Agenda packet — Imperial Beach City Council, November 16, 2022 (part 2 of 3)

Project
THE PICTORIAL AND GRAPHIC EXPRESSIONS DISPLAYED WITH THIS WORK ARE COPYRIGHTED UNDER THE LAWS OF THE UNITED STATES, TITLE 17, U.S. CODE. UNDER SECTION 106 OF THE COPYRIGHT ACT, THE ARCHITECT SHALL MAINTAIN THE EXCLUSIVE RIGHT OF THE REPRODUCTION, DISPLAY OR ANY DERIVATION OF THIS WORK.

Wakeland Housing
20105
06/24/22 CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 0 10 20 40
L101
Hardscape
Plan

MATERIALS SCHEDULE
SYMBOL# ITEM DESCRIPTION
PAVING
CAST IN PLACE GREY CONCRETE NATURAL GREY, SAND AND EXPOSED AGG. FINISH

CAST IN PLACE INTEGRAL COLOR CONCRETE INTEGRAL COLOR, SAND FINISH CAST IN PLACE INTEGRAL COLOR CONCRETE INTEGRAL COLOR, EXPOSED AGG. FINISH

PERMEABLE PAVERS PER PLAN

LINEAR PAVERS AT COMMON AREAS
NEW ASPHALT @ PARKING LOT PER CIVIL

SITE FURNISHINGS
TABLES AND CHAIRS (4 TOP)
TABLES AND CHAIRS (2 TOP)
TABLES AND CHAIRS (4 TOP W/

UMBRELLA)

LOUNGE CHAIR

OUTDOOR SOFA

OUTDOOR GRILL
STOOL

PICNIC TABLE

BAR TABLE
PALM AVE.

Page 109 of 296 ends

Wakeland Housing
20105
06/24/22 CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 0 10 20 40
L201
Irrigation
Plan

IRRIGATION LEGEND
ITEM

DRIP IRRIGATION
SPRAY IRRIGATION @ BIOSWALES
TREE BUBBLER - 2 PER TREE TYPICAL (NOT SHOWN)

WEATHER BASED IRRIGATION CONTROLLER IC
PROPOSED IRRIGATION NOTES:

NOTE 1:

IRRIGATION SYSTEM SHALL BE DESIGNED WITH THE PROPER OPERATING PRESSURE AND AN APPROPRIATE WATERING WINDOW TO ASSURE OPTIMAL DELIVERY OF WATER TO THE PLANT MATERIAL AT ALL TIMES.

NOTE 2:

WATER USE CALCULATIONS WILL BE REQUIRED PER THE CITY OF IMPERIAL BEACH MODEL WATER EFFICIENT LANDSCAPE REGULATION.

NOTE 3:

SITE SPECIFIC EVAPO-TRANSPIRATION RATES AND SOIL PERCOLATION RATES SHALL BE CONSIDERED IN THE DESIGN PROCESS.

NOTE 4:

CHECK VALVES WILL BE REQUIRED TO PREVENT LOW-HEAD DRAINAGE.

NOTE 5:

NO IRRIGATION SHALL BE INSTALLED IN NEW AREAS UNTIL SOIL TESTING HAS BEEN SUBMITTED AND ALL SOIL AMENDING HAS OCCURRED.

NOTE 6:

MICRO-CLIMATE AREAS AND SOLAR EXPOSURE ZONES (SITE SPECIFIC HYDRO ZONES) SHALL BE IRRIGATED ON SEPARATE CONTROL VALVES.

NOTE 7:

IRRIGATION RECORD DRAWINGS SHALL CLEARLY DOCUMENT THE FINAL INSTALLATION OF THE ENTIRE SYSTEM, WITH ACCURATE DIMENSIONS, SIZES, AND TYPES OF EQUIPMENT. IT SHALL REFLECT ALL NEW AREAS AS WELL AS ANY MODIFIED IRRIGATION SYSTEMS. IRRIGATION RECORD DRAWINGS TO BE

SUBMITTED IN AUTOCAD PER CITY OF IMPERIAL BEACH STANDARDS NOTE 8.

THE IRRIGATION SYSTEM SHALL BE DESIGNED IN CONFORMANCE WITH THE CITY OF IMPERIAL BEACH WATER EFFICIENT LANDSCAPE REGULATIONS (LMMC CHAPTER14.29).

Project
Wakeland Housing
20105
06/24/22 CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932

IRRIGATION LEGEND
ITEM

DRIP IRRIGATION
SPRAY IRRIGATION @ BIOSWALES
TREE BUBBLER - 2 PER TREE TYPICAL (NOT SHOWN)

WEATHER BASED IRRIGATION CONTROLLER IC
PROPOSED IRRIGATION NOTES:

NOTE 1:

IRRIGATION SYSTEM SHALL BE DESIGNED WITH THE PROPER OPERATING PRESSURE AND AN APPROPRIATE WATERING WINDOW TO ASSURE OPTIMAL DELIVERY OF WATER TO THE PLANT MATERIAL AT ALL TIMES.

NOTE 2:

WATER USE CALCULATIONS WILL BE REQUIRED PER THE CITY OF IMPERIAL BEACH MODEL WATER EFFICIENT LANDSCAPE REGULATION.

NOTE 3:

SITE SPECIFIC EVAPO-TRANSPIRATION RATES AND SOIL PERCOLATION RATES SHALL BE CONSIDERED IN THE DESIGN PROCESS.

NOTE 4:

CHECK VALVES WILL BE REQUIRED TO PREVENT LOW-HEAD DRAINAGE.

NOTE 5:

NO IRRIGATION SHALL BE INSTALLED IN NEW AREAS UNTIL SOIL TESTING HAS BEEN SUBMITTED AND ALL SOIL AMENDING HAS OCCURRED.

NOTE 6:

MICRO-CLIMATE AREAS AND SOLAR EXPOSURE ZONES (SITE SPECIFIC HYDRO ZONES) SHALL BE IRRIGATED ON SEPARATE CONTROL VALVES.

NOTE 7:

SUBMITTED IN AUTOCAD PER CITY OF IMPERIAL BEACH STANDARDS NOTE 8.

THE IRRIGATION SYSTEM SHALL BE DESIGNED IN CONFORMANCE WITH THE CITY OF IMPERIAL BEACH WATER EFFICIENT LANDSCAPE REGULATIONS (LMMC CHAPTER14.29).

PALM AVE.

Page 110 of 296 ends

Wakeland Housing
20105
06/24/22 CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 0 10 20 40
L301
Planting
Plan

PLANT LEGEND
SYMBOL BOTANICAL NAME COMMON NAME CONT. SIZE FORM MATURE SIZE (H X W) TREES
CERCIDIUM DESERT MUSEUM PALO VERDE 24" BOX STANDARD 20' H / 20' W DRACAENA DRACO DRAGON TREE 36" BOX MULTI 10' T / 10' W
LAGERSTOREMIA INDICA CRAPE MYRTLE 36" BOX MULTI 10' T / 10' W OLEA EUROPEA WILSONII FRUITLESS OLIVE 36" BOX STANDARD 10' T / 10' W PLATANUS RACEMOSA CALIFORNIA SYCAMORE 36" BOX STANDARD 30' H / 20' W ULMUS PARVIFOLIA EVERGREEN ELM 36" BOX STANDARD 20' H / 20' W EXISTING TREE TO BE REMOVED (10FT

OR GREATER)
SHRUBS/GRASSES SUCH AS: SIZE SPACING WATER- LIGHT
AGAVE BLUE FLAME BLUE FLAME AGAVE 5 GALLON 3' O.C. LOW-SUN AGAVE ATTENUATA FOXTAIL AGAVE 5 GALLON 3' O.C. LOW-SUN
ALOE BLUE ELF BLUE ELF ALOE 5 GALLON 1'-6" O.C. LOW-SUN ALOE BARBARIDENSIS ALOE VERA 5 GALLON 2' O.C. LOW-SUN/PARTIAL SHADE ASPARAGUS MEYERSI FOXTAIL FERN 5 GALLON 2' O.C. MEDIUM-SUN/SHADE

BOUTELOUA GRACILIS 'BLONDE

AMBITION'
'BLONDE AMBITION' GRAMA
GRASS 1 GALLON 1'-6" O.C. LOW
SALVIA GREGGI AUTUMN SAGE 1 GALLON 3' O.C. LOW
SANSEVIERIA TRIFASCIATA MOTHER-IN-LAW'S TONGUE 5 GALLON 1'-0" LOW-SUN/SHADE

BIOSWALE PLANTS SUCH
AS:

CAREX PANSA SAD DUNE SEDGE 1 GALLON 3'-6" O.C. MEDIUM -SUN/SHADE CAREX SPISSA SAN DIEGO SEDGE 1 GALLON 3'-6" O.C. LOW -SUN/SHADE CHONDROPETALUM TECTORUM SMALL CAPE RUSH 1 GALLON 3' O.C. LOW-SUN-SHADE DIANELLA CASSA BLUE CASSA BLUE FLAX LILY 1 GALLON 2' O.C. LOW-SUN-SHADE IRIS DOUGLASIANA DOUGLAS IRIS 5 GALLON 3' O.C. LOW-SUN-SHADE IVA HAYESIANA SAN DIEGO POVERTY WEED 1 GALLON 3' O.C. LOW-SUN-SHADE JUNCUS PATENS COMMON RUSH 5 GALLON 8" O.C. LOW-SUN/SHADE

LEYMUS CONDENSATUS CANYON
PRINCE
CANYON PRINCE WILD RYE 1 GALLON 2' O.C. LOW-SUN/SHADE
MUHLENBERGIA RIGENS DEER GRASS 1 GALLON 3' O.C. LOW-SUN-SHADE SALVIA CLEVELANDII CLEVELAND SAGE 1 GALLON 3' O.C. LOW-SUN/SHADE

MULCH LEGEND

SYMBOL MULCH SIZE & COLOR
NOT SHOWN ROCK MULCH TYPE 1 - SMALL 'DRIFT' PEBBLE 50% 3/4" SIZE, 50% 3/8" SIZE. PER SPECS DECORATIVE STONE SOLUTIONS 800.699.1878 NOT SHOWN ROCK MULCH TYPE 2 - MEDIUM-@ ALL
DOWNSPOUT LOCATIONS 3' X 3' AREA 'KETTLE' RUBBLE 2"-4" SIZE PER SPECS DECORATIVE STONE SOLUTIONS 800.699.1878 NOT SHOWN BOULDERS 2'-3' BOULDER - 'SUNRISE' PER SPECS DECORATIVE STONE SOLUTIONS 800.699.1878

1. ALL NEW PLANTING AREAS TO RECEIVE 3" DEPTH ROCK MULCH, REFER TO SPECIFCATIONS FOR TYPE & DEPTH.

2. REMOVE ANY CONCRETE, ASPHALT AND ASSOCIATED BASE COURSE FROM ALL PLANTING AREAS. ALL NEW PLANTING AREAS TO BE RIPPED AND RECOMPACTED PER SPECIFICATIONS.

3. ALL TREES SHALL BE "CONTRACT GROWN" REFER TO SPECIFICATIONS FOR MORE INFORMATION

4. TEST "ENGINEERED SOIL" IN BIOSWALE PLANTERS FOR PLANT SUITABILITY PRIOR TO IMPORT. ADD AMENDMENTS OFFSITE IF NECESSARY PRIOR TO

INSTALLATION

LANDSCAPE AREA

CALCULATIONS
TOTAL SITE AREA 65,385 SQ FT
NEW IMPERVIOUS / HARDSCAPE AREA 45,693 SQ FT
NEW PERVIOUS / LANDSCAPE AREA 19,692 SQ FT

TOTAL NEW PERVIOUS/ LANDSCAPE
AREA % 30.1%

TREE CANOPY GAIN
STREET TREES TO BE REMOVED4
ONSITE TREES TO BE REMOVED8
NEW STREET TREES 12
NEW TREES ONSITE 48
TOTAL TREE GAIN 60

TREE PLAN

UNDERSTORY PLANTING
PALM AVE. PALM AVE.

EXISITNG 10’ CANOPY OR GREATER
TREE TO BE REMOVED - 12 TOTAL

Page 111 of 296 ends

UP UP
Proposed building area
Property line
Accessible Building Entry
Standard accessible parking space
Van accessible parking space
HC
VAN

1. When shown in site plan, all dimensions are to face of finish to property lines, imaginary lines, setbacks, etc., U.N.O.

2. Do not scale drawings. Written dimensions govern.

3. All clear dimensions are not to be adjusted without approval of the Architect.

4. See building plans for all other notes and dimensions not shown here.

5. See accessibility notes and details for accessibility information.

6. See Civil and Landscape for additional information.

7. See Civil and Structural for ground level finish floor elevations.

8. Any off-site improvements shown are for reference only and will be reviewed and permitted separately by the Public Works
Department.

9. All site lighting will cut off at the property boundary.

BUILDING A:

SENIOR HOUSING
BUILDING B:

NEIGHBORHOOD CENTER

PALM AVENUE
DRIVEW
AY
20'-0"
TYP.
8'-6"
TYP.
8'-6"
18' - 0"
18' - 0"
8'-6"
18' - 0"
8'-6"
18' - 0"
PROPOSED 22 PARKING SPACES
9'-0"
5'-0"
9'-0"
8' - 6"
18'-0"
8' - 6"
18'-0"
8' - 6"
18'-0"
9' - 0" 8' - 0" 8' - 6"

DRIVE AISLE
24' - 0"

DRIVE AISLE
20' - 0"

DRIVEAIS
LE
24'-0"

SEA VILLAGE DRIVE
PROPOSED 20 PARKING SPACES

PROPOSED FENCE WALL

PROPOSED

COURTYARD

PROPOSED TRASH ENCLOSURE AND BIKE PARKING
BLDGT
OPL
27'-31
/2"

PROPOSED SIDEWALK PROPOSED TREES

PER LANDSCAPE
BLDGT
OPL
26'-61
/4"

BLDG TO PL
12' - 7 3/4"
BLDGT
OPL
19'-43
/4"
1 2
34 EV
HC
VAN5
HC6
7 89 10 11
22 21 20 19 18 17 16 15 14 13 12
24 HC VAN
23 25
26 271
8'-0"
29 30
31 32
28 33
34 35
36 37
38 39
40 41
42 14'-11
1/8"
BLDGT
OPL
26'-10
7/8"

BLDG TO PL
9' - 5 1/8"
R-1500 R-1-6000R-1500 R-1-6000
2' - 0"
2' - 0"
2'
-0
"
2'-0"

RELOCATE GATE FROM SEA VILLAGE DRIVE
TO THE NORTH. FENCING TO BE PROVIDED

ON THE WEST EDGE OF SEA VILLAGE DRIVE

TO ENCLOSE THE EXISTING SUBDIVISION

INDICATES LOCATIONS FOR PHOTOVOLTAIC
SOLAR PANELS. THE PROJECT WILL BE 100%
ELECTRIC WITH 100% SOLAR OFFSET.

EV EV EV

EV CHARGING STATIONS
6' TALL CMU SOUND ATTENUATION FENCING
ACROSS THE SOUTH PROPERTY LINE AND 100'

ALONG THE EAST AND WEST PROPERTY LINE
CONTINUOUS 6' TALL FENCING ALONG THE

EASTERN PROPERTY LINE
H
N
I
1 L
No. C17113 CA E O

T E T S A
.
-
3 PX F
5 I L CE E
I A
32 -I FORN CT TE
R
ES
D
A
C
R IC
C
.

N
ASLUND
Project
THE PICTORIAL AND GRAPHIC EXPRESSIONS DISPLAYED WITH THIS WORK ARE COPYRIGHTED UNDER THE LAWS OF THE UNITED STATES, TITLE 17, U.S. CODE. UNDER SECTION 106 OF THE COPYRIGHT ACT, THE ARCHITECT SHALL MAINTAIN THE EXCLUSIVE RIGHT OF THE REPRODUCTION, DISPLAY OR ANY DERIVATION OF THIS WORK.

Site Plan Wakeland Housing
20105
A001
06/24/2022CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 Keynotes
Legend - Site Plan
General Notes - Site Plan
1 1" = 20'-0"
Site Plan
NORTH

Page 112 of 296 ends

Building Division:

1. Obtain all required building permits (Building, Plumbing, Mechanical, Electrical, Grading, etc.) for this project. All construction shall comply with the adopted 2019 California Building Standards Codes; Residential, Building, Electrical, Mechanical, Plumbing, energy, Fire, Green Building, Historic Building, Existing Building, as amended by City Ordinance 2019-1190 and other applicable Municipal Codes in effect at the time of plan submittal for building permits.

2. A demolition permit will be required for the removal of the existing structures on the property.

3. should the proposed work exceed any of the thresholds established by Imperial Beach Municipal Code 15.54.030, a grading permit will be required.

4. Prior to Foundations Inspection a survey of the property shall be conducted from a California Licensed Surveyor or Engineer and survey pins shall be in placed to identify the corners.

5. Prior to foundation approval, a pad and/or form certification shall be provided by a California Licensed Surveyor verifying that the proposed foundation is in conformance with the approved plans.

6. All projects greater than or equal to twenty-five thousand dollars ($25,000), or which involve the construction and/or demolition of two-hundred-fifty (250) square feet or more of floor space shall comply with Imperial Beach Municipal Code Chapter 8.38. A complete Waste Management Plan shall be submitted with the building permit application.

7. Any development of property other than single-family residence(s) or duplex(es) with a valuation in excess of fifty thousand dollars ($50,000) will be required to underground all utility services on-site, adjacent thereto and those which traverse the site. IBMC 13.08

8. Plans deviating from conventional wood frame construction shall have the structural portions signed and sealed by the California state licensed engineer or architect responsible for their preparation, along with structural calculations. (California Business and Professions Code).

9. No work from which a building permit is required shall be performed within the hours of 7:00 P.M. - 7:00 A.M. Monday - Friday, nor prior to 8:00 A.M. or after 5:00 P.M. on Saturdays nor anytime on Sundays. A sign shall be posted at a conspicuous location near the main entry to the site, prominently displaying these hour restrictions.

10. The California Building Standards Code will be updated as of January 1, 2023. Please note, projects submitted for a building permit after this date will be subject to review under the newly adopted codes.

11. The project is located in noise critical areas (CNEL contours of 60 dB) as shown on the City's General Plan. The project will need to show compliance using one of the following methods from the California Green Building Standards Code (GBSC):
a) Prescriptive method (GBSC Section 5.507.4.1) - Wall and roof-ceiling assemblies exposed to the noise source shall meet a composite Sound Transmission Class (STC) rating of at least 50 or a composite Outdoor-Indoor Sound Transmission Class (OITC) rating of no less than 40.
b) Performance Method (GBSC Section 5.507.4.2) - An acoustical analysis documenting complying interior sound levels, not in excess of an hourly equivalent noise level (Leq - 1Hr) of 50 dBA in occupied areas during any hour of operation, shall be prepared by personnel approved by the architect or engineer of record.

12. A soils report must be provided with the building permit application. The report shall include foundation design recommendations based on the engineer's findings and shall comply with Section R401.4.

Prior to the contractor requesting a Building Department foundation inspection, the soils engineer shall advise the building official in writing that:
a) The building pad was prepared in accordance with the soils report, b) The utility trenches have been properly backfilled and compacted, and c) The foundation excavations, the soils expansive characteristics and bearing capacity conform to the soils report.

A letter will need to be provided from the soils engineer confirming that the foundation plan, grading plan and specifications have been reviewed and that it has been determined that the recommendations in the soils report are properly incorporated into the construction documents (when required by the soil report).

13. The project will require to provide an energy design detailing compliance with the Mandatory Measures and either the Performance or Prescriptive methods of compliance.

14. The mandatory Green Building requirements for residential construction must be included on your plans. Green Standards are applicable to newly constructed residential buildings and additions / alterations that increase the building's conditioned area, volume or size.

15. Please contact the San Diego gas & Electric Project Planning Team ( Metro Service Order Team) at 619-230-7800 to confirm your service requirements for this project.

16. Please contact Matthew Schuler at California American Water District, 619-446-5713 or [email protected] to confirm your water service requirements for this project.

17. The proposed multifamily dwelling units and common use areas are required to comply with the accessibility provisions detailed in Chapter 11A of the California Building Code as well as any other applicable laws.

18. The proposed neighborhood center and other public use areas proposed in this project are required to comply with the accessibility provisions details in Chapter 11B of the California Building Code as well as any other applicable laws.

19. At the time of building submittal, the project information on the cover sheet shall clarify whether the buildings on the lot will be treated as separate buildings or considered as portions of one building per CBC 503.1.2. Building area, building height and number of stories allowances shall be calculated and detailed as required per Sections 504 and 506 of the CBC.

Public Works:

1. (If Applicable) New sewer connection(s) to the main line shall be coordinated with the Public Works Department.

2. Prior to approval of these plans the sewer lateral locations shall be drawn on the plans and submitted to the City for review and approval. If applicable, new buildings cannot be constructed on top of existing sewer lateral, rerouting is required.

3. Condominiums & multifamily dwellings are to have a separate sewer lateral for each detached unit with separate water meters. Applicants may request during the plan check to connect each building sewer to a common sewer system extension that leads to the public sewer system provided that the sewer system extension is adequately sized and an agreement is in place between adjoining units.

4. (If applicable) The applicant is required to demonstrate that the existing sewer lateral conforms to all City standards, specifications and codes. In order to determine the existing conditions of the lateral (if applicable) the applicant must provide an in-line closed-circuit video (CCTV) inspection of the lateral from the building to the City's sewer main. Any damaged sections of pipe found during the video inspection must be repaired before approval of the lateral for use.

5. All sewer laterals shall be installed per Regional Standards SS-01 through SS-04, SP-01 through SP-03 & SC-01. Prior to sewer tap, the applicant shall contact the Public Works Department for an inspection of the tie to the Main by calling the Public Works Inspector (619)551-8005.

6. If an existing sewer lateral servicing the site will not be utilized and is to be abandoned, it shall be abandoned per the Greenbook standards or other approved building standards. Include the abandonment procedures on the building plans for City approval.

7. No building roof or landscape water drains may be piped to the street or onto impervious surfaces that lead to the street.

A design that has these water discharges directly into the storm drain conveyance system (onto an impervious surface that flows to the street) is in violation of the Municipal Storm Water Permit - Order R9-2013-0001.

8. Building foundation elevations shall be at least one (1) foot above gutter line to minimize flooding during storm conditions.

9. The owner of the private property adjoining the public right-of-way shall be responsible to maintain existing landscaping in the area between the sidewalk and private property line for the entire frontage of the property. Such maintenance shall include watering and clearing of weeds.

10. Proposed driveway approaches shall be constructed in a manner so as to:
a) Maintain existing stormwater runoff flows:
b) Avoid the flow of stormwater across the new driveway )or associated sidewalk); and c) Include the installation of an expansion joint between the paved surface on the private property and the paved surface on the public right-of-way.

11. Existing driveway approaches on Palm Ave. shall be re-constructed in compliance with San Diego Regional Standard Drawings G-14A (Concrete Driveway - Type A, Contiguous Sidewalk), G-15 (Driveway Location - Adjacent to Curb Returns and Street Lines), and G-16 (Driveway Location and Width Requirements). new curb and gutter shall be constructed in compliance with San Diego Regional Standard Drawing G-3 (Monolithic Curb, Gutter & Sidewalk).

