciated:

Land 11,950,873 $ 16,000 $ - $ 11,966,873 $
Construction in progress 4,044,330 451,624 (3,986,741) 509,213 Total capital assets not being depreciated 15,995,203 467,624 (3,986,741) 12,476,086 Capital assets being depreciated:

Buildings and improvements 187,856,815 8,289,644 - 196,146,459 Machinery and equipment 30,818,214 3,006,044 (232,181) 33,592,077 Right to use leased equipment - 25,726 - 25,726 Total capital assets being depreciated 218,675,029 11,321,414 (232,181) 229,764,262 Less accumulated depreciation:

Buildings and improvements (76,689,579) (3,470,293) (133,689) (80,293,561) Machinery and equipment (16,372,607) (2,139,861) 231,464 (18,281,004) Right to use leased equipment - (5,260) - (5,260) Total accumulated depreciation (93,062,186) (5,615,414) 97,775 (98,579,825) Total capital assets being depreciated, net 125,612,843 5,706,000 (134,406) 131,184,437 Business-type Activities capital assets, net 141,608,046 $ 6,173,624 $ (4,121,147) $ 143,660,523 $

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-50-
NOTE 4 - CAPITAL ASSETS (Continued)
Depreciation expense for the fiscal year ending June 30, 2024 was charged to the following activities:

Governmental Activities:

General governmental 5,921,988 $
Public safety 230,727 Public works 1,230,543 Recreation 230,727 Community development 76,909 Capital assets held by the internal service funds that were charged to the various functions based on their usage 1,157,139 Total 8,848,032 $ Business-type Activities:

Water system 2,323,115 $
Wastewater 1,818,715 Storm drain 379,462 Refuse 723,599 Airport 319,509
Intermodal 26,117 Building Safety 24,897
Total 5,615,414 $
NOTE 5 - LONG-TERM DEBT
The following is a summary of the long-term debt activity for the year ended June 30, 2024:

Balance
July 1, 2023 Additions
Deletions/
Adjustments
Balance
June 30, 2024
Due Within
One Year
Governmental Activities
Pension obligation bonds payable 25,460,230 $ - $ (1,537,515) $ 23,922,715 $ 1,500,683 $ Lease payable 34,041 675,857 (71,031) 638,867 144,704 SBITA payable 353,827 237,867 (413,323) 178,371 99,097 Total Governmental Activities 25,848,098 913,724 (2,021,869) 24,739,953 1,744,484 Business-type Activities Pension obligation bonds payable 4,263,770 - (257,486) 4,006,284 251,316 Bonds payable 14,530,000 - (1,805,000) 12,725,000 1,880,145 Bond premiums 483,118 - (73,307) 409,811 73,307 Note payable - direct 4,306,151 - (415,311) 3,890,840 429,847 Finance purchase arrangement - direct borrowing 6,341,947 - (930,923) 5,411,024 1,027,984 Lease payable - 25,725 (4,983) 20,742 4,983 Total Business-type Activities 29,924,986 25,725 (3,487,010) 26,463,701 3,667,582 Total Primary Government 55,773,084 $ 939,449 $ (5,508,879) $ 51,203,654 $ 5,412,066 $

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-51-
NOTE 5 - LONG-TERM DEBT (Continued)
Governmental Activities
Bonds Payable
On May 23, 2022, the City of Hanford issued $30,946,000 Pension Obligation Bonds bearing interest of 4.39% payable annually on June 1 commencing June 1, 2023. The bonds mature annually at various amounts through June 1, 2039. The bonds are payable from net revenues in both the governmental activities and business-type activities created under the Indenture.

The Bonds were issued to pay the City’s unfunded accrued actuarial liability (UAAL), now known as Net Pension Liability, to the California Public Employees’ Retirement System (CalPERS).

Significant terms that pertain to the Pension Obligation Bonds are as follows. If the City fails to make the payment of principal or interest when due and payable; if the City fails to observe and perform any of the covenants, agreements, or conditions required in the bond agreement; if the City commences a voluntary case under Title 11 of the United States Code or any substitute or successor statute; the City shall be considered in default. In the event of a default, the Trustee may declare the principal and interest of the bond immediately due and payable. The revenues pledge from the bond are the revenues payable from the various funds allocated the issuance of the debt.

Pension obligation bonds outstanding on June 30, 2024 for governmental activities are $23,922,715.

The future maturities of the pension obligation bonds payable for governmental activities are as follows:

Fiscal Year Principal Interest Total
2025 1,500,683 $ 1,050,206 $ 2,550,889 $
2026 1,506,678 984,289 2,490,967 2027 1,498,113 918,146 2,416,259 2028 1,564,068 852,378 2,416,446
2029 1,286,544 783,716 2,070,260
2030-2034 6,977,489 3,042,925 10,020,414 2035-2038 9,589,140 1,337,575 10,926,715 Totals 23,922,715 $ 8,969,235 $ 32,891,950 $

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-52-
NOTE 5 - LONG-TERM DEBT (Continued)
Governmental Activities (Continued)
Leases Payable
The City entered into several lease agreements for the use of various types of equipment. The lease agreements range from 12 to 60 months. The City is required to make annual fixed payments ranging from $4,046 to $13,001. The agreements have interest rates ranging from 0.2% to 2.63%. As of June 30, 2024, the City had total outstanding lease payable of $638,867 and right to use asset of $927,235, net of amortization.

The future principal and interest lease payments as of June 30, 2024, are as follows:

Fiscal Year Principal Interest Total
2025 144,704 $ 12,815 $ 157,519 $
2026 131,763 10,802 142,565 2027 135,145 7,407 142,552
2028 135,686 3,946 139,632
2029 91,569 977 92,546 Totals 638,867 $ 35,947 $ 674,814 $ Subscription based IT arrangement (SBITA) payable
The City entered into several subscription-based IT arrangements for the use of various types of software. The SBITA’S agreements range from 12 to 24 months. The City is required to make annual fixed payments ranging from $4,380 to $81,385. The agreements have interest rates ranging from

0.2% to 2.63%. As of June 30, 2024, the City had total outstanding SBITA payable of $178,371 and right to use asset of $197,760, net of amortization.

Fiscal Year Principal Interest Total
2025 99,097 $ 2,647 $ 101,744 $
2026 79,274 543 79,817 Totals 178,371 $ 3,190 $ 181,561 $

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-53-
NOTE 5 - LONG-TERM DEBT (Continued)
Business-type Activities
Bonds Payable
On July 1, 2012, the City of Hanford issued $13,165,000 Wastewater Revenue Refunding Bonds Series 2012 bearing interest of 3.0% to 5.0% payable semi-annually on April 1 and October 1 commencing October 1, 2012. The bonds mature annually at various amounts through October 1, 2032. The bonds are payable from net revenues of the City’s Wastewater System and from amounts on deposit in certain funds and accounts created under the Indenture.

The Bonds were issued to refinance the City’s previously issued $5,000,000 CSCDA Water and Wastewater Revenue Bonds, dated October 1, 1999 and the $10,555,000 CSCDA Water and Wastewater Revenue Bonds dated April 16, 2002. As a result, the 1999 and 2002 Revenue Bonds are considered to be defeased and the liability for those bonds has been removed from the longterm liabilities of the Business Activities Debt.

The aggregate debt service payments of the new debt is $2,121,034 less than the old debt. The issuance of the new debt and refunding of the old debt resulted in an economic gain (the difference between the present value of the old debt and new debt payments) of approximately $1,537,677.

Significant terms that pertain to the Wastewater Revenue Refunding Bonds Series 2012 are as follows. If the City fails to make the payment of principal or interest when due and payable; if the City fails to observe and perform any of the covenants, agreements, or conditions required in the bond agreement; if the City files a petition or answer seeking reorganization or arrangement under the Federal bankruptcy laws; the City shall be considered in default. In the event of a default, the Trustee may declare the principal and interest of the bonds immediately due and payable. The revenues pledged of the bond are the revenues payable from the City’s Wastewater fund for the life of the bonds.

Wastewater revenue bonds outstanding on June 30, 2024 are $6,380,000.

The future maturities of the wastewater revenue bonds payable are as follows:

Fiscal Year Principal Interest Total
2025 695,145 $ 214,063 $ 909,208 $
2026 725,000 201,375 926,375 2027 750,000 175,563 925,563 2028 785,000 148,209 933,209
2029 805,000 119,390 924,390
2030-2033 2,619,855 197,200 2,817,055 Totals 6,380,000 $ 1,055,800 $ 7,435,800 $

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-54-
NOTE 5 - LONG-TERM DEBT (Continued)
Business-type Activities (Continued)
On July 1, 2013, the City of Hanford issued $12,725,000 Water Revenue Refunding Bonds Series 2013 bearing interest of 2.0% to 5.0% payable semi-annually on April 1 and October 1, commencing October 1, 2013. The bonds mature annually at various amounts through October 1, 2028. The bonds are payable from net revenues of the City’s Water System and from amounts on deposit in certain funds and accounts created under the Indenture.

The Bonds are being issued to refinance the City’s previously issued to refinance the City’s previously issued $8,925,000 CSDA Water and Wastewater Revenue Bonds, dated December 9, 2003 and the $8,150,000 Installment Sale Agreement Water System dated December 20, 2007. As a result the 2003 Revenue Bond and 2007 Installment Sale Agreement are considered defeased and the liability for those issues has been removed from the long-term liabilities of the Business Activities Debt.

The aggregate debt service payments of the new debt are $1,430,167 less than the old debt. The issuance of the new debt and refunding of the old debt resulted in an economic gain (the difference between the present value of the old debt and new debt payments) of approximately $567,774.

Significant terms that pertain to the Water Revenue Refunding Bonds Series 2013 are as follows. If the City fails to make the payment of principal or interest when due and payable; if the City fails to observe and perform any of the covenants, agreements, or conditions required in the bond agreement; if the City files a petition or answer seeking reorganization or arrangement under the Federal bankruptcy laws; the City shall be considered in default. In the event of a default, the Trustee may declare the principal and interest of the bonds immediately due and payable. The revenues pledged for the bond are the revenues payable from the City’s Water fund for the life of the bonds.

Water revenue bonds outstanding on June 30, 2024 are $4,125,000.

The future maturities of the water revenue bonds payable are as follows:

Fiscal Year Principal Interest Total
2025 970,000 $ 157,425 $ 1,127,425 $
2026 1,015,000 115,075 1,130,075 2027 1,055,000 68,600 1,123,600 2028 530,000 36,238 566,238 2029 555,000 12,488 567,488 Totals 4,125,000 $ 389,826 $ 4,514,826 $

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-55-
NOTE 5 - LONG-TERM DEBT (Continued)
Business-type Activities (Continued)
On January 28, 2015, the City of Hanford issued $3,885,000 Wastewater Revenue Refunding Bonds Series 2015, bearing interest of 2.0% to 4.0% payable semi-annually on April 1 and October 1, commencing April 1, 2015. The bonds mature annually at various amounts through October 1, 2032.

The bonds are payable from net revenues of derived from charges and revenues received by the City from the operation of the Wastewater System.

The bonds are being issued to provide funds to refund the City’s outstanding City of Hanford, Variable Rate Demand Sewer System Refunding Revenue Bonds, 1996 Series A, to purchase a reserve fund municipal bond insurance policy in lieu of cash funding a bond reserve fund for the Bonds, and to pay the cost of issuing the Bonds. As a result, the 1996 Revenue Bonds are considered to be defeased and the liability for those bonds has been removed from the long-term liabilities of the Business Activities Debt.

The aggregate debt service payments of the new debt are $644,540 more than the old debt. The issuance of the new debt and refunding of the old debt resulted in an economic loss (the difference between the present value of the old debt and new debt payments) of approximately $621,656.

Significant terms that pertain to the Wastewater Revenue Refunding Bonds Series 2015 are as follows. If the City fails to make the payment of principal or interest when due and payable; if the City fails to observe and perform any of the covenants, agreements, or conditions required in the bond agreement; if the City abandons a substantial part that shall continue for a period of sixty consecutive days; if the City files a petition or answer seeking reorganization or arrangement under the Federal bankruptcy laws; the City shall be considered in default. In the event of a default, the Trustee may declare the principal and interest of the bonds immediately due and payable. The revenue pledged for the bond are the revenues payable from the City’s Wastewater fund for the life of the bonds.

Wastewater revenue bonds outstanding on June 30, 2024 are $2,220,000.

The future maturities of the wastewater revenue bonds payable are as follows:

Fiscal Year Principal Interest Total
2025 215,000 $ 78,975 $ 293,975 $
2026 220,000 72,450 292,450 2027 225,000 65,775 290,775 2028 235,000 57,700 292,700
2029 245,000 48,100 293,100
2030-2033 1,080,000 88,400 1,168,400 Totals 2,220,000 $ 411,400 $ 2,631,400 $

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-56-
NOTE 5 - LONG-TERM DEBT (Continued)
Business-type Activities (Continued)
On May 23, 2022, the City of Hanford issued $30,946,000 Pension Obligation Bonds bearing interest of 4.39% payable annually on June 1 commencing June 1, 2023. The bonds mature annually at various amounts through June 1, 2039. The bonds are payable from net revenues in both the governmental activities and business-type activities created under the Indenture.

Pension obligation bonds outstanding on June 30, 2024 for business-type activities are $4,006,284.

The future maturities of the pension obligation bonds payable for business activities are as follows:

Fiscal Year Principal Interest Total
2025 251,316 $ 175,876 $ 427,192 $
2026 252,320 164,837 417,157 2027 250,886 153,760 404,646 2028 261,931 142,746 404,677
2029 215,455 131,247 346,702
2030-2034 1,168,505 509,592 1,678,097 2035-2039 1,605,871 223,999 1,829,870 Totals 4,006,284 $ 1,502,057 $ 5,508,341 $
Notes Payable – direct borrowing
On May 28, 2002, the City of Hanford obtained a loan from the California Infrastructure and Economic Development Bank in the amount of $10,000,000. The term of the agreement is thirty (30) years with a maturity date of February 1, 2034, and an annual interest rate of 3.50%. Prior to the Bond Date, there is a .26% reduction in the interest rate, resulting in an initial rate of 3.24%. Interest on the loan is payable semi-annually on each February 1 and August 1, commencing August 1, 2003. As of June 30, 2024, the balance outstanding was $3,890,840.

Significant terms that pertain to the California Infrastructure and Economic Development Bank loan are as follows. If the City fails to make the payment of principal or interest when due and payable; if the City fails to observe and perform any of the covenants, agreements, or conditions required in the note agreement; if the City made any representation or other written statement contained in the agreement that was incorrect in any material respect; if the City files a petition or answer seeking reorganization or arrangement under the Federal bankruptcy laws; the City shall be considered in default. In the event of a default, the CIEDB may declare the principal and interest of the bonds immediately due and payable. Additionally, revenues pledged for the note are the revenues payable from the City’s Wastewater fund.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-57-
NOTE 5 - LONG-TERM DEBT (Continued)
Business-type Activities (Continued)
The future maturities of the note payable are as follows:

Fiscal Year Principal Interest Total
2025 429,847 $ 128,657 $ 558,504 $
2026 444,892 113,349 558,241 2027 460,463 97,505 557,968 2028 476,579 81,107 557,686
2029 493,259 64,135 557,394
2030-2032 1,585,800 84,528 1,670,328 Totals 3,890,840 $ 569,281 $ 4,460,121 $ Finance Purchase Arrangements – direct borrowing
In November, 2011, the City entered into a finance purchase arrangement with Bank of America to design and construct an energy efficient tracker system for the City’s wastewater treatment plant.

The purchase price of this project is $4,325,556, with annual payments in varying amounts including interest at 3.33% commencing on July 8, 2012 with a final payment in July, 2026. The balance outstanding as of June 30, 2024 was $999,544.

Significant terms that pertain to the 2011 Finance Purchase Arrangement are as follows. If the City fails to make the payment of principal or interest when due and payable; if the City fails to observe and perform any of the covenants, agreements, or conditions required in the agreement; if the City had a statement, representation, or warranty that was proven to be false, incorrect, misleading, or breached; if the City defaults on any other agreement for borrowing money, lease financing of property, or other credit under which the City is an obligor; if the City files a petition or answer seeking reorganization or arrangement under the Federal bankruptcy laws; the City shall be considered in default. In the event of a default, the Lessor may take whatever action necessary or desirable to collect each rental payment as they become due and payable, or they may enter the premises where the equipment is located and retake possession or they may take whatever action at law or in equity may appear necessary or desirable to enforce. The collateral pledged for the lease is the equipment noted in the capital lease.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-58-
NOTE 5 - LONG-TERM DEBT (Continued)
Business-type Activities (Continued)
The annual debt service requirements for the 2011 Finance Purchase Arrangement outstanding on June 30, 2024 are as follows:

Fiscal Year Principal Interest Total
2025 302,640 $ 33,285 $ 335,925 $
2026 332,549 23,207 355,756 2027 364,355 12,133 376,488 Totals 999,544 $ 68,625 $ 1,068,169 $
In March 2014, the City entered into a finance purchase arrangement with Bank of America National Association to design and construct a solar photovoltaic energy system using an energy service contract with Chevron Energy Solutions Company for several facilities throughout the City. The purchase price of this contract is $8,495,138, with semi-annual payments in varying amounts including interest at 3.54% commencing on October 26, 2014 with a final payment in April, 2029.