12. For alley, sidewalk, or curb & gutter replacement ensure compliance with San Diego Regional Standard Drawing G-11 ( Concrete Curb, Gutter, Sidewalk & Pavement Removal and Replacement) in that, the "Area to be removed [must be] 5' or from joint to joint in panel, whichever is less." The distance between joints or score marks must be a minimum of 5- feet. Where the distance from "Area to be removed", to existing joint, edge or score mark is less than the minimum shown, "Area to be removed" shall be extended to that joint, edge or score mark.

13. All existing sidewalk abutting the property on Palm Ave. that does not conform to current ADA standards shall be removed and reconstructed per SDRSD G-7, with sidewalk joint locations per SDRSD G-9 and concrete joint details per SDRSD G-10 & G-11.

14. Along the public right-of-way, the applicant shall eliminate any existing tripping hazard caused by the condition of the existing public sidewalk along the property frontage. The remedial work required herein shall be performed to the satisfaction of the Public Works Inspector.

15. IBMC Section 12.28.025 prohibits cuts or openings in roadways for 5 years after completion of a City roadway improvement project. This development project will cut into the newly constructed pavement of Palm Ave. The Public Works Director has authority to grant exemptions and impose conditions for restoration and surface paving. When an exemption is allowed, the applicant will make a concerted effort to protect the integrity of the pavement structure, and to ensure a high-quality replacement patch or overlay. Depending on the particular trench cut size, location, and construction duration, conditions will be placed on the Applicant to return the street to a similar integrity as prior to the cut occurring. This may require a larger pavement restoration area on each side of the trench, a full lane-width pavement replacement, or a full curb-to-curb replacement. The actual trench cut will follow the trench cut details above, with a minimum 6” overlap on each side of the trench for base replacement. Additional pavement restoration will extend beyond the limits of the trench cut with a minimum grind and overlay of 2” or full depth if the adjacent pavement is 4” or less. For lateral cuts, the Applicant will follow the trench cut details above, but the pavement replacement will have the following changes:
a) Where the lateral impacts a travel lane, replace a minimum of 5' on each side of the trench. b) Where the lateral impacts only a parking lane, replace a minimum of 3' on each side of the trench.

16. Where existing right-of-way pavement is to be removed, a clean, neat line shall be saw- cut at the edge of existing pavement where the new replacement pavement to be installed. A minimum twelve (12) inch cut shall be provided between a new driveway, curb or other concrete work that meets with asphalt. This will give a clean, compactable area to transition from new concrete to existing road surface. All driveways or sidewalks shall be poured as soon as possible after disturbance of existing pavement to prevent erosion of pavement integrity. Any damaged pavement shall be repaired with like material to the satisfaction of the Public Works Inspector. Existing street widths shall not be narrowed as a result of apron placement.

17. All trench resurfacing shall be performed in accordance with the standards shown below and shall be subject to inspection by the City’s Public Works Inspector. The permittee shall be responsible for calling for an inspection at (619) 423-8311. Trenches and improvements in streets shall conform to regional standards as follows:
a) Trenches wider than six (6) inches: Use Regional Standard G-24A type C. The base shall be compacted with twelve (12) inch maximum lifts to 95% modified proctor and test reports. b) Trenches six (6) inches or less: Use regional standard G-33 Type B. Call for an inspection prior to the Asphalt repair at (619) 423-8311.
c)Traffic Control plans shall be followed per approved plans and adjusted by the contractor for changing conditions. d) Trench plates used for a SDG&E gas connection (which can take several weeks), or on downhill road sections, need to be ground down so plates are flush with roadway. All plates are to be slip resistant. All open trenches in roadway shall be plated and secured at the end of the work day. All other open trenches shall be plated or covered in heavy plywood. e) Where a curb exists, the applicant shall bore under or saw cut a minimum of the width of the asphalt patch and replace with same construction.
f)No trench shall be opened in any street for the purpose of laying pipes, conduits or ducts except when the prior written consent of the Director of Public Works has been obtained. Construction shall include restoration of all speed controls (bumps or humps) and all striping and/or any signage that may be disturbed as the result of project implementation.

Restoration of disturbed speed humps shall include a double coat of speed hump paint with glass crystals. No open trench shall be allowed across any street or within 10 ft. of any travel way.

18. For any work to be performed in the street or alley, submit a traffic control plan for approval by Public Works Inspector a minimum of 5 working days in advance of street work. Traffic control plan is to be per Regional Standard Drawings or CALTRANS Traffic Control Manual.

19. The applicant shall be responsible for informing the public of the traffic conditions existing within the construction area at all times by placement of appropriate warning and advisory signs. The applicant shall also provide and maintain all traffic control and safety items. Barricades and any other delineation in the right of way shall be required and maintained by applicant for the duration of the right of way improvements. Applicant assumes sole and complete responsibility for the job and site conditions during the course of construction, including safety of all persons and property. This requirement shall apply continuously twenty-four (24) hours per day and shall not be limited to normal work hours.

20. For any project that proposes work within the public right-of-way (i.e., driveway removal/construction, sidewalk removal/construction, street or alley demolition/reconstruction, sewer lateral trenching and installation, landscaping and irrigation, fences, walls within the public right-of-way, etc.), a Temporary Encroachment Permit (TEP) shall be applied for and approved either prior to or concurrent with issuance of the building permit required for the project. Application for a Temporary Encroachment Permit shall be made on forms available at the Community Development Department.

21. Permittee shall schedule inspections with the Public Works Department (619) 551-8005 at least 24 hours prior to need as follows:
a) Sidewalk, Driveway, Curb and Gutter and other Concrete Work Pre-pour and Final b) Street Excavation T-Cut and Final
c) Sewer Lateral Capping during Demolition and New Lateral Connection to Main d) All Other Encroachment Activity Final

22. All alley, driveway, sidewalk, or curb & gutter construction within the City right-of-way shall require either a “CLASS A” or “C-8” Contractor’s license. All sewer lateral installations and trenching work within the City right-of-way shall require a “CLASS A” Contractor’s license.

23. Any disposal/transportation of solid/construction waste in roll off containers must be contracted through EDCO Disposal Corporation unless the hauling capability exists integral to the prime contractor performing the work.

24. The parcel impervious surfaces are not to increase beyond that proposed in the project review drawings. This will be as a post-construction condition in order to maximize the water runoff infiltration area on the parcel in compliance with Municipal Storm Water Permit – Order R9-2013-0001.

25. Install/set property survey monuments at all property corners. Prepare either a Record of Survey or Corner Record, whichever is applicable pursuant to the requirements of the State Land Surveyor’s Act. Said Record of Survey or Corner Record shall be recorded in the office of the San Diego County Recorder. Provide the City with a recorded copy.

26. Applicant required to provide verification of post construction Best Management Practice (BMP) maintenance provisions through a legal agreement, covenant, CEQA mitigation requirement, and / or Conditional Use Permit. Agreement is provided through the Community Development Department.

27. Property owner must institute “Best Management Practices” to prevent contamination of storm drains, ground water and receiving waters during both construction and post construction. The property owner or applicant BMP practices shall include but are not limited to:
a) Contain all construction water used in conjunction with the construction. Contained construction water is to be properly disposed in accordance with Federal, State, and City statutes, regulations and ordinances b) All recyclable construction waste must be properly recycled and not disposed in the landfill. c) Water used on site must be prevented from entering the storm drain conveyance system (i.e. streets, gutters, alley, storm drain ditches, storm drain pipes).
d) All wastewater resulting from cleaning construction tools and equipment must be contained on site and properly disposed in accordance with Federal, State, and City statutes, regulations, and ordinances. e) Erosion control - All sediment on the construction site must be contained on the construction site and not permitted to enter the storm drain conveyance system. Applicant is to cover disturbed and exposed soil areas of the project with plastic– like material (or equivalent product) to prevent sediment removal into the storm drain system. See CASQA’s (California Stormwater Quality Association) Construction Best Management Practices Handbook for other alternative erosion and sediment control BMPs.

28. Two days prior to any excavation, “Dig-Alert” (800) 227-2600 shall be notified to locate all known underground utilities.

29. Applicant must underground all utilities in accordance with I.B.M.C. 13.08.060.C as noted below, applicability to new structures:
a) For any development which requires a building permit but is of a valuation of fifty thousand dollars or less, the applicant will be required either to underground the utilities or to sign a deferral agreement pertaining thereto. b) For any development of single-family residence(s) or duplex(es) which exceeds a valuation of fifty thousand dollars, the applicant will be required to sign a deferral agreement with, and pay a recording fee to, the city. c) Any development of property other than as described in subsection A or B of this section in excess of fifty thousand dollars valuation will be required to underground all utility services on-site, adjacent thereto and those which traverse the site.”
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Conditions of
Approval Wakeland Housing
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06/24/2022CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 Conditions of Approval

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Overall ViewsWakeland Housing
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06/24/2022CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 1 Overall View from North West
2 Overall View from North East
3 Overall View from South West

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UP
UP
UP UP
STUDIO
STUDIO
STUDIO
STUDIO
STUDIO
STUDIO
STUDIO
ELEC. STORAGE

WORK/BREAK/KITCHEN INTERVIEW OFFICE

STORAGE

FILES WAITING
ELEV.

MACHINE
MPOE ELEV.

MEN'S

WOMEN'S

LAUNDRY KITCHEN STORAGE

COMMUNITY ROOM

COMPUTER
ROOM
STUDIO
STUDIO
STUDIO
STUDIO
STUDIO
TRASH

ENCLOSURE
15' - 5 7/8" 15' - 5 7/8" 15' - 5 7/8" 15' - 5 7/8" 15' - 5 7/8" 15' - 5 7/8" 15' - 7 3/8" 5' - 0" 5' - 0"
5' - 0"
15' - 5 7/8" 15' - 5 7/8" 15' - 5 7/8" 15' - 5 7/8" 15' - 4 1/2" 9' - 8 1/8"
29' - 9 1/4"
10' - 4 5/8" 10' - 6 7/8"
30' - 7 1/2" 11' - 9 7/8" 12' - 2 1/8" 12' - 4 1/2" 11' - 0 1/2" 7' - 10 3/8" 4' - 6 3/4" 12' - 5" 13' - 6" 10' - 1 5/8" 12' - 7 5/8" 36' - 0 5/8"
2 AA410
AA310
1 4 AA310
AA310 2
AA310
3 3
AA410
4 AA410
1 AA410

FENCE &
GATE

FENCE &
GATE
BIKE

PARKING

OFFICE OFFICE OFFICE BREAK/
WORK
FILES

RECEPTION
AREA
LOBBY

ELEVATOR MEN'S WOMEN'S
JAN.

KITCHEN

MULTI-PURPOSE ROOM

STORAGE
ELEC.

NEIGHBORHOOD CENTER PRODUCTION/STORAGE
21' - 7" 9' - 9 5/8" 9' - 6 1/2" 9' - 8 1/4" 37' - 10"
16' - 3 7/8" 14' - 4 5/8" 14' - 8" 15' - 8 1/2"
21' - 6" 10' - 0" 56' - 11 3/8"
4' - 0" 4' - 0"
4' - 0"
4' - 0" 4' - 0"
4' - 0"
42' - 8 1/4" 48' - 1"
1 AB410
2 AB310 AB410
1 AB310
3 AB310 2
4 AB310

1. When shown in plan, all dimensions are to face of stud, face of concrete, centerline of columns, or centerline of wall assemblies, U.N.O.

2. Do not scale drawings. Written dimensions govern.

3. All clear dimensions are not to be adjusted without approval of the Architect.

4. See site plan for overall site dimensions and notes not shown.

5. All grid lines indicate center of structural wall or face of structural material, U.N.O.

6. Window types and locations shall be as per building plans, not enlarged plans.

7. See enlarged plans for dimensions, tags, keynotes, notes, etc. not shown.

8. Refer to Civil and Structural for level one finish floor elevations.

9. See finish legend for typical finishes, U.N.O.

10. See reflected ceiling plans for locations and dimensions of soffited areas.

11. Provide and install min. 2x flat wood blocking or min. 16GA metal strapping per mfr. for all bath accessories, handrails, cabinets, towel bars, bike racks, wall mounted fixtures or equipment and any other items attached to walls.

12. All changes in floor materials occur at centerline of door or framed openings unless otherwise indicated on the drawings.

13. At areas of transition between different wall assemblies, continue thickest layer of substrate or finish to provide a flush finished surface in all directions to nearest perpendicular surface (wall, ceiling, etc.), U.N.O.

14. Provide batt insulation at interior walls for acoustic purposes at corridors, bathrooms, laundry rooms and party walls where occurs, U.N.O.

15. All blockouts in slabs, walls, footings and P.T. slabs where occur shall be coordinated and provided, even if not specifically shown on drawings.

16. Occupiable spaces, habitable spaces and corridors shall have a ceiling height of not less than 7 feet 6 inches. Bathrooms, toilet rooms, kitchens, storage rooms and laundry rooms shall be permitted to have a ceiling height of not less than 7 feet. (CBC Sec. 1208.2)

17. Door jambs are located 4” from perpendicular wall U.N.O.

18. Exterior walking surfaces exposed to weather at courtyards, plazas, terraces or balconies that are on an accessible route shall have a maximum one-fourth unit vertical in 12 units horizontal (2- percent) slope in any direction.

19. Exterior walking surfaces exposed to weather shall have a minimum one-eighth unit vertical in 12 units horizontal (1-percent slope) slope for positive drainage U.N.O. Refer to plans for slopes and area drains.

20. Wood substrates below a concrete topping slab or traffic coating that is exposed to weather shall have a one-fourth unit vertical in 12 units horizontal (2-percent) slope for positive drainage U.N.O.

Refer to plans for slopes and area drains. (CBC Sec. 2304.12.2.5) H
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THE PICTORIAL AND GRAPHIC EXPRESSIONS DISPLAYED WITH THIS WORK ARE COPYRIGHTED UNDER THE LAWS OF THE UNITED STATES, TITLE 17, U.S. CODE. UNDER SECTION 106 OF THE COPYRIGHT ACT, THE ARCHITECT SHALL MAINTAIN THE EXCLUSIVE RIGHT OF THE REPRODUCTION, DISPLAY OR ANY DERIVATION OF THIS WORK.

Level One
Plan
Wakeland Housing
20105
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06/24/2022CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 1 1/8" = 1'-0"
Level 1 Building A 2 1/8" = 1'-0"Level 1 Building B
General Notes - Floor Plan

NORTH NORTH

Page 115 of 296 ends

UP
DN DN

1. When shown in plan, all dimensions are to face of stud, face of concrete, centerline of columns, or centerline of wall assemblies, U.N.O.

2. Do not scale drawings. Written dimensions govern.

3. All clear dimensions are not to be adjusted without approval of the Architect.

4. See site plan for overall site dimensions and notes not shown.

5. All grid lines indicate center of structural wall or face of structural material, U.N.O.

6. Window types and locations shall be as per building plans, not enlarged plans.

7. See enlarged plans for dimensions, tags, keynotes, notes, etc. not shown.

8. Refer to Civil and Structural for level one finish floor elevations.

9. See finish legend for typical finishes, U.N.O.

10. See reflected ceiling plans for locations and dimensions of soffited areas.

12. All changes in floor materials occur at centerline of door or framed openings unless otherwise indicated on the drawings.

14. Provide batt insulation at interior walls for acoustic purposes at corridors, bathrooms, laundry rooms and party walls where occurs, U.N.O.

15. All blockouts in slabs, walls, footings and P.T. slabs where occur shall be coordinated and provided, even if not specifically shown on drawings.

17. Door jambs are located 4” from perpendicular wall U.N.O.

Refer to plans for slopes and area drains. (CBC Sec. 2304.12.2.5) STUDIO
STUDIO
STUDIO
STUDIO
STUDIO
STUDIO
STUDIO
IT ELEC. ELEV.

STUDIO
STUDIO
STUDIO
STUDIO
STUDIO
STUDIO
STUDIO
1-BED1-BED1-BED
1-BED1-BED
A102 3
A102 4
2 AA410 AA310 1
4 AA310
AA310
2 AA310 3
1 AA410 OFFICE OFFICE OFFICE OFFICE BREAK/
WORK

DORM ROOM

GATHERING/DINING

MEN'S W/ SHOWER WOMEN'S W/ SHOWER

STORAGE

CONFERENCE

ELEVATOR
JAN.

KITCHEN AREA

DORM ROOM
1 AB410
2 AB410
AB310 1
AB310 3
AB310
2 4 AB310
BATH

KITCHEN
BED
11' - 5 1/4" 13' - 5 3/4"
15' - 5 1/4"
5' - 6 1/2" 19' - 4 1/2"
5' - 8 7/8" 7' - 3 1/8" 2' - 11 3/8"

BEDROOM
BATH

KITCHEN

LIVING ROOM
25' - 0 1/2"
12' - 4 1/2" 12' - 1 1/2"
12' - 3 3/8" 2' - 6 1/2" 10' - 2 5/8"
18' - 7 1/4" 5' - 10 3/4"
CLOSET
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Levels Two &
Three PlanWakeland Housing
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06/24/2022CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 General Notes - Floor Plan
NORTH
NORTH
1 1/8" = 1'-0"
Levels 2 & 3 Building A
2 1/8" = 1'-0"
Level 2 Building B
3 1/4" = 1'-0"
Studio Unit
4 1/4" = 1'-0"
1-Bed Unit
AREA: 400 SQ. FT.

UNITS: 40
AREA: 616 SQ. FT.

BALCONY: 66 SQ. FT.

UNITS: 10

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1. CEMENT PLASTER, SAND FINISH

2. CEMENT BOARD PANELING WITH BATTENS

3. VINYL WINDOWS AND DOORS

4. CONCRETE MASONRY

5. MURAL OR GREENWALL

6. GALVANIZED RAILINGS

7. ALUMINUM STOREFRONT
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Building A
Exterior
Elevations Wakeland Housing
20105
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06/24/2022CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 1 3/32" = 1'-0"
Elevation - North (Building A)
3 3/32" = 1'-0"
Elevation - South (Building A)
4 3/32" = 1'-0"
Elevation - East (Building A)
2 3/32" = 1'-0"
Elevation - West (Building A)
Legend
321
5647
31 4
123
4 6
12 4
6

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1. When shown in elevation or section, all dimensions are to top of plate, top of concrete, or top of cement-based underlayment, U.N.O.

2. Do not scale drawings. Written dimensions govern.

3. All clear dimensions are not to be adjusted without approval of the Architect.

4. See Civil and Structural for finish floor elevations.

5. See Civil for adjacent hardscape elevations. Where exterior stairs land on exterior hardscape; confirm elevations with Civil.

ROOF STRUCTURE
13' - 3 1/2"
4 AA410
12' - 3 1/2"
TRASH

ENCLOSURE
BIKE

PARKING
3 AA410
13' - 3 1/2"

ROOF STRUCTURE
Level 1A
0' - 0"
Level 2A
13' - 1"
T.O. Plate A
34' - 1"
Level 3A
24' - 1"
T.O. Parapet A
39' - 0"
2 AA410
Building A Highest Point:
+21.7
Building A Lowest Point:
+18.0
3' - 8 1/4"
Building A Height
46' - 3"
Average Level of Highest and Lowest Point of Site
1' - 10 1/8"
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Building A
Building
Sections Wakeland Housing
20105
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06/24/2022CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 General Notes -
Building Sections
Keynotes
2 1/8" = 1'-0"
Building A N/S Section3 1/8" = 1'-0"
Trash Enclosure and Bike Parking
4 1/8" = 1'-0"
Trash Enclosure and Bike Parking
1 1/8" = 1'-0"
Building A W/E Section

Page 118 of 296 ends

1. CEMENT PLASTER, SAND FINISH

2. CEMENT BOARD PANELING WITH BATTENS

3. VINYL WINDOWS AND DOORS

4. CONCRETE MASONRY

5. MURAL OR GREENWALL

6. GALVANIZED RAILINGS

7. ALUMINUM STOREFRONT

8. COMPOSITE WOOD RAILINGS
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Building B
Exterior
Elevations Wakeland Housing
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06/24/2022CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 1 3/32" = 1'-0"
Elevation - North (Building B)
2 3/32" = 1'-0"
Elevation - West (Building B)
3 3/32" = 1'-0"
Elevation - South (Building B)
4 3/32" = 1'-0"
Elevation - East (Building B)
2 Legend
71 4
5 12
58 84284
1 7
844
12

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1. When shown in elevation or section, all dimensions are to top of plate, top of concrete, or top of cement-based underlayment, U.N.O.

2. Do not scale drawings. Written dimensions govern.

3. All clear dimensions are not to be adjusted without approval of the Architect.

4. See Civil and Structural for finish floor elevations.

5. See Civil for adjacent hardscape elevations. Where exterior stairs land on exterior hardscape; confirm elevations with Civil.

6. Occupiable spaces, habitable spaces and corridors shall have a ceiling height of not less than 7 feet 6 inches. Bathrooms, toilet rooms, kitchens, storage rooms and laundry rooms shall be permitted to have a ceiling height of not less than 7 feet. (CBC Sec. 1208.2)
Level 1B
-1' - 7 1/4"
Level 2B
10' - 4 3/4"
T.O. Plate B
21' - 4 3/4"
T.O. Parapet B
24' - 4 3/4"
2 AB410
Building B Highest Point:
+19.8
Building B Lowest Point:
+15.5
Average Level of Highest and Lowest Point of Site
4' - 3"
Building B Height
31' - 8 3/8"
2' - 1 1/2"
Level 1B
-1' - 7 1/4"
Level 2B
10' - 4 3/4"
T.O. Plate B
21' - 4 3/4"
T.O. Parapet B
24' - 4 3/4"
1 AB410
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Building B
Building
Sections Wakeland Housing
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06/24/2022CDP Submittal Imperial Beach Neighborhood Center + Housing 455 Palm Avenue, Imperial Beach, CA 91932 General Notes -
Building Sections
Keynotes
1 1/8" = 1'-0"
Building B W/E Section 2 1/8" = 1'-0"
Building B N/S Section

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IBNC Narrative
The Imperial Beach Neighborhood Center project is composed of two important components: a 50-unit affordable housing complex for low-income seniors and a new state of the art building for the existing Imperial Beach Neighborhood Center (IBNC). The project components will be developed together as an integrated campus. The affordable housing will provide permanent affordable housing for Imperial Beach residents, while the IBNC will provide enhanced services to the residents of the affordable housing and the larger community. The IBNC will continue its presence and legacy on the site, while expanding its capacity to serve the residents of the affordable housing and the wider community.

The affordable homes will be built on the northern portion of the site in a three-story building that includes a community space and generous amenities opening into a courtyard. An approximately 1,000 square foot community room will be a social hub and natural meeting place for residents. An onsite, approximately 13,000 square foot, Neighborhood Center (Service Center) will be located on the southern portion of the site. The new Neighborhood Center will enhance the level of services delivered to the residents of the housing and seniors living throughout the Imperial Beach community. The presence of the Neighborhood Center on the campus will allow for true aging in place for the affordable housing residents. The site will be planned with enhanced pedestrian access through the residential portion of the site to the remainder of the campus The courtyard in the center of the site, will serve as both recreational space and a useful outdoor resource. Active security measures will be installed throughout the property to promote safety and appropriate social integration.

The 13,000 Imperial Beach Neighborhood Center facility will have several functions. First, it will provide office space for the IBNC staff and several other service agencies that will provide community programs.

Second, there will be a generous community meeting space. This meeting space will be made available for community events, social gatherings, and activities such as yoga, meditation, and public lectures.

Third, the new building will provide dedicated space for the IBNC’s long-standing outreach programs that serve community members in need. For instance, the new building will house IBNC’s food distribution program, nutrition education classes, and other services that promote the health and welfare of residents in need. Finally, the new building will host a young adult residency program. This program will provide living and training space for up to five young adults. While living on site, these young adults will learn the skills of community engagement and organizing, while providing services to residents of Imperial Beach.

Program participants will be identified through the youth ministries of the United Methodist Church, other religious organizations and nonprofit service organizations. The IBNC will collaborate with service agencies and existing programs offered throughout the City of Imperial Beach. While the building will allow for the continued presence of the IBNC in Imperial Beach, it is anticipated that the majority of services will be provided, the IBNC facility will function mainly as the brains of its whole community operation with limited community services offered on-site.

Attachment 3

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Attachment 4
1 CITY OF IMPERIAL BEACH

DESIGN REVIEW BOARD

REGULAR MEETING MINUTES
October 20, 2022, 4:00 p.m.

Council Chambers
825 Imperial Beach Boulevard
Imperial Beach, CA 91932
Members Present: Miguel Beltran, Chelsea Grace, Lance Rogers, Ilia Voronchihin Members Absent: Karl Bradley
Staff Present: Community Development Director Foltz, Deputy City Clerk Carballo, Senior Planner Openshaw
_____________________________________________________________________

1. CALL TO ORDER
Vice Chair Beltran called the meeting to order at 4:00

2. ROLL CALL
Deputy City Clerk Carballo took roll.

3. PUBLIC COMMENT
None.

4. BUSINESS ITEMS

4.a WAKELAND HOUSING AND DEVELOPMENT CO. (APPLICANT);
DESIGN REVIEW CASE (DRC-22-0025) FOR A NEW 50 UNIT

AFFORDABLE SENIOR HOUSING AND NEIGHBORHOOD CENTER
PROJECT AT 455 PALM AVENUE (APN 625-230-23-00) USE-22-0095.

Senior Planner Openshaw gave a PowerPoint presentation. The applicant, John Griffin-Atil, Executive Director, Imperial Beach Neighborhood Center, provided background on the project and its origin, as well as the purpose of the project including senior housing, senior programs and activities, and a residential training program for 5 young adults.

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Attachment 4
2 Eric Naslund, Principal, Studio E Architects gave a PowerPoint presentation and reviewed many of the features of the project.

John Sugden, Project Manager, Wakeland Housing and Development Corporation, gave a PowerPoint presentation on the Wakeland company and reviewed the various projects the company has been involved with.

Dick Pilgrim spoke in support of the community center because it would help solve homelessness. This is a long-term investment, and the applicant/developers have taken the initiative to find the money for this project. He encouraged the board to move this forward, it's a wonderful project and positive addition to the City.

Newton Allred stated he opposed the project because of the negative impact on privacy, parking and living conditions. He submitted questions to the staff about the project, and voiced concerns regarding the capacity of the sewer line in that is now tied into their property. His wife shared her concerns on privacy in their backyard.

Gregory Neal stated he was not against project conceptually, and he likes that the 3 stories have been moved off Palm Ave. He lives behind Building B and is concerned with the sightlines, windows looking into their property, maintenance on the trees, and security. He inquired about the setbacks and environmental impact studies.

Written public comments in support of the project were submitted by Sandra Brillhart, Kim Frink, and Barbara Elliot Sanders.

Allen Wesley submitted a written comment voicing concerns on safety, size of the building, parking, privacy, and sun and wind blockage.

Member Rogers stated he appreciate the presentation and was proud to be part of the process. There is a homelessness crisis in the City and State, and he appreciates the work of the neighborhood center. It's a beautiful design, it accomplishes a lot of goals. He stated the sightline concerns should be addressed. He inquired regarding the setbacks on the project.

Senior Planner Openshaw stated the setback requirements are being exceeded. The only setback they are asking for an adjustment on is the front yard setback to 9 ft. 6 in. otherwise the setbacks are over 20 ft. for buildings A and B, and the rear yard is 12 ft.

In response to Member Roger's question, Senior Planner Openshaw stated the project was exempt from CEQA's requirements.

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Attachment 4
3 Members Rogers stated that the project has 42 parking spaces. He inquired as to how they arrived at the number of parking spaces.

Mr. Naslund stated per state law they get a reduction to 1/2 space per unit, but from previous experience managing similar projects, seniors and homeless tend not to have or drive cars.

Member Rogers inquired about installing an EV charger. In terms of the mural, he suggested something that addresses the intent of the neighborhood center with a deeper meaning. He is proud of this project.

Member Grace voiced concerns about the windows in the dorm rooms and gathering room looking down into the neighboring properties. In response to her question Mr. Naslund stated the trees on the south side would grow to 30 feet and provide shielding as they are broadleaf.

Member Grace recommended elevating the windows or providing vines or trellises to provide more shielding.

In response to Member Grace's questions, Mr. Naslund stated the project will be fully electrical and be 100% off-set by solar. There will be secure bike storage in and around the courtyard, they could install a wall next to the loading dock for noise mitigation, the lights will not spill out onto neighboring properties, and the landscaping at the front of the building will be a bioswale with various plants.

Member Grace commented that the parking is adequate for what is required for this development as the .5 requirement would be 25 spots and 17 spots for employees which is ten less than the 42 proposed spaces.

In response to Member Grace's question, Senior Planner Openshaw stated the public was welcome to reach out to the Community Development Department to discuss projects and any related questions could be answered at that time or the board members could make inquiries to staff during the meeting.

In response to Member Grace's question, Senior Planner Openshaw stated the project does not propose rezoning. The existing zoning is R-1500 and R-1-6000 - Senior development projects are allowed in any zone and have unique development standards to that specific use.

In response to Member Roger's question regarding public input, Senior Planner Openshaw stated members of the public can reach out via email or phone calls, the Design Review Board's recommendations are always incorporated into the projects, the public can also submit written public

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Attachment 4
4 comments, and the best way to provide feedback is to reach out to staff directly. Today the Board is looking at the design, but the item will go to City Council in the future for project approvals and members of the public can provide comments there also. At times there are also workshops with the developers for public input.

In response to Member Grace's question, Mr. Naslund stated the nearest bus stop is across the street on Palm Ave.

Member Voronchihin stated it's a very nice likeable design. In response to his question, Mr. Naslund stated the soonest they could start with demolition is March 2024 and stated the funds would be public money from various jurisdictions including the City. Once they secure funds then they can move into design drawings.

Senior Planner Openshaw stated when the item goes to City Council, they will decide what amount of funds would be provided by the City.

In response to Member Voronchihin's question, Mr. Naslund stated 25 units would be subsidized under section 8, the others would have a restricted rent set per the State and County.

In response to Member Voronchihin's question, Pastor John Griffin-Atil stated the United Methodist Church has young adults that are already vetted which they assign to different regions. The young adults would then live in the center and be paid a stipend. These are young adults that come out of colleges looking for careers in social work, clergy, politics, etc. This is program would be part of educational process.

In response to Member Voronchihin's question about the use of the community room in Building A, Director Foltz stated this project is noncommercial.

Mr. Sugden stated the bottom level would have a management office.

Mr. Naslund stated there would be one employee (office manager) on a day-to-day basis, a floating maintenance person, and various providers coming in from time to time. The 17 employee parking spaces would not be fully occupied.

In response to Member Voronchihin's question, Senior Planner Openshaw stated these types of developments have different requirements as far as height.

Page 125 of 296 ends

Attachment 4
5 Mr. Sudgen stated the ground level is 13 feet floor to floor. It would house mechanical items but would also be a flexible space in case it was needed for additional offices, etc. Above that is a 10 foot ceiling.

Member Voronchihin stated a 9-foot ceiling height for the 1-bedroom units would be plenty and also suggested adjusting the parapet height to reduce the volume of the building.

Peter Armstrong, Vice President of Real Estate Development with Wakeland, stated they would like to preserve the ceiling height, especially in the studios because they are relatively small. The 10 foot ceiling creates better volume in the studios.

Member Voronchihin stated he would leave it up to the discretion of staff but having 10 ceilings might create a "well" effect, and the proportion of the room would be off.

Member Voronchihin voiced concerns regarding the plans not being to scale which made them difficult to read and recommended using a larger font.

In response to Member Voronchihin's question, Mr. Naslund stated demolition would take several weeks and grading would take approximately 1 1/2 months. Member Voronchihin recommended including drawings to show what is being demolished, fencing, screening and dumpster location during that time.

In response to his question, Mr. Naslund stated there are internal downspouts for drainage.

Member Voronchihin recommended providing a material board. He stated he liked the elevation on Palm Ave. because there was some interest in textures and varying colors, but the east and south elevations were lacking contrast and interest. Having the materials board would help visualize the finishes. He recommended getting larger scale plants and trees from the start in order to ensure privacy and maybe some screening on the property line as there are concerns about privacy and noise. On the side of residential he recommended placing the windows in a way to control the view.

Vice Chair Beltran thanked the developers for the project. He stated it's important to consider the long-term effects of these types of projects, and input from the community and City Council should be taken into consideration. The recurring theme is the impact on the single-family homes around this area. Screening and the placement of Building B is the primary

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Attachment 4
6 focus as the properties that border the building sit below. He inquired if there was ever consideration to have Building B in a different spot, maybe more central on the property.

Mr. Sugden stated they never considered putting it in another location and the project is respecting the zoning requirement for multi-family. He stated if the building was more central it would mean a lot more traffic (vehicles, trucks, cars) would need to enter the lot through the south side. He stated that would not solve the issues eastward. He stated they could implement some strategies to alleviate the issues southward, however he would not like to fill more of the site with asphalt.

Vice Chair Beltran suggested moving Building B or providing additional screening to the patios on the south side with wood board and screening vines, etc.

In response to his question, Mr. Sudgen stated there is a breakout outdoor space in the corner. He stated they can place a perimeter wall and plant more landscaping for additional screening in between. He stated there is no access to the roof in that open corner and the conference room in the corner is set far back.

Vice Chair Beltran recommended using a block wall for fencing to mitigate noise. He recommended showing on the plans where the bike area will be.

He stated the materials feel a little industrial and he agreed with Member Voronchihin about the need of the materials board.

In response to his question, Mr. Sudgen stated everything in white is plaster with a synthetic topcoat. The grey is a corrugated metal that will be painted or painted cement board. The benefit of the metal is that is forms an air barrier or shield which allows hot air to rise before it enters the building which makes it energy efficient. Painted cement board can be used in a variety of ways.

Vice Chair Beltran reiterated the need for materials that can hold up to the beach climate. He recommended more definition as far as the planting areas. Landscaping may help mitigate noise and soften the view. He recommended providing the final landscape plan. He stated the sycamore trees are semi deciduous and recommended going with full evergreen trees all the way around the property. He proposed doing a green wall instead of a mural. Green walls help mitigate noise, soften the feel of the exterior and are low maintenance.

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Attachment 4
7 In response to Vice Chair Beltran's question, Mr. Sudgen stated a new gate would be installed and moved from the current location.

Member Voronchihin recommended using common names of the plants and what they will look like when they mature.

Senior Planner Openshaw reviewed the Board's recommendations:
• Add electric vehicle charging stations.
• Consider relocating or adjusting the windows along the eastern and southern elevations to enhance privacy or incorporate vine trellises to enhance privacy.
• Reflect the installation of solar for the project on the plans. • Show on the plans where the secure bike storage would locate. • Incorporate additional privacy and noise mitigation measures such as a block wall.
• Ensure that all lighting is maintained on-site and wouldn’t have any spill-over into the neighborhood.
• Consider adjusting the floor to ceiling height for the two upper stories to 9-feet and consider adjusting the parapet wall height. • Provide a demolition plan and existing site plan.
• Revise the plans to show all fencing and screening.
• Provide a materials board for both building materials and landscaping.
• Provide enhancing contrasts and interest on the eastern and southern elevations and consider providing additional building accents.
• Consider providing mature plantings to enhance privacy and screening.
• All ground cover and low plant material should be a minimum of 1 gallon, foundation and mid-ground planting should be a minimum of 5 gallons, taller hedges and screening shrubs should be a minimum of 15 gallons, and proposed trees should be no less than a 24” box.

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Attachment 4
8 • Consider providing an alternate material, such as synthetic wood board or screening vines to the patios on the southern elevation of Building B.
• Remove or adjust the location of the windows for Building B along the southern and eastern elevations to provide enhanced privacy. • Ensure all proposed lighting fixtures would maintain the lighting onsite. • Utilize materials for the building that are long lasting and durable and reflect the character of Imperial Beach.
• Consider providing revised renderings that accurately reflect the proposed landscaping.
• Replace the California Sycamore trees with evergreen trees along the southern property line.
• Consider replacing murals with green walls where feasible. • Loading dock must provide sound mitigation.
• Consider relocating Building B if feasible.

Motion by Lance Rogers
Seconded by Ilia Voronchihin
That the Design Review Board approve the project to move forward to City Council including the listed recommendations.

AYES (4): Miguel Beltran, Chelsea Grace, Lance Rogers, and Ilia Voronchihin
ABSENT (1): Karl Bradley
Motion Carried (4 to 0)

5. INFORMATIONAL ITEMS/REPORTS
None.

6. ADJOURNMENT
Vice Chair Beltran Adjourned the meeting at 5:47 p.m.

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Attachment 4
9 _______________________ _______________________
Sunem Carballo, CMC Miguel Beltran,
Deputy City Clerk Vice Chair

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November 3, 2022
John Sugden
Wakeland Housing
address
San Diego, CA 92101
Re: Response Memorandum for:

DRB Comments
John:

Please find below our response to the comments made at the Imperial Beach Design Review Board meeting of October, 20.2022.
1 Add electric vehicle charging stations
Electric Vehicle parking is noted on the Site Plan.
2 Consider relocating or adjusting the windows along the eastern and southern elevations to enhance privacy or incorporate vine trellises to enhance privacy
Windows on the second level of the Neighborhood Center building have been adjusted to enhance privacy into the back yards of neighboring properties. The eastern elevation now has angled bays that veil the views eastward and windows are places facing down the side yard. Windows on the southern façade have been removed. See the building elevations. 3 Reflect installation of solar for the project on the plans The project will be 100% electric with 100% solar offset. This in noted and indicated on the site plan.
4 Show on the plans where the secure bike storage would locate Bike storage has been added to the courtyard pavilion building adjacent to the trash room. See the site plan and the floor plans.
5 Incorporate additional privacy and noise mitigation measures such as a block wall
A CMU wall has been added to the entire southern property line and 100’ along the eastern and western property lines. See the notation added to the site plan.

Attachment 5

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6 Ensure that all lighting is maintained on-site and wouldn’t have any spillover into the neighborhood All site lighting will cut off at the site perimeter. See added notes on the site plan.
7 Consider adjusting the floor to ceiling height for the two upper stories to 9- feet and consider adjusting the parapet wall height
The 10’ ceiling heights proposed are essential to offset the small unit footprint. The very slight ceiling height increase dramatically improves the livability of these units. We would ask that the city council approve this as submitted.
8 Provide a demolition plan and existing site plan
The entire site is being demolished such that the project is starting with a blank site. We added a note about this on the title sheet. 9 Revise the plans to show all fencing and screening
All proposed fencing and screening have been noted in the site plan and the landscape site plan. CMU walls, wood fencing, and landscape improvements have been noted.
10 Provide a materials board for both building materials and landscaping This will be provided in advance of the City Council hearing. 11 Provide enhancing contrasts and interest on the eastern and southern elevations and consider providing additional building accents Additional material changes and screeding has been added to the southern and western elevations of the Neighborhood Center. See the elevations. 12 Consider providing mature plantings to enhance privacy and screening This is a tax credit financed affordable housing project and the budgets available to fund these projects generally won’t support mature landscape materials and the costs associated with this. We will adhere to the sizing criteria in the next note.
13 All ground cover and low plant material should be a minimum of 1 gallon, foundation and mid-ground planting should be a minimum of 5 gallon, taller hedges and screening shrubs should be a minimum of 15 gallon, and proposed trees should be no less than a 24” box
These notes have been added in the landscape plans.
14 Consider providing an alternate material, such as synthetic wood board or screening vines to the patios on the southern elevation of Building B This has been changed at the Neighborhood Center. The retention portions below remain CMU, but the guardrail portions are amended. See the elevations.

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P a g e | 1
November 16, 2022
ITEM TITLE: BREAKWATER HOTEL/HAMPTON INN & SUITES ECONOMIC DEVELOPMENT

SUBSIDY REPORT FIVE-YEAR UPDATE
ORIGINATING DEPARTMENT:

Community Development
EXECUTIVE SUMMARY:

An Economic Development Subsidy Five-Year Update Report has been prepared in accordance with California Government Code Section 53083(d) in order to update the City Council and the public regarding the economic development subsidy that was provided by the City to SudberryPalm Avenue LLC or its permitted successors and assignees (Attachment 1). On December 6, 2017, as part of various approvals by the City Council and Successor Agency, the City Council considered an Economic Development Subsidy Report (Attachment 2) and approved an “Operating Covenant Agreement” with Sudberry-Palm Avenue LLC, including its permitted successors and assignees, to provide an economic subsidy for the construction of a new hotel by sharing transient occupancy tax. An update on the economic development subsidy must be provided five years following the approval of the “Operating Covenant Agreement.” The City contracted with an economic consultant, Keyser Marston Associates, Inc., to prepare the fiveyear update report, which provides information related to the Project’s generation of tax revenues and employment. The five-year update has been made available on the City’s website and a public hearing describing the subsidy and considering any comments must be provided.

RECOMMENDATION:

That the City Council hold the public hearing and consider any written or oral comments on the information contained in the report and accept and file the report.

OPTIONS:
 That the City Council accept and file the report; or
 That the City Council request additional information.

BACKGROUND/ANALYSIS:

An Economic Development Subsidy Five-Year Update Report (Report) was prepared in accordance with California Government Code Section 53083(d) in order to update the City Council and the public regarding the economic development subsidy that was provided by the City to Sudberry-Palm Avenue LLC (Developer) or its permitted successors and assignees. The

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P a g e | 2
subsidy between the City and the Developer was to share transient occupancy tax (TOT), defined as the TOT Incentive Payments (Subsidy). The Subsidy is based on and calculated on an equal portion of the net TOT revenue collected and remitted to the City from the development.

In 2020, the Developer constructed an approximately 62,000-square-foot, 100-room, four-story Hampton Inn & Suites hotel (Project). The Project is located on the westerly portion of a larger development project located at the southwestern corner of 9th Street and Palm Avenue. The City is providing the Developer or its permitted successors or assignees a Subsidy equal to 50.0% of TOT revenue generated by the Project for no more than 10 years in an amount not to exceed a total of $2,500,000.

The City engaged its economic consultant, Keyser Marston Associates, Inc. (KMA), to provide information related to the Project’s generation of tax revenues and employment. The KMA findings are summarized as follows:
 Under the terms of the Agreement, the City provided the Developer or its permitted successors and assignees with a total Subsidy of approximately $391,000 since July 2020.
 Since May 2020, the Project has generated tax revenues, net of the Subsidy, of approximately $433,000, consisting of property tax, TOT, and sales tax.  To date, the Project has created 254 full-time construction (temporary) jobs and 20 fulltime and 5 part-time permanent jobs.

Under the obligations and covenants set forth in the Agreement, Subsidy payments began in July 2020. The Subsidy will end on the earlier of: 1) the date that is 10 years from the date of commencement of operation of the Project, defined as the Payment Period in the Agreement, or 2) the date on which the Developer or its permitted successors and assignees has received a total of $2,500,000. The Project has generated combined total gross tax revenues of $823,768 from May 2020 through June 2022. After accounting for the Subsidy provided to the Developer, the City has collected total net tax revenues of $432,797. Since the Subsidy payments began in July 2020, it is anticipated that the Subsidy will end no later than July 2030.

Development of the Project has assisted the City in achieving its economic development goals and objectives as defined in the City’s General Plan. These include the following:
 Development of visitor-serving facilities that encourage use of local commercial retail and visitor-serving facilities, which leads to an increase in sales tax revenue to the City; and  Generation of increased General Fund revenues through an expanded tax base (property tax and TOT), which enables the City to increase public services and improve public infrastructure; and
 Provision of employment opportunities for the residents of the City; and  Revitalization of underutilized and vacant land.

ENVIRONMENTAL DETERMINATION:

Not a project as defined by CEQA.

FISCAL IMPACT:

Consulting services for preparation of the report are not to exceed $6,500 per an executed agreement for professional services with Keyser Marston Associates, Inc.

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P a g e | 3
ATTACHMENTS:

ATT 1 Breakwater Hotel Project Economic Subsidy Report 5-Year Update ATT 2 Breakwater Hotel Project Economic Subsidy Report 2017

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BREAKWATER HOTEL PROJECT
(HAMPTON INN & SUITES)

PALM/COMMERCIAL REDEVELOPMENT PROJECT AREA

IMPERIAL BEACH, CALIFORNIA

ECONOMIC DEVELOPMENT SUBSIDY REPORT

FIVE-YEAR UPDATE
California Government Code
Section 53083(d)

PURSUANT TO THE OPERATING COVENANT AGREEMENT

BETWEEN

THE CITY OF IMPERIAL BEACH
AND

HERITAGE INN OF IMPERIAL BEACH, LLC
(ORIGINALLY SUDBERRY-PALM AVENUE LLC)
City of Imperial Beach, California
November 2022
Attachment 1 - 5-Year Update

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TABLE OF CONTENTS
I. Introduction ........................................................................................................................................ 1 II. Name and Address of Business Entity Receiving Subsidy ................................................................... 2 III. Start and End Dates and Schedule for the Subsidy ............................................................................. 2 IV. Description of Economic Subsidy ........................................................................................................ 3 V. Public Purpose of Subsidy ................................................................................................................... 3 VI. Net Tax Revenues to City .................................................................................................................... 3 VII. Number of Jobs Created by the Subsidy ............................................................................................. 4 VIII. Limiting Conditions.............................................................................................................................. 4

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Economic Development Subsidy Five-Year Update Report – October 2022 Page 1 Breakwater Hotel Project (Hampton Inn & Suites)
22098kal
14070.013.001
I. INTRODUCTION
A. Purpose of Report
This Economic Development Subsidy Five-Year Update Report (Report) was prepared in accordance with California Government Code Section 53083(d) in order to inform the City Council of the City of Imperial Beach (City) and the public with an update regarding the economic development subsidy that was provided by the City to Sudberry-Palm Avenue LLC (Developer) or its permitted successors and assignees. The subsidy is further described in the Operating Covenant Agreement (Agreement), approved in 2018, between the City and the Developer for the sharing of transient occupancy tax (TOT), defined as the TOT Incentive Payments (Subsidy). The Subsidy is based on and calculated on an equal portion of the net TOT revenue collected and remitted to the City from the development, as described below.