The balance outstanding as of June 30, 2024 was $4,411,480.

Significant terms that pertain to the 2014 Finance Purchase Arrangement are as follows. If the City fails to make the payment of principal or interest within 10 days after the date when due; if the City fails to observe and perform any of the covenants, agreements, or conditions required in the agreement; if the City had a statement, representation, or warranty that was proven to be false, incorrect, misleading, or breached; if the City defaults on any other agreement for borrowing money, lease financing of property, or other credit under which the City is an obligor; the City shall be considered in default. In the event of a default, the Lessor may take whatever action necessary or desirable to collect each rental payment as they become due and payable or they may enter the premises where the equipment is located and retake possession or they may take whatever action at law or in equity may appear necessary or desirable to enforce. The collateral pledged for the lease is the equipment noted in the capital lease.

The annual debt service requirements for the 2014 Finance Purchase Arrangement outstanding on June 30, 2024 are as follows:

Fiscal Year Principal Interest Total
2025 725,344 $ 149,803 $ 875,147 $
2026 798,858 123,481 922,339 2027 877,195 94,514 971,709 2028 960,630 62,730 1,023,360 2029 1,049,453 27,946 1,077,399 Totals 4,411,480 $ 458,474 $ 4,869,954 $

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-59-
NOTE 5 - LONG-TERM DEBT (Continued)
Business-type Activities (Continued)
Leases Payable
The City entered into a lease agreements for the use of equipment. The lease agreement ranges from 12 to 60 months. The City is required to make annual fixed payments ranging from $5,814 to $6,291. The agreement has an interest rate of 2.63%. As of June 30, 2024, the City had total outstanding lease payable of $20,742 and right to use asset of $20,466, net of amortization.

The future principal and interest lease payments as of June 30, 2024, are as follows:

Fiscal Year Principal Interest Total
2025 4,983 $ 470 $ 5,453 $
2026 5,115 336 5,451 2027 5,252 199 5,451
2028 5,392 59 5,451
Totals 20,742 $ 1,064 $ 21,806 $
NOTE 6 - LEASE RECEIVABLE
Lease Receivables
The City has entered into various lease agreement as the lessor. The leases range from 12 to 108 months. The lessees are required to make monthly fixed payments ranging from $3,511 to $90,643.

The leases have interest rates ranging from 0.2% to 2.63%. The combined value of lease receivables and deferred inflow of resources as of June 30, 2024 was $1,456,518 and $1,384,373, respectively.

In addition, the City recognized lease revenue of $248,359 during the fiscal year related to these leases.

Payments for the lease receivables are expected to be received in the following subsequent years:

Fiscal Year Principal Interest Total
2025 293,103 $ 17,940 $ 311,043 $
2026 242,412 13,307 255,719 2027 252,666 8,886 261,552
2028 263,322 4,292 267,614
2029 143,872 786 144,658
2030-2033 261,143 1,131 262,274
Totals 1,456,518 $ 46,342 $ 1,502,860 $

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-60-
NOTE 7 - CHANGES IN OTHER LONG-TERM LIABILITIES
Balance
July 1, 2023 Additions Deletions
Balance
June 30, 2024
Due Within
One Year
Governmental Activities
Compensated absences 1,433,064 $ 528,430 $ (545,519) $ 1,415,975 $ 360,581 $ Total Governmental Activities 1,433,064 $ 528,430 $ (545,519) $ 1,415,975 $ 360,581 $ Business-type Activities
Compensated absences 307,123 $ 135,702 $ (123,959) $ 318,866 $ 39,483 $ Total Business-type Activities 307,123 $ 135,702 $ (123,959) $ 318,866 $ 39,483 $ Compensated Absences
The City accounts for compensated absences (unpaid vacation, sick leave, and compensatory time) in accordance with generally accepted accounting principles. In governmental funds, compensated absences are recorded as expenditures in the year paid, as it is the City’s intention to liquidate any unpaid compensated absences as of June 30 from future resources, rather than current available financial resources. Accordingly, the unpaid liability for governmental funds is recorded in the government-wide statement of net assets. The General Fund typically liquidates governmental funds compensated absences.

NOTE 8 - PENSION PLAN
Plan Descriptions
All qualified permanent and probationary employees are eligible to participate in the Public Agency Cost-Sharing Multiple-Employer Defined Benefit Pension Plan (Plan or PERF C) administered by the California Public Employees’ Retirement System (CalPERS.) The Plan 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. Plan assets may be used to pay benefits for any employer rate plan of the safety and miscellaneous pools. Accordingly, rate plans within the safety or miscellaneous pools are not separate plans under generally accepted accounting principles. Individual employers may sponsor more than one rate plan in the miscellaneous or safety risk pools. The City participates in three rate plans (one miscellaneous and two safety). The miscellaneous plan is an agent multiple-employer plan and the police and fire safety plans are cost-sharing multiple employer plans. Benefit provisions under the Plan are established by State statute and Local Government 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, at www.calpers.ca.gov.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-61-
NOTE 8 - PENSION PLAN (Continued)
Benefits Provided (Continued)
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 5 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 operates under the provisions of the California Public Employees’ Retirement Law (PERL), the California Public Employees’ Pension Reform Act of 2013 (PEPRA), and the regulations, procedures and policies adopted by the CalPERS Board of Administration. The Plan’s authority to establish and amend the benefit terms are set by the PERL and PEPRA, and may be amended by the California state legislature and in some cases require approval by the CalPERS Board.

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City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-62-
NOTE 8 - PENSION PLAN (Continued)
Benefits Provided (Continued)
The Plan’s provisions and benefits in effect as of June 30, 2024, are summarized as follows:

PEPRA
Prior to
January 1, 2013
On or After
January 1, 2013
Benefit formula 3.0% @ 60 2.0% @ 62
Benefit vesting schedule 5 years' service 5 years' service Benefit payments monthly for life monthly for life
Retirement age 50 52
Monthly benefits as a % of eligible compensation 2.000% - 3.000% 1.000% - 2.500% Required employee contribution rates 8.00% 7.50%
Required employer contribution rates 14.04% 8.25%
PEPRA
Prior to
January 1, 2013
On or After
January 1, 2013
Benefit formula 3% @ 55 2.7% @ 57
Benefit vesting schedule 5 years' service 5 years' service Benefit payments monthly for life monthly for life
Retirement age 50 50
Monthly benefits as a % of eligible compensation 2.400%-3.000% 2.000% - 2.700% Required employee contribution rates 9.00% 13.75%
Required employer contribution rates 26.11% 14.50%
PEPRA
Prior to
January 1, 2013
On or After
January 1, 2013
Benefit formula 3% @ 55 2.7% @ 57
Benefit vesting schedule 5 years' service 5 years' service Benefit payments monthly for life monthly for life
Retirement age 50 50
Monthly benefits as a % of eligible compensation 2.400%-3.000% 2.000% - 2.700% Required employee contribution rates 9.00% 13.75%
Required employer contribution rates 26.11% 14.50%
Miscellaneous
Safety Police
Safety Fire

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-63-
NOTE 8 - PENSION PLAN (Continued)
As of the June 30, 2022 actuarial valuation, the following current and former City employees were covered by the agent-multiple employer miscellaneous plan:

Inactive employees or beneficiaries
currently receiving benefits 220
Inactive employees entitled to but
not yet receiving benefits 206
Active employees 191
Total 617
Contributions
Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The employer is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions. Employer Contributions to the Plan for the fiscal year ended June 30, 2024, were $1,897,812 for the Miscellaneous plan and $2,004,715 for the Safety plan. The actual employer payments of $2,442,956 made to CalPERS by the City for the Safety plan during the measurement period ended June 30, 2023 differed from the City’s proportionate share of the employer’s contributions of $4,182,755 by $1,739,799, which is being amortized over the expected average remaining service lifetime in the Public Agency Cost-Sharing Multiple Employer Plan.

Net Pension Liability
The City’s net pension liability for the Plan is measured as the total pension liability, less the pension plan’s fiduciary net position. The net pension liability is measured as of June 30, 2023, using an annual actuarial valuation as of June 30, 2022 rolled forward to June 30, 2023 using standard update procedures. A summary of principal assumptions and methods used to determine the net pension liability is as follows.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-64-
NOTE 8 - PENSION PLAN (Continued)
Actuarial Methods and Assumptions Used to Determine Total Pension Liability The June 30, 2022 valuation was rolled forward to determine the June 30, 2023 total pension liability, based on the following actuarial methods and assumptions:

Valuation date June 30, 2022
Measurement date June 30, 2023
Actuarial cost method Entry Age Actuarial Cost Method
Asset valuation method Fair value of assets
Actuarial assumptions:

Discount rate 6.90%
Inflation 2.30%
Salary increases Varies by Entry Age and Service
Mortality rate table (1) Derived using CalPERS' membership data for all funds Post retirement benefit The lessor of contract COLA or 2.30% until Purchasing Power Protection 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.

Long-term Expected Rate of Return
The long-term expected rate of return on pension plan investments was determined using a buildingblock method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.

In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations. Using historical returns of all of the funds’ asset classes, expected compound (geometric) returns were calculated over the next 20 years using a buildingblock approach. The expected rate of return was then adjusted to account for assumed administrative expenses of 10 Basis points.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-65-
NOTE 8 - PENSION PLAN (Continued)
The expected real rates of return by asset class are as follows:

Asset Class
Assumed Asset
Allocation Real Return1,2
Global equity - cap-weighted 30.00% 4.54%
Global equity - non-cap-weighted 12.00% 3.84%
Private equity 13.00% 7.28%
Treasury 5.00% 0.27%
Mortgage-backed securities 5.00% 0.50%
Investment grade corporates 10.00% 1.56%
High yield 5.00% 2.27%
Emerging market debt 5.00% 2.48%
Private debt 5.00% 3.57%
Real assets 15.00% 3.21%
Leverage (5.00%) (0.59%) 2
Figures are based on the 2021 Asset Liability M anagement study. 1 An expected inflation of 2.30% used for this period.

Change of Assumptions
There were no assumption changes in 2023. Effective with the June 30, 2021 valuation date (June 30, 2022 measurement date), the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. In addition, demographic assumptions and the price inflation assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The accounting discount rate was 7.15% for measurement dates June 30, 2017 through June 30, 2021, 7.65% for measurement dates June 30, 2015 through June 30, 2016, and 7.50% for measurement date June 30, 2014.

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 plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-66-
NOTE 8 - PENSION PLAN (Continued)
Subsequent Events
There were no subsequent events that would materially affect the results presented in this disclosure.

Pension Plan Fiduciary Net Position
Information about the pension plan’s assets, deferred outflows of resources, liabilities, deferred inflows of resources, and fiduciary net position are presented in CalPERS’ audited financial statements, which are publicly available reports that can be obtained at CalPERS’ website, at www.calpers.ca.gov. The plan’s fiduciary net position and additions to/deductions from the plan’s fiduciary net position have been determined on the same basis used by the pension plan, which is the economic resources measurement focus and the accrual basis of accounting. Benefits and refunds are recognized when due and payable in accordance with the terms of the plan. Investments are reported at fair value.

Proportionate Share of Net Pension Liability
The following table shows the Safety Plan’s proportionate share of the net pension liability over the measurement period.

Miscellaneous Safety
Proportion - June 30, 2022 N/A 0.16430%
Proportion - June 30, 2023 N/A 0.15592%
Change - Increase (Decrease) N/A -0.00838%
The City’s proportion of the net pension liability was determined by CalPERS using the output from the Actuarial Valuation System and the fiduciary net position, as provided in the CalPERS Public Agency Cost-Sharing Allocation Methodology Report, which is a publicly available report that can be obtained at CalPERS’ website, at www.calpers.ca.gov. The City's proportionate share of the net pension liability/(asset) for the Safety Plan as of June 30, 2022 and 2023 measurement dates was as follows:

Total Fiduciary Net Pension
Pension Liability Net Position Liability
Safety
Balance at: 6/30/22 (Valuation date) 108,292,236 $ 97,002,100 $ 11,290,136 $ Balance at: 6/30/23 (Measurement date) 116,617,770 104,962,766 11,655,004 Net changes during 2022-2023 $ 8,325,534 $ 7,960,666 $ 364,868 Increase(Decrease)

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-67-
NOTE 8 - PENSION PLAN (Continued)
Change in agent-multiple employer plan
The following table shows the changes in net pension liability of the Miscellaneous Plan over the measurement period:

Increase (Decrease)
Total Pension
Liability
(a)
Plan Fiduciary
Net Position
(b)
Net Pension
Liability /
(Asset)
(c) = (a) - (b)
Balance at: 6/30/2022 (VD) 123,327,742 $ 111,300,142 $ 12,027,600 $ Changes recognized for the
measurement period:

Service cost 2,525,214 - 2,525,214
Interest on the Total
Pension Liability 8,376,796 - 8,376,796
Changes of assumptions 133,790 - 133,790 Differences between expected and actual experience (34,421) - (34,421) Net plan to plan resource movement - 52,804 (52,804) Contributions from the employer - 2,415,486 (2,415,486) Contributions from employees - 1,006,834 (1,006,834) Net investment income - 6,736,220 (6,736,220)
Benefit payments, including refunds
of employee contributions (6,573,779) (6,573,779) - Administrative expense - (81,845) 81,845 Other miscellaneous income/(expense)1 - - - Net Changes during 2022-23 4,427,600 3,555,720 871,880 Balance at: 6/30/2023 (MD) 127,755,342 $ 114,855,862 $ 12,899,480 $ 1 During Fiscal Year 2017-18, as a result of Governmental Accounting Standards Board Statement (GASB) No. 75, Accounting and Financial Reporting for Postemployment Benefit Plans Other than Pensions (GASB 75), CalPERS reported its proportionate share of activity related to postemployment benefits for participation in the State of California’s agent OPEB plan. Accordingly, CalPERS recorded a one-time expense as a result of the adoption of GASB 75.

Additionally, CalPERS employees participate in various State of California agent pension plans and during Fiscal Year 2017-18, CalPERS recorded a correction to previously reported financial statements to properly reflect its proportionate share of activity related to pensions in accordance with GASB Statement No. 68, Accounting and Financial Reporting for Pensions (GASB 68).

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-68-
NOTE 8 - PENSION PLAN (Continued)
Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the City’s net pension liabilities as of the measurement date, calculated using the discount rate of 6.90%, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower (5.90%) or 1 percentage-point higher (7.90%) than the current rate:

Miscellaneous Safety
1% Decrease 5.90% 5.90%
Net Pension Liability 30,227,311 $ 27,652,887 $
Current Discount Rate 6.90% 6.90%
Net Pension Liability 12,899,480 $ 11,655,004 $
1% Increase 7.90% 7.90%
Net Pension Liability/(Asset) (1,326,066) $ (1,424,404) $ Amortization of Deferred Outflows and Deferred Inflows of Resources Under GASB 68, gains and losses related to changes in total pension liability and fiduciary net position are recognized in pension expense systematically over time.

The first amortized amounts are recognized in pension expense for the year the gain or loss occurs.

The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to pensions and are to be recognized in future pension expense.

The amortization period differs depending on the source of the gain or loss:

Net difference between
projected and actual earnings
on pension plan investments
5-year straight-line amortization
All other amounts Straight-line amortization over the expected average remaining service lives (EARSL) of all members that
are provided with benefits (active, inactive and
retired) as of the beginning of the measurement
period
The expected average remaining service lifetime (EARSL) is calculated by dividing the total future service years by the total number of plan participants (active, inactive, and retired) in the Public Agency Cost-Sharing Multiple-Employer Plan (PERF C).