In 2020, the Developer constructed an approximately 62,000-square-foot (SF), 100-room, four-story Hampton Inn & Suites hotel (Project). The Project is located on the westerly portion (Phase II Site) of a larger development project located at the southwestern corner of 9thth Street and Palm Avenue.

In accordance with California Government Code Section 53083(d), this Report describes and specifies the following:
(1) The name and address of all corporations or any other business entities that are the beneficiary of the Subsidy;
(2) The start and end dates and schedule, if applicable, for the Subsidy; (3) The description of the Subsidy, including the estimated total amount of the expenditure of public funds by, or of revenue lost to, the City as a result of the Subsidy; (4) The statement of the public purposes for the Subsidy; (5) The net tax revenue to the City as a result of the Subsidy; and (6) The number of jobs created by the Subsidy, broken down by full-time, part-time, and temporary positions.

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Economic Development Subsidy Five-Year Update Report – October 2022 Page 2 Breakwater Hotel Project (Hampton Inn & Suites)
22098kal
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B. Summary of Findings
The City engaged its economic consultant, Keyser Marston Associates, Inc. (KMA), to provide information related to the Project’s generation of tax revenues and employment. The KMA findings are summarized as follows:
 Under the terms of the Agreement, the City provided the Developer or its permitted successors and assignees with a total Subsidy of approximately $391,000 since July 2020.  Since May 2020, the Project has generated tax revenues, net of the Subsidy, of approximately $433,000, consisting of property tax, TOT, and sales tax.  To date, the Project has created 254 full-time construction (temporary) jobs and 20 full-time and 5 part-time permanent jobs.

C. Description of Property and Project
The Phase II Site consists of approximately 1.40 acres and was part of the second (westerly) phase of a larger development site located at the southwestern corner of 9th Street and Palm Avenue. The Phase II Site was comprised of two (2) parcels, Parcel F and Parcel G, which were consolidated into one (1) legal lot for the development of the Project. The Phase II Site was developed with a Hampton Inn & Suites hotel and includes 100 rooms, interior amenities, an outdoor recreational pool, and surface parking.

II. NAME AND ADDRESS OF BUSINESS ENTITY RECEIVING SUBSIDY The Subsidy provided under the Agreement is paid to the Developer or its permitted successors and assignees, under the name:

Heritage Inn
4520 36th Avenue S
Fargo, ND 58104
III. START AND END DATES OF SUBSIDY
Under the obligations and covenants set forth in the Agreement, Subsidy payments are delivered by the City to the Developer or its permitted successors and assignees after certain conditions of the

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Economic Development Subsidy Five-Year Update Report – October 2022 Page 3 Breakwater Hotel Project (Hampton Inn & Suites)
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Project were completed. The Developer met those conditions and the Subsidy payments began in July 2020. The Subsidy will end on the earlier of:

1. the date that is 10 years from the date of commencement of operation of the Project, defined as the Payment Period in the Agreement, or

2. the date on which the Developer or its permitted successors and assignees has received a total of $2,500,000.

Since the Subsidy payments began in July 2020, it is anticipated that the Subsidy will end no later than July 2030.

IV. DESCRIPTION OF THE SUBSIDY
The City is providing the Developer or its permitted successors or assignees a Subsidy equal to 50.0% of TOT revenue generated by the Project for no more than 10 years in an amount not to exceed a total of $2,500,000.

V. PUBLIC PURPOSE OF SUBSIDY
Development of the Project has assisted the City in achieving its economic development goals and objectives as defined in the City’s General Plan. These include the following:
 Development of visitor- and convention-serving facilities that encourage use of local commercial retail and visitor-serving facilities, which leads to an increase in sales tax revenue to the City  Generation of increased General Fund revenues through an expanded tax base (property tax and TOT), which enables the City to increase public services and improve public infrastructure  Provision of employment opportunities for the residents of the City  Revitalization of underutilized and vacant land
VI. NET TAX REVENUES TO CITY
The Project currently generates property tax, TOT, and sales tax. Only one (1) business occupies the Site. The amount of sales tax generated by individual businesses is legally confidential in California and cannot be publicly disclosed. Therefore, the amount of sales tax has been combined with

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Economic Development Subsidy Five-Year Update Report – October 2022 Page 4 Breakwater Hotel Project (Hampton Inn & Suites)
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property tax and TOT to protect the sales tax confidentiality. According to the City’s Finance Department, the Project has generated combined total gross tax revenues of $823,768 from May 2020 through June 2022. After accounting for the Subsidy provided to the Developer, the City has collected total net tax revenues of $432,797.

VII. NUMBER OF JOBS CREATED BY THE SUBSIDY
Development of the Project created 250 temporary and 4 permanent construction jobs with all employees considered to be full-time. At present, the Project contains 25 full-time permanent jobs, of which 20 jobs are full-time and 5 jobs are part-time.

VIII. LIMITING CONDITIONS

1. The KMA analysis is based, in part, on data provided by secondary sources such as state and local governments, planning agencies, real estate brokers, and other third parties. While KMA believes that these sources are reliable, we cannot guarantee their accuracy.

2. The projections and analyses contained herein are based on estimates and assumptions which were developed using currently available economic data, project-specific data and other relevant information. It is the nature of forecasting, however, that some assumptions may not materialize and unanticipated events and circumstances may occur. Such changes are likely to be material to the projections and conclusions herein and, if they occur, would require review or potential revision of this document.

3. Any estimates of revenue or cost projections are based on the best project-specific and fiscal data available at this time as well as experience with comparable projects. They are not intended to be projections of actual future performance of any specific project. Any changes to costs, development program, or project performance may render the conclusions contained herein invalid.

4. KMA assumes that all applicable laws and governmental regulations in place as of the date of this document will remain unchanged throughout the projection period of our analysis. In the event that this does not hold true, i.e., if any tax rates change, the analysis would need to be revised.

5. KMA is not advising or recommending any action be taken by the City with respect to any prospective, new or existing municipal financial products or issuance of municipal securities

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Economic Development Subsidy Five-Year Update Report – October 2022 Page 5 Breakwater Hotel Project (Hampton Inn & Suites)
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(including with respect to the structure, timing, terms and other similar matters concerning such financial products or issues).

6. KMA is not acting as a Municipal Advisor to the City and does not assume any fiduciary duty hereunder, including, without limitation, a fiduciary duty to the City pursuant to Section 15B of the Exchange Act with respect to the services provided hereunder and any information and material contained in KMA’s work product.

7. The City shall discuss any such information and material contained in KMA’s work product with any and all internal and/or external advisors and experts, including its own Municipal Advisors, that it deems appropriate before acting on the information and material.

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PALM/COMMERCIAL REDEVELOPMENT PROJECT AREA

IMPERIAL BEACH, CALIFORNIA

ECONOMIC DEVELOPMENT SUBSIDY REPORT
California Government Code
Section 53083

PURSUANT TO THE OPERATING COVENANT AGREEMENT

BETWEEN

THE CITY OF IMPERIAL BEACH
AND

SUDBERRY-PALM AVENUE LLC
City of Imperial Beach, California
November 2017
Attachment 2 - 2017 Report

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TABLE OF CONTENTS
I. Introduction ........................................................................................................................................ 1 II. Name and Address of Business Entity Receiving Subsidy ................................................................... 6 III. Start and End Dates of Subsidy ........................................................................................................... 6 IV. Description of Subsidy......................................................................................................................... 6 V. Public Purpose of Subsidy ................................................................................................................... 6 VI. Projected Tax Revenue to City Resulting from the Subsidy................................................................ 7 VII. Estimated Number of Jobs Created by the Subsidy............................................................................ 8 VIII. Limiting Conditions.............................................................................................................................. 9

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Economic Development Subsidy Report Page 3
Breakwater – 9th Street and Palm Avenue Project
17071ndh
14070.007.001
I. INTRODUCTION
A. Purpose of Report
This Economic Development Subsidy Report (Report) was prepared in accordance with Section 53083 of the California Government Code in order to inform the City Council of the City of Imperial Beach (City) and the public of the proposed Economic Development Subsidy (Subsidy) provided by the City to Sudberry-Palm Avenue LLC (Developer) or its permitted successors and assigns. The proposed Subsidy is further described in a draft Operating Covenant Agreement (TOT Agreement), under review as of November 2017, between the City and the Developer for the sharing of transient occupancy tax (TOT).

The Developer intends to develop an approximate 57,920-square-foot (SF), four-story hotel (Project) on

1.40 acres. The Project is located on the westerly portion (Phase II Site) of a larger development project located at the southwestern corner of 9thth Street and Palm Avenue (Site) in the City of Imperial Beach.

The Project will include approximately 101 rooms and other interior amenities, surface parking, and an outdoor recreational pool.

The Report describes and specifies:
(1) The name and address of all corporations or any other business entities that are the beneficiary of the Subsidy;
(2) The start and end dates and schedule, if applicable, for the Subsidy; (3) The description of the Subsidy, including the estimated total amount of the expenditure of public funds by, or of revenue lost to, the City as a result of the Subsidy; (4) The statement of the public purposes for the Subsidy; (5) The projected tax revenue to the City as a result of the Subsidy; and (6) The estimated number of jobs created by the Subsidy, broken down by full-time, part-time, and temporary positions.

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Economic Development Subsidy Report Page 4
Breakwater – 9th Street and Palm Avenue Project
17071ndh
14070.007.001
B. Summary of Findings
The City engaged its economic consultant, Keyser Marston Associates, Inc. (KMA), to prepare the Report required by California Government Code Section 53083 and analyze the economic terms contained in the proposed TOT Agreement. The principal conclusions of the KMA Report are summarized as follows:
• Under the terms of the proposed TOT Agreement, the City will provide a Subsidy to the Developer or its permitted successors and assigns equal to 50.0% of Projected-generated TOT revenues for the first 10 years, starting at commencement of operations, not to exceed a total of $2,500,000. • During the first 15 years of operation, the Project is projected to generate a total of $5,216,000 in net tax revenues to the City, including both TOT (net of TOT sharing with the Developer or its permitted successors and assigns during Years 1-10) and property tax revenues. • Development of the Project is expected to create approximately 30 full-time construction jobs and 35 full-time permanent jobs.

C. Description of Property and Proposed Project
The Phase II Site consists of approximately 1.40 acres, and is part of the second (westerly) phase of a larger development site located at the southwestern corner of 9th Street and Palm Avenue. The Phase II Site is comprised of two (2) parcels, Parcel F and Parcel G, which will be consolidated into one legal lot for the development of the Project. The Phase II Site is currently under a review for entitlements to allow for the development of a hotel use. The Project will include approximately 101 hotel rooms, interior amenities, and an outdoor recreational pool. Completion of the Project will provide additional business and leisure accommodations within the City.

Table I-1 provides a summary of the physical characteristics of the proposed Project.

Table I-1: Project Description
Phase II Site Area 1.40 Acres
Gross Building Area (GBA) 57,920 SF
Number of Hotel Rooms 101 Rooms
Parking 101 Spaces
D. Proposed Transaction Terms
This section summarizes the salient aspects of the business terms contained in the proposed TOT Agreement.

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17071ndh
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• The 1.40-acre Phase II Site was sold to the Developer as part of the larger 4.75-acre Site for the Purchase Price of $213,000 subject to a Purchase and Sale Agreement dated January 29, 2014, as amended on July 28, 2014, July 27, 2015, and March 17, 2017, and further amended by the First Amendment on January 12, 2016, between the Imperial Beach Redevelopment Agency Successor Agency (Successor Agency) and the Developer. The Purchase and Sale Agreement is proposed to be further amended by the Parties by a Second Amendment to allow for the hotel development on the Phase II Site.
• The Developer will prepare a building pad and construct and operate an approximately 101-room limited service hotel on the Phase II Site.
• Following the Effective Date (as defined therein) of the TOT Agreement and continuing until the expiration or termination of the Operating Period (as defined therein), Developer (or its permitted successors and assigns) shall not Transfer1 all or any part of Developer’s interest in or rights or obligations under the TOT Agreement and/or any part of Developer’s interest in or rights to the Phase II Site, and/or the Project, and/or Ownership and/or Control (as defined therein) of Developer, without the City’s prior written approval. A proposed Transfer requires the approval of the City Council of the City at a noticed public meeting, except for Permitted Transfers (as defined therein), which Permitted Transfers may be reviewed and approved by the City Manager on behalf of the City in accordance with the procedures described in the TOT Agreement. In no event shall a Transfer consist of the right to receive the Subsidy separate and apart from the Project. A Permitted Transfer includes (i) a Transfer of Ownership and/or Control resulting from the death or mental or physical incapacity of an individual shareholder or member of Developer; (ii) a Transfer of Ownership and/or Control in trust for the benefit of a spouse, children, grandchildren, or other immediate family members of any individual owner of Developer; (iii) the granting of certain easements, licenses, rights of entry or permits to facilitate the development of the Phase II Site; (iv) a Transfer for financing purposes in connection with recordation of a certain Construction Loan or bona fide Permanent Loan replacing the Construction Loan following Completion; and (v) the creation of a new joint venture entity with Tharaldson Hospitality Development, LLC, a Nevada limited liability company (“Tharaldson”), or an Affiliate (as defined therein) of Tharaldson, and Developer or an Affiliate of Developer as co-managers or co-general partners, so long as all of the criteria described in the TOT Agreement are satisfied.
• Upon the completion and satisfaction of conditions set forth in the proposed TOT Agreement, the Developer or its permitted successors and assigns shall receive payments from the City in an amount equivalent to 50.0% of Project-generated TOT revenues for 10 years, starting at commencement of operations, not to exceed a total of $2,500,000.
1 The term “Transfer” as used in the TOT Agreement means and includes any direct or indirect conveyance, transfer, sale, assignment, lease, sublease, license, concession, franchise, gift, management agreement, operating agreement, hypothecation, mortgage, pledge, encumbrance, or the like of the TOT Agreement, the Phase II Site, or any part thereof, the Project and/or Ownership and/or Control of Developer.

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Economic Development Subsidy Report Page 6
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17071ndh
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II. NAME AND ADDRESS OF BUSINESS ENTITY RECEIVING SUBSIDY The Subsidy provided under the proposed TOT Agreement will be paid to the Developer under the name:

Sudberry-Palm Avenue LLC, a California limited liability company c/o Sudberry Properties
5465 Morehouse Drive, Suite 260
San Diego, CA 92121
The identity and name of the Developer under the proposed TOT Agreement may change to a permitted successor and assign in the event the City approves a Transfer as described above, in accordance with the terms and conditions of the TOT Agreement.

III. START AND END DATES OF SUBSIDY
Payments will be delivered by the City to the Developer or its permitted successors and assigns after certain conditions of the Project are completed in accordance with the obligations and covenants set forth in the proposed TOT Agreement. Once these conditions are fulfilled, the 10-year TOT subsidy will begin, but not sooner than issuance of a Certificate of Occupancy for the proposed Project and commencement of operations of the Project. The subsidy will end on the earlier of: (1) the date that is 10 years from the date of commencement of operation of the Project, or (2) the date on which the Developer or its permitted successors and assigns has received a total of $2,500,000.

IV. DESCRIPTION OF THE SUBSIDY
The City will provide the Developer or its permitted successors and assigns a subsidy equal to 50.0% of TOT revenue generated by the Project for 10 years, starting at commencement of operations, not to exceed a total of $2,500,000.

V. PUBLIC PURPOSE OF SUBSIDY
Implementation of the proposed TOT Agreement, allowing for the Subsidy, can be expected to assist the City in achieving its economic development goals and objectives as defined in the City’s General Plan.

These include the following:
• Development of visitor- and convention-serving facilities that encourage use of local commercial retail and visitor-serving facilities – which in turn will lead to an increase in sales tax revenue to the City

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Economic Development Subsidy Report Page 7
Breakwater – 9th Street and Palm Avenue Project
17071ndh
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• Generation of increased General Fund revenues through an expanded tax base (property tax and TOT), which in turn enable the City to increase public services and improve public infrastructure • Provision of employment opportunities for the residents of the City • Revitalization of underutilized and vacant land
VI. PROJECTED TAX REVENUE TO CITY RESULTING FROM THE SUBSIDY Direct tax revenues generated to the City as a result of completion of the Project are projected to consist of property tax and TOT. KMA has estimated these public revenues based on a detailed economic analysis of the Project.

Table VI-1 provides a summary of the total estimated tax revenue to the City during the stabilized year of Project operations as a result of the Subsidy. A
Table IV-1: Estimated Tax Revenue to City at Stabilized Year (1)(2) TOT Revenues $191,000
Property Tax Revenues $37,000
Total Revenues to City $228,000
(1) All estimates are expressed in undiscounted future dollars (2) Reflects net TOT revenues to City after the proposed Subsidy to Developer or its permitted successors and assigns during the stabilized year, Year 3.

Furthermore, Table VI-2 below provides a summary of the total estimated tax revenue to the City for Years 1-15 of Project operations as a result of the Subsidy. As shown below, the Total Tax Revenues to the City after the Subsidy are estimated at $5,216,000.

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Table VI-2: Estimated Tax Revenue to City (1)
Year
Total TOT
Revenues
Projected
TOT
Subsidy
Net TOT
Revenues to
City (2)
Property
Tax Revenues
to City
Total Net Tax
Revenues to
City
1 $304,000 ($152,000) $152,000 $36,000 $188,000
2 $342,000 ($171,000) $171,000 $37,000 $208,000
3 $382,000 ($191,000) $191,000 $37,000 $228,000
4 $393,000 ($197,000) $197,000 $38,000 $235,000
5 $405,000 ($203,000) $203,000 $39,000 $242,000
6 $417,000 ($209,000) $209,000 $40,000 $249,000
7 $430,000 ($215,000) $215,000 $41,000 $256,000
8 $443,000 ($222,000) $222,000 $41,000 $263,000
9 $456,000 ($228,000) $228,000 $42,000 $270,000
10 $470,000 ($235,000) $235,000 $43,000 $278,000
11 $484,000 $0 $484,000 $44,000 $528,000
12 $498,000 $0 $498,000 $45,000 $543,000
13 $513,000 $0 $513,000 $46,000 $559,000
14 $529,000 $0 $529,000 $47,000 $576,000
15 $545,000 $0 $545,000 $48,000 $593,000
Grand Total,
Years 1-15 $6,611,000 ($2,023,000) $4,592,000 $624,000 $5,216,000 (1) All estimates are expressed in nominal dollars. Allow for rounding. (2) Reflects net TOT revenues to City after the proposed 50.0% TOT Subsidy to Developer or its permitted successors and assigns in Years 1-10.

VII. ESTIMATED NUMBER OF JOBS CREATED BY THE SUBSIDY
A. Temporary Employment
Development of the Project will create temporary construction jobs. It is estimated that construction of the Project will directly support approximately 75 new full-time construction jobs (no part-time employees anticipated) during the construction period of the Project.

B. Permanent Employment
The Developer estimates operation of the Project upon completion will create 30 full-time jobs (no parttime employees anticipated).

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Economic Development Subsidy Report Page 9
Breakwater – 9th Street and Palm Avenue Project
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14070.007.001
VIII. LIMITING CONDITIONS

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November 16, 2022
ITEM TITLE: CITY OF IMPERIAL BEACH 4TH OF JULY COMMUNITY CELEBRATION ORIGINATING DEPARTMENT:

Parks & Recreation
EXECUTIVE SUMMARY:

Traditionally, the City of Imperial Beach, with support from the Port of San Diego and private donations, has celebrated the 4
th of July with a fireworks display, often intended to be similar to the Big Bay Boom produced by the Port of San Diego. Due to unforeseen circumstances the July 2022 fireworks display was canceled by the fireworks company and because no fireworks company could be identified to produce the display, the City quickly pivoted to hold the first ever Imperial Beach 4th of July Drone display. Since that time, staff has received several requests to continue to produce a drone display, but almost an equal number of requests to return to the traditional fireworks display. Staff is seeking direction from the City Council ono whether to pursue a drone or a fireworks display, and to discuss potential dates for the event in 2023.

RECOMMENDATION:

Provide staff with direction on the type of display and the date for the 2023 4 th of July celebration
in the City of Imperial Beach.

OPTIONS:
 Direct staff in relation to the type of display (drone or fireworks) and the preferred date  Provide specific direction to the City Manager with a request for additional information BACKGROUND/ANALYSIS:

The City of Imperial Beach has had a proud tradition of recognizing the Country’s birthday (July 4). In recent years, the celebration has included a fireworks display with shells being launched from the pier so the thousands of people gathered at the beach can enjoy the lights and sounds of the fireworks. The display typically lasts just under 20 minutes and coincides with the larger Big Bay Boom produced by the Port of San Diego launched from large barges in the San Diego Bay.

Although every attempt is made to “mirror” the Big Bay Boom event, the fireworks display in Imperial Beach are not part of the official event.

In late June of 2022, the fireworks company contracted to produce the display was not able to perform. Staff quickly attempted to find another fireworks company to produce the event, but because there was less than a week before the 4th of July, not a single company could accommodate the City. Staff quickly pivoted to find an alternative and was able to obtain a commitment from a drone company to produce a drone display synchronized with music. The change in scope prompted amendments to permits, approvals from the Coastal Commission, Fish

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and Wildlife Service, the Port of San Diego, and CEQA. Promotion of the event to be held in less than a week was undertaken and given the situation, the drone show was highly successful.

However, there were lessons learned and advantages and challenges with the drone display.

Both drone and fireworks displays are fun and exciting ways to celebrate events, but they are very different events to produce. One of the thrilling features of fireworks are the sounds and physical percussion experienced when the shells explode. Many comments were received that spectators missed the sounds of the fireworks display. However, there are impacts from the sounds and percussion resulting from fireworks that are reported from residents such as stress disorders, pet and wildlife/animal behavior, and concerns for children with autism. Therefore, if the City Council determines fireworks are preferable, staff can do a better job helping residents prepare for the impacts of the sounds and percussion. Conversely, if a drone display is preferred, staff would recommend widespread speakers on the beach so that attendees can hear the synchronized music.

Another factor is the length of the event. Because of the last-minute change, the drone show was only about 12 minutes long. If a drone display is preferred, staff would work with the producer to lengthen the display to be more consistent with the traditional fireworks display and the Big Bay Boom at around 20 minutes.

Other differences between a drone and firework event are the direct and indirect costs of the event. The direct costs of a drone display tend to be higher than fireworks. For comparative analysis, the direct cost of the 2022 drone display was about twice as much as the fireworks.

However, the indirect costs of fireworks are much higher. The staff costs associated with cleaning up the paper enclosing the firework shells, report writing to the Coastal Commission and Fish and Wildlife Service, on-site requirements for the Fire-Rescue and other indirect costs associated with the fireworks are simply not issues associated with a drone display. After a fireworks display the debris must be gathered and weighed to determine the percentage of debris that was collected.

It also takes much longer to open the pier due to the need for check for unexploded or partially shells that could be a danger to the public.

The City received a lot of press coverage and interest by doing something out of the norm. Several cities have contacted staff asking for details about how to hold a drone display. Of note, the City has contacted by pet owners throughout the County expressing thanks for having a pet friendly event that they could attend.

A final consideration is the date of the event. This year, the 4th of July falls on a Tuesday. Staff would like director on whether to hold the show on Sunday, July 2nd to accomplish the following:

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 Families might find it more appealing to have the event on a weekend day.  It may be easier to address traffic concerns if the traffic is localized rather than having the additional traffic coming from Coronado after their event.  The cost of the display may be less because the vendors are much busier on the 4th of July.

Staff is seeking direction from the City Council on how to move forward with planning the City’s 4 th of July community event.

ENVIRONMENTAL DETERMINATION:

CEQA analysis will be conducted upon a decision by the City Council.

FISCAL IMPACT:

To be determined after direction from City Council to solicit vendor for firework or drone show.

ATTACHMENTS:

None.

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November 16, 2022
ITEM TITLE: REVIEW OF FISCAL YEAR 2021-22 AUDITED FINANCIAL STATEMENTS AND RELATED DOCUMENTS AND RESOLUTION NO. 2022-101 AUTHORIZING THE

ALLOCATION OF FUND BALANCE
ORIGINATING DEPARTMENT:

Finance
EXECUTIVE SUMMARY:

The independent audit of the Financial Statements of City of Imperial Beach for the Fiscal Year Ended June 30, 2022 has been completed and prepared for consideration by the City Council.

The audit reports on government-wide fiscal activities, as well as on the fund level activity in the General Fund, Other Governmental Funds, the Sewer Enterprise Fund and the Internal Services Funds from July 1, 2021 to June 30, 2022. The annual Housing Authority reports are also included in the audit.

RECOMMENDATION:

1. City Council and Board(s) receive and file the Fiscal Year 2021-22 City of Imperial Beach Audited Financial Statements and related documents.

2. Adopt Resolution No. 2022-101 Authorizing the allocation of Fund Balance and authorizing necessary assignments, transfers, and budget amendments.

OPTIONS:
 Receive and file the Fiscal Year 2021-22 City of Imperial Beach audited financial statements and related documents and approve Resolution No. 2022-101 authorizing the allocation of Fund Balance and authorizing necessary assignments, transfers, and budget amendments
 Receive and file the Fiscal Year 2021-22 City of Imperial Beach audited financial statements and related documents and do not approve Resolution No. 2022-101 authorizing the allocation of Unassigned Fund Balance and authorizing necessary assignments, transfers, and budget amendments
 Provide direction to staff to provide additional information BACKGROUND/ANALYSIS:

An independent audit is an important mechanism to validate fiscal data and to reassure constituents that the financial results are presented accurately, and City’s finances and internal

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processes are in good order. Moreover, an outside review is crucial for maintaining consistency with best financial practices and a welcomed opportunity for staff to obtain recommendations on implementation of new procedures to optimize fiscal management. This report will provide an overview of a more complex document, and the entire municipal audit is available for review by the public and will be published on City’s website.

REVENUES
The Citywide fund level revenue in fiscal 2021-22, excluding transfers, was $38,693,370. The General Fund revenue of $26,243,293 represents approximately 68% of the Citywide revenue.

The Sewer Enterprise Fund revenue of $6,126,341 accounts for about 16% of Citywide revenue with the Internal Service Funds (total revenues of $1,974,922), and the Other Government Funds (total revenues of $4,348,814), making up the remainder of the revenue, as indicated in the chart below.

Fiscal Year 2021-22 total General Fund revenue was about $3,221,866 greater than fiscal year 2020-21. The greatest contributors to the year-over-year increase were City’s 1% Sales Tax and the new Measure I Sales Tax combined accounting for over $2.6 million of the increase. This was the first full year of Measure I Sales Tax collection and the receipts came in significantly above the initial expectations. A contributing factor to the increase in sales tax was the exceptionally high inflation which pushed consumer goods prices up throughout the period. Transient Occupancy Tax increased by approximately $450,000, the result of the reopening of the economy and recovery in the travel industry. Additionally, the components of the Property Tax continued to experience year-over-year revenue growth.

These revenue increases were partially offset by weaker investment earnings as fair market value accounting adjustments resulted in unrealized investment losses on June 30, 2022. The City’s Sewer
Enterprise Fund
$6,126,341
Internal
Services Fund
$1,974,922
Other
Government
Funds
$4,348,814
General Fund,
$26,243,293

CITYWIDE REVENUES

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franchise revenue and certain categories of permits revenue also decreased slightly when compared to fiscal year 2020-21. This was a result of changing market conditions and normal fluctuations in the business activity, respectively. The City also changed reporting for certain grants resulting in associated revenue streams now being reported in Other Governmental Funds instead of in the General Fund. That led to a decrease in the intergovernmental revenue category for the fund in fiscal 2021-22 but will ultimately result in a better year-over-year comparability of General Fund revenues.

In addition to these revenues, the General Fund also received approximately $1.5 million in interfund transfers and other financing sources, bringing the actual revenues to $27,724,461 exceeding the final amended budget by $0.8 million.

EXPENDITURES
The Citywide expenditures, excluding transfers, in Fiscal Year 2021-22 was $33,436,651.

Approximately 73%, or $ 24,388,425, of the expenditures is attributable to the General Fund, 15%, or $5,006,323, to the Sewer Enterprise Fund, 5%, or $1,765,409, to the Internal Services Funds and the remainder, $2,276,494, to Other Government Funds.

The following chart provides an overview of the Citywide expenditures.

The fiscal year 2021-22 General Fund actual expenditures, including transfers of approximately $2.3 million, totaled $26,642,064. That is approximately $1.0 million below the final amended budgeted expenditures of $27,606,984. Much of the variance to budget is related to salary and Sewer
Enterprise Fund
$5,006,323
Internal
Services Fund
$1,765,409
Other Government
Funds
General Fund $2,276,494
$24,388,425

CITYWIDE EXPENDITURES

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benefits for unfilled positions. The City has experienced some staffing shortages due to the challenging job market experienced during the fiscal period.

The actual General Fund expenditures increased year-over-year by $2.8 million. As the City reopened to public during fiscal year 2021-22 and services started to return to the pre-pandemic levels, there was an increase in City’s activities and projects.

As revenues affected by COVID-19 rebounded in fiscal 2021-22 and the City’s 1% Sales Tax, as well as the new Measure I Sales Tax, came in stronger than expected, the City amended the initial adopted expenditure budget, strategically increasing certain expenditures. An additional $1.3 million was allocated for one-time transfers to the Internal Service Funds to strengthen reserves for funding City’s vehicle fleet, risk management, informational technology and facilities.

The City also increased funding for capital improvement projects – both newly approved by City Council and carried over from the prior period. Overall, the budget increased by $3.5 million over the adopted budget. However, due primarily to the aforementioned staffing challenges, the actual expenditures came in $1.0 million below the amended budget.

Overall, the net change in General Fund balance, or the difference between the actual revenues and expenditures, for fiscal year 2021-22 was $1,082,397. This amount approximates the expenditure budgetary variance and serves as an evidence of management’s continued commitment to a balanced budget. Had the budgeted expenditures been incurred as expected, the revenues of the General Fund would be equal to expenditures.

FUND BALANCE
Fund Balance represents the difference between assets and liabilities in a given fund in the City.

In other words, it is the City’s unrestricted net position in the fund, that can be used to satisfy the government’s ongoing obligations or goals. These funds may be assigned, committed, or used at the direction of the City Council.

The largest and most important fund balance in the City is the General Fund Unassigned Fund Balance. The assets in the General Fund Unassigned Fund Balance allow the City Council to appropriate funds for unforeseen expenses or emergency expenditures and it also provides funding for effective cash management. These items are discussed in detail in the Management’s Discussion and Analysis of the audit documents. The City Council has adopted a policy that the General Fund Unassigned Fund Balance should remain between 30% - 40% of General Fund expenditures. On June 30, 2022, the General Fund Unassigned Fund Balance was $10,489,984 or about 39.4% of the fiscal year 2021-22 General Fund expenditures. This represents an increase of $718,877 when compared to prior fiscal year.

The City Council has also established a policy creating an Economic Uncertainty Fund Balance which is to be used in fiscal emergency situations and is to be 10% of the General Fund expenditures. On June 30, 2022, the Economic Uncertainly Fund Balance was $2,500,000 which is consistent with the policy. Additionally, the City Council has established a Public Works Reserve Fund which is to be utilized only in the event of an emergency requiring funds to provide for public

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safety, minimum levels of circulation or other authorized emergency situations. The Fund Balance Policy requires a minimum of $1,000,000 and, as of June 30, 2022, the Public Works Reserve balance was $1,300,000 and in compliance with the policy. Other fund balances on June 30, 2022 include the Public Works Strategic Capital Reserve, with a balance of $254,482, community benefit funding of $144,195, $22,434 for public access use (PEG), and $1,000,000 for Section 115 Trust to address pension liability. Additionally, $115,308 is assigned for Public Works projects in progress as of June 30, 2022.

As mentioned, the General Fund Unassigned Fund balance is about 39.4% of the FY 2021-22 General Fund expenditures. This is at the high level set forth by City Council policy and creates an opportunity for the City to strengthen important reserves, such as the Public Works Strategic Capital Reserve which was depleted in fiscal 2021-22 in order to fund a number of vital new capital projects. Additionally, it can be used to increase the reserves for the Technology and Communication Internal Service Fund, and Facilities Maintenance Fund. These actions can continue to provide financial stability and allow the City to prepare for future needs and to respond to any unanticipated changes in revenue.

To accomplish this, Staff is requesting to reallocate/transfer $700,000 of the General Fund Unassigned Fund Balance in the following manner:

1. Transfer $250,000 of unassigned fund balance to the Public Works Strategic Capital Reserve (Fund 101). This fund has recently experienced a decline in its balance due to the funding of several recent, unplanned capital projects. The proposed transfer would increase this reserve balance to approximately $500,000 and allow a funding mechanism for future unanticipated capital projects.

2. Transfer $250,000 of unassigned fund balance to the Technology and Communication Fund (Fund 503). The fund balance of the Technology Fund on June 30, 2022 is $21,110.

This is a result of unforeseen expenditures over multiple fiscal years as well as not budgeting ample revenues to offset the increasing expenditures. The $250,000 transfer will ensure the availability of funds for unexpected expenditures in future periods as well as be a step towards funding for future technology infrastructure needs and improvements.

3. Transfer $200,000 of unassigned fund balance to the Facilities Repair & Maintenance Fund (Fund 504). The Facilities Fund strives to maintain a minimum $200,000 balance in order to be sure funds are available for unexpected or emergency repairs at City facilities.

Due to unanticipated expenditures resulting from deferred maintenance, the balance in this fund has fallen to $64,107 at June 30, 2022. The transfer will bring the reserve back to the desired level as well as provide funds for future unforeseen facility repairs and maintenance.

Other Funds
The City has several other funds that are included in the annual audit. These funds are discussed in detail in the Management’s Discussion and Analysis of the audit documents, but in summary, they include:

Sewer Enterprise Fund – The Sewer Enterprise Fund is the only business type activity operated by the City of Imperial Beach. On June 30, 2022, the Sewer Enterprise Fund had a net position of $12,744,724, of which $3,651,210 is unrestricted.

Miscellaneous Grant Fund – The fund is used for reporting various types of grants awarded to the City. This includes, but is not limited, to COVID-19 relief grants. The June 30, 2022 balance in the fund was $211,245 and restricted for Parks and Recreation.

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Gas Taxes Fund Balance – The City receives revenue from gas taxes (Gas Tax, RMRA and Proposition A, or Transnet) that are restricted in use. Combined, the balances in these funds on June 30, 2022 was $806,023.

Supplemental Law Enforcement Fund (SLEF) – Funds received from the State of California and used to supplement existing resources for “front line law enforcement services”. The balance in this fund on June 30, 2022 was $49,989.

Park Maintenance Fund – Funds restricted for maintenance of the City’s parks had a balance of $342,258 on June 30, 2022.

Internal Services Funds – There are four funds that have been created to provide services to the City including the Vehicle Replacement and Maintenance Fund with a June 30, 2022, unrestricted balance of $959,168, the Risk Management Fund with a balance of $755,864, the Technology and Communication Fund with a balance of $21,110, and the Facilities Repair and Maintenance Fund with a balance of $64,107.

Housing Authority – The June 30, 2022, balance in the Housing Authority Fund was $713,123.

GOVERNMENT-WIDE FINANCIAL STATEMENTS
The City’s year-end financial report also contains Government-wide financial statements which combine a majority of the individual funds and are designed to provide a broad overview of the City's finances. They present information using accounting methods similar to those used by private sector companies. This includes reporting of long-term assets, such as equipment and infrastructure, and long-term liabilities, such as debt instruments or pension obligations that are not included in the statements of individual funds. Inclusion of long-term obligations, and unfunded pension obligation in particular, can and for many government agencies do, result in negative unrestricted fund balances (or “net position”) in Government-wide financial statements despite reporting positive unrestricted balances at the fund level.

Such is not the case at the City of Imperial Beach where management has been continuously targeting the threat of runaway pension obligation through pre-funding, strategic outsourcing of services, as well as cost sharing. As such, the City reports a positive unrestricted balance in the Statement of Net Position for both governmental and business-type (sewer) activities. Moreover, there has been a year-over-year increase of approximately $6.6 million in the unrestricted fund balance (net position). This improvement in the net position is almost entirely attributable to the decrease in net pension liability. However, this is temporary, as the decrease is a result of prior years’ strong investment returns experienced by CalPERS. The market has since taken a downward turn and CalPERS has continued to adjust the discount rate, to which the pension liability is highly sensitive, downwards. As a result, the net pension obligation is expected to increase again in fiscal 2022-23. The staff will therefore continue its commitment to making the mitigation of the negative impact of pension obligations on City finances a priority in the future.

AUDIT FINDINGS
Staff is pleased to announce there were no findings for FY 2021-22. Additionally, the independent auditors found no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

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OTHER CITY RELATED FUNDS
The Citywide Audited Financial Statements is inclusive of the separate agencies of the Imperial Beach Redevelopment Successor Agency and the Housing Authority of the City of Imperial Beach. The required Housing Authority Specified Activity report will be posted on the City’s website in accordance with the California Health and Safety Code 34176.1 et. seq.

ENVIRONMENTAL DETERMINATION:

Not a project as defined by CEQA.

FISCAL IMPACT:

Assignment or transfer of Unreserved Fund Balance totaling $700,000 FISCAL YEAR: FY 2022-23
BUDGETED: N

BUDGET AMENDMENT Y
ACCOUNT NO(S).: 101-0000-253.0800 – Public Works Strategic $ 250,000 101-0000-253.0000 – Unassigned Fund Balance $ 250,000
101-1920-419.9003 – Transfer Out $ 450,000
503-0000-391.9001 – Transfer In $ 250,000
504-0000-391.9001 – Transfer In $ 200,000
PROJECT NO(S).: N/A
FISCAL ANALYSIS: Transfer and reassignment of Fund Balance will maintain the General Fund Unrestricted Fund Balance in compliance with the policy adopted by City Council.

CURRENT BUDGET: N/A

ANTICIPATED
EXPENDITURE:

N/A
ATTACHMENTS:

ATT 1 – FY22 Audited Financial Statements
ATT 2 – FY22 Housing Asset Audit Report
ATT 3 –Housing Successor Specified Activity Report
ATT 4 – Resolution 2022-101

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FINANCIAL STATEMENTS
City of Imperial Beach, California

FISCAL YEAR ENDED
JUNE 30, 2022
ATTACHMENT 1

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CITY OF IMPERIAL BEACH, CALIFORNIA

FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2022

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City of Imperial Beach
Financial Statements
For the Fiscal Year Ended
June 30, 2022

TABLE OF CONTENTS
Page
Number
INDEPENDENT AUDITOR’S REPORT ................................................................................. 1 MANAGEMENT’S DISCUSSION AND ANALYSIS ............................................................... 4

BASIC FINANCIAL STATEMENTS
Government-Wide Financial Statements
Statement of Net Position ........................................................................................ 11 Statement of Activities ............................................................................................. 12 Fund Financial Statements
Balance Sheet – Governmental Funds .................................................................... 14 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position .............................................................................. 15 Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds ............................................................................................... 16 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities ..................... 17 Statement of Net Position – Proprietary Funds ........................................................ 18 Statement of Revenues, Expenses and Changes in Net Position – Proprietary Funds .................................................................................................... 19 Statement of Cash Flows – Proprietary Funds ......................................................... 20 Statement of Fiduciary Net Position – Fiduciary Funds ............................................ 21 Statement of Changes in Fiduciary Net Position – Fiduciary Funds ......................... 22 Notes to Financial Statements ........................................................................................ 23

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City of Imperial Beach
Financial Statements
For the Fiscal Year Ended
June 30, 2022

TABLE OF CONTENTS
Page
Number

REQUIRED SUPPLEMENTARY INFORMATION
Schedule of Proportionate Share of the Net Pension Liability And Related Ratios as of the Measurement Date ....................................................... 73 Schedule of Plan Contributions ...................................................................................... 74 Schedule of Changes in the Total OPEB Liability and Related Ratios ........................... 75 Budgetary Comparison Schedule by Department
General Fund .......................................................................................................... 76 Notes to Required Supplementary Information .............................................................. 77 Budgetary Comparison Schedule
Miscellaneous Grants Fund ..................................................................................... 79

COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES
Combining Balance Sheet – Nonmajor Governmental Funds ........................................ 80 Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Nonmajor Governmental Funds ......................................................... 83 Budgetary Comparison Schedules – Special Revenue Funds
Gas Tax ................................................................................................................... 86 Prop A Tax .............................................................................................................. 87 CDBG Grant ............................................................................................................ 88 Supplemental Law Enforcement .............................................................................. 89 RMRA ...................................................................................................................... 90 Budgetary Comparison Schedules – Capital Projects Funds Parks Maintenance CIP ............................................................................................ 91 Capital Projects ........................................................................................................ 92 Combining Statement of Net Position – Internal Service Funds ..................................... 93 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position – Internal Service Funds ................................................................................................ 94

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City of Imperial Beach
Financial Statements
For the Fiscal Year Ended
June 30, 2022

TABLE OF CONTENTS
Page
Number
Combining Statement of Cash Flows – Internal Service Funds ..................................... 95 Combining Statement of Fiduciary Net Position – All Custodial Funds .......................... 96 Combining Statement of Changes in Fiduciary Net Position – All Custodial Funds ....... 98

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To the Honorable Mayor and Members of the City Council
City of Imperial Beach, 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 City of Imperial Beach, California (the City), as of and for the year ended June 30, 2022, 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, 2022, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

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. 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.

Responsibilities of Management for the Financial Statements The City’s 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.

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

Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS 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, 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 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.

Emphasis of Matter
As discussed in Note 10 to the financial statements, the City adopted provisions of Governmental Accounting Standards Board Statement No. 87, Leases. Our opinions are not modified with respect to this matter.

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Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the required supplementary information, as listed in the table of contents, be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements.

We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The supplementary information, as listed in the table of contents is presented for purposes of additional analysis and is not a required part of the basic financial statements.

The accompanying supplementary 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. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the accompanying supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated November 7, 2022, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of 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’s internal control over financial reporting and compliance.

San Bernardino, California
November 7, 2022

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Management's Discussion and Analysis
The City of Imperial Beach prepares an annual financial statement to identify the status of the City's financial accounts, investments, assets, and liabilities. The management team (City Manager, Chief Administrative Officer (CAO), and Finance Director) has reviewed in detail the independent audit conducted by an accounting firm not associated with the City and prepared this overview and analysis of financial statements for the fiscal year ended June 30, 2022. The contents of this overview are not a substitute for the more complete analysis found in the financial statements and readers are encouraged to consider this discussion in conjunction with information included in the more comprehensive financial statements.

Financial Highlights
The Citywide fund level revenue recorded for the fiscal year ending June 30, 2022, was $38,693,370 inclusive of the General Fund, Miscellaneous Grant Fund, Other Government Funds, the Internal Services Funds, and the Sewer Enterprise Fund. The Successor Agency to the former Redevelopment Agency revenue is not included in the Citywide revenue because the Successor Agency is considered a separate entity and not technically part of the municipal corporation.

Conversely, the Citywide expenditures and expenses for fiscal year ending on June 30, 2022, were $33,436,651. Internal Services $1,974,922 General Fund $26,243,293 Miscellaneous Grant $2,029,264 Other Government $2,319,550 Sewer $6,126,341
*Excludes transfers
Internal Services $1,765,409 General Fund
$24,388,425 Miscellaneous Grant $1,327,883 Other Government $948,611 Sewer $5,006,323
*Excludes transfers
CITYWIDE REVENUES* CITYWIDE
EXPENDITURES AND EXPENSES*
The fiscal year 2021-2022 General Fund actual expenditures, including transfers, totaled $26,642,064. That is below the budgeted, as amended, expenditures of $27,631,384. Initially, the City Council adopted General Fund budget with revenues and transfers exceeding expenditures by approximately $500,000 to address uncertainties due to the COVID-19 emergency. As the City re-opened to public during the fiscal year and services started to return to the pre-pandemic levels, the budget was amended to address the increase in City’s activities and projects.

When the pandemic struck in the winter of 2020, the City Council immediately adopted a Financial Preparation and Recovery Plan that reduced spending, implemented a "soft" hiring and spending freeze, and deferred spending on maintenance and capital projects. While carefully monitoring incoming revenues, as well as the overall economy, the City started to gradually reverse the pandemic spending freeze in fiscal year 2021-2022. The primary focus was given to the deferred, but urgently needed, maintenance and capital improvements projects, as well as the funding of the newly established recreation department and the hiring of its related positions. As revenues affected by COVID-19 rebounded and the City’s 1% Sales Tax, as well as the new Measure I Sales Tax, came in stronger than expected, the expenditure budget had been increased by $3.5 million over the adopted budget. Approximately $1.3 million of the increase was due to one-time transfers to the Internal Service Funds to strengthen the funds reserves for future needs. Much of the remainder of the increase resulted from capital improvement projects – both newly

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approved by City Council and carried over from the prior period. The fiscal year ended with expenditures $1 million below the final increased budget. Much of the variance is related to salary and benefits for unfilled positions as the City experienced some staffing shortages due to the challenging job market.

The fiscal year 2021-2022 adopted budget for General Fund revenues, including transfers, was $24.8 million. The budget was subsequently increased by $2.0 million primarily due to the growth of Sales Tax and Measure I Sales Tax. Property Tax, as well as Transient Occupancy Tax also finished the year above budget. This revenue growth was partially offset by weaker investment earnings as fair market value accounting adjustments resulted in some unrealized investment losses on June 30, 2022. Overall, General Fund revenues, including other financing sources, totaled $27,724,461, exceeding the amended budget by approximately $0.8 million.

The net change in General Fund balance, or the difference between the actual revenues and expenditures, for fiscal year 2021-2022 was $1,082,397.

Fund Balances
Fund balance represents the difference between assets and liabilities in a City fund. The easiest way to think of fund balance is as a "reserve" or "savings" account for each identified City fund.