The EARSL for PERF C for the measurement period ending June 30, 2023 is 3.8 years, which was obtained by dividing the total service years of 600,538 (the sum of remaining service lifetimes of the active employees) by 160,073 (the total number of participants: active, inactive, and retired) in PERF C. Inactive employees and retirees have remaining service lifetimes equal to 0. Total future service is based on the members’ probability of decrementing due to an event other than receiving a cash refund.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-69-
NOTE 8 - PENSION PLAN (Continued)
Pension Expense and Deferred Outflows and Deferred Inflows of Resources Related to Pensions As of the start of the measurement period (July 1, 2022), the City’s net pension liabilities were $12,027,600 and $11,290,136, for the Miscellaneous and Safety plans, respectively. For the measurement period ending June 30, 2023 (the measurement date), the City incurred a pension expense of $3,577,031 and $3,962,306 for the Miscellaneous and Safety Plans, respectively. The pension expense of the Miscellaneous Plan was as follows:

Description Amount
Service cost 2,525,214 $
Interest on total pension liability 8,376,796 Changes in benefit terms 133,790 Recognized changes of assumptions 483,691 Recognized differences between expected
and actual experience (513,003) Net plan to plan movement (52,804) Employee contributions (1,006,834) Projected earnings on pension plan investments (7,565,601)
Recognized difference between projected
and actual earnings on plan investments 1,113,937 Administrative expense 81,845 Total pension expense 3,577,031 $ As of June 30, 2024, the City has deferred outflows and deferred inflows of resources related to pensions as follows:

Deferred Outflows Deferred Inflows
Changes of assumptions 919,011 $ - $
Differences between expected and actual experiences - 738,707 Net differences between projected and actual earnings on investments 5,254,517 - Pension contributions subsequent to measurement date 1,897,812 - Total 8,071,340 $ 738,707 $ Deferred Outflows Deferred Inflows
Changes in assumptions 680,202 $ - $
Differences between expected and actual experience 782,436 - Net differences between projected and actual earnings on investments 1,594,984 - Adjustment due to differences in proportions 5,956,213 - Change in employer's proportion - 9,745,451 Pension contributions subsequent to measurement date 2,004,715 - Total 11,018,550 $ 9,745,451 $ Safety Plan
Miscellaneous Plan

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-70-
NOTE 8 - PENSION PLAN (Continued)
Pension Expense and Deferred Outflows and Deferred Inflows of Resources Related to Pensions (Continued)
The amounts above are net of outflows and inflows recognized in the 2022-23 measurement period expense. Contributions subsequent to the measurement date of $1,897,812 and $2,004,715, for the Miscellaneous and Safety Plans, respectively reported with deferred outflows of resources will be recognized as a reduction of the net pension liability in the upcoming fiscal year.

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

Fiscal year
ended June 30 Miscellaneous Plan Safety Plan
2025 1,071,632 $ (735,811) $
2026 789,719 (749,796)
2027 3,407,593 709,471
2028 165,877 44,520
Total 5,434,821 $ (731,616) $
Deferred Outflows (Inflows) of Resources
Payable to the Pension Plan
The City had no outstanding amounts owed to the pension plan for contributions for the year ended June 30, 2024.

NOTE 9 - POST EMPLOYMENT HEALTH CARE BENEFITS
Plan Description: the City participates in the CalPERS medical program under the Public Employees’’ Medical and Hospital and Care Act (PEMHCA). As such, the City is obligated to contribute toward the cost of retiree medical coverage for the retiree’s lifetime or until coverage is discontinued. The City has selected the equal contribution method, where it resolves to contribute the same amount for retirees as is contributed toward active employee medical plan coverage. The City currently pays the minimum employer contribution (MEC) for both active and retired employees as well as their survivors, if covered at the time of the employees’ death. The MEC is $119 per month for 2024. The plan does not issue separate standalone financial statements.

Dental insurance is available to retired employees as well, though the cost of coverage is paid entirely by the retiree. Once the retiree reaches age 65 the City no longer allows the retiree to stay on the dental plan.

The above coverage is available for employees who satisfy the requirements for retirement under CalPERS (attained age 50 with 5 years of State or public agency service or approved disability retirement). An employee cannot terminate employment before meeting the age condition and be entitled to receive benefits. As of January 1, 2016, the City terminated its healthcare contract with CalPERS. No future retirees are eligible for healthcare coverage or benefits from the City toward the cost of retiree medical coverage.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-71-
NOTE 9 - POST EMPLOYMENT HEALTH CARE BENEFITS (Continued) Employees Covered
As of the June 30, 2023 actuarial valuation, the following current and former City employees were covered by the OPEB plan membership:

Inactive employees or beneficiaries currently receiving benefit payments 43 Inactive employees entitled to, but not yet receiving benefits 1 Active employees 291
Total employees covered by the OPEB plan membership 335 Contributions
Currently the City funds retiree healthcare benefits on a pay-as-you-go basis, paying a maximum of $119 per month for retiree benefits from the City funds as they are due with no prefunding for future years. The City recognizes expenditures for its share of the annual premiums as these benefits become due. For fiscal year 2023-2024, the City paid approximately $45,696 for benefits of 44 retirees or their beneficiaries receiving benefits.

Total OPEB Liability
The City’s total OPEB liability was measured as of June 30, 2024 and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation dated June 30, 2023, based on the following actuarial methods and assumptions.

Valuation Date June 30, 2023
Funding Method Entry Age Normal Cost, level of pay
Asset Valuation Method Fair value of assets
Discount Rate 3.97% as of June 30, 2024

3.86% as of June 30, 2023
Participants Valued
Salary Increase
General Inflation Rate 2.5% per year
Mortality CalPERS 2021 Experienced Study
Mortality Improvement MacLeod Watts Scale 2022 applied generationally from 2022 Healthcare Trend 6.8% in 2024, step down to 3.9% by 2076 Only current active employees, retired participants and covered dependents are valued. No future entrants are

3.0% per year. Since benefits do not depend on salary, this is used to allocate the cost of benefits between service years.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-72-
NOTE 9 - POST EMPLOYMENT HEALTH CARE BENEFITS (Continued) Discount Rate
The discount rate used to measure the total OPEB liability was 3.97 percent. The projection of the cash flows used to determine the discount rate assumed that the City contributions will be made at rates equal to the actuarially determined contribution rates. Based on these assumptions, the OPEB City’s net position was projected to be available to make all projected OPEB payments for inactive employees and beneficiaries based on the “pay as you go” annual contributions.

Changes in the total OPEB Liability
The change in the total OPEB liability for the year ended June 30, 2024 is as follows:

Total OPEB
Liability
Plan Fiduciary Net
Position
Net OPEB Liability
(Asset)
Balance at June 30, 2023 3,938,192 $ - $ 3,938,192 $
(6/30/23 measurement date)
Changes in the year:

Service cost 288,001 - 288,001
Interest 159,742 - 159,742
Employer contribution - 175,583 (175,583) Benefit payments (175,583) (175,583) - Changes in assumptions (41,334) - (41,334) Net change 230,826 - 230,826 Balance at June 30, 2024 (6/30/24 measurement date) 4,169,018 $ - $ 4,169,018 $
Increase (Decrease)
Sensitivity of the total OPEB Liability to Changes in the Discount Rate The following presents the total OPEB liability of the Plan as of the measurement date, calculated using the discount rate of 3.97%, if it were calculated using a discount rate that is 1 percentage-point lower (2.97%) or 1 percentage-point higher (4.97%) than the current rate:

Discount Rate
-1% (2.97%)
Current
Discount Rate

3.97%
Discount Rate
+1% (4.97%)
Total OPEB Liability 4,561,126 $ 4,169,018 $ 3,812,283 $

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-73-
NOTE 9 - POST EMPLOYMENT HEALTH CARE BENEFITS (Continued) Change in Assumptions
The discount rate changed from a rate of 3.86% on June 30, 2023, to a rate of 3.97% on June 30, 2024.

Sensitivity of the total OPEB Liability to Changes in the Healthcare Cost Trend Rate The following presents the total OPEB liability of the Plan if it were calculated using healthcare cost trend rates that are 1 percentage-point lower or 1 percentage-point higher than the current rate:
1% Decrease
Current Trend
Rate 1% Increase
Total OPEB Liability 3,740,354 $ 4,169,018 $ 4,679,812 $ OPEB Expense
As of the start of the measurement period (July 1, 2023), the total OPEB liability was $3,938,192.

For the measurement period ended June 30, 2024 (the measurement date), the City incurred an OPEB expense of $631,671. The pension expense was as follows:

OPEB Expense 631,671 $
As of June 30, 2024, the City has deferred outflows and deferred inflows of resources related to the total OPEB liability as follows:

Deferred Outflows
of Resources
Deferred Inflows of
Resources
Difference between expected and actual experience 668,070 $ 113,939 $ Changes in assumptions or other inputs 1,090,600 634,245 Total 1,758,670 $ 748,184 $

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-74-
NOTE 9 - POST EMPLOYMENT HEALTH CARE BENEFITS (Continued) OPEB Expense (Continued)
Other amounts reported as deferred inflows of resources related to pensions will be recognized in the future pension expense as follows:

Fiscal Year ended
June 30,
Recognized Net Deferred
Outflows (Inflows) of
Resources
2025 183,928 $
2026 183,928 2027 183,928
2028 183,928
2029 183,928
Thereafter 90,846 $ 1,010,486
NOTE 10 - RISK MANAGEMENT
The City participates in a public entity risk pool for workers’ compensation and general liability insurance above our self-insured retention limits. For workers’ compensation, the City is individually liable for claims up to $250,000 per occurrence. Coverage in excess of the City’s self-insured retention is then obtained through Public Risk Innovation, Solutions, and Management (PRISM) excess workers’ compensation program up to the statutory limits. The City participates in a risk pool for general liability claims through PRISM above the City’s self-insured retention of $100,000 up to $25,000,000 per occurrence, subject to certain exclusions. For both excess workers’ compensation and general liability covered occurrences, PRISM coordinates reimbursement of costs incurred for covered actions in excess of each member’s self-insured retention. While there were no reductions in excess coverage from the prior year and there were no settlements that exceeded excess pool layer of coverage for the past three fiscal years, given marketing challenges in California, additional coverage exclusions continue to apply.

The City participates in a number of supplemental insurance programs through Alliant. Alliant Property Insurance Program (APIP) is for city owned buildings and structures. In 2022 a city-wide site inspection was conducted to appraise city owned buildings and structures. The APIP deductible is $10,000.00 per covered occurrence. APIP insurance includes elected coverage for Boiler & Machinery, Cyber Security, and Pollution Coverage. Claim reporting timeframe limitations apply to both Cyber Coverage and Pollution Coverage policies.

Also, the City participate in Alliant’s Motor Vehicle Program (AMVP) in an effort to reduce the loss of replacement values for approximately 90 City owned vehicles and equipment.

Worker’s compensation and general liability claims incurred prior to July 1, 2012 were covered through the City’s participation in the Central San Joaquin Valley Risk Management Authority (CSJVRMA), a public entity risk pool.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-75-
NOTE 11 - INTERFUND TRANSACTIONS
Interfund transactions are reported as either loans, service provided, reimbursements, or transfers.

Loans are reported as interfund receivables and payables, as appropriate, and are subject to elimination upon consolidation. Services provided, deemed to be at market or near market rates, are treated as revenues and expenditures/expenses. Reimbursements occur when one fund incurs a cost, charges the appropriate benefiting fund, and reduces its related cost as a reimbursement. All other interfund transactions are treated as transfers. Transfers among governmental or proprietary funds are netted as part of the reconciliation to the government-wide financial statements.

As of June 30, 2024 the City interfund due from/to other funds were as follows:

Due From
Other Funds
Due To
Other Funds
Governmental Funds
General Fund 2,311,944 $ - $
CDBG Home/Housing Fund
Non-major funds - 207,346 Proprietary Funds
Refuse - 1,890,481 Non-major funds - 214,117 Total 2,311,944 $ 2,311,944 $ These balances are to cover deficit cash balances and for short-term loans.

As of June 30, 2024 the City’s interfund advances to/from other funds were as follows:

Advances To
Other Funds
Advances From
Other Funds
Governmental Funds
Capital Projects Fund 1,659,026 $ - $
Proprietary Funds
Non-major enterprise funds
Airport fund - 375,468
Intermodal fund - 261,224
Courthouse square - 1,022,334 Total 1,659,026 $ 1,659,026 $ These balances are for long-term financing between funds.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-76-
NOTE 11 - INTERFUND TRANSACTIONS (Continued)
Interfund transfers consist of operating transfers from funds receiving resources to funds through which the resources are to be expended. Interfund transfers for the year-ended June 30, 2024 were as follows:

Transfers In Transfers Out
Governmental Funds
General Fund 1,817,486 $ 1,318,520 $
CDBG Home/Housing Fund - 155,640 ARPA Fund - 833,334
Non-major Governmental Funds 359,387 1,001,663 Proprietary Funds Water System Fund 252,903 - Wastewater Fund - 28,125 Refuse Fund 934,839 - Non-major enterprise fund types Airport Fund - 5,012 Risk Management Fund - 11,428 Building Fund - 50,024 Fleet Management Fund 992,504 953,373 Total 4,357,119 $ 4,357,119 $ These balances are for funding of capital projects, operating expenses and debt service payments.

NOTE 12 - DEFICIT FUND BALANCE/NET POSITION
The American Rescue Plan Act Fund has a fund balance deficit of $146,712, mainly attributable to the unearned revenues. The deficient will be recovered as the City continues to spend and earn the revenue.

The Courthouse Square Fund has a fund balance deficit of $1,234,767, mainly attributable to the due to other funds balance. The deficit will be recovered through grant support received from other government agencies.

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-77-
NOTE 13 - EXCESS EXPENDITURES OVER APPROPRIATIONS
For the fiscal year ended June 30, 2024, expenditures exceeded appropriations as follows:

Major Funds:

General Fund
Public works (68,831) $
Debt service - principal (102,953) Debt service - interest (16,175) Transportation Development Act Fund General government (1,229) Non-major Funds:

Park Impact Fees
General government (857) Parking Fund
General government (175)
Downtown Reinvestment Fund
General government (5) City Housing Fund
General government (15) Central Parking and Business Improvement Fund General government (43)
Fire Protection Impact Fees
General government (321) Traffic Safety
General government (69) State Gas Tax Fund
General government (2,203) Transportation Impact Fees
General government (1,961)
Cannabis Operation
Community development (25,000) Capital Projects
General government (7,936)

City of Hanford
Notes to the Financial Statements
For the Year Ended June 30, 2024
-78-
NOTE 14 - NET POSITION
Net Investments in Capital Assets
Net position for governmental activities and business-type activities is classified as 1) net investments in capital assets, 2) restricted or 3) unrestricted. Net position that was classified as net investments in capital assets as of June 30, 2024, was determined as follows:

Governmental
Activities
Capital assets, net of accumulated depreciation 166,185,429 $ Less: Lease liability (638,867) Subscription liability (178,371) Net investment in capital assets 165,368,191 $
Non-major Total
Water System Wastewater Storm Drain Refuse Enterprise Enterprise Fund Fund Fund Fund Funds Funds
Capital assets, net of
accumulated depreciation 54,346,048 $ 53,022,768 $ 22,947,657 $ 6,322,922 $ 7,021,128 $ 143,660,523 $ Less capital related debt balances:

Outstanding principal balance of:

Bonds payable (4,125,000) (8,600,000) - - - (12,725,000) Finance lease (4,411,478) (999,546) - - - (5,411,024) Note payable - (3,890,840) - - - (3,890,840) Unamortized bond premium (108,943) (300,868) - - - (409,811) Lease payable (20,742) - - - - (20,742) Net investment in capital assets 45,679,885 $ 39,231,514 $ 22,947,657 $ 6,322,922 $ 7,021,128 $ 121,203,106 $ Business-type Activities

REQUIRED SUPPLEMENTARY

INFORMATION

City of Hanford
Required Supplementary Information
Schedule of Changes in the Net Pension Liability and Related Ratios Last Ten Fiscal Years
-79-
Miscellaneous Plan
Fiscal Year 2024 2023 2022 2021 2020 2019 2018 2017 2016 2015 Total Pension Liability Service cost 2,525,214 $ 2,629,757 $ 2,307,283 $ 2,151,214 $ 2,064,352 $ 2,105,925 $ 2,090,309 $ 1,914,877 $ 1,859,399 $ 1,803,855 $ Interest 8,376,796 8,080,540 8,011,156 7,725,010 7,440,145 7,031,320 7,021,932 6,976,069 6,689,193 6,381,234 Change in benefit terms 133,790 - - - - - - - - - Differences between expected and actual experience (34,421) (1,259,145) (436,335) (410,579) 1,398,071 (1,511,015) (3,768,183) (831,190) (443,007) - Changes in assumptions - 1,886,393 - - - (3,087,527) 6,006,913 - (1,698,571) - Benefit payments, including refunds of employees contributions (6,573,779) (6,353,883) (5,729,725) (5,302,018) (5,004,441) (4,588,971) (4,191,413) (4,206,587) (3,783,672) (3,644,252) Net change in total pension liability 4,427,600 4,983,662 4,152,379 4,163,627 5,898,127 (50,268) 7,159,558 3,853,169 2,623,342 4,540,837 Total pension liability- beginning 123,327,742 118,344,080 114,191,701 110,028,074 104,129,947 104,180,215 97,020,657 93,167,488 90,544,146 86,003,309 Total pension liability-ending (a) 127,755,342 123,327,742 118,344,080 114,191,701 110,028,074 104,129,947 104,180,215 97,020,657 93,167,488 90,544,146 Plan Fiduciary Net Position Contributions-employer 2,415,486 15,804,838 4,300,785 4,072,920 3,791,023 3,415,348 3,213,198 295,917 2,937,484 2,451,408 Contributions-employees 1,006,834 903,798 908,516 852,662 874,603 796,926 760,087 709,460 712,929 686,870 Net plan to plan resource movement 52,804 (52,804) - - - (188) - - - - Net investment income 6,736,220 (8,335,831) 20,183,976 4,294,558 5,316,832 6,405,074 7,625,528 366,113 1,494,371 10,020,177 Benefit payments (6,573,779) (6,353,883) (5,729,725) (5,302,018) (5,004,441) (4,588,971) (4,191,413) (4,206,587) (3,783,672) (3,644,252) Administrative expense (81,845) (68,151) (89,733) (121,281) (57,883) (340,724) (100,570) (41,645) (76,906) - Other miscellaneous income/(expense) - - - - 186 - - - - - Net change in plan fiduciary net position 3,555,720 1,897,967 19,573,819 3,796,841 4,920,320 5,687,465 7,306,830 (2,876,742) 1,284,206 9,514,203 Total plan fiduciary net position-beginning 111,300,142 109,402,175 89,828,356 86,031,515 81,111,195 75,423,730 68,116,900 68,331,642 67,147,436 57,633,233 Total plan fiduciary net position-ending (b) 114,855,862 111,300,142 109,402,175 89,828,356 86,031,515 81,111,195 75,423,730 65,454,900 68,431,642 67,147,436 Net pension liability-ending (a)-(b) 12,899,480 $ 12,027,600 $ 8,941,905 $ 24,363,345 $ 23,996,559 $ 23,018,752 $ 28,756,485 $ 31,565,757 $ 24,735,846 $ 23,396,710 $ Plan fiduciary net position as a percentage of the total pension liability 89.90% 90.25% 92.44% 78.66% 78.19% 77.39% 72.40% 70.21% 73.34% 74.16% City's covered-employee payroll 13,183,736 $ 12,146,682 $ 11,735,924 $ 10,586,681 $ 10,064,610 $ 10,080,535 $ 9,434,933 $ 9,643,787 $ 9,090,194 $ 8,260,542 $ Net pension liability as a percentage of covered-employee payroll 97.84% 99.02% 76.19% 230.13% 238.43% 228.35% 304.79% 299.71% 273.22% 283.23% 1 Net of administrative expenses. Notes to Schedule: *The pension schedules are required to show ten years of data and the additional years' information will be displayed as it becomes available Benefit Changes: The figures above do not include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the measurement date. However, offers of Two Years/Additional Service Credit (a.k.a Golden Handshakes) that occurred after the valuation date are not included in the figures above unless the liability impacts is deemed to be material by the plan actuary.

Changes of assumptions: There were no assumption changes in 2023. Effective with the June 30, 2021 valuation date (June 30, 2022 measurement date), the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. In addition, demographic assumptions and the price inflation assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The accounting discount rate was 7.15% for measurement dates June 30, 2017 through June 30, 2021, 7.65% for measurement dates June 30, 2015 through June 30, 2016, and 7.50% for measurement date June 30, 2014.

City of Hanford
Required Supplementary Information
Schedule of the City’s Proportionate Share of the Net Pension Liability Last Ten Fiscal Years
-80-
Safety Plan
Employer's
Proportionate Pension's Plan
Employer's Share of the Fiduciary Net
Employer's Proportion Collection Net Position as a
Proportion of Share of the Pension Percentage of
the Collective Collective Net Liability (Asset) the Total Measurement Net Pension Pension as a Percentage Pension Date Liability (Asset)1Liability (Asset) Covered Payroll of Covered Payroll Liability (Asset) 6/30/2014 0.2402% 14,946,492 $ 5,581,396 $ 267.79% 77.21% 6/30/2015 0.2194% 14,547,172 6,602,409 220.33% 78.71%
6/30/2016 0.2137% 18,487,608 6,897,272 268.04% 74.41%
6/30/2017 0.2115% 20,972,245 6,409,767 327.19% 74.07%
6/30/2018 0.2153% 20,744,090 6,692,475 309.96% 75.73%
6/30/2019 0.2161% 22,146,339 6,673,847 331.84% 75.21%
6/30/2020 0.2249% 24,469,454 6,889,321 355.18% 74.04%
6/30/2021 0.3957% 13,888,402 9,140,252 151.95% 86.06%
6/30/2022 0.1643% 11,290,136 8,109,211 139.23% 90.25%
6/30/2023 0.1559% 11,655,004 8,109,211 143.73% 89.90%
*The pension schedules are required to show ten years of data and the additional years' information will be displayed as it becomes available
1 Proportion of the net pension liability represents the plan's proportion of PERF C, which includes both the Miscellaneous and Safety Risk Pools excluding the 1959 Survivors Risk Pool.

City of Hanford
Required Supplementary Information
Schedule of Plan Contributions
Last Ten Years*
-81-
Miscellaneous Plan
2024 2023 2022 2021 2020 2019 2018 2017 2016 2015
Actuarially determined contribution 2,415,486 $ 4,261,698 $ 4,300,785 $ 4,072,920 $ 3,791,023 $ 3,415,348 $ 3,213,198 $ 2,957,917 $ 2,837,484 $ 2,451,408 $ Contributions in relation to the actuarially
determined contribution (2,415,486) (15,804,838) (4,300,785) (4,072,920) (3,791,023) (3,415,348) (3,213,198) (2,957,917) (2,837,484) (2,451,408) Contribution deficiency (excess) - $ (11,543,140) $ - $ - $ - $ - $ - $ - $ - $ - $ Covered-employee payroll 13,183,736 $ 12,146,682 $ 11,735,924 $ 10,586,681 $ 10,064,610 $ 10,080,535 $ 9,434,933 $ 9,643,787 $ 9,090,194 $ 8,260,542 $ Contributions as a percentage of
covered-employee payroll 20.61% 130.12% 36.65% 38.47% 37.67% 33.88% 34.06% 30.67% 31.21% 29.68% Safety Plan
2024 2023 2022 2021 2020 2019 2018 2017 2016 2015
Actuarially determined contribution 2,004,715 $ 2,422,956 $ 22,748,720 $ 4,062,968 $ 3,451,832 $ 3,067,990 $ 3,064,625 $ 3,728,697 $ 2,859,367 $ 1,937,233 $ Contributions in relation to the actuarially
determined contribution (2,004,715) (2,422,956) (22,748,720) (4,062,968) (3,451,832) (3,067,990) (3,064,625) (3,728,697) (2,859,367) (1,937,233) Contribution deficiency (excess) - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ Covered-employee payroll 8,835,591 $ 8,109,211 $ 8,109,211 $ 9,140,252 $ 6,889,321 $ 6,673,847 $ 6,692,475 $ 6,409,767 $ 6,897,272 $ 6,602,409 $ Contributions as a percentage of
covered-employee payroll 22.69% 29.88% 280.53% 44.45% 50.10% 45.97% 45.79% 58.17% 41.46% 29.34% Notes to Schedule:

Employers are assumed to make contributions equal to the actuarially determined contributions. However, some employers may choose to make additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially determined contributions. *The pension schedules are required to show ten years of data and the additional years' information will be displayed as it becomes available.

City of Hanford
Required Supplementary Information
Schedule of Changes in Total OPEB Liability and Related Ratios Last Ten Fiscal Years*
-82-
2024 2023 2022 2021 2020 2019 2018
Total OPEB Liability
Service cost 288,001 $ 235,139 $ 310,994 $ 120,203 $ 105,251 $ - $ - $ Interest on total OPEB liability 159,742 151,238 88,810 63,027 74,534 47,002 50,391 Differences between expected and actual experience - (131,402) 283,719 (1,034,539) 1,034,539 - Changes in assumptions (41,334) (100,260) (699,772) 1,541,087 141,650 39,397 (6,734) Benefit payments, including refunds of employee contributions (175,583) (159,927) (142,193) (149,569) (136,950) (153,422) (168,043) Net change in total OPEB liability 230,826 (5,212) (442,161) 1,858,467 (850,054) 967,516 (124,386) Total Net OPEB liability - beginning 3,938,192 3,943,404 4,385,565 2,527,098 2,342,613 1,375,097 1,499,483 Total Net OPEB liability- ending (a) 4,169,018 3,938,192 3,943,404 4,385,565 1,492,559 2,342,613 1,375,097 Plan Fiduciary Net Position Contributions- employer 175,583 154,219 142,193 149,569 136,950 153,422 168,043 Benefit payments (175,583) (154,219) (142,193) (149,569) (136,950) (153,422) (168,043) Net change in plan fiduciary net position - - - - - - - Total plan fiduciary net position - beginning - - - - - - - Total plan fiduciary net position - ending (b) - - - - - - - Net OPEB liability - ending (a)-(b) 4,169,018 $ 3,938,192 $ 3,943,404 $ 4,385,565 $ 1,492,559 $ 2,342,613 $ 1,375,097 $ Plan fiduciary net position as a percentage of the total OPEB liability 0% 0% 0% 0% 0% 0% 0% City's covered-employee payroll 26,822,825 $ 26,307,809 $ 18,572,290 $ 19,345,356 $ 18,420,461 $ 19,211,409 $ - $ Net OPEB liability as a percentage of covered-employee payroll 15.54% 14.97% 21.23% 22.67% 13.72% 12.19% 0% Notes to Schedule:
*Historical information is required only for measurement periods for which GASB 75 applicable. Future years' information will be displayed up to ten years as information becomes available.

City of Hanford
Required Supplementary Information
Schedule of Contributions – OPEB
Last Ten Fiscal Years*
-83-
2023 2023 2022 2021 2020 2019 2018
Actuarially determined contribution 175,583 $ 154,219 $ 142,193 $ 149,569 $ 136,950 $ 153,422 $ 168,043 $ Contributions in relation to the (175,583) (154,219) (142,193) (149,569) (136,950) (153,422) (168,043) actuarially determined contribution
Contribution deficiency (excess) - $ - $ - $ - $ - $ - $ - $ City's covered-employee payroll 26,822,825 $ 26,307,809 $ 18,572,290 $ 19,345,356 $ 18,420,461 $ 19,211,409 $ - $ Contributions as a percentage of
covered-employee payroll 0.65% 0.59% 0.77% 0.77% 0.74% 0.80% - Notes to Schedule:

Valuation Date June 30, 2023
Funding Method Entry Age Normal Cost, level percent of pay Asset Valuation Fair value of assets
Discount Rate 3.97% as of June 30, 2024

3.86% as of June 30, 2023
Participants Valued
Salary Increase
General Inflation Rate 2.50% per year.

Mortality CalPERS 2017 Experience Study
Mortality Improvement MacLeod Watts 2022 Scale Generationally Healthcare Trend 6.8% in 2024, step down to 3.9%% by 2076 *Historical information is required only for measurement periods for which GASB 75 is applicable. Future years' information will be displayed up to ten years as information becomes available.

Only current active employees and retired participants and covered dependents are valued. No future entrants are considered in this valuation.

3.00% per year, since benefits do not depend on salary, this is used only to allocate the cost of benefits between service years.

The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2021-2022 were as follows for the June 30, 2021 measurement date actuarial valuations.

City of Hanford
Required Supplementary Information
Budgetary Comparison Schedule – (GAAP Basis) General Fund For the Year Ended June 30, 2024
-84-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Taxes and special assessments 33,177,780 $ 33,177,780 $ 33,745,197 $ 567,417 $ Aid from other government agencies 1,109,500 2,876,361 8,365,595 5,489,234 Licenses and permits 47,700 47,700 86,270 38,570
Fines and forfeitures 118,500 118,500 132,724 14,224
Charges for services 2,452,410 2,452,410 2,991,009 538,599 Lease revenue - - 137,197 137,197
Revenue from use of money and property 62,800 62,800 694,590 631,790 Miscellaneous 8,500 8,500 73,625 65,125
Total revenues 36,977,190 38,744,051 46,226,207 7,482,156

EXPENDITURES
Current:

General government 4,052,623 4,907,348 3,781,636 1,125,712 Public safety 23,786,298 24,251,873 23,950,549 301,324
Public works 2,428,253 2,480,135 2,548,966 (68,831)
Recreation 4,741,662 8,410,212 4,995,392 3,414,820
Community development 1,099,055 1,099,055 963,665 135,390 Debt service:

Principal 1,493,275 1,493,275 1,596,228 (102,953)
Interest 1,070,750 1,070,750 1,086,925 (16,175)
Capital outlay 52,292 10,133,615 6,073,304 4,060,311
Total expenditures 38,724,208 53,846,263 44,996,665 8,849,598 Excess (deficiency) of revenues
Over (under) expenditures (1,747,018) (15,102,212) 1,229,542 16,331,754 OTHER FINANCING SOURCES (USES) Transfers in 2,129,334 2,129,334 1,817,486 (311,848) Transfers out (342,007) (342,007) (1,318,520) (976,513) Lease and other financing proceeds - - 675,857 675,857 Proceeds from sale of assets - - 18,741 18,741 Total other financing sources (uses) 1,787,327 1,787,327 1,193,564 (593,763) Net change in fund balance 40,309 (13,314,885) 2,423,106 15,737,991

FUND BALANCE
Beginning of year 10,519,086 10,519,086 10,519,086 - End of year 10,559,395 $ (2,795,799) $ 12,942,192 $ 15,737,991 $ General Fund

City of Hanford
Required Supplementary Information
Budgetary Comparison Schedule – (GAAP Basis) CDBG Home/Housing Fund For the Year Ended June 30, 2024
-85-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Aid from other government agencies 1,095,000 $ 1,095,000 $ 625,740 $ (469,260) $ Revenue from use of money and property 83,150 83,150 (290,281) (373,431) Miscellaneous 360,000 360,000 1,193 (358,807) Total revenues 1,538,150 1,538,150 336,652 (1,201,498) EXPENDITURES Current:

Community development 1,381,440 1,855,094 665,994 1,189,100 Total expenditures 1,381,440 1,855,094 665,994 1,189,100 Excess (deficiency) of revenues
Over (under) expenditures 156,710 (316,944) (329,342) (12,398) OTHER FINANCING SOURCES (USES) Transfers out (400,000) (400,000) (155,640) 244,360 Total other financing sources (uses) (400,000) (400,000) (155,640) 244,360 Net change in fund balance (243,290) (716,944) (484,982) 231,962

FUND BALANCE
Beginning of year 20,824,947 20,824,947 20,824,947 - End of year 20,581,657 $ 20,108,003 $ 20,339,965 $ 231,962 $ CDBG/Home/Housing Fund

City of Hanford
Required Supplementary Information
Budgetary Comparison Schedule – (GAAP Basis) Transportation Development Act Fund For the Year Ended June 30, 2024
-86-
Original Final Actual Amount
Variance with
Final Budget

REVENUES
Taxes and special assessments 821,000 $ 821,000 $ 1,213,113 $ 392,113 $ Revenue from use of money and property 39,000 39,000 488,629 449,629 Total revenues 860,000 860,000 1,701,742 841,742

EXPENDITURES
Current:

General government 4,000 40,360 41,589 (1,229) Capital outlay - 402,743 239,075 163,668 Total expenditures 4,000 443,103 280,664 162,439 Net change in fund balance 856,000 416,897 1,421,078 1,004,181 FUND BALANCE Beginning of year 7,529,400 7,529,400 7,529,400 - End of year 8,385,400 $ 7,946,297 $ 8,950,478 $ 1,004,181 $ Transportation Development Act Fund

City of Hanford
Required Supplementary Information
Budgetary Comparison Schedule – (GAAP Basis) American Rescue Plan Act Fund For the Year Ended June 30, 2024
-87-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Aid from other government agencies 3,552,011 $ 3,552,011 $ 1,267,331 $ (2,284,680) $ Total revenues 3,552,011 3,552,011 1,267,331 (2,284,680) EXPENDITURES Current:

Community development - 50,000 50,000 - Capital outlay - 5,321,625 383,997 4,937,628 Total expenditures - 5,371,625 433,997 4,937,628 Excess (deficiency) of revenues
Over (under) expenditures 3,552,011 (1,819,614) 833,334 2,652,948 OTHER FINANCING SOURCES (USES) Transfers out (833,334) (833,334) (833,334) - Total other financing sources (uses) (833,334) (833,334) (833,334) - Net change in fund balance 2,718,677 (2,652,948) - 2,652,948 FUND BALANCE Beginning of year (146,712) (146,712) (146,712) - End of year 2,571,965 $ (2,799,660) $ (146,712) $ 2,652,948 $ American Rescue Plan Act

City of Hanford
Notes to Budgetary Comparison Required Supplementary Information For the Year Ended June 30, 2024
-88-
Budget and Budgetary Accounting
The procedures established by the City Council in adopting the budgetary data are as follows:

On or before the second meeting in May, the City Manager submits to the City Council a proposed operating and capital projects budget for the fiscal year commencing the following July 1.