Some of these funds have specific City Council policies that dictate their use and others are more flexible in nature. Detailed information about these fund balances can be found on the balance sheet of the Financial Statement.

General Fund Unassigned Fund Balance- The largest and perhaps most important fund balance is the Unassigned Fund Balance of the General Fund. The fund is critical for two reasons. First, this fund allows the City Council to appropriate funds for an unforeseen expense or emergency that was not contemplated when the budget was adopted. Second, the Unassigned Fund Balance of the General Fund is important for cash management. Although expenses are incurred throughout the fiscal year, revenue tends to be received in larger portions at specific times. For instance, the largest revenue source of the City, property tax, is received monthly but much larger payments are received near the end of the calendar year and in the early spring when property taxes for most property owners come due. The Unassigned Fund Balance of the General Fund allows the City to satisfy its obligations prior to receiving revenues, when necessary.

The City Council has adopted a policy that the Unassigned Fund Balance of the General Fund should be maintained between 30% and 40% of the annual General Fund expenditures. The Unassigned Fund Balance as of June 30, 2022, was $10,489,984 or about 39.4% of the fiscal year 2021-2022 General Fund expenditures (including transfers) of $26,642,064. As such, it is towards the high threshold established by the adopted City Council policy. In the next fiscal year, it is anticipated that a portion of the Unassigned Fund Balance will be transferred to increase the Public Works Strategic Capital reserve, to increase reserve for the purchase of new equipment in the Vehicle Replacement Fund, to replenish the Technology and Communication Internal Service Fund, and Facilities Maintenance Fund. These actions will continue to provide financial stability and allow the City to prepare for future needs of the City and to respond to any unanticipated changes in revenue.

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Economic Uncertainty Fund - The City Council has established an Economic Uncertainty Fund that should only be used in fiscal emergency situations. The City Council determined that the Economic Uncertainty Fund should be a minimum of 10% of annual General Fund expenditures.

The Economic Uncertainty Fund was $2,500,000 on June 30, 2022, which is generally consistent with the adopted policy. No transfers out of the reserve were necessary in fiscal year 2021-2022, while City increased the balance in order to remain consistent with the adopted policy.

Public Works Reserve Fund – The City Council has established a Public Works Reserve Fund that is to be utilized only in the event of an emergency requiring funds to provide for public safety, minimum levels of circulation or other authorized emergency situations. The Public Works Reserve Fund, which by resolution should contain a minimum of $1,000,000, had a balance of $1,300,000 on June 30, 2022.

Other General Fund Balances - The City Council has established a reserve in the General Fund that is used to complete capital projects within the City. The Strategic Capital Fund, an assigned fund balance, had a balance of $254,482 on June 30, 2022. Other assigned balances within the General fund include $115,308 for Public Works projects encumbrances, $144,195 of community benefit funding, $22,434 for public access use (PEG), and $1,000,000 for Section 115 Trust.

Other Government Funds - The City receives revenue from other government functions that have restrictions in their use. On June 30, 2022, the Gas Tax Fund Balance was -$665, the Road Maintenance and Rehabilitation Fund (RMRA/SB1) Fund Balance was $627,199, the Supplemental Law Enforcement Fund was $49,989, and the Proposition A (Transnet) Fund Balance was $179,489. The Park Maintenance Fund Balance was $342,258 on June 30, 2022.

The Miscellaneous Grant Fund Balance was $211,245 on June 30, 2022 Internal Service Fund Balances - There are four Internal Service Funds that were created to provide services to the various City departments and are funded from proportional contributions from each of the departments. The total of all Internal Service net position on June 30, 2022 was $2,247,683.

The Vehicle Replacement & Maintenance Fund serves all City departments with the purchase and maintenance of the City's vehicle fleet. On June 30, 2022, the net position was $1,404,895, of which $445,727 is invested in capital assets and $959,168 is unrestricted. In the next fiscal year, staff will be requesting an increase of the net position in the Vehicle Fund to plan for future vehicle and equipment purchases.

The Risk Management (Self-Insurance) Fund was created to address the City's liabilities and special legal services. The Risk Management net position includes the City's liability insurance and the self-insured retention (SIR), or deductible. Funding should be available for at least 5 times the deductible of $100,000, or a minimum of $500,000. Additional funds should also be in place for settling claims, both internal and external. On June 30, 2022, the Risk Management Fund had a net position of $755,864. Staff will continue to maintain the net position of the Risk Management Fund at approximately $750,000 in the next two-year budget cycle.

The Technology & Communication Fund serves all departments with computers, servers, printers, and other technological assistance and maintenance. The Technology net position was $21,110 at the end of the 2022 fiscal year. The City will prioritize increasing the net position in the Technology & Communication Fund to ascertain modern, safe, and accessible information technology infrastructure for its residents and staff.

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The Facilities Repair & Maintenance Fund allows funds to be set aside for building repairs and improvements. On June 30, 2022, the net position of the Facilities Maintenance Fund was $65,814, of which $1,707 is invested in capital assets and $64,107 is unrestricted and can be used for improvements to and maintenance of the various City buildings. In the next fiscal year, staff is proposing to restore the Building Maintenance Reserve to $200,000 to address maintenance needs of aging facilities.

Housing Authority - Created under the authority of the former Redevelopment Agency, the Housing Authority was previously funded through a percentage of tax increment generated by the Redevelopment Agency. Since the dissolution of Redevelopment Agencies, the funding source (tax increment) for the Housing Authority has been eliminated. The Housing Authority ending fund balance on June 30, 2022, was $713,123.

Sewer Fund - The only Enterprise Fund (Business Type Activity) operated by the City is the Wastewater or Sewer Fund. The City Council has directed staff to maintain a net position in the Sewer Fund of approximately $3 million in case of an unanticipated repair or emergency. On June 30, 2022, the Sewer Fund had a net position of $12,744,724, of which $3,651,210 is unrestricted, which complies with the direction provided by the City Council. The remaining $9,093,514 of the net position is investment in capital assets.

Overview of Financial Statements
This section of the Management's Discussion and Analysis is a review of the City's basic financial statements which consist of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) the notes to financial statements. There is also supplementary information intended to furnish additional detail to support the content of the financial statements.

Government-Wide Financial Statements - Government-wide financial statements are designed to provide a broad overview of the City's finances. They present information using accounting methods similar to those used by private sector companies, including the reporting of long-term assets and liabilities. The statement of net position presents financial information on the City's assets, liabilities, and deferred inflows/outflows of resources, with the difference reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating.

The statement of activities indicates how the City's net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).

Both the statement of net position and the statement of activities distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, highways and streets, sanitation, and culture and recreation.

The business-type activities of the City include sewer operations.

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The government-wide financial statements include not only the City Corporation itself (known as the primary government), but also legally separate agencies including the Successor Agency of the former Redevelopment Agency and the Housing Authority. Financial information for these separate units is reported separately from the financial information presented for the primary government itself.

Fund Financial Statements - A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All funds of the City can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds.

Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on nearterm inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. This information is useful in assessing near-term financing requirements.

Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements.

By doing so, readers may better understand the long-term impact of near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.

The City reports two major governmental funds: the General Fund, and the Miscellaneous Grant Fund. For the two funds, the information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances. Data from the other governmental funds are combined into a single aggregated presentation. Individual fund data for each of the non-major governmental funds is provided in the “Combining and Individual Fund Statements and Schedules” section of this report.

The City adopts a bi-annual appropriated budget for its General Fund. A budgetary comparison statement has been provided for the General Fund and the Miscellaneous Grant Fund to demonstrate compliance with this budget.

The City maintains two different types of Proprietary Funds, Enterprise Funds and Internal Service Funds. Enterprise Funds are used to report the same functions presented as businesstype activities in the governmentwide financial statements. The City uses an Enterprise Fund to account for its Sewer operation. Internal Service Funds are an accounting device used to accumulate and allocate costs internally among the City's various functions. The City uses Internal Service Funds to account for the management of its retained risks, for its fleet of vehicles, information technology, and facilities maintenance. Because these services predominantly benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements.

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Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for the Sewer Enterprise Fund and the Internal Services Fund which are considered major funds of the City.

Fiduciary funds are used to account for resources held for the benefit of parties outside of the government. Fiduciary funds are not reported in the government-wide financial statements because the resources of those funds are not available to support the City's own programs. The accounting used for fiduciary funds is much like that used for proprietary funds.

The City maintains two different types of fiduciary funds. The Private-Purpose Trust Fund is used to report resources held in trust for other entities. The Custodial Funds report resources held by the City in a custodial capacity for individuals, private organizations, and other governments. The City current has five Custodial Funds (Special Assessment Districts), and one Private Trust Fund (the Successor Agency of the Former RDA).

Government-wide Overall Financial Analysis
Net position over time, may serve as a useful indicator of a government's financial position. On June 30, 2022, total assets and deferred outflows of resources exceeded total liabilities and deferred inflows by $86,190,272. That represents an increase of $6,610,254 from $79,580,018 on June 30, 2021. The large increase is primarily due to a decrease in net pension liability of approximately $7.2 million. This decrease is a result of prior years’ strong investment results and is temporary as the market has since taken a downward turn. Moreover, CalPERS continues to adjust discount rate downwards to which the pension liability is highly sensitive.

Primary Government - Net Position
Governmental Business-Type
Activities Activities Total
Current and other assets $29,357,337 $4,019,980 $33,377,317 Capital assets, net 56,650,709 9,093,514 65,744,223
Intangible assets, net 114,827 - 114,827
Total Assets 86,122,873 13,113,494 99,236,367
Deferred Outflows of Resources 5,354,322 121,565 5,475,887 Total Liabilities (13,726,814) (392,598) (14,119,412)
Deferred Inflows of Resources (4,304,833) (97,737) (4,402,570) Total Net Position $73,445,548 $12,744,724 $86,190,272
The City's combined net position is $86,190,272 which reflects restricted and unrestricted funds, as well as investment in capital assets (e.g., land, buildings, machinery, equipment, vehicles, and infrastructure), less any related outstanding debt that was used to acquire those assets. The City uses these capital assets to provide a variety of services to its citizens. Accordingly, these assets are not available for future spending.

At the end of the 2021-2022 fiscal year, the City maintained positive balances in all reported categories of net position, both for the government as a whole and the separate governmental and business-type activities.

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Financial Analysis of Governmental Funds
City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. The purpose of the City's governmental funds is to provide information on nearterm inflows, outflows, and balances of spendable resources. This information is valuable in assessing the City's financing requirements. Unassigned Fund Balance may serve as a useful measure of net resources available for discretionary use as they represent the portion of fund balance which has not been appropriated for a specific purpose by either an external party, the City itself, or a group or individual that has been delegated authority to assign resources for specific purposes by the City Council.

The City's governmental funds reported combined fund balances of $18,794,563. Of this amount, $10,489,319 constitutes Unassigned Fund Balance, which is available for spending at the discretion of the City Council. The remaining $8,305,244 is either restricted, committed, or assigned. The Unrestricted Net Position of the Business-Type Fund, or the Sewer Enterprise Fund, was $3,651,210 on June 30, 2022.

Capital Assets and Debt Administration
The City's net investment in capital assets for its governmental and business-type activities amounts to $65,742,674 (net of accumulated depreciation). This investment in capital assets includes land, buildings, machinery, equipment, vehicles, park facilities, roads, highways, bridges, and the wastewater or sewer system. See note 4 for additional information.

On June 30, 2022, the City’s long-term obligations consisted of $798,362 principal outstanding on Transnet Commercial Paper borrowing and $116,376 of lease liability for printing equipment.

See note 10 for additional information.

The City's Unfunded Accrued Liability in the California Public Employees Retirement System (CalPERS) as of June 30, 2022 consisted of an obligation to pay $2,277,672 for net pension liability and $2,025,106 in other post-retirement benefits.

The City also has an obligation of $1,111,312 for compensated absences (vacation and sick leave) for the existing employees. The City must retain enough funding to pay off these absences as if every employee were to leave employment at the same time.

Summary
The comments herein represent an explanation and a narrative for the contents of the City's financial statements. This report was not intended to be a replacement for the contents of the financial statements and if there is any discrepancy between the two documents it is unintentional, and the contents of the financial statements are presumed to supersede the contents of this report.

This financial report provides a general overview of the City's financial documents for all those with an interest in the government's fiscal health. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to Joann M. Gitmed, Finance Director, City of Imperial Beach, Finance Department, 825 Imperial Beach Blvd., Imperial Beach, CA 91932.

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City of Imperial Beach
Statement of Net Position
June 30, 2022
See Notes to Financial Statements
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Governmental Business-Type
Activities Activities Total
Assets:

Cash and investments 24,944,643 $ 4,842,222 $ 29,786,865 $ Receivables:

Accounts 775,295 - 775,295 Accrued interest 28,223 - 28,223 Internal balances 972,433 (972,433) - Prepaid costs 137,277 - 137,277 Due from other governments 2,499,466 150,191 2,649,657 Capital assets, not being depreciated 15,920,223 426,861 16,347,084 Capital assets, net of depreciation 40,730,486 8,666,653 49,397,139 Intangible right to use asset, net of amortization 114,827 - 114,827 Total Assets 86,122,873 13,113,494 99,236,367 Deferred Outflows of Resources:

Deferred pension related items 4,311,212 97,882 4,409,094 Deferred OPEB related items 1,043,110 23,683 1,066,793 Total Deferred Outflows of Resources 5,354,322 121,565 5,475,887 Liabilities:

Accounts payable 2,178,029 236,602 2,414,631
Accrued liabilities 199,589 21,454 221,043 Unearned revenue 3,309,066 - 3,309,066 Deposits payable 1,145,844 - 1,145,844 Compensated absences due in one year 679,014 39,021 718,035 Claims payable due in one year 123,000 - 123,000 Long-term liabilities due in one year 328,102 - 328,102 Noncurrent liabilities:

Compensated absences due in more than one year 393,277 - 393,277 Claims payable due in more than one year 577,000 - 577,000 Long-term liabilities due in more than one year 586,636 - 586,636 Net Pension Liability 2,227,108 50,564 2,277,672 Total OPEB liability 1,980,149 44,957 2,025,106 Total Liabilities 13,726,814 392,598 14,119,412 Deferred Inflows of Resources:

Deferred pension related items 3,862,791 87,701 3,950,492 Deferred OPEB related items 442,042 10,036 452,078 Total Deferred Inflows of Resources 4,304,833 97,737 4,402,570 Net Position:

Investment in capital assets 56,649,160 9,093,514 65,742,674 Restricted for:

Community development 713,123 - 713,123 Public safety 49,989 - 49,989 Parks and recreation 553,503 - 553,503 Public works 1,544,244 - 1,544,244 Unrestricted 13,935,529 3,651,210 17,586,739 Total Net Position 73,445,548 $ 12,744,724 $ 86,190,272 $

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City of Imperial Beach
Statement of Activities
Year Ended June 30, 2022
See Notes to Financial Statements
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Program Revenues
Operating Capital
Charges for Contributions Contributions
Expenses Services and Grants and Grants
Functions/Programs
Primary Government:

Governmental Activities:

General government 6,476,001 $ 500,955 $ 99,601 $ - $
Public safety 10,802,947 301,900 5,467,335 - Community development 166 619,566 - - Parks, recreation and senior center 1,961,009 39,051 - - Public works 4,454,317 460,758 2,349,679 2,022,727 Interest on long-term liabilities 9,972 - - - Total Governmental Activities 23,704,412 1,922,230 7,916,615 2,022,727 Business-Type Activities:

Sewer 4,997,924 6,217,535 - - Total Business-Type Activities 4,997,924 6,217,535 - - Total Primary Government 28,702,336 $ 8,139,765 $ 7,916,615 $ 2,022,727 $ General Revenues:

Taxes:

Property taxes, levied for general purpose
Transient occupancy taxes
Sales taxes
Franchise taxes
Business licenses taxes
Motor vehicle in lieu - unrestricted
Use of money and property
Other
Transfers in (out)
Total General Revenues
Change in Net Position
Net Position at Beginning of Year
Restatement of Net Position
Net Position at Beginning of Year, as restated
Net Position at End of Year

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See Notes to Financial Statements
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Net (Expenses) Revenues and
Changes in Net Position
Primary Government
Governmental Business-Type
Activities Activities Total
$ - (5,875,445) $ (5,875,445) $
- (5,033,712) (5,033,712)
- 619,400 619,400
- (1,921,958) (1,921,958)
- 378,847 378,847
- (9,972) (9,972)
- (11,842,840) (11,842,840)
1,219,611 - 1,219,611
1,219,611 - 1,219,611
1,219,611 (11,842,840) (10,623,229) 6,779,578 - 6,779,578 1,353,140 - 1,353,140 7,523,483 - 7,523,483
2,266,242 - 2,266,242
377,130 - 377,130 32,086 - 32,086
(91,194) (4,228) (95,422) 634,827 - 634,827
20,518 (20,518) -
(70,676) 18,941,740 18,871,064
1,148,935 7,098,900 8,247,835
12,138,080 67,441,938 79,580,018
(542,291) (1,095,290) (1,637,581)
11,595,789 66,346,648 77,942,437 $ 12,744,724 73,445,548 $ 86,190,272 $

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City of Imperial Beach
Balance Sheet
Governmental Funds
June 30, 2022
See Notes to Financial Statements
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Special
Revenue Fund Other Total
Miscellaneous Governmental Governmental
General Grant Funds Funds
Assets:

Pooled cash and investments 17,516,305 $ 2,004,446 $ 2,775,734 $ 22,296,485 $ Receivables:

Accounts 775,295 - - 775,295 Accrued interest 28,223 - - 28,223 Prepaid costs 107,966 - - 107,966 Due from other governments 2,235,266 61,620 172,974 2,469,860 Due from other funds 50,294 - - 50,294 Total Assets 20,713,349 $ 2,066,066 $ 2,948,708 $ 25,728,123 $ Liabilities, Deferred Inflows of Resources,
and Fund Balances:

Liabilities:

Accounts payable 1,909,840 $ 62,005 $ 99,465 $ 2,071,310 $ Accrued liabilities 183,073 - - 183,073 Unearned revenues 1,366,250 1,792,816 150,000 3,309,066 Deposits payable 1,145,844 - - 1,145,844 Due to other funds - - 50,294 50,294 Total Liabilities 4,605,007 1,854,821 299,759 6,759,587 Deferred Inflows of Resources:

Unavailable revenues 173,973 - - 173,973 Total Deferred Inflows of Resources 173,973 - - 173,973 Fund Balances:

Nonspendable:

Prepaid costs 107,966 - - 107,966 Restricted for:

Community development projects - - 713,123 713,123 Public safety - - 49,989 49,989 Parks, recreation and senior center - 211,245 342,258 553,503 Public works - - 1,544,244 1,544,244 Committed to:

Economic uncertainty reserve 2,500,000 - - 2,500,000
Public works 1,300,000 - - 1,300,000
Assigned to:

Public works strategic capital reserve 254,482 - - 254,482 Public works projects 115,308 - - 115,308 Community benefit 144,195 - - 144,195
PEG 22,434 - - 22,434 Section 115 1,000,000 - - 1,000,000 Unassigned (deficit) - 10,489,984 (665) 10,489,319 Total Fund Balances 15,934,369 211,245 2,648,949 18,794,563 Total Liabilities, Deferred Inflows of Resources,
and Fund Balances 20,713,349 $ 2,066,066 $ 2,948,708 $ 25,728,123 $

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City of Imperial Beach
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position
June 30, 2022
See Notes to Financial Statements
-15-
Fund balances of governmental funds 18,794,563 $
Amounts reported for governmental activities in the statement of net position are different because:

Capital and intangible right to use assets have not been included as financial resources in governmental fund activity (excludes internal service funds).

Capital assets net of depreciation 56,203,275
Intangible right to use assets net of amortization 114,827 Compensated absences, long term liabilities, net pension liability, and total OPEB liability that have not been included in the governmental fund activity (excludes internal service funds):

Compensated absences (1,050,706) Long term liabilities (914,738) Net pension liability (2,183,377) Total OPEB liability (1,941,267)
Deferred inflows and outflows of resources related to pension and OPEB that have not been included in the government fund activity (excludes internal service funds):

Deferred outflows of resources - pension related 4,226,558 Deferred outflows of resources - OPEB related 1,022,627 Deferred inflows of resources - pension related (3,786,941) Deferred inflows of resources - OPEB related (433,362) Revenues reported as unavailable revenue in the governmental funds and recognized in the statement of activities. These are included in the intergovernmental revenues in the governmental fund activity. 173,973 Internal service funds are used by management to charge the costs of certain activities, such as equipment management and self-insurance, to individual funds. The assets and liabilities of the internal service funds must be added to the statement of net position. This also includes the portion reflected in the Sewer Enterprise Fund. 3,220,116 Net Position of Governmental Activities 73,445,548 $

Page 185 of 296 ends

City of Imperial Beach
Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds
Year Ended June 30, 2022
See Notes to Financial Statements
-16-
Special
Revenue Fund
Other Total
Miscellaneous Governmental Governmental
General Grant Funds Funds
Revenues:

Taxes 17,922,444 $ - $ - $ 17,922,444 $
Licenses and permits 788,075 - - 788,075
Intergovernmental 497,624 2,038,701 2,231,318 4,767,643 Charges for services 6,300,535 - 68,951 6,369,486 Use of money and property 46,311 (9,437) 10,289 47,163 Fines and forfeitures 239,492 - - 239,492 Miscellaneous 448,812 - 8,992 457,804 Total Revenues 26,243,293 2,029,264 2,319,550 30,592,107 Expenditures:

Current:

General government 6,232,045 639,975 - 6,872,020 Public safety 13,458,006 - 160,023 13,618,029 Community development - - 166 166 Parks, recreation and senior center 1,819,018 2,576 - 1,821,594 Public works 2,465,587 316,166 129,578 2,911,331 Debt Service
Principal 29,767 - 296,928 326,695
Interest 1,614 - 8,358 9,972 Capital outlay 382,388 369,166 353,558 1,105,112 Total Expenditures 24,388,425 1,327,883 948,611 26,664,919 Excess (Deficiency of Revenues Over (Under) Expenditures 1,854,868 701,381 1,370,939 3,927,188 Other Financing Sources (Uses):

Lease acquisition 146,143 - - 146,143 Transfers in 1,335,025 - 1,145,518 2,480,543 Transfer out (2,253,639) (490,136) (895,117) (3,638,892) Total Other Financing Sources (Uses) (772,471) (490,136) 250,401 (1,012,206) Net Change in Fund Balances 1,082,397 211,245 1,621,340 2,914,982 Fund Balances at Beginning of Year 14,851,972 - 1,027,609 15,879,581 Fund Balances at End of Year 15,934,369 $ 211,245 $ 2,648,949 $ 18,794,563 $

Page 186 of 296 ends

City of Imperial Beach
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities Year Ended June 30, 2022
See Notes to Financial Statements
-17-
Net change in fund balances - total governmental funds 2,914,982 $ Amounts reported for governmental activities in the statement of net position are different because:

Governmental funds report capital outlays as expenditures. However, in the statement of activities, the costs of those assets is allocated over their estimated useful lives as depreciation expense. This is the amount by which capital outlays exceeded depreciation in the current period.

Capital outlay 313,544 $
Depreciation (2,196,979) Amortization (31,316) (1,914,751) Compensated absences expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. (350) The issuance of long term liabilities provides current financial resources to governmental funds, while the repayment of the principal of the principal of long term liabilities consumes current financial resources. These amounts are the net effect of the difference in treatment of long term liabilities and related items in the statement of activities.

Commercial paper 296,928 Lease liability 29,767 326,695 Pension revenue reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as revenue in governmental funds. 4,511,405 OPEB obligation expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. (174,627) Revenues reported as unavailable revenue in the governmental funds and recognized in the statement of activities. These are included in the intergovernmental revenues in the governmental fund activity. 96,601
Internal service funds are used by management to charge the costs of certain activities, such as equipment management and self-insurance, to individual funds.

The net revenues (expenses) of the internal service funds is reported with governmental activities. 1,338,945 Change in Net Position of Governmental Activities 7,098,900 $

Page 187 of 296 ends

City of Imperial Beach
Statement of Net Position
Proprietary Funds
June 30, 2022
See Notes to Financial Statements
-18-
Enterprise Governmental
Fund Activities
Internal
Sewer Service Funds
Assets:

Current:

Cash and investments 4,842,222 $ 2,648,158 $
Prepaid costs - 29,311 Due from other governments 150,191 29,606 Total Current Assets 4,992,413 2,707,075 Noncurrent:

Capital assets, not being depreciated 426,861 - Capital assets, net of depreciation 8,666,653 447,434 Total Noncurrent Assets 9,093,514 447,434 Total Assets 14,085,927 3,154,509 Deferred Outflows of Resources:

Deferred pension related items 97,882 84,654 Deferred OPEB related items 23,683 20,483 Total Deferred Outflows of Resources 121,565 105,137 Liabilities:

Current:

Accounts payable 236,602 106,719
Accrued liabilities 21,454 16,516 Compensated absences due in one year 39,021 19,465 Claims and judgments due in one year - 123,000 Total Current Liabilities 297,077 265,700 Noncurrent:

Compensated absences due in more than one year - 2,120 Claims and judgments due in more than one year - 577,000 Net pension liability 50,564 43,731 Total OPEB liability 44,957 38,882 Total Noncurrent Liabilities 95,521 661,733 Total Liabilities 392,598 927,433 Deferred Inflows of Resources:

Deferred pension related items 87,701 75,850 Deferred OPEB related items 10,036 8,680 Total Deferred Inflows of Resources 97,737 84,530 Net Position:

Investment in capital assets 9,093,514 447,434 Unrestricted 4,623,643 1,800,249 Total Net Position 13,717,157 $ 2,247,683 $ Reconciliation of Net Position to the
Statement of Net Position
Net Position per Statement of Net Position - Proprietary Funds 13,717,157 $ Prior years' accumulated adjustment to reflect the consolidation of internal service funds activities related to the enterprise funds (980,832) Current years' adjustments to reflect the consolidation of internal service activities related to enterprise funds 8,399 Net Position per Statement of Net Position 12,744,724 $

Page 188 of 296 ends

City of Imperial Beach
Statement of Revenues, Expenses, and Changes in Net Position Proprietary Funds
Year Ended June 30, 2022
See Notes to Financial Statements
-19-
Business-Type
Activities Governmental
Enterprise Fund Activities
Internal
Sewer Service Funds
Operating Revenues:

Sales and service charges 6,217,535 $ 1,839,800 $
Miscellaneous - 186,513 Total Operating Revenues 6,217,535 2,026,313 Operating Expenses:

Source of supply 4,187,886 - Services and supplies 1,839 999,030 Claims expense - 260,083 Personnel and administrative 522,285 332,678
Depreciation expense 294,313 173,618
Total Operating Expenses 5,006,323 1,765,409 Operating Income 1,211,212 260,904 Nonoperating Revenues (Expenses):

Investment loss (91,194) (51,391) Total Nonoperating Revenues (Expenses) (91,194) (51,391) Income Before Transfers 1,120,018 209,513 Transfers in 20,518 1,137,831 Total Transfers 20,518 1,137,831 Change in Net Position 1,140,536 1,347,344
Net Position:

Beginning of Year, as Restated 12,576,621 900,339 End of Fiscal Year 13,717,157 $ 2,247,683 $ Reconciliation of Changes in Net Position to
the Statement of Activities:

Changes in Net Position, per the Statement of Revenues, Expenses and Changes in Net Position - Proprietary Funds 1,140,536 $ Adjustment to reflect the consolidation of current fiscal year internal service funds activities related to enterprise funds 8,399 Changes in Net Position of Business-Type Activities per Statement of Activities 1,148,935 $

Page 189 of 296 ends

City of Imperial Beach
Statement of Cash Flows
Proprietary Funds
Year Ended June 30, 2022
See Notes to Financial Statements
-20-
Business-Type
Activities Governmental
Enterprise Fund Activities
Internal
Sewer Service Funds
Cash Flows from Operating Activities:

Cash received from customers and users 6,200,649 $ - $
Cash received from/(paid to) interfund service provided - 2,026,369 Cash paid to suppliers for goods and services (3,975,507) (1,412,589) Cash paid to employees for services (605,331) (414,161) Net Cash Provided by Operating Activities 1,619,811 199,619 Cash Flows from Non-Capital Financing Activities:

Transfers from other funds 20,518 1,137,831 Amounts received from other funds - (347,158) Net Cash Provided by Non-Capital Financing Activities 20,518 790,673 Cash Flows from Capital and Related Financing Activities:

Acquisition and construction of capital assets (229,097) (64,067) Net Cash Used by Capital and Related Financing Activities (229,097) (64,067) Cash Flows from Investing Activities:

Investment loss (91,194) (51,391)
Net Cash Used by Investing Activities (91,194) (51,391) Net Increase in Cash and Cash Equivalents 1,320,038 874,834 Cash and Cash Equivalents, Beginning of Year 3,522,184 1,773,324 Cash and Cash Equivalents, End of Year 4,842,222 $ 2,648,158 $ Reconciliation of Operating Income to Net Cash
Provided (Used) by Operating Activities:

Operating income 1,211,212 $ 260,904 $
Adjustments to Reconcile Operating Income to Net Cash
Provided (Used) by Operating Activities:

Depreciation 294,313 173,618 (Increase) decrease in accounts receivable 809 - (Increase) decrease in prepaid costs 376 23,898 (Increase) decrease in due from other governments (17,695) 56 (Increase) decrease in deferred pension related items 32,049 27,719 (Increase) decrease in deferred OPEB related items 2,490 2,152 Increase (decrease) in accounts payable 213,842 (85,374) Increase (decrease) in accrued liabilities 3,579 5,053
Increase (decrease) in compensated absences 13,809 326
Increase (decrease) in claims and judgments - (92,000)
Increase (decrease) in net pension liability (160,446) (138,764) Increase (decrease) in total OPEB liability (8,482) (7,336) Increase (decrease) in deferred inflows - pension 23,919 20,687 Increase (decrease) in deferred OPEB - pension 10,036 8,680 Total Adjustments 408,599 (61,285) Net Cash Provided (Used) by Operating Activities 1,619,811 $ 199,619 $

Page 190 of 296 ends

City of Imperial Beach
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2022
See Notes to Financial Statements
-21-
PrivatePurpose Trust
Fund
Successor
Custodial Agency to the
Funds Former RDA
Assets:

Pooled cash and investments 445,038 $ 1,019,177 $
Land held for resale - 5,760,000 Deferred charges - loss on bond refunding - 306,358 Due from other governments - 60,117 Restricted assets:

Cash and investments with fiscal agents - 68,764
Total Assets 445,038 7,214,416 Liabilities:

Accounts payable - 976 Accrued liabilities - 6,888 Accrued interest - 85,267 Deferred charges - gain on bond refunding - 6,415 Long-term liabilities:

Due in one year - 885,000 Due in more than one year - 28,667,018 Total Liabilities - 29,651,564 Net Position (Deficit):

Held in trust for other purposes 445,038 (22,437,148) Total Net Position 445,038 $ (22,437,148) $

Page 191 of 296 ends

City of Imperial Beach
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
Year Ended June 30, 2022
See Notes to Financial Statements
-22-
PrivatePurpose Trust
Fund
Successor
Custodial Agency to the
Funds Former RDA
Additions:

Taxes - $ 2,251,387 $
Interest and change in fair value of investments - (18,608) Miscellaneous 4,940 60,117 Total Additions 4,940 2,292,896 Deductions:

Administrative expenses - 207,979 Contractual services - 136,495 Interest expense - 800,387
Bond issuance cost - 246,578
Total Deductions - 1,391,439 Changes in Net Position 4,940 901,457 Net Position (Deficit) at Beginning of Year 440,098 (23,338,605) Net Position (Deficit) at End of Year 445,038 $ (22,437,148) $

Page 192 of 296 ends

City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-23-
I. SIGNIFICANT ACCOUNTING POLICIES
Note 1: Summary of Significant Accounting Policies
a. Description of the Reporting Entity
The City of Imperial Beach, California (the City), was incorporated July 18, 1956, and operates as a General Law City. The City operates under a Council/Manager form of government and provides the following services: general government, fire, highways and streets, planning and zoning, and public improvements. Police services are contracted through the County of San Diego Sheriff’s Department.

The City is not subject to federal or state income taxes.

As required by generally accepted accounting principles, these financial statements present the City (the primary government) and its component units.

The component units discussed below are included in the City's reporting entity because of the significance of their operational or financial relationship with the City. These entities are legally separate from each other. However, the City's elected officials have a continuing full or partial 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 exclusions 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 units' balances and transactions are reported in a manner similar to the balances and transactions of the City. Component units are presented on a blended basis when the component unit's governing body is substantially the same as the City's or the component unit provides services almost entirely to the City. A description of these component units and the method of incorporating their financial information in the accompanying financial statements are summarized as follows:

Blended Component Units
Imperial Beach Public Financing Authority
The Imperial Beach Public Financing Authority was established on November 20, 2003, by a joint exercise of powers agreement between the City of Imperial Beach and the former Imperial Beach Redevelopment Agency pursuant to the Community Redevelopment Law (commencing with Section 33000) of the Health and Safety Code of the State of California. Separate financial statements are not prepared for the Authority.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-24-
Note 1: Summary of Significant Accounting Policies (Continued) Imperial Beach Housing Authority
The Imperial Beach Housing Authority was established on January 14, 2011, by Council resolution to transact business and exercise powers in the City of Imperial Beach and to accept any appropriate funds from the former Imperial Beach Redevelopment Agency. The Authority also acts as the Housing Successor Agency. Separate financial statements are not prepared for the Authority. b. Government-Wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the nonfiduciary activities of the primary government and its blended component units. All fiduciary activities are reported only in the fund financial statements. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support.

The statement of activities demonstrates the degree to which the direct expenses of a given function or segment, are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include: 1) charges to customers or applicants who purchase, use or directly benefit from goods, services or privileges provided by a given function or segment, and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues.

Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. The fund financial statements provide information about the government's funds, including its fiduciary funds and blended component units.

Separate statements for each fund category - governmental, proprietary, and fiduciary - are presented.

Page 194 of 296 ends

City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-25-
Note 1: Summary of Significant Accounting Policies (Continued) c. Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.

Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting.

Revenues are recognized as soon as they are both measurable and available.

Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period.

For this purpose, the government considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as 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. Agency funds are purely custodial (assets equal liabilities) and thus do not involve measurement of results of operations. The private-purpose trust funds are reported using the economic resources management focus and the full accrual basis of accounting.

Property taxes, franchise taxes, licenses and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the government.

All proprietary funds are accounted for using the flow of economic resources measurement focus and the accrual basis of accounting. Their revenues are recognized when they are earned and become measurable; expenses are recognized when they are incurred. Unbilled service receivables are recorded as accounts receivable and as revenue when earned.

Page 195 of 296 ends

City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-26-
Note 1: Summary of Significant Accounting Policies (Continued) The City reports the following major governmental funds:
 The General Fund is the City's primary operating fund. It accounts for all financial resources of the general government except those required to be accounted for in another fund.
 The Miscellaneous Grants Fund is used for reporting of various types of grants awarded to the City. This includes, but is not limited, to COVID-19 relief grants.

The City reports the following major proprietary fund:
 The Sewer Fund is an Enterprise Fund that accounts for the revenues and expenses associated with providing wastewater treatment services to residents of the City.

Additionally, the City reports the following fund types:
 Special Revenue Funds are used to account for the proceeds of specific revenue sources that are legally restricted or committed to expenditures for specified purposes.
 The Capital Projects Funds account for tracking the financial resources used to acquire and/or construct a major capital asset.
 Internal Service Funds account for the financing of goods or services related to repair, replacement and maintenance of City-owned equipment, the City's selfinsurance programs, the City's general information systems and telecommunications hardware, software and the repair, replacement and maintenance of City-owned facilities. These services are provided to other departments or agencies of the City on a cost reimbursement basis.  The Private Purpose Trust Fund accounts for the assets and liabilities of the former redevelopment agency and is allocated revenue to pay estimated installment payments of enforceable obligations until obligations of the former redevelopment agency are paid in full and assets have been liquidated.  Custodial Funds are used to report resources held by the City in a purely custodial capacity, which involves only the receipt, temporary investment and remittance of fiduciary resources to individuals, private organizations or other governments. They do not involve measurement of results of operations. The City's custodial funds account for its special assessment districts.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-27-
Note 1: Summary of Significant Accounting Policies (Continued) As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this general rule are charges between the government's proprietary funds function and various other functions of the government. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned.

Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the Enterprise Funds and of the Internal Service Funds are charges to customers for sales and services. Operating expenses for Enterprise Funds and Internal Service Funds include the cost of sales and services, administrative expenses and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. d. Assets, Liabilities and Net Position or Equity
Cash and Investments
For purposes of the statement of cash flows, the City considers cash and cash equivalents to be cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition. For cash flow purposes, cash and cash equivalents are shown as both restricted and unrestricted cash and investments in the Proprietary Funds.

Investments for the City, as well as for its blended component units, are reported at fair value. The City's policy is generally to hold investments until maturity or until market values equal or exceed cost. The State Treasurer's Investment Pool operates in accordance with appropriate state laws and regulations. The reported value of the pool is the same as the fair value of the pool shares.

Receivables and Payables
Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either "due to/due 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). All other outstanding balances between funds are reported as "due to/from other funds." Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as "internal balances."
All trade and property tax receivables are shown net of an allowance for uncollectibles.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-28-
Note 1: Summary of Significant Accounting Policies (Continued) Functional Classifications
Expenditures of the Governmental Funds are classified by function. Functional classifications are defined as follows:
 General Government includes legislative activities that have a primary objective of providing legal and policy guidelines for the City. Also included in this classification are those activities that provide management or support services across more than one functional area.
 Public Safety includes those activities that involve the protection of people and property.
 Community Development includes those activities which involve planning and economic development, as well as building and safety.
 Parks, Recreation and Senior Center include those activities that involve community park maintenance and recreational activities within the community.  Public Works includes those activities that involve the maintenance and improvement of City streets, roads and park department development and maintenance.
 Debt Service includes those activities that account for the principal an interest payment of long-term liabilities.
 Capital outlay includes those activities that account for the purchase of fixed and capital assets.

Inventories and Prepaid Items
All inventories are valued at cost using the first-in/first-out (FIFO) method. The General Fund inventory is accounted for on the consumption method. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-29-
Note 1: Summary of Significant Accounting Policies (Continued) Capital Assets
Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads, bridges, sidewalks and similar items), are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $5,000 (amount not rounded). Such assets are recorded at historical cost or estimated historical cost if purchased or constructed.

Donated capital assets are recorded at acquisition value as of the date of acquisition.

In accordance with Governmental Accounting Standards Board (GASB) Statement No. 34, the City has reported general infrastructure assets acquired in prior and current years. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized.

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 are included as part of the capitalized value of the assets constructed.

Property, plant and equipment of the primary government, as well as the component units, are depreciated using the straight-line method over the following estimated useful lives:

Assets Years
Buildings & improvements 25 - 50
Improvements other than buildings 10 - 50
Sewer lines and pump stations 35 - 50
Equipment 3 - 20
Vehicles 5 - 10
Infrastructure Years
Pavement 30 - 33
Curb and gutter 50

Page 199 of 296 ends

City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-30-
Note 1: Summary of Significant Accounting Policies (Continued) Deferred Outflows and Inflows of Resources
In addition to assets, the statements of net position and governmental fund balance sheets will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The City has two items which qualify for reporting in this category. They are the deferred pension and OPEB related items, is reported in the government-wide statement of net position.

In addition to liabilities, the statements of net position and governmental fund balance sheet will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City has three items which qualify for reporting in this category. One item, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category. Unavailable revenue is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues that are recognized as an inflow of resources in the period that the amounts become available. The other items are deferred pension and OPEB related items reported in the government-wide statement of net position.

Compensated Absences
All permanent employees of the City are permitted to accumulate a maximum of two times their annual accrual rate (annual leave). Maximum sick leave accrual for miscellaneous employees is 800 hours and for safety employees it can be 1,120 or 1,400 hours, depending on the hire date. Upon termination of employment, an employee is paid for accumulated annual leave but forfeits accumulated sick leave unless the employee has over five years of service. After five years of service, upon termination, the employee is paid for half the accumulated sick leave. Compensated absences are paid out of the General Fund and are reported there as a liability when they have matured.

Accumulated vested sick pay and vacation pay for employees of the Proprietary Funds have been accrued. All accumulated compensated absences are accrued when incurred in the government-wide, proprietary and fiduciary fund financial statements.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-31-
Note 1: Summary of Significant Accounting Policies (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.

GASB 68 requires that the reported results must pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used:

Valuation Date June 30, 2020
Measurement Date June 30, 2021
Measurement Period July 1, 2020 to June 30, 2021
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.

GASB Statement No. 75 requires that the reported results must pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used:

Valuation Date June 30, 2022
Measurement Date June 30, 2022
Measurement Period July 1, 2021 to June 30, 2022
Long-Term Obligations
In the government-wide financial statements and proprietary 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.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-32-
Note 1: Summary of Significant Accounting Policies (Continued) Fund Equity
In the fund financial statements, government funds report the following fund balance classification:

Nonspendable includes amounts that cannot be spent because they are either (a) not in spendable form or (b) legally or contractually required to be maintained intact.

Restricted includes amounts that are constrained on the use of resources by either (a) external creditors, granters, contributors, or laws of regulations of other governments or (b) by law through constitutional provisions or enabling legislation.

Committed includes amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of the City Council. The formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is a City Council resolution.

Assigned includes amounts that are constrained by the government's intent to be used for specific purposes but are neither restricted nor committed.

Resolution No. 2011-7039 authorizes the City Manager to assign amounts to a specific purpose.

Unassigned includes the residual amounts that have not been restricted, committed, or assigned to specific purposes.

An individual governmental fund could include nonspendable resources and amounts that are restricted or unrestricted (committed, assigned, or unassigned) or any combination of those classifications. Restricted amounts are to be considered spent when an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available and committed, assigned, and then unassigned amounts are considered to have been spent when an expenditure is incurred for purposes for which amounts in any of those unrestricted fund balance classifications can be used.

Net Position Flow Assumption
Sometimes the City will fund outlays for a particular purpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted - net position and unrestricted – net position in the government-wide and proprietary fund financial statements, a flow assumption must be made about the order in which the resources are considered to be applied. It is the City's policy to consider restricted - net position to have been depleted before unrestricted - net position is applied.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-33-
Note 1: Summary of Significant Accounting Policies (Continued) Fund Balance Flow Assumptions
Sometimes the City will fund outlays for a particular purpose from both restricted and unrestricted resources (the total of committed, assigned, and unassigned fund balance). In order to calculate the amounts to report as restricted, committed, assigned, and unassigned fund balance in the governmental fund financial statements a flow assumption must be made about the order in which the resources are considered to be applied. It is the City's policy to consider restricted fund balance to have been depleted before using any of the components of unrestricted fund balance. Further, when the components of unrestricted fund balance can be used for the same purpose, committed fund balance is depleted first, followed by assigned fund balance. Unassigned fund balance is applied last.

Encumbrances
Encumbrance accounting, under which purchase orders, contracts and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is employed as an extension of formal budgetary integration. The City uses a modified encumbrance system in which only significant, select encumbrances are carried over at year-end. All other encumbrances lapse at year-end and are re-encumbered in the following fiscal year.

Property Tax Revenue
Property tax revenue is recognized in the fiscal year for which the taxes have been levied providing they become available. Available means then due, or past due and receivable within the current period and collected within the current period or expected to be collected soon enough thereafter (not to exceed 60 days) to be used to pay liabilities of the current period. The County of San Diego collects property taxes for the City. Tax liens attach annually on the first day in January preceding the fiscal year for which the taxes are levied. The tax levy covers the fiscal period July 1 to June 30. All secured personal property taxes and one-half of the taxes on real property are due November 1; the second installment is due February 1. All taxes are delinquent, if unpaid, on December 10 and April 10, respectively. Unsecured personal property taxes become due on the first of March each year and are delinquent, if unpaid, on August 31.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-34-
Note 2: Stewardship, Compliance and Accountability
a. Deficit Fund Balances or Net Position
The following nonmajor funds reported deficits in fund balance at June 30, 2022:

Gas Tax Fund (665) $
The deficit in the Gas Tax Fund will be eliminated by future expected revenue sources.
b. Budget Data
For the fiscal year ended June 30, 2022, the Housing Authority Fund had no adopted annual budgets.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-35-
II. DETAILED NOTES ON ALL FUNDS
Note 3: Cash and Investments
As of June 30, 2022, cash and investments were reported in the accompanying financial statements as follows:

Cash and investments:

Governmental activities 24,944,643 $
Business-Type activities 4,842,222 Fiduciary funds:

Custodial funds 445,038 Private Purpose Trust 1,019,177 Total Cash and Investments 31,251,080 Restricted cash with fiscal agents:

Fiduciary Funds:

Private Purpose Trust 68,764 Total cash and investments with fiscal agents 68,764 Total cash and investments 31,319,844 $
Cash and investments as of June 30, 2022 consists of the following:

Deposits with financial institutions 822,715 $
Cash on hand 1,000
Investments 30,496,129 Total cash and investments 31,319,844 $ The City follows the practice of pooling cash and investments of all funds except for funds required to be held by fiscal agents under provisions of bond indentures.

Interest income earned on pooled cash and investments is allocated monthly to the various funds based on monthly cash and investment balances. Interest income from cash and investments with fiscal agents is credited directly to the related fund.