Following publication and public hearings, the budget is legally enacted by resolution with a copy available on the City’s website.

The City Manager is authorized to transfer funds appropriated with respect to all classifications within the same department. The City Manager may transfer appropriated funds from any classification within other expenditure categories to existing capital outlay and capital projects classifications within the same department only; however, any revisions that alter the total expenditures of any department or create additional projects must be approved by the City Council.

Supplemental budgetary appropriations were negligible for the fiscal year ended June 30, 2024.

All unencumbered appropriations lapse at year-end. Budgets were legally adopted for all governmental funds with the exception of the Special Aviation Fund and Street Tree Committee Fund.

See note 1 for more information regarding the City’s budgetary process.

Excess of expenditures over appropriations
Fund Amount
Major Funds:

General Fund
Public works (68,831) $
Debt service - principal (102,953)

SUPPLEMENTARY INFORMATION

City of Hanford
Combining Balance Sheet
Non-Major Special Revenue Funds
June 30, 2024
-89-
CMAQ
Transportation
Fund
Park Impact
Fees Parking Fund
Downtown
Reinvestment
Fund
Landscaping
Assessment
District
ASSETS
Cash and investments - $ 5,876,629 $ 480,199 $ 166,532 $ 1,704,678 $ Receivables:

Accounts 167,521 110,758 - - 558,505 Loans - - - - - Prepaid expenses - - - - - Advances to other funds - - - - - Total Assets 167,521 $ 5,987,387 $ 480,199 $ 166,532 $ 2,263,183 $

LIABILITIES AND FUND BALANCES
Liabilities:

Accounts payable - $ 12,210 $ - $ - $ 114,837 $
Accrued wages payable - - - - - Due to other funds - - - - 103,043 Total Liabilities - 12,210 - - 217,880 Fund Balances (deficit):

Nonspendable:

Loan receivable - - - - - Prepaid expenses - - - - - Restricted for:

Streets and roads 167,521 - - - - Recreation - 5,975,177 - - - Landscape maintenance - - - - 2,045,303 Public safety - - - - - Committed for:

Parking and business improvement - - 480,199 166,532 - Community development - - - - - Cannabis - - - - - Total Fund Balances 167,521 5,975,177 480,199 166,532 2,045,303 Total Liabilities and Fund Balances 167,521 $ 5,987,387 $ 480,199 $ 166,532 $ 2,263,183 $ Special Revenue

City of Hanford
Combining Balance Sheet
Non-Major Special Revenue Funds
June 30, 2024 (continued)
-90-
City Housing
Fund
Central Parking
and Business
Improvement
Fire Protection
Impact Fees
Police
Protection
Impact Fees Special Aviation
ASSETS
Cash and investments 626,271 $ 127,139 $ 768,441 $ - $ - $ Receivables:

Accounts - 6,601 151,853 130,495 18,536 Loans 1,806,216 - - - - Prepaid expenses - - - - - Advances to other funds - - - - - Total Assets 2,432,487 $ 133,740 $ 920,294 $ 130,495 $ 18,536 $

LIABILITIES AND FUND BALANCES
Liabilities:

Accounts payable - $ 647 $ - $ - $ - $
Accrued wages payable - - - - - Due to other funds - - - 104,303 - Total Liabilities - 647 - 104,303 - Fund Balances (deficit):

Nonspendable:

Loan receivable 1,806,216 - - - - Prepaid expenses - - - - - Restricted for:

Streets and roads - - - - 18,536 Recreation - - - - - Landscape maintenance - - - - - Public safety - - 920,294 26,192 - Committed for:

Parking and business improvement - 133,093 - - - Community development 626,271 - - - - Cannabis - - - - - Total Fund Balances 2,432,487 133,093 920,294 26,192 18,536 Total Liabilities and Fund Balances 2,432,487 $ 133,740 $ 920,294 $ 130,495 $ 18,536 $ Special Revenue

City of Hanford
Combining Balance Sheet
Non-Major Special Revenue Funds
June 30, 2024 (continued)
-91-
Traffic Safety
Street Tree
Committee
State Gas Tax
Fund
Public Housing
Authority
Transportation
Impact Fees
ASSETS
Cash and investments 154,457 $ 1,218 $ 7,384,931 $ 161,660 $ 8,970,951 $ Receivables:

Accounts 5,352 - 913,966 - 424,123 Loans - - - - - Prepaid expenses - - - - - Advances to other funds - - - - - Total Assets 159,809 $ 1,218 $ 8,298,897 $ 161,660 $ 9,395,074 $

LIABILITIES AND FUND BALANCES
Liabilities:

Accounts payable - $ - $ 16 $ 622 $ 26,249 $
Accrued wages payable - - - 3,136 - Due to other funds - - - - - Total Liabilities - - 16 3,758 26,249 Fund Balances (deficit):

Nonspendable:

Loan receivable - - - - - Prepaid expenses - - - - - Restricted for:

Streets and roads - - 8,298,881 - - Recreation - - - - - Landscape maintenance - 1,218 - - - Public safety 159,809 - - - - Committed for:

Parking and business improvement - - - - - Community development - - - 157,902 9,368,825 Cannabis - - - - - Total Fund Balances 159,809 1,218 8,298,881 157,902 9,368,825 Total Liabilities and Fund Balances 159,809 $ 1,218 $ 8,298,897 $ 161,660 $ 9,395,074 $ Special Revenue

City of Hanford
Combining Balance Sheet
Non-Major Special Revenue Funds
June 30, 2024 (concluded)
-92-
Special Revenue
Cannabis
Operations
Capital Projects
Fund
Total Non-Major
Special Revenue
Funds
ASSETS
Cash and investments 49,679 $ 803,964 $ 27,276,749 $
Receivables:

Accounts 147,927 - 2,635,637 Loans - - 1,806,216
Prepaid expenses - 1,100 1,100 Advances to other funds - 1,659,026 1,659,026 Total Assets 197,606 $ 2,464,090 $ 33,378,728 $

LIABILITIES AND FUND BALANCES
Liabilities:

Accounts payable - $ 256,806 $ 411,387 $
Accrued wages payable - - 3,136 Due to other funds - - 207,346 Total Liabilities - 256,806 621,869 Fund Balances (deficit):

Nonspendable:

Loan receivable - - 1,806,216 Prepaid expenses - 1,100 1,100 Restricted for:

Streets and roads - - 8,484,938 Recreation - - 5,975,177 Landscape maintenance - - 2,046,521
Public safety - - 1,106,295
Committed for:

Parking and business improvement - 2,206,184 2,986,008
Community development - - 10,152,998 Cannabis 197,606 - 197,606 Total Fund Balances 197,606 2,207,284 32,756,859 Total Liabilities and Fund Balances 197,606 $ 2,464,090 $ 33,378,728 $

City of Hanford
Combining Statement of Revenues, Expenditures and Changes in Fund Balances Non-Major Special Revenue Funds
For the Year Ended June 30, 2024
-93-
CMAQ
Transportation
Fund
Park Impact
Fees Parking Fund
Downtown
Reinvestment
Fund
Landscaping
Assessment
District

REVENUES
Taxes and special assessments - $ 1,073,614 $ - $ - $ 1,136,595 $ Aid from other government agencies 168,026 - - - - Fines and forfeitures - - - - - Revenue from use of money and property - 432,600 30,476 6,857 107,700 Miscellaneous - - - - - Total revenues 168,026 1,506,214 30,476 6,857 1,244,295 EXPENDITURES Current:

General government - 4,657 325 105 14 Public works - - - - 648,648 Community development - - - - 531 Capital outlay 205,830 1,231,616 - - - Total expenditures 205,830 1,236,273 325 105 649,193 Excess (deficiency) of revenues over expenditures (37,804) 269,941 30,151 6,752 595,102 OTHER FINANCING SOURCES (USES) Transfers in - 45,000 - - - Transfers out (2,473) - - - - Total other financing sources (uses) (2,473) - 45,000 - - Net change in fund balance (40,277) 269,941 75,151 6,752 595,102 FUND BALANCE (DEFICIT) Beginning of year 207,798 5,705,236 405,048 159,780 1,450,201 End of year 167,521 $ 5,975,177 $ 480,199 $ 166,532 $ 2,045,303 $ Special Revenue

City of Hanford
Combining Statement of Revenues, Expenditures and Changes in Fund Balances Non-Major Special Revenue Funds
For the Year Ended June 30, 2024 (continued)
-94-
City Housing
Fund
Central Parking
and Business
Improvement
Fire Protection
Impact Fees
Police
Protection
Impact Fees Special Aviation

REVENUES
Taxes and special assessments - $ 117,271 $ 191,390 $ 106,885 $ - $ Aid from other government agencies - - - - 18,536 Fines and forfeitures - - - - - Revenue from use of money and property 53,802 14,583 59,307 (7,535) - Miscellaneous 2,177 - 161,608 144,379 - Total revenues 55,979 131,854 412,305 243,729 18,536 EXPENDITURES Current:

General government 485 143 671 - - Public works - 81,090 - - - Community development 4,256 9,640 - - - Capital outlay - 45,000 232,800 47,140 - Total expenditures 4,741 135,873 233,471 47,140 - Excess (deficiency) of revenues over expenditures 51,238 (4,019) 178,834 196,589 18,536 OTHER FINANCING SOURCES (USES) Transfers in - - - - - Transfers out - (45,000) - - - Total other financing sources (uses) - (45,000) - - - Net change in fund balance 51,238 (49,019) 178,834 196,589 18,536 FUND BALANCE (DEFICIT) Beginning of year 2,381,249 182,112 741,460 (170,397) - End of year 2,432,487 $ 133,093 $ 920,294 $ 26,192 $ 18,536 $ Special Revenue

City of Hanford
Combining Statement of Revenues, Expenditures and Changes in Fund Balances Non-Major Special Revenue Funds
For the Year Ended June 30, 2024 (continued)
-95-
Traffic Safety
Street Tree
Committee
State Gas Tax
Fund
Public Housing
Authority
Transportation
Impact Fees

REVENUES
Taxes and special assessments - $ - $ 3,582,140 $ - $ 2,114,724 $ Aid from other government agencies - - - - - Fines and forfeitures 40,522 - - - - Revenue from use of money and property 8,456 - 427,261 - 545,132 Miscellaneous - - - 415 - Total revenues 48,978 - 4,009,401 415 2,659,856 EXPENDITURES Current:

General government 99 - 4,803 - 6,061 Public works - - - - - Community development - - - 312,329 - Capital outlay - - 967,514 - 99,435 Total expenditures 99 - 972,317 312,329 105,496 Excess (deficiency) of revenues over expenditures 48,879 - 3,037,084 (311,914) 2,554,360 OTHER FINANCING SOURCES (USES) Transfers in - - - 311,914 2,473 Transfers out - - - - - Total other financing sources (uses) - - - 311,914 2,473 Net change in fund balance 48,879 - 3,037,084 - 2,556,833 FUND BALANCE (DEFICIT) Beginning of year 110,930 1,218 5,261,797 157,902 6,811,992 End of year 159,809 $ 1,218 $ 8,298,881 $ 157,902 $ 9,368,825 $ Special Revenue

City of Hanford
Combining Statement of Revenues, Expenditures and Changes in Fund Balances Non-Major Special Revenue Funds
For the Year Ended June 30, 2024 (concluded)
-96-
Special Revenue
Cannabis
Operations
Capital Projects
Fund
Total Non-Major
Special
Revenue Funds

REVENUES
Taxes and special assessments 913,584 $ - $ 9,236,203 $ Aid from other government agencies - - 186,562 Fines and forfeitures 8,069 - 48,591 Revenue from use of money and property 888 88,175 1,767,702 Miscellaneous 128,000 - 436,579 Total revenues 1,050,541 88,175 11,675,637 EXPENDITURES Current:

General government - 10,136 27,499 Public works - - 729,738 Community development 25,000 - 351,756 Capital outlay - 693,001 3,522,336 Total expenditures 25,000 703,137 4,631,329 Excess (deficiency) of revenues over expenditures 1,025,541 (614,962) 7,044,308

OTHER FINANCING SOURCES (USES)
Transfers in - - 359,387 Transfers out (954,190) - (1,001,663) Total other financing sources (uses) (954,190) - (642,276) Net change in fund balance 71,351 (614,962) 6,402,032 FUND BALANCE (DEFICIT) Beginning of year 126,255 2,822,246 26,354,827 End of year 197,606 $ 2,207,284 $ 32,756,859 $

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual CMAQ Transportation Fund
For the Year Ended June 30, 2024
-97-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Aid from other government agencies 167,186 $ 167,186 $ 168,026 $ 840 $ Total revenues 167,186.00 167,186 168,026 840

EXPENDITURES
Current:

Capital outlay - 366,414 205,830 160,584
Total expenditures - 366,414 205,830 160,584
Excess (deficiency) of revenues
over (under) expenditures 167,186 (199,228) (37,804) 161,424 OTHER FINANCING SOURCES (USES) Transfers in - - (2,473) (2,473) Total other financing sources (uses) - - (2,473) (2,473) Net change in fund balance 167,186 (199,228) (40,277) 158,951 FUND BALANCE Beginning of year 207,798 207,798 207,798 - End of year 374,984 $ 8,570 $ 167,521 $ 158,951 $ CMAQ Transportation Fund

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Park Impact Fees Fund
For the Year Ended June 30, 2024
-98-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Taxes and special assessments 750,000 $ 750,000 $ 1,073,614 $ 323,614 $ Revenue from use of money and property 38,000 38,000 432,600 394,600 Total revenues 788,000 788,000 1,506,214 718,214 EXPENDITURES Current:

General government 3,800 3,800 4,657 (857) Capital outlay - 3,399,264 1,231,616 2,167,648 Total expenditures 3,800 3,403,064 1,236,273 2,166,791
Net change in fund balance 784,200 (2,615,064) 269,941 2,885,005

FUND BALANCE
Beginning of year 5,705,236 5,705,236 5,705,236 - End of year 6,489,436 $ 3,090,172 $ 5,975,177 $ 2,885,005 $ Park Impact Fees

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Parking Fund
For the Year Ended June 30, 2024
-99-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Revenue from use of money and property 1,100 $ 1,100 $ 30,476 $ 29,376 $ Total revenues 1,100 1,100 30,476 29,376

EXPENDITURES
Current:

General government 150 150 325 (175) Total expenditures 150 150 325 (175) Excess (deficiency) of revenues over (under) expenditures 950 950 30,151 29,201 OTHER FINANCING SOURCES (USES) Transfers in - - 45,000 45,000 Lease acquisition 19,496 19,496 - (19,496) Total other financing sources (uses) 19,496 19,496 45,000 25,504 Net change in fund balance 20,446 20,446 75,151 54,705

FUND BALANCE
Beginning of year 405,048 405,048 405,048 - End of year 425,494 $ 425,494 $ 480,199 $ 54,705 $ Parking Fund

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Downtown Reinvestment Fund
For the Year Ended June 30, 2024
-100-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Revenue from use of money and property 1,300 $ 1,300 $ 6,857 $ 5,557 $ Miscellaneous 2,500 2,500 - (2,500) Total revenues 3,800 3,800 6,857 3,057 EXPENDITURES Current:

General government 100 100 105 (5) Total expenditures 100 100 105 (5) Net change in fund balance 3,700 3,700 6,752 3,052

FUND BALANCE
Beginning of year 159,780 159,780 159,780 - End of year 163,480 $ 163,480 $ 166,532 $ 3,052 $ Downtown Reinvestment Fund

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Landscaping Assessment District Fund
For the Year Ended June 30, 2024
-101-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Taxes and special assessments 1,038,707 $ 1,038,707 $ 1,136,595 $ 97,888 $ Revenue from use of money and property 4,640 107,700 103,060 Total revenues 1,038,707 1,043,347 1,244,295 200,948

EXPENDITURES
Current:

General government 30 30 14 16 Public works 741,799 741,799 648,648 93,151 Community development 2,540 2,540 531 2,009 Total expenditures 744,369 744,369 649,193 95,176 Net change in fund balance 294,338 298,978 595,102 296,124

FUND BALANCE
Beginning of year 1,450,201 1,450,201 1,450,201 - End of year 1,744,539 $ 1,749,179 $ 2,045,303 $ 296,124 $ Landscaping Assessment District

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual City Housing Fund
For the Year Ended June 30, 2024
-102-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Revenue from use of money and property 4,200 $ 4,200 $ 53,802 $ 49,602 $ Miscellaneous 10,000 10,000 2,177 (7,823) Total revenues 14,200 14,200 55,979 41,779

EXPENDITURES
Current:

General government 470 470 485 (15) Community development 20,000 20,000 4,256 15,744 Total expenditures 20,470 20,470 4,741 15,729 Excess (deficiency) of revenues
over (under) expenditures (6,270) (6,270) 51,238 57,508 OTHER FINANCING SOURCES (USES) Transfers out 10,000 10,000 - (10,000)
- Total other financing sources (uses) 10,000 10,000 - (10,000) - Net change in fund balance 3,730 3,730 51,238 47,508

FUND BALANCE
Beginning of year 2,381,249 2,381,249 2,381,249 - End of year 2,384,979 $ 2,384,979 $ 2,432,487 $ 47,508 $ City Housing Fund

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Central Parking and Business Improvement Fund
For the Year Ended June 30, 2024
-103-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Taxes and special assessments 105,000 $ 105,000 $ 117,271 $ 12,271 $ Revenue from use of money and property 1,000 1,000 14,583 13,583 Total revenues 106,000 106,000 131,854 25,854

EXPENDITURES
Current:

General government 100 100 143 (43) Public works 81,090 81,090 81,090 - Community development 15,000 15,000 9,640 5,360 Capital outlay - 45,000 45,000 - Total expenditures 96,190 141,190 135,873 5,317 Excess (deficiency) of revenues over (under) expenditures 9,810 (35,190) (4,019) 31,171 OTHER FINANCING SOURCES (USES) Transfers out - - (45,000) (45,000) Total other financing sources (uses) - - (45,000) (45,000) Net change in fund balance 9,810 (35,190) (49,019) (13,829)

FUND BALANCE
Beginning of year 182,112 182,112 182,112 - End of year 191,922 $ 146,922 $ 133,093 $ (13,829) $ Central Parking and Business Improvement Fund

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Fire Protection Impact Fees Fund
For the Year Ended June 30, 2024
-104-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Taxes and special assessments 170,000 $ 170,000 $ 191,390 $ 21,390 $ Revenue from use of money and property 3,400 3,400 59,307 55,907 Miscellaneous - - 161,608 161,608 Total revenues 173,400 173,400 412,305 238,905

EXPENDITURES
Current:

General government 350 350 671 (321) Capital outlay - 232,800 232,800 - Total expenditures 350 233,150 233,471 (321) Net change in fund balance 173,050 (59,750) 178,834 238,584 FUND BALANCE Beginning of year 741,460 741,460 741,460 - End of year 914,510 $ 681,710 $ 920,294 $ 238,584 $ Fire Protection Impact Fees

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Police Protection Impact Fees Fund
For the Year Ended June 30, 2024
-105-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Taxes and special assessments 103,000 $ 103,000 $ 106,885 $ 3,885 $ Revenue from use of money and property 1,000 1,000 (7,535) (8,535) Miscellaneous - - 144,379 144,379 Total revenues 104,000 104,000 243,729 139,729

EXPENDITURES
Current:

General government 80 80 - 80 Capital outlay - 47,140 47,140 - Total expenditures 80 47,220 47,140 80 Net change in fund balance 103,920 56,780 196,589 139,809

FUND BALANCE (DEFICIT)
Beginning of year (170,397) (170,397) (170,397) - End of year (66,477) $ (113,617) $ 26,192 $ 139,809 $ Police Protection Impact Fees

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Traffic Safety Fund
For the Year Ended June 30, 2024
-106-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Fines and forfeitures 36,000 $ 36,000 $ 40,522 $ 4,522 $ Revenue from use of money and property 300 300 8,456 8,156 Total revenues 36,300 36,300 48,978 12,678 EXPENDITURES Current:

General government 30 30 99 (69) Total expenditures 30 30 99 (69) Net change in fund balance 36,270 36,270 48,879 12,609 FUND BALANCE Beginning of year 110,930 110,930 110,930 - End of year 147,200 $ 147,200 $ 159,809 $ 12,609 $ Traffic Safety

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual State Gas Tax Fund
For the Year Ended June 30, 2024
-107-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Taxes and special assessments 3,394,300 $ 3,394,300 $ 3,582,140 $ 187,840 $ Revenue from use of money and property 24,800 24,800 427,261 402,461 Total revenues 3,419,100 3,419,100 4,009,401 590,301

EXPENDITURES
Current:

General government 2,600 2,600 4,803 (2,203) Capital outlay 425,000 3,198,301 967,514 2,230,787 Total expenditures 427,600 3,200,901 972,317 2,228,584 Net change in fund balance 2,991,500 218,199 3,037,084 2,818,885

FUND BALANCE
Beginning of year 5,261,797 5,261,797 5,261,797 - End of year 8,253,297 $ 5,479,996 $ 8,298,881 $ 2,818,885 $ State Gas Tax Fund

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Public Housing Authority Fund
For the Year Ended June 30, 2024
-108-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Miscellaneous - $ - $ 415 $ 415 $
Total revenues - - 415 415 EXPENDITURES
Current:

Community development 316,761 336,761 312,329 24,432 Debt service:

Principal 836 836 - 836
Interest 6 6 - 6 Total expenditures 317,603 337,603 312,329 25,274 Excess (deficiency) of revenues over (under) expenditures (317,603) (337,603) (311,914) 25,689 OTHER FINANCING SOURCES (USES) Transfers in 317,603 317,603 311,914 (5,689) Lease acquisition 3,844 3,844 - (3,844) Total other financing sources (uses) 321,447 321,447 311,914 (9,533) Net change in fund balance 3,844 (16,156) - 16,156 FUND BALANCE Beginning of year 157,902 157,902 157,902 - End of year 161,746 $ 141,746 $ 157,902 $ 16,156 $ Public Housing Authority

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Transportation Impact Fees Fund
For the Year Ended June 30, 2024
-109-
Original Final Actual Amount
Variance with
Final Budget

REVENUES
Taxes and special assessments 1,430,000 $ 1,430,000 $ 2,114,724 $ 684,724 $ Revenue from use of money and property 41,000 41,000 545,132 504,132 Total revenues 1,471,000 1,471,000 2,659,856 1,188,856 EXPENDITURES Current:

General government 4,100 4,100 6,061 (1,961) Capital outlay - 2,892,987 99,435 2,793,552 Total expenditures 4,100 2,897,087 105,496 2,791,591 Excess (deficiency) of revenues
over (under) expenditures 1,466,900 (1,426,087) 2,554,360 3,980,447 OTHER FINANCING SOURCES (USES) Transfers in - - 2,473 2,473 Total other financing sources (uses) - - 2,473 2,473 Net change in fund balance 1,466,900 (1,426,087) 2,556,833 3,982,920 FUND BALANCE Beginning of year 6,811,992 6,811,992 6,811,992 - End of year 8,278,892 $ 5,385,905 $ 9,368,825 $ 3,982,920 $ Transportation Impact Fees

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Cannabis Operations Fund
For the Year Ended June 30, 2024
-110-
Original
Budget
Final
Budget Actual
Variance with
Final Budget

REVENUES
Taxes and special assessments 1,200,000 $ 1,200,000 $ 913,584 $ (286,416) $ Fines and forfeitures - - 8,069 8,069 Revenue from use of money and property 2,700 2,700 888 (1,812) Miscellaneous 96,000 96,000 128,000 32,000 Total revenues 1,298,700 1,298,700 1,050,541 (248,159) EXPENDITURES Current:

General government 300 300 - 300 Community development - - 25,000 (25,000) Total expenditures 300 300 25,000 (24,700) Excess (deficiency) of revenues over (under) expenditures 1,298,400 1,298,400 1,025,541 (272,859) OTHER FINANCING SOURCES (USES) Transfers out (1,296,000) (1,296,000) (954,190) 341,810 Total other financing sources (uses) (1,296,000) (1,296,000) (954,190) 341,810 Net change in fund balance 2,400 2,400 71,351 68,951 FUND BALANCE Beginning of year 126,255 126,255 126,255 - End of year 128,655 $ 128,655 $ 197,606 $ 68,951 $ Cannabis Operations

City of Hanford
Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual Capital Projects Fund
For the Year Ended June 30, 2024
-111-
Original Final Actual Amount
Variance with
Final Budget

REVENUES
Taxes and special assessments 50,000 $ 50,000 $ - $ (50,000) $ Revenue from use of money and property 22,000 22,000 88,175 66,175 Total revenues 72,000 72,000 88,175 16,175

EXPENDITURES
General Government 2,200 2,200 10,136 (7,936) Capital outlay - 1,114,227 693,001 421,226 Total expenditures 2,200 1,116,427 703,137 413,290 Net change in fund balance 69,800 (1,044,427) (614,962) 429,465

FUND BALANCE
Beginning of year 2,822,246 2,822,246 2,822,246 - End of year 2,892,046 $ 1,777,819 $ 2,207,284 $ 429,465 $ Capital Projects Fund

City of Hanford
Combining Statement of Net Position
Non-major Enterprise Funds
June 30, 2024
-112-
Airport Intermodal Courthouse Building Safety
Fund Fund Square Fund Totals
ASSETS
Current assets
Cash and investments 268,658 $ 45,579 $ - $ 577,392 $ 891,629 $ Receivables:

Accounts 22,695 39,528 5,347 49,622 117,192 Leases - 164,534 - - 164,534 Interest - 329 - - 329 Total current assets 291,353 249,970 5,347 627,014 1,173,684 Noncurrent assets Capital assets:

Land 2,596,623 278,884 - - 2,875,507 Construction in progress 66,231 - - - 66,231 Building and improvements 10,123,741 1,305,817 - - 11,429,558 Machinery and equipment 81,851 - - 334,260 416,111 Accumulated depreciation/amortization (6,948,049) (743,199) - (75,031) (7,766,279) Total capital assets (net of accumulated depreciation) 5,920,397 841,502 - 259,229 7,021,128 Total noncurrent assets 5,920,397 841,502 - 259,229 7,021,128 Total assets 6,211,750 1,091,472 5,347 886,243 8,194,812 LIABILITIES Current Liabilities
Accounts payable 5,576 2,104 3,663 33,912 45,255 Salaries and benefits payable - - - 11,568 11,568 Due to other funds - - 214,117 - 214,117 Advances to other funds 375,468 261,224 1,022,334 - 1,659,026 Compensated absences - current portion - - - 2,749 2,749 Total current liabilities 381,044 263,328 1,240,114 48,229 1,932,715 Noncurrent Liabilities Compensated absences payable - - - 34,787 34,787 Total noncurrent liabilities - - - 34,787 34,787 Total liabilities 381,044 263,328 1,240,114 83,016 1,967,502 DEFERRED INFLOWS OF RESOURCES Deferred inflows related to leases - 157,406 - - 157,406 Total deferred inflows of resources - 157,406 - - 157,406 NET POSITION (DEFICIT) Net investment in capital assets 5,920,397 841,502 - 259,229 7,021,128 Unrestricted (89,691) (170,764) (1,234,767) 543,998 (951,224) Total net position 5,830,706 $ 670,738 $ (1,234,767) $ 803,227 $ 6,069,904 $ Non-major Funds

City of Hanford
Combining Statement of Revenues, Expenses and Changes in Net Position Non-major Enterprise Funds
For the Year Ended June 30, 2024
-113-
Airport Intermodal Courthouse Building Safety
Fund Fund Square Fund Totals

OPERATING REVENUES
Charges for services 154,968 $ 706 $ 55,016 $ 2,298,943 $ 2,509,633 $ Other revenues 239,850 1,024 6 131,927 372,807 Total operating revenues 394,818 1,730 55,022 2,430,870 2,882,440 OPERATING EXPENSES Personnel services 46,426 - - 794,305 840,731 Services and supplies 201,859 30,139 112,369 830,468 1,174,835 Depreciation and amortization 319,509 26,117 - 24,897 370,523 Total operating expenses 567,794 56,256 112,369 1,649,670 2,386,089 Operating income (loss) (172,976) (54,526) (57,347) 781,200 496,351 NON-OPERATING REVENUES (EXPENSES) Interest income 7,519 2,841 (6,201) 4,721 8,880 Unrealized gain (loss) on investments 3,952 1,065 - - 5,017 Lease revenue - 39,356 - - 39,356 Federal grant 75,000 - - - 75,000 Total non-operating revenue (expenses) 86,471 43,262 (6,201) 4,721 128,253 Income (loss) before capital contributions and transfers (86,505) (11,264) (63,548) 785,921 624,604 Capital contributions - - - 17,306 17,306 Transfers in/(out) (5,012) - - - (5,012) Total Capital Contributions and Transfers (5,012) - - 17,306 12,294 Change in net position (91,517) (11,264) (63,548) 803,227 636,898 NET POSITION (DEFICIT) Beginning of year 5,922,223 682,002 (1,171,219) - 5,433,006 End of year 5,830,706 $ 670,738 $ (1,234,767) $ 803,227 $ 6,069,904 $ Non-major Funds

City of Hanford
Combining Statement of Cash Flows
Non-major Enterprise Funds
For the Year Ended June 30, 2024
-114-
Airport Intermodal Courthouse Building Safety
Fund Fund Square Fund Totals

CASH FLOWS FROM OPERATING ACTIVITIES
Cash received for current services 134,919 $ (494) $ 51,440 $ 2,249,321 $ 2,435,186 $ Cash received for other operating revenues 239,850 1,024 6 131,927 372,807 Cash paid for services and supplies (198,804) (28,626) (112,502) (796,556) (1,136,488) Cash paid for salaries and benefits (47,089) - - (745,201) (792,290) Net cash provided (used) by operating activities 128,876 (28,096) (61,056) 839,491 879,215 CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES Transfers (to)/from other funds (5,012) - - - (5,012) Loans from/(to) other funds - - 61,055 - 61,055 Intergovernmental revenue 75,000 - - - 75,000 Net cash provided (used) by non-capital financing activities 69,988 - 61,055 - 131,043

CASH FLOWS FROM CAPITAL AND

RELATED FINANCING ACTIVITIES
Payments for capital asset acquisition (66,231) - - (266,820) (333,051) Lease income - 38,421 - - 38,421 Net cash provided (used) by capital and related financing activities (66,231) 38,421 - (266,820) (294,630) CASH FLOWS FORM INVESTING ACTIVITIES Unrealized gain (loss) on investments 3,952 1,065 - - 5,017 Interest received 7,519 2,512 (6,201) 4,721 8,551 Net cash provided (used) by investing activities 11,471 3,577 (6,201) 4,721 13,568 Net increase (decrease) in cash and investments 144,104 13,902 (6,202) 577,392 729,196 Cash and investments, beginning of year 124,554 31,677 6,202 - 162,433 Cash and investments, end of year 268,658 $ 45,579 $ - $ 577,392 $ 891,629 $ Reconciliation to Statement of Net Position:

Cash and investments 268,658 $ 45,579 $ - $ 577,392 $ 891,629 $ Total cash and investments 268,658 $ 45,579 $ - $ 577,392 $ 891,629 $

RECONCILIATION OF OPERATING INCOME (LOSS) TO NET

CASH PROVIDED (USED) BY OPERATING ACTIVITIES
Operating income (loss) (172,976) $ (54,526) $ (57,347) $ 781,200 $ 496,351 $ Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:

Depreciation 319,509 26,117 - 24,897 370,523 (Increase) decrease in:

Receivables (17,568) (1,200) (3,576) (49,622) (71,966) Accounts payable 3,055 1,513 (133) 33,912 38,347 Salaries and benefits payable (663) - - 11,568 10,905 Compensated absences - - - 37,536 37,536 Deposits and unearned revenue (2,481) - - - (2,481) Total Adjustments 301,852 26,430 (3,709) 58,291 382,864 Net cash provided (used) by operating activities 128,876 $ (28,096) $ (61,056) $ 839,491 $ 879,215 $ Noncash from Capital and Related Financing Activities
Capital Contributions - $ - $ - $ 17,306 $ 17,306 $
Non-major Funds

City of Hanford
Combining Statement of Net Position
Internal Service Funds
June 30, 2024
-115-
City Payroll
Fund
Risk Management
Fund
Computer
Maintenance
Fund
ASSETS
Current assets
Cash and investments 337,757 $ 8,066,273 $ 381,381 $
Receivables - 13,214 57 Deposits - 185,000 - Prepaid expenses - - - Inventory - - - Total current assets 337,757 8,264,487 381,438 Noncurrent assets Capital assets:

Construction in progress - - - Building and improvements - - - Machinery and equipment - - 1,771,281 Right to use assets - - 237,867 Accumulated depreciation/amortization - - (1,186,684) Total capital assets (net of accumulated depreciation) - - 822,464 Total noncurrent assets - - 822,464 Total assets 337,757 8,264,487 1,203,902 DEFERRED OUTFLOWS OF RESOURCES Deferred outflows related to pensions - - 80,713 Total deferred outflows of resources - - 80,713

LIABILITIES
Current Liabilities
Accounts payable 235,856 195,024 10,096 Salaries and benefits payable 25,589 - 5,962 Interest payable - - 3,105
Compensated absences - current portion - - 6,683
Bonds and notes payable - current portion - - 9,389
SBITA payable - current portion - - 77,208 Total current liabilities 261,445 195,024 112,443 Noncurrent Liabilities Compensated absences payable - - 14,100 Claims payable - 6,999,000 - Bonds and notes payable - - 140,201 Net pension liability - - 128,995 SBITA payable - - 79,275 Total noncurrent liabilities - 6,999,000 362,571 Total liabilities 261,445 7,194,024 475,014

DEFERRED INFLOWS OF RESOURCES
Deferred inflows related to pensions - - 7,387 Total deferred inflows of resources - - 7,387

NET POSITION (DEFICIT)
Net investment in capital assets - - 822,464 Unrestricted 76,312 1,070,463 (20,250) Total net position 76,312 $ 1,070,463 $ 802,214 $

(concluded)
-116-
Building Fund
Fleet
Management
Fund Medical Fund Totals
$ 18,140,776 1,591,856 $ 940,218 $ 29,458,261 $
223 1,269 302 15,065
- - - 185,000
30,375 - - 30,375
309,722 - - 309,722
18,481,096 1,593,125 940,520 29,998,423
- 152,733 - 152,733
26,191 644,586 - 670,777
13,802,583 229,583 - 15,803,447
- - - 237,867
(9,351,235) (371,350) - (10,909,269)
4,477,539 655,552 - 5,955,555
4,477,539 655,552 - 5,955,555
22,958,635 2,248,677 940,520 35,953,978
161,426 161,426 - 403,565
161,426 161,426 - 403,565
40,442 61,944 99,506 642,868
12,694 8,732 - 52,977
- - - 3,105
2,698 2,800 - 12,181
31,565 22,293 - 63,247
- - - 77,208
87,399 95,769 99,506 851,586
29,926 11,606 - 55,632
- - - 6,999,000
471,325 332,880 - 944,406
257,990 257,990 - 644,975
- - - 79,275
759,241 602,476 - 8,723,288
846,640 698,245 99,506 9,574,874
14,774 14,774 - 36,935
14,774 14,774 - 36,935
4,477,539 655,552 - 5,955,555
17,781,108 1,041,532 841,014 20,790,179 $ 22,258,647 1,697,084 $ 841,014 $ 26,745,734 $

City of Hanford
Combining Statement of Revenues, Expenses and Changes in Net Position Internal Service Funds
For the Year Ended June 30, 2024
-117-
City Payroll
Fund
Risk
Management
Fund
Computer
Maintenance
Fund

OPERATING REVENUES
Charges for services - $ 985,532 $ 1,313,825 $
Other revenues - 36,133 - Total operating revenues - 1,021,665 1,313,825 OPERATING EXPENSES Personnel services - - 374,053 Services and supplies 573 1,015,137 418,088 Depreciation and amortization - - 303,154
Total operating expenses 573 1,015,137 1,095,295 Operating income (loss) (573) 6,528 218,530 NON-OPERATING REVENUES (EXPENSES) Interest income 26,200 248,313 12,777
Interest expense - - (10,094) Unrealized gain (loss) on investments 41,640 219,643 9,708 Gain/(loss) on disposals - - - Total non-operating revenue (expenses) 67,840 467,956 12,391 Income (loss) before capital contributions and transfers 67,267 474,484 230,921 Transfers in/(out) - (11,428) - Change in net position 67,267 463,056 230,921 NET POSITION (DEFICIT) Beginning of year 9,045 607,407 571,293
End of year 76,312 $ 1,070,463 $ 802,214 $

(concluded)
-118-
Building Fund
Fleet
Management
Fund Medical Fund Totals
$ 5,763,340 1,405,358 $ 3,239,847 $ 12,707,902 $
18,126 273 4,078 58,610
5,781,466 1,405,631 3,243,925 12,766,512
825,480 602,181 - 1,801,714
4,466,412 417,263 3,231,896 9,549,369
780,257 73,728 - 1,157,139
6,072,149 1,093,172 3,231,896 12,508,222
(290,683) 312,459 12,029 258,290
662,755 43,452 81,656 1,075,153
(23,496) (16,594) - (50,184)
599,136 31,688 - 901,815
(483,364) - - (483,364)
755,031 58,546 81,656 1,443,420
464,348 371,005 93,685 1,701,710
39,131 (50,024) - (22,321)
503,479 320,981 93,685 1,679,389
21,755,168 1,376,103 747,329 25,066,345 $ 22,258,647 1,697,084 $ 841,014 $ 26,745,734 $

City of Hanford
Combining Statement of Cash Flows
Internal Service Funds
For the Year Ended June 30, 2024
-119-
City Payroll Fund
Risk Management
Fund
Computer
Maintenance Fund

CASH FLOWS FROM OPERATING ACTIVITIES
Cash received for current services 45,205 $ 1,018,146 $ 1,313,768 $ Cash received for other operating revenues - 36,133 - Cash paid for services and supplies (262,677) 225,781 (411,553) Cash paid for salaries and benefits (560,994) - (361,704) Net cash provided (used) by operating activities (778,466) 1,280,060 540,511 CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES Transfers (to)/from other funds - (11,428) - Loans from/(to) other funds - - (337,695) Net cash provided (used) by non-capital financing activities - (11,428) (337,695)

CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Principal payments on long-term debt - - (9,614)
Interest payments on long-term debt - - (6,989)
Payments for capital asset acquisition - - (29,305) SBITA payments - - (81,384) Proceeds from the sale of capital assets - - - Net cash provided (used) by capital and related financing activities - - (127,292) CASH FLOWS FORM INVESTING ACTIVITIES Unrealized gain (loss) on investments 41,640 219,643 9,708 Interest received 26,200 248,313 12,777 Net cash provided (used) by investing activities 67,840 467,956 22,485 Net increase (decrease) in cash and investments (710,626) 1,736,588 98,009 Cash and investments, beginning of year 1,048,383 6,329,685 283,372 Cash and investments, end of year 337,757 $ 8,066,273 $ 381,381 $ Reconciliation to Statement of Net Position:

Cash and investments 337,757 $ 8,066,273 $ 381,381 $
Total cash and investments 337,757 $ 8,066,273 $ 381,381 $

RECONCILIATION OF OPERATING INCOME (LOSS) TO NET

CASH PROVIDED (USED) BY OPERATING ACTIVITIES
Operating income (loss) (573) $ 6,528 $ 218,530 $
Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:

Depreciation - - 303,154 (Increase) decrease in:

Receivables 45,205 32,614 (57) Prepaids - 4,800 -
Inventory - - - Deferred outflow of resources - - 33,282 Accounts payable (262,104) 13,118 6,535 Salaries and benefits payable (560,994) - 613 Compensated absences - - 3,661 Claims payable - 1,223,000 - Net pension liability - - (17,743) Deferred inflow of resources - - (7,464) Total Adjustments (777,893) 1,273,532 321,981 Net cash provided (used) by operating activities (778,466) $ 1,280,060 $ 540,511 $

(concluded)
-120-
Building Fund
Fleet Management
Fund Medical Fund Totals
$ 5,767,059 1,410,230 $ 3,240,151 $ 12,794,559 $
18,126 273 4,078 58,610
(4,514,677) (390,000) (3,399,791) (8,752,917)
(841,648) (581,152) - (2,345,498)
428,860 439,351 (155,562) 1,754,754
39,131 (50,024) - (22,321)
(137,941) - - (475,636)
(98,810) (50,024) - (497,957)
(32,321) (22,827) - (64,762)
(23,496) (16,594) - (47,079)
(201,332) (152,733) - (383,370)
- - - (81,384)
17,306 - - 17,306
(239,843) (192,154) - (559,289)
599,136 31,688 - 901,815
662,755 43,452 81,656 1,075,153
1,261,891 75,140 81,656 1,976,968
1,352,098 272,313 (73,906) 2,674,476
16,788,678 1,319,543 1,014,124 26,783,785 $ 18,140,776 1,591,856 $ 940,218 $ 29,458,261 $ $ 18,140,776 1,591,856 $ 940,218 $ 29,458,261 $
$ 18,140,776 1,591,856 $ 940,218 $ 29,458,261 $
$ (290,683) 312,459 $ 12,029 $ 258,290 $
780,257 73,728 - 1,157,139
3,719 4,872 304 86,657
(30,375) - - (25,575)
9,987 - - 9,987
163,739 49,744 - 246,765
(27,877) 27,263 (167,895) (410,960)
69 758 - (559,554)
8,183 (2,903) - 8,941
- - - 1,223,000
(160,571) (13,833) - (192,147)
(27,588) (12,737) - (47,789)
719,543 126,892 (167,591) 1,496,464 $ 428,860 439,351 $ (155,562) $ 1,754,754 $

City of Hanford
Combining Statement of Fiduciary Net Position
Custodial Funds
June 30, 2024
-121-
Renters' Miscellaneous
Civil Insurance COE Park Deposits
Subpoena Deposits Deposits Trust Total
ASSETS
Cash and investments 278,150 $ 4,034 $ 488 $ 1,041,259 $ 1,323,931 $ Accounts receivable - - - 488,539 488,539 Total Assets 278,150 4,034 488 1,529,798 1,812,470 LIABILITIES Accounts payable - - - 1,382,916 1,382,916 Deposits held for others 348,233 835 - 66,629 415,697 Total Liabilities 348,233 835 - 1,449,545 1,798,613 NET POSITION (DEFICIT) Restricted (70,083) 3,199 488 80,253 13,857 Total Net Position (70,083) $ 3,199 $ 488 $ 80,253 $ 13,857 $

City of Hanford
Combining Statement of Changes in Fiduciary Net Position Custodial Funds
For the Year Ended June 30, 2024
-122-
Renters' Miscellaneous
Civil Insurance COE Park Deposits
Subpoena Deposits Deposits Trust Total

ADDITIONS
Other additions - $ - $ - $ - $ - $
Total Additions - - - - - DEDUCTIONS
General government 9,887 - - - 9,887 Total Deductions 9,887 - - - 9,887 Change in Fiduciary Net Position (9,887) - - - (9,887) NET POSITION (DEFICIT) Beginning of year, as restated (60,196) 3,199 488 80,253 23,744 End of year (70,083) $ 3,199 $ 488 $ 80,253 $ 13,857 $

STATISTICAL SECTION

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City of Hanford
Net Position by Component
Last Ten (10) Fiscal Years
(accrual basis of accounting)
-123-
2015 2016 2017 2018
Governmental activities
Net investment in capital assets 137,807,121 $ 138,153,691 $ 143,053,747 $ 147,136,482 $ Restricted 45,230,167 44,303,261 40,033,008 37,759,964 Unrestricted (7,767,187) (4,230,067) (11,322,040) (11,446,292) Total governmental activities net position 175,270,101 $ 178,226,885 $ 171,764,715 $ 173,450,154 $ Business-type activities
Net investment in capital assets 72,850,892 $ 79,775,875 $ 80,951,839 $ 86,648,028 $ Restricted 3,124,917 324 2,420 2,419 Unrestricted 15,364,950 17,620,112 21,659,423 28,437,335 Total business-type activities net position 91,340,759 $ 97,396,311 $ 102,613,682 $ 115,087,782 $ Primary government
Net investment in capital assets 210,658,013 $ 217,929,566 $ 224,005,586 $ 233,784,510 $ Restricted 48,355,084 44,303,585 40,035,428 37,762,383 Unrestricted 7,597,763 13,390,045 10,337,383 16,991,043 Total primary government net position 266,610,860 $ 275,623,196 $ 274,378,397 $ 288,537,936 $ Fiscal Year
Source: City of Hanford Finance Department

City of Hanford
Net Position by Component, (Continued)
Last Ten (10) Fiscal Years
(accrual basis of accounting)
-124-
2019 2020 2021 2022 2023 2024
$ 158,401,312 152,623,126 $ 157,116,548 $ 153,865,284 $ 155,203,294 $ 165,368,191 $ 31,543,209 36,912,718 39,517,385 44,531,429 23,285,547 29,207,622 (13,031,815) (10,241,262) (16,865,455) (20,739,018) 16,776,297 18,755,308 $ 176,912,706 179,294,582 $ 179,768,478 $ 177,657,695 $ 195,265,138 $ 213,331,121 $ $ 96,648,645 92,471,031 $ 108,641,344 $ 104,136,670 $ 141,608,046 $ 121,203,106 $ 2,379 2,419 2,379 2,379 4,743 -
37,049,575 32,334,598 36,037,365 46,369,374 13,013,309 46,530,975 $ 133,700,599 124,808,048 $ 144,681,088 $ 150,508,423 $ 154,626,098 $ 167,734,081 $ $ 255,049,957 245,094,157 $ 265,757,892 $ 258,001,954 $ 296,811,340 $ 286,571,297 $ 31,545,588 36,915,137 39,519,764 44,533,808 23,290,290 29,207,622 24,017,760 22,093,336 19,171,910 25,630,356 29,789,606 65,286,283 $ 310,613,305 304,102,630 $ 324,449,566 $ 328,166,118 $ 349,891,236 $ 381,065,202 $

City of Hanford
Changes in Net Position
Last Ten (10) Fiscal Years
(accrual basis of accounting)
-125-
2015 2016 2017 2018
Expenses
Governmental activities:

General government 2,377,309 $ 1,985,661 $ 1,834,286 $ 2,411,345 $ Public safety 14,386,240 14,331,789 16,605,006 17,908,901 Public works 7,110,149 8,587,563 7,970,040 9,665,063 Parks and recreation 3,327,204 2,992,500 3,577,165 2,986,101 Community development 2,134,853 3,602,920 9,419,387 5,255,402 Interest expense - - - - Total governmental activities expenses 29,335,755 31,500,433 39,405,884 38,226,812 Business-type activities:

Water system 6,490,128 6,416,603 7,038,650 6,897,804 Wastewater system 6,213,253 5,104,626 5,543,929 5,917,049 Storm drain 909,360 1,087,813 1,109,392 415,192 Refuse 6,535,528 6,524,554 7,116,048 8,488,643 Airport 428,542 401,980 366,610 408,718 Intermodal 78,241 107,976 111,455 68,237 Courthouse square 205,220 266,876 238,637 111,060 Building Safety - - - - Total business-type activities expenses 20,860,272 19,910,428 21,524,721 22,306,703 Total primary government expenses 50,196,027 $ 51,410,861 $ 60,930,605 $ 60,533,515 $ Program Revenues
Governmental activities:

Charges for services 5,119,281 $ 8,174,050 $ 7,378,383 $ 5,117,638 $ Operating grants and contributions 1,252,929 981,843 1,244,656 474,195 Capital grants and contributions 914,526 1,435,941 754,175 1,745,470 10,591,834 7,286,736 $ 8,606,753 $ 8,107,764
Business-type activities:

Charges for services 19,793,536 20,332,313 23,361,084 25,347,121 Capital grants and contributions 3,388,446 1,096,236 763,709 - 21,428,549 23,181,982 $ 24,124,793 $ 25,347,121 Total primary government revenues 30,468,718 $ 32,020,383 $ 32,731,546 $ 33,454,885 $ Net (expense)/revenue
Governmental activities (22,049,019) $ (20,908,599) $ (30,799,131) $ (30,119,048) $ Business-type activities 2,321,710 1,518,121 2,600,072 3,040,418 $ (19,390,478) (19,727,309) $ (28,199,059) $ (27,078,630) $ Fiscal Year
Total governmental activities program revenues
Total business-type activities program revenues
Total primary government net (expense)/revenue
Source: City of Hanford Finance Department

City of Hanford
Changes in Net Position, (Continued)
Last Ten (10) Fiscal Years
(accrual basis of accounting)
-126-
2019 2020 2021 2022 2023 2024
$ 7,424,876 1,818,009 $ 7,777,169 $ 6,839,279 $ 8,647,803 $ 7,755,643 $ 22,348,294 20,415,070 21,878,581 21,556,505 36,761,886 26,472,385 5,328,310 8,608,632 4,310,762 4,644,058 4,151,802 10,096,705 3,628,645 2,681,282 3,290,716 3,280,139 4,163,652 5,483,946 2,780,857 4,140,104 2,636,159 2,248,980 2,468,828 2,890,465 - - - - 1,140,021 1,086,925
41,510,982 37,663,097 39,893,387 38,568,961 57,333,992 53,786,069 7,430,096 6,097,140 7,613,367 8,418,232 10,805,234 7,711,131 5,375,459 4,738,256 5,830,921 5,776,311 7,127,609 7,506,365 747,116 (112,831) 1,082,412 945,288 1,624,217 1,680,905 8,478,104 8,281,902 8,173,990 9,019,863 10,388,974 10,852,999 505,212 429,455 645,131 769,767 671,372 558,304
57,761 50,808 57,818 49,616 56,589 56,256
79,642 177,774 102,750 97,270 63,436 107,624
- - - - - 1,649,670
22,673,390 19,662,504 23,506,389 25,076,347 30,737,431 30,123,254 $ 64,184,372 57,325,601 $ 63,399,776 $ 63,645,308 $ 88,071,423 $ 83,909,323 $ $ 7,235,394 8,160,049 $ 5,962,037 $ 6,970,563 $ 6,491,551 $ 4,544,558 $ 1,606,323 1,402,082 1,908,465 4,897,714 8,160,718 12,658,886 416,429 710,585 780,926 531,131 15,030,908 16,354,756
9,258,146 10,272,716 8,651,428 12,399,408 29,683,177 33,558,200 25,726,945 24,277,814 26,671,382 27,232,541 26,733,436 32,097,134 - - - - 5,154,104 4,431,308
25,726,945 24,277,814 26,671,382 27,232,541 31,887,540 36,528,442 $ 34,985,091 34,550,530 $ 35,322,810 $ 39,631,949 $ 61,570,717 $ 70,086,642 $ $ (32,252,836) (27,390,381) $ (31,241,959) $ (26,169,553) $ (27,650,815) $ (20,227,869) $ 3,053,555 4,615,310 3,164,993 2,156,194 1,150,109 6,405,188 $ (29,199,281) (22,775,071) $ (28,076,966) $ (24,013,359) $ (26,500,706) $ (13,822,681) $

City of Hanford
Changes in Net Position (Continued)
Last Ten (10) Fiscal Years
(accrual basis of accounting)
-127-
2015 2016 2017 2018
Government activities:

Taxes
Property Taxes 11,013,069 $ 10,201,145 $ 10,019,733 $ 11,369,719 $ Sales and use tax 8,405,169 9,552,912 13,287,020 13,737,784 Franchise tax 1,057,300 1,030,056 952,304 1,080,031 Other taxes 2,383,057 2,281,349 2,164,133 1,056,995 Revenue from use of money and property 689,100 1,657,481 809,857 796,670 Impact Fees - - - 2,602,398 Contributed capital - - - 4,993,434 Miscellaneous/other 875,621 283,381 334,227 1,077,706
Transfers - Interfund (138,102) (1,140,941) (506,048) (1,825,044) Investment earnings - - - - Gain (Loss) on disposal of assets - - - - Total governmental activities 24,285,214 23,865,383 27,061,226 34,889,693 Business-type activities:

Revenue from use of money and property 93,420 153,781 186,871 169,094 Impact fees 1,829,015 2,676,359 1,619,558 1,543,490 Contributed Capital - - - 1,591,676 Impairment loss - - - - Miscellaneous/other 551,634 566,350 304,822 1,095,274 Transfers - Interfund 138,102 1,140,941 506,048 1,825,044 Investment Earnings - - - - Lease Revenue - - - - Loss on lease termination - - - - Gain (Loss) on sale of capital assets (111,708) - - - Total business-type activities 2,500,463 4,537,431 2,617,299 6,224,578 Total primary government 26,785,677 $ 28,402,814 $ 29,678,525 $ 41,114,271 $ Extraordinary Items (Governmental Activities)
Settlement expenditures - - - - Total primary government - $ - $ - $ - $ Change in Net Position
Governmental activities 2,236,195 $ 2,956,784 $ (3,737,905) $ 4,770,645 $ Business-type activities 4,822,173 6,055,552 5,217,371 9,264,996 Total primary government 7,058,368 $ 9,012,336 $ 1,479,466 $ 14,035,641 $ Fiscal Year
Source: City of Hanford Finance Department

City of Hanford
Changes in Net Position, (Concluded)
Last Ten (10) Fiscal Years
(accrual basis of accounting)
-128-
2019 2020 2021 2022 2023 2024
$ 12,295,760 11,901,159 $ 13,414,233 $ 14,205,410 $ 13,988,031 $ 15,019,781 $ 14,103,551 14,006,613 16,332,234 18,199,243 18,011,255 16,772,531 998,402 900,895 1,152,391 1,141,696 1,256,488 1,310,678 1,239,906 1,183,139 1,292,189 2,735,498 2,696,299 1,853,648 917,907 1,685,494 936,759 (1,478,136) - -
1,720,516 1,876,232 1,098,344 3,372,830 - -
6,196,908 3,014,556 2,233,673 - - -
370,256 377,283 374,064 111,176 124,250 539,645
(1,004,179) (1,039,937) (1,861,652) (924,456) (243,210) (1,154,605) - - - - 976,872 2,947,174
(993,957) - (8,936) 21,714 279,583 18,741
35,845,070 33,905,434 34,963,299 37,384,975 37,089,568 37,307,593 714,727 863,991 243,843 (643,781) - -
1,369,100 1,413,423 2,220,328 2,916,474 - -
3,424,285 1,447,855 885,641 - - -
(974,950) - - - - -
352,995 286,931 3,014,868 15,138 2,384,559 2,615,755
1,004,179 1,039,937 1,861,652 924,456 243,210 1,154,605 - - - - 871,114 2,735,869
- - - 610,805 193,373 111,166
- - - - (724,690) -
- - (134,464) - - 85,400
5,890,336 5,052,137 8,091,868 3,823,092 2,967,566 6,702,795 $ 41,735,406 38,957,571 $ 43,055,167 $ 41,208,067 $ 40,057,134 $ 44,010,388 $ - - - (12,500,000) - - $ - - $ - $ (12,500,000) $ - $ - $ $ 3,592,234 6,515,053 $ 3,721,340 $ (1,284,578) $ 9,438,753 $ 17,079,724 $ 8,943,891 9,667,447 11,256,861 5,979,286 4,117,675 13,107,983 $ 12,536,125 16,182,500 $ 14,978,201 $ 4,694,708 $ 13,556,428 $ 30,187,707 $

City of Hanford
Governmental Activities Tax and Assessments Revenues by Source Last Ten (10) Fiscal Years
(modified accrual basis of accounting)
-129-
Fiscal Property Sales & Use Franchise Transfer Transient Occupancy Other Year Taxes Tax Taxes Taxes Taxes Taxes Total
2015 10,959,966 $ 8,405,169 $ 1,057,300 $ 129,784 $ 352,149 $ 542,024 $ 21,446,392 $ 2016 10,147,678 9,552,912 1,030,056 154,528 380,945 569,721 21,835,840 2017 9,968,170 13,287,020 952,304 165,387 381,106 589,580 25,343,567 2018 10,704,232 12,620,519 1,080,031 163,628 391,743 685,830 25,645,983 2019 11,217,176 12,941,563 900,896 155,791 519,663 682,518 26,417,607 2020 11,514,040 12,896,552 998,401 163,345 534,169 1,041,783 27,148,290 2021 12,565,022 15,086,391 1,152,391 214,997 506,042 813,256 30,338,099 2022 13,043,532 16,887,598 1,141,696 266,734 633,951 2,107,462 34,080,973 2023 13,755,470 18,011,255 1,256,488 232,561 770,144 1,926,155 35,952,073 2024 15,019,781 16,772,531 1,310,678 235,563 750,696 1,853,648 35,942,897 Includes General Fund, Special Revenue, Capital Projects Funds, Source: City of Hanford Finance Department

City of Hanford
Fund Balances of Governmental Funds
Last Ten (10) Fiscal Years
(modified accrual basis of accounting)
-130-
2015 2016 2017 2018
General fund
Non Spendable:

Long-term receivables 7,736,418 $ 6,551,252 $ - $ - $
Land for resale 246,450 246,450 246,450 - Prepaid expenses - - - - Deposits - - - - Insurance deposits 100,000 102,500 102,500 102,500 Committed for:

Community development - - 223,841 - Capital Projects 1,123,971 361,571 410,805 - Unassigned 6,336,292 7,588,301 8,243,676 8,504,194 Total general fund 15,543,131 14,850,074 9,227,272 8,606,694 All other governmental funds
Non Spendable:

Long-term receivables 2,568,908 $ 2,327,669 $ 2,308,419 $ 2,252,474 $ Loan receivable - - - - Lease receivable - - - - Land for resale - - - Prepaid expenses - - - - Deposits - - - Insurance deposits - - - - Restricted for:

Community development 17,733,678 18,024,438 18,828,294 19,451,267 Streets and roads 8,619,104 9,235,637 3,163,348 3,150,066 Recreation 2,574,664 3,438,237 3,883,314 3,442,097
Landscape Maintenance 753,691 633,978 570,497 470,405
Public safety 2,132,681 1,860,328 1,901,468 847,555
Committed for:

Parking and business improvement 9,212,800 7,715,855 7,271,925 7,529,338 Community development 1,146,655 1,154,093 2,490,055 616,762 Cannabis - - - - Unassigned (21,428) (49,932) (1,627,279) (15,381) Total all other governmental funds 44,720,753 44,340,303 38,790,041 37,744,583 Total fund balance all governmental funds 60,263,884 $ 59,190,377 $ 48,017,313 $ 46,351,277 $ Fiscal Year
Source: City of Hanford Finance Department

City of Hanford
Fund Balances of Governmental Funds (Continued)
Last Ten (10) Fiscal Years
(modified accrual basis of accounting)
-131-
2019 2020 2021 2022 2023 2024
$ - - $ - $ - $ - $ - $
- - - - - -
92,744 384,221 6,302 144,650 199,992 226,857
- - - 104,500 104,500 104,500
104,500 180,950 104,500 - - -
- - - - - -
- - - - - -
5,383,628 6,884,054 10,926,987 3,031,928 10,214,594 12,610,835 5,580,872 7,449,225 11,037,789 3,281,078 10,519,086 12,942,192 $ 2,252,415 2,252,416 $ 20,503,159 $ - $ - $ - $ - - - 20,346,974 20,378,274 19,501,968
- - - 557,209 - -
- - - - -
1,722 1,686 1,722 1,722 1,100 1,100
- - - - - -
- - - - - -
20,434,281 19,909,210 1,646,956 1,870,075 - -
5,744,795 6,810,336 6,522,042 10,075,783 15,276,502 20,079,629 4,204,305 3,701,300 4,322,904 5,107,894 5,705,236 5,975,177 581,818 526,765 731,600 968,179 1,451,419 2,046,521
636,174 452,490 399,646 713,464 852,390 1,106,295
5,154,829 5,882,433 4,931,758 3,902,047 3,537,705 2,986,008 460,475 442,281 552,161 722,548 7,550,690 10,152,998
- - 124,305 121,818 126,255 197,606
(269,568) (16,291) (109,905) (583,155) (317,109) (146,712) 39,201,246 39,962,626 39,626,348 43,804,558 54,562,462 61,900,590 $ 44,782,118 47,411,851 $ 50,664,137 $ 47,085,636 $ 65,081,548 $ 74,842,782 $

City of Hanford
Changes in Fund Balances of Governmental Funds
Last Ten (10) Fiscal Years
(modified accrual basis of accounting)
-132-
2015 2016 2017 2018
Revenues
Taxes and special assessments 24,888,688 $ 27,293,684 $ 29,647,843 $ 30,598,941 $ Aid from other government agencies 3,210,188 3,755,254 2,896,846 4,691,907 Licenses and permits 769,258 1,106,359 1,038,419 844,802 Fines and forfeitures 286,060 212,736 185,641 183,604 Charges for services 1,015,014 1,233,071 1,171,293 1,377,615 Lease Revenue - - - - Revenue from use of money and property 750,596 1,723,563 866,874 865,159 Miscellaneous 790,248 282,591 367,111 1,641,647 Total Revenues 31,710,052 35,607,258 36,174,027 40,203,675 Expenditures General government 2,425,078 2,218,049 1,864,740 2,787,272 Public safety 14,696,077 16,220,588 16,880,475 17,772,608 Public works 3,095,492 4,294,423 3,454,560 4,105,399 Recreation 2,699,506 2,815,731 3,037,478 4,318,774 Community development 2,070,679 3,777,870 9,365,735 2,803,849 Debt service:

Principal - - - -
Interest - - - - Capital outlay 4,278,701 6,772,187 10,235,425 7,185,808 Total Expenditures 29,381,758 35,982,623 44,838,413 38,973,710 Excess of revenues over (under) expenditures 2,328,294 (375,365) (8,664,386) 1,229,965 Other Financing Sources (Uses) Transfers in 2,371,171 304,218 2,503,606 5,172,191 Transfers out (2,472,098) (1,002,360) (2,288,019) (8,095,493) Proceeds from issuance of bonds - - - - Lease and SBITA acquisition - - - - Loss on lease termination - - - - Proceeds from sale of assets - - - - Total Other Financing Sources (Uses) (100,927) (698,142) 215,587 (2,923,302) Net Change in Fund Balances Before Extraordinary Item 2,227,367 (1,073,507) (8,448,799) (1,693,337) Extraordinary Item - - - -
Net Change in Fund Balances 2,227,367 $ (1,073,507) $ (8,448,799) $ (1,693,337) $ Debt Service as a percentage of
non-capital expenditures 0.00% 0.00% 0.00% 0.00%
Fiscal Year
Source: City of Hanford Finance Department

City of Hanford
Changes in Fund Balances of Governmental Funds (Continued) Last Ten (10) Fiscal Years
(modified accrual basis of accounting)
-133-
2019 2020 2021 2022 2023 2024
$ 31,981,731 31,610,153 $ 34,967,879 $ 41,422,170 $ 43,260,146 $ 44,194,513 $ 3,516,928 6,078,876 3,097,879 5,380,585 6,208,765 10,445,228 1,105,993 938,841 1,052,363 1,797,872 1,849,277 86,270
171,876 170,956 163,068 224,399 242,675 181,315
1,787,004 1,275,044 2,494,238 3,128,433 3,205,579 2,991,009 - - - 19,496 - 137,197
1,559,423 1,233,994 761,614 (847,591) 1,335,944 2,660,640 434,160 439,602 605,185 194,405 149,569 511,397
40,557,115 41,747,466 43,142,226 51,319,769 56,251,955 61,207,569 2,666,323 1,762,734 2,134,148 4,162,723 3,042,292 3,850,724 20,484,238 19,357,821 20,775,293 42,528,787 23,465,277 23,950,549 4,753,648 3,337,476 3,731,386 6,192,054 3,770,437 3,278,704 3,510,358 3,618,014 3,441,612 5,662,458 4,670,976 4,995,392 2,790,439 2,868,807 2,758,705 3,508,200 2,716,570 2,031,415 - - - 22,193 1,243,300 1,596,228
- - - 513 1,140,021 1,086,925
7,643,581 7,995,534 3,255,771 4,623,507 6,362,118 10,218,712 41,848,587 38,940,386 36,096,915 66,700,435 46,410,991 51,008,649 (1,291,472) 2,807,080 7,045,311 (15,380,666) 9,840,964 10,198,920 320,279 1,962,967 1,583,169 6,194,001 4,627,696 2,176,873 (825,757) (3,381,448) (2,767,302) (7,508,224) (4,934,143) (3,309,157) - - - 25,390,437 - -
- - - 89,571 - 675,857
- - - - (11,319) -
- - - 21,716 304,024 18,741
(505,478) (1,418,481) (1,184,133) 24,187,501 (13,742) (437,686) (1,796,950) 1,388,599 5,861,178 8,806,835 9,827,222 9,761,234 - - - (12,500,000) - - $ (1,796,950) 1,388,599 $ 5,861,178 $ (3,693,165) $ 9,827,222 $ 9,761,234 $

0.00% 0.00% 0.00% 0.03% 5.07% 5.44%

City of Hanford
General Fund Tax Revenue by Source
Last Ten (10) Fiscal Years
(modified accrual basis of accounting)
-134-
Fiscal Sales & Use Property Franchise Transfer Transient Business Misc.

Year Tax Taxes Fees Tax Tax License Taxes Total
2015 8,405,169 $ 11,357,154 $ 1,057,300 $ 129,784 $ 352,149 $ 542,024 $ 3,044,861 $ 24,888,441 $ 2016 9,552,912 10,601,898 1,030,056 154,528 380,945 569,721 5,003,623 27,293,683 2017 13,287,020 10,470,392 952,304 165,387 381,106 589,580 3,802,054 29,647,843 2018 12,620,519 11,225,844 1,080,031 163,628 391,743 645,499 4,471,677 30,598,941 2019 12,941,563 11,767,502 900,896 155,791 519,663 644,074 4,680,385 31,609,874 2020 12,896,552 12,152,049 998,401 163,345 534,170 686,180 4,551,031 31,981,728 2021 15,086,391 13,345,637 1,152,392 214,997 506,042 735,628 3,926,792 34,967,879 2022 16,887,597 13,965,637 1,141,697 266,734 633,951 1,259,122 7,267,433 41,422,171 2023 18,011,255 14,879,090 1,256,488 232,561 770,144 825,848 7,284,761 43,260,147 2024 16,772,531 16,202,645 1,310,678 235,563 750,696 940,064 7,982,336 44,194,513 Source: City of Hanford Finance Department