Deposits
At June 30, 2022, the carrying amount of the City's deposits was $822,715 and the bank balance was $979,004. The $156,289 difference represents outstanding checks and other reconciling items.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-36-
Note 3: Cash and Investments (Continued)
Deposits
The California Government Code requires California banks and savings and loan associations to secure a city's deposits by pledging government securities with a value of 110% of a city's deposits. California law also allows financial institutions to secure city deposits by pledging first trust deed mortgage notes having a value of 150% of a city's total deposits. The City Treasurer may waive the collateral requirement for deposits that are fully insured up to $250,000 by the FDIC. The collateral for deposits in federal and state chartered banks is held in safekeeping by an authorized Agent of Depository recognized by the State of California Department of Banking. The collateral for deposits with savings and loan associations is generally held in safekeeping by the Federal Home Loan Bank in San Francisco, California as an Agent of Depository. These securities are physically held in an undivided pool for all California public agency depositors. Under Government Code Section 53655, the placement of securities by a bank or savings and loan association with an "Agent of Depository" has the effect of perfecting the security interest in the name of the local government agency. Accordingly, all collateral held by California Agents of Depository are considered to be held for, and in the name of, the local governmental agency.

Investments
Under provisions of the City's investment policy, and in accordance with the California Government Code, the following investments are authorized:
 U.S. Treasury Obligations (bills, notes and bonds)
 Bonds, notes or other evidence of indebtedness issued or guaranteed by agency of the United States government
 Certificates of Deposit or Time Deposits placed with commercial banks and savings and loans
 Medium-term Corporate Notes with an "A" or comparable ratings  Instruments of other California Government Entities with an "A" or comparable rating
 Banker's Acceptances
 Repurchase Agreements
 Local Agency Investment Fund Demand Deposits (State Pool)  County of San Diego Treasury (County Pool)
 California Arbitrage Management Program (Bond Pool)
 Passbook Savings Account Demand Deposits
 Money Market funds, which invest solely in securities issued by the U.S.

Treasury and agencies of the Federal government, and repurchase agreements collateralized with U.S. Treasury and Federal agency obligations  Overnight Sweep accounts as managed by the depository bank as part of the checking account packaged contracted by the City, provided the sweep account is collateralized in accordance with state law

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-37-
Note 3: Cash and Investments (Continued)
Investments Authorized by Debt Agreements
The above investments do not address investment of debt proceeds held by a bond trustee. Investments of debt proceeds held by a 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.

Investments in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. LAIF is overseen by the Local Agency Investment Advisory Board, which consists of five members, in accordance with State statute.

The State Treasurer's Office audits the fund annually. The fair value of the position in the investment pool is the same as the value of the pool shares. Currently, LAIF does not have an investment rating. LAIF has a minimum $5,000 transaction amount in increments of $1,000 with a maximum of 15 transactions (combination of deposits and withdrawals) per month. LAIF requires a one-day prior notice for deposits and withdrawals of $10 million or more.

GASB Statement No. 31
The City adopted GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools, as of July 1, 1997. GASB Statement No. 31 establishes fair value standards for investments in participating interest earning investment contracts, external investment pools, equity securities, option contracts, stock warrants and stock rights that have readily determinable fair values. Accordingly, the City reports its investments at fair value in the balance sheet.

All investment income, including changes in the fair value of investments, is recognized as revenue in the operating statement.

Disclosures Relating to Credit Risk
The City's investment policy limits investments in medium-term notes (MTN's) to those rated "A" or higher by Standard and Poor's (S&P) or by Moody's. As of June 30, 2022, the City's investment in Medium-Term Corporate Notes were all rated A or better by Moody's and S&P. In addition, the City's investments in Federal Home Loan Bank, Federal Farm Credit Bank, Federal National Mortgage Association and Federal Home Loan Mortgage Corporation were rated "AA+" by Moody's and by S&P. All securities were investment trade and were legal under State law. Investments in U.S.

Treasuries are not considered to have credit risk; therefore, their credit quality is not disclosed.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-38-
Note 3: Cash and Investments (Continued)
The City also invests in LAIF which invests in various underlying securities, including the federal agency securities. While LAIF is not rated, the federal agency securities are, and these have been affected by this rating change as well.

As of June 30, 2022, the City's investments in external investment pools, money market mutual funds and investment agreements are unrated.

Disclosures Relating to Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the City's investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits: The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The 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. The City does not accept 150% of the secured public totals.

At June 30, 2022, the City deposits (bank balances) were insured by the Federal Depository Insurance Corporation up to $250,000 and the remaining balances were collateralized under California Law.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-39-
Note 3: Cash and Investments (Continued)
Concentration of Credit Risk
The City's investment policy imposes restrictions for certain types of investments with any one issuer to 25% of the total investment pool. With respect to concentration risk, as of June 30, 2022, the City has not invested more than 25% of its total investments in any one issuer. In addition, GASB 40 requires a separate disclosure if any single issuer comprises more than 5% of the total investment value. As of June 30, 2022, the City has investments with the following issuers, which exceed 5% of the total investment value:

Reported Percent
Issuer amount of portfolio
Federal Farm Credit Bank 1,768,403 $ 21%
Federal Home Loan Mortgage Corporation 1,189,574 14%
Federal National Mortgage Association 619,251 7%
Investments guaranteed by the U.S. government and investments in mutual funds and external investment pools are excluded from this requirement.

Interest Rate Risk
The City's investment policy limits investment maturities as a means of managing its exposure to fair value losses arising from increasing interest rates. The City's investment policy states that the City's investment portfolio will not directly invest in securities maturing in more than five years. The City has elected to use the segmented time distribution method of disclosure for its interest rate risk.

As of June 30, 2022, the City had the following investments and original maturities:

Investment Maturities (in Years)
1 year 1 to 3 3 to 5
Investments or less years years Total
State Pooled Investment (LAIF) 18,442,580 $ - $ - $ 18,442,580 $ Federal Farm Credit Bank 698,495 1,069,908 - 1,768,403 Federal Home Loan Bank - 264,577 - 264,577 Federal Home Loan Mortgage Corporation - 1,189,574 - 1,189,574 Federal National Mortgage Association - 389,408 229,843 619,251 U.S. Treasury Notes - 2,555,340 729,580 3,284,920 Medium Term Corporate Notes 748,821 2,548,437 865,530 4,162,788 Supranational - 401,305 - 401,305 Money Market 194,241 - - 194,241 Cash with Fiscal Agent 68,764 - - 68,764 Collateralized Mortgage Obligations (CMO) - 99,726 - 99,726 Total Investments 20,152,901 $ 8,518,275 $ 1,824,953 $ 30,496,129 $

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-40-
Note 3: Cash and Investments (Continued)
Fair Value Hierarchy
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, 2022:

Fair Value Measurement Level
Cash & Investments Total 1 2 3
Federal Farm Credit Bank 1,768,403 $ - $ 1,768,403 $ - $ Federal Home Loan Bank 264,577 - 264,577 - Federal Home Loan Mortgage Corporation 1,189,574 - 1,189,574 - Federal National Mortgage Association 619,251 - 619,251 - U.S. Treasury Notes 3,284,920 - 3,284,920 - Medium Term Corporate Notes 4,162,788 - 4,162,788 - Supranational 401,305 - 401,305 - Money Market 194,241 - 194,241 - Collateralized Mortgage Obligations (CMO) 99,726 - 99,726 - Total 11,984,785 - $ 11,984,785 $ - $ Investments not subject to fair value
State Pooled Investment (LAIF) 18,442,580 Cash with Fiscal Agent 68,764 Total Investments 30,496,129 $ Local Agency Investment Funds classified in Level 2 of the fair value hierarchy are valued using specified fair market value factors. Federal Agency Securities and U.S.

Treasury Notes classified in Level 2 of the fair value hierarchy are valued using institutional bond quotes. Medium Term Corporate Notes classified in Level 2 of the fair value hierarchy are valued using institutional secondary market. Medium Term Corporate Notes can be defined as extended maturity commercial paper.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-41-
Note 4: Capital and Intangible Assets
Capital asset activity for the year ended June 30, 2022, was as follows:

Beginning Ending
Balance Transfers Increases Decreases Balance
Governmental Activities:

Capital assets, not being depreciated:

Land 2,688,532 $ - $ - $ - $ 2,688,532 $
Infrastructure right-of-way 12,406,327 - - - 12,406,327 Construction-in-progress 2,731,357 (2,042,215) 136,222 - 825,364 Total Capital Assets, Not Being Depreciated 17,826,216 (2,042,215) 136,222 - 15,920,223 Capital assets, being depreciated:

Structures and improvements 11,942,606 696,607 - (14,600) 12,624,613 Equipment and vehicles 5,951,016 319,380 241,389 (601,100) 5,910,685 Infrastructure 49,148,866 1,026,228 - - 50,175,094 Total Capital Assets, Being Depreciated 67,042,488 2,042,215 241,389 (615,700) 68,710,392 Less accumulated depreciation:

Structures and improvements (7,538,561) - (607,649) 14,600 (8,131,610) Equipment and vehicles (5,204,716) - (266,963) 601,100 (4,870,579) Infrastructure (13,481,732) - (1,495,985) - (14,977,717) Total Accumulated Depreciation (26,225,009) - (2,370,597) 615,700 (27,979,906) Total Capital Assets, Being Depreciated, Net 40,817,479 2,042,215 (2,129,208) - 40,730,486 Governmental Activities Capital Assets, Net 58,643,695 $ - $ (1,992,986) $ - $ 56,650,709 $ Depreciation expense was charged to functions/programs of the primary government follows:

Governmental Activities:

General Government 309,258 $
Public Safety 57,864 Public Works 1,538,568 Parks, Recreation and Senior Center 291,289 Internal Service Funds 173,618
Total Governmental Activities 2,370,597 $

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-42-
Note 4: Capital and Intangible Assets (Continued)
Beginning Ending
Balance Adjustment* Increases Decreases Balance
Business-Type Activities:

Capital assets, not being depreciated:

Construction-in-progress 1,927,108 $ (542,291) $ 317,915 $ (1,275,871) $ 426,861 $ Total Capital Assets,
Not Being Depreciated 1,927,108 (542,291) 317,915 (1,275,871) 426,861 Capital assets, being depreciated:

Sewer lines and pump stations 13,422,275 - 1,187,053 - 14,609,328 Total Capital Assets, Being Depreciated 13,422,275 - 1,187,053 - 14,609,328 Less accumulated depreciation:

Sewer lines and pump stations (5,648,362) - (294,313) - (5,942,675) Total Accumulated Depreciation (5,648,362) - (294,313) - (5,942,675) Total Capital Assets, Being Depreciated, Net 7,773,913 - 892,740 - 8,666,653 Business-Type Activities Capital Assets, Net 9,701,021 $ (542,291) $ 1,210,655 $ (1,275,871) $ 9,093,514 $ *Prior period adjustment to correct beginning construction-in-progress balance. See note 18.

Depreciation expense was charged to functions/programs of the primary government as follows:

Business-Type Activities:

Sewer 294,313 $
Intangible asset activity for the year ended June 30, 2022, was as follows:

Beginning Ending
Balance Increases Decreases Balance
Intangible right to use asset
Equipment - $ 146,143 $ - $ 146,143 $
Accumulated amortization - (31,316) - (31,316) Total intangible right to use asset, net - $ 114,827 $ - $ 114,827 $

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-43-
Note 5: Loans Receivable
Loans receivable offset by allowances consist of the following:

South Bay Community Services Loan – Hemlock Ave.

In April 2006, the Agency entered into a loan agreement for an amount not-to-exceed $540,425 with South Bay Community Services (SBCS) to loan low- and moderateincome housing set-aside funds to rehabilitate a seven-unit apartment complex located at 1360 Hemlock Avenue. This loan agreement was amended in October 2007, and increased the loan agreement by $89,183, creating a total not-to-exceed amount of $629,608. SBCC intends to rent all seven units to families earning 50% or below of the area median income, for a term of fifty-five years.

Beginning May 31, 2006, and continuing through 2061, simple interest accrues at 3% per annum on the principal balance. Monthly principal and interest payments are not required to be paid if the rental and occupancy conditions are met for the property. All principal and accrued interest on the Loan shall be due in full on (i) the date of any transfer not authorized by the Agency; (ii) the date of any Default; or (iii) the expiration of the Loan Term, whichever occurs first. However, upon expiration of the Loan Term, the Loan amount pursuant to the Note and accrued interest shall be forgiven provided all covenants and conditions were met over the Loan Term. Accrued interest at June 30, 2022, amounts to $291,353 and is offset by allowance. The outstanding balance at June 30, 2022, is $920,961, including accrued interest.

South Bay Community Services Loan - Calla Ave.

In April 2006, the Agency entered into a loan agreement for an amount not-to-exceed $491,271 with South Bay Community Services (SBCS) to loan low- and moderateincome housing set-aside funds to rehabilitate an eight-unit apartment complex located at 1260 Calla Avenue. SBCC intends to rent all seven units to families earning 50% or below of the area median income, for a term of fifty-five years. Beginning May 31, 2006, and continuing through 2061, simple interest accrues at 3% per annum on the principal balance. Monthly principal and interest payments are not required to be paid if the rental and occupancy conditions are met for the property. All principal and accrued interest on the Loan shall be due in full on (i) the date of any transfer not authorized by the Agency; (ii) the date of any Default; or (iii) the expiration of the Loan Term, whichever occurs first. However, upon expiration of the Loan Term, the Loan amount pursuant to the Note and accrued interest shall be forgiven provided all covenants and conditions were met over the Loan Term. Accrued interest at June 30, 2022, amounts to $232,024 and is offset by allowance. The loan has not been fully disbursed at June 30, 2022. The outstanding balance at June 30, 2022, is $718,479, including accrued interest.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-44-
Note 5: Loans Receivable (Continued)
Tax Increment Loan – 12th Street
In August 2008, the Agency entered into a loan agreement for an amount not-toexceed $1,945,000 with Beachwind Court, LP to loan low- and moderate-income housing set-aside funds to rehabilitate a fifteen-unit apartment complex located at 624 12th Street. As a condition of the loan, Beachwind Court, LP is to rent seven units to families earning 50% or below of the area median income and eight units to families earning 60% or below of the area median income, for a period of fifty-five years.

Beginning on the date of disbursement, simple interest accrues at 3% per annum on the principal balance. Monthly principal and interest payments are required to be paid within 30 days of completion of the annual audit equivalent to 50% of the residual receipts generated by the projects audited records. Accrued interest at June 30, 2022, amounts to $751,697 and is offset by allowance. The outstanding balance at June 30, 2022, is $2,696,697, including accrued interest.

American Legion Loan
The Imperial Beach Housing Authority and Hitzke Development Corporation entered into an Affordable Housing Agreement for the development of a mixed-use affordable housing development project and new American Legion Post. The Authority authorized financing for the Project for an amount not to exceed $4,100,000 to construct thirty (30) units of affordable housing consisting of twenty-nine (29) affordable residential rental units and one manager's unit. Monthly principal and interest payments are required to be paid within 30 days of completion of the annual audit equivalent to 50% of the residual receipts generated by the projects audited records. Accrued interest at June 30, 2022, amounts to $1,201,444 and is offset by allowance. The outstanding balance at June 30, 2022, is $5,301,444, including accrued interest.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-45-
Note 5: Loans Receivable (Continued)
Homeowner Loans
The Imperial Beach Housing Authority and the individual homeowners entered into Notes secured by a deed of trust agreement, whereas the Housing Authority sold the six units of property to homeowners, as it was understood the Authority may transfer these notes. There will be no interest except in the event of a default. The following shall each be deemed "Defaults" under these Notes: (i) an uncured Owner default under the terms of the Note, the Deed of Trust securing the Note and/or the Affordable Housing Resale Restrictions, Option to Designate Eligible Purchasers and Option to Purchase Upon Default ("Resale Restriction") affecting the Property's; (ii) a Transfer (as defined in the Resale Restriction) that is not approved by the Authority in writing; or (iii) any Owner default under the terms of the First Lien (as defined in the Resale Restriction). In the event of a Default, the principal shall become due and immediately payable together with interest, which shall be deemed to have accrued from the date of these Notes at the greater of the following amounts: a) The rate equal to the interest rate on the First Lien; or b) ten percent (10%) per annum. The outstanding balance at June 30, 2022, is $933,520.

Total loans receivable at June 30, 2022, amounts to $10,571,101, however, as the result of these loans being forgivable, the City has recorded an offsetting allowance for all loans for a net loans receivable balance of $0.

Note 6: lnterfund Receivable, Payable and Transfers
The composition of interfund balances as of June 30, 2022 is as follows:

Due To/Due from Other Funds
Due to other funds
Non-Major
Governmental
Funds Funds Total
Due from Other Funds:

General Fund 50,294 $ 50,294 $
Total 50,294 $ 50,294 $
The General Fund is owed $50,294 from non-major governmental funds for temporary negative cash and investments.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-46-
Note 6: lnterfund Receivable, Payable and Transfers (Continued) Interfund Transfers
Transfer In
Non-major Internal
General Governmental Sewer Service
Transfers Out Fund Funds Fund Funds Total
General Fund - $ 1,145,518 $ - $ 1,108,121 $ 2,253,639 $ Miscellaneous Grants 439,908 - 20,518 29,710 490,136 Non-Major Governmental Funds 895,117 - - - 895,117 Total 1,335,025 $ 1,145,518 $ 20,518 $ 1,137,831 $ 3,638,892 $ Transfers into the General Fund totaling $895,117 were made from the Gas Tax Fund and Prop A Tax Fund to support street maintenance and transportation costs.

Transfer of $439,908 and $29,710 from the Miscellaneous Grants Fund was made to General Fund and Internal Service Funds, respectively. This was to reimburse the City for certain costs and services impacted by COVID-19 out of ARPA funds.

Transfer out of General Fund to Parks Maintenance CIP Fund and Capital Projects Fund in the total of $1,145,518 consisted of funding for various capital improvements projects.

Transfer of $20,518 to Sewer Fund out of Miscellaneous Grants Fund was to reimburse the sewer division for impact of COVID-19 on costs and services out of ARPA funds.

Transfer of $1,108,121 out of General Fund was made to Internal Service Funds for support services.

Note 7: Deferred Outflows and Inflows of Resources
Pursuant to GASB Statement No. 63, “Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position,” and GASB Statement No. 65, “Items Previously Reported as Assets and Liabilities,” the City recognized deferred outflows of resources in the Statement of Net Position. These items are a consumption of net position by the City that is applicable to a future reporting period.

Previous financial reporting standards do not include guidance for reporting those financial statement elements, which are distinct from assets and liabilities. The City has two items that are reportable on the Statement of Net Position. One relates to outflows from changes in the net pension liability (Note 11). Governmental activities and Business-Type Activities recorded deferred outflows of resources related to pension of $4,311,212 and $97,882, respectively. The other relates to the outflows from changes in total OPEB liability (Note 12). Governmental activities and BusinessType Activities recorded deferred outflows of resources related to OPEB of $1,043,110 and $23,683, respectively.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-47-
Note 7: Deferred Outflows and Inflows of Resources (Continued) In addition, the City recognized deferred inflows of resources in the statement of Net Position and governmental fund balance sheet. These items are an acquisition of net position by the City that is applicable to a future reporting period. Previous financial reporting standards do not include guidance for reporting those financial statement elements, which are distinct from assets and liabilities. The City has three items that are reportable on the Statement of Net Position. One relates to inflows from changes in the net pension liability (Note 11). Governmental activities and Business-Type Activities recorded deferred inflows of resources related to pension of $3,862,791 and $87,701, respectively. The other relates to the inflows from changes in total OPEB liability (Note 12). Governmental activities and Business-Type Activities recorded deferred inflows of resources related to OPEB of $442,042 and $10,036, respectively.

Lastly, reported on the governmental fund balance sheet is the reporting of unavailable revenues. Deferred inflows of resources related to unavailable revenues reported as of June 30, 2022 were $173,973.

Under the modified accrual basis of accounting, it is not enough that revenue is earned; it must also be available to finance expenditures of the current period.

Governmental funds will therefore include additional deferred inflows of resources for amounts that have been earned but are not available to finance expenditures in the current period. The City has one item that is reportable on the Governmental Fund Balance Sheet: this item relates to unavailable revenue of $7,608, civil penalties revenues of $37,615, and other revenues of $128,750.

Note 8: Unearned Revenue
General Fund unearned revenue consists of $40,000 relating to a lease with the Unified Port District of San Diego. The City entered into an agreement with the Port District in 1993 whereby the Port District leases the Pier Plaza and a parking lot from the City. The District paid the City $1,800,000 at the beginning of the lease. Each year of the 30-year contract, the City recognizes $60,000 of income and reduces the unearned revenue. As of June 30, 2022, $40,000 remains of this unearned lease revenue. In addition, the City entered into a development agreement with March and Ash Imperial Beach, Inc., dba March and Ash in December 2021. March and Ash paid the City $1,500,000 at the beginning of the agreement for the development and expansion of community programs and infrastructure. As of June 30, 2022 $1,326,250 remains of this unearned revenue.

Miscellaneous Grants Fund unearned revenue consists of $1,792,816 as of June 30, 2022 relating to the American Rescue Plan Act of 2021 (ARPA). The City was granted an allocation of $3,282,116 in July 2021.

Parks Maintenance CIP Fund unearned revenue consists of a grant of $150,000 received from the Kreutzkamp Foundation for the Veterans Park improvement project.

As of June 30, 2022, The full amount remains as unearned revenue.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-48-
Note 9: Compensated Absences
a. Compensated Absences - Governmental Activities
The City's policies relating to compensated absences are described in Note 1 of the Notes to Financial Statements. The following is a summary of changes in compensated absences of the City for the year ended June 30, 2022:

Beginning Ending Due Within
Balance Increases Decreases Balance One Year
Compensated absences 1,071,615 $ 683,173 $ 682,497 $ 1,072,291 $ 679,014 $ b. Compensated Absences - Business-Type Activities
The following is a summary of changes in Proprietary Fund compensated absences for the year ended June 30, 2022:

Beginning Ending Due Within
Balance Increases Decreases Balance One Year
Compensated absences 25,212 $ 47,365 $ 33,556 $ 39,021 $ 39,021 $ Note 10: Long-Term Liabilities
The following is a summary of changes in long-term liabilities of the City for the year ended June 30, 2022:

Beginning Ending Due Within
Balance Additions Deletions Balance One Year
Long-term liabilities:

Direct borrowings
Transnet Commercial Paper 1,095,290 $ - $ (296,928) $ 798,362 $ 296,928 $ Lease Liability
Equipment - 146,143 (29,767) 116,376 31,174 Total long-term liabilities 1,095,290 $ 146,143 $ (326,695) $ 914,738 $ 328,102 $

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-49-
Note 10: Long-Term Liabilities (Continued)
Transnet Commercial Paper
On October 4, 2019, the City entered into a loan agreement with the San Diego County Regional Transportation Commission for a $1.3 million loan for the purposes of financing Imperial Boulevard enhancement project. The proceeds were funded when the City requested reimbursement for valid expenditures related to the project.

On May 6, 2020 the City entered into a loan agreement with the San Diego County Regional Transportation Commission for another $600,000 for State Route 75 Signal Interconnection Project. The repayment of the debt is the first priority on the use of the City's annual TransNet revenues, which are received from SANDAG. As of June 30, 2022 the City has drawn a total on $1,455,000 on these loan agreements with $445,000 still available to draw for SR 75 Signal project. The principal remaining on the loan is $798,362 payable through 2025.

The following is a schedule by years, of future debt service payments as of June 30:

Year Ending Direct borrowing
June 30, Principal
2023 296,928 $
2024 361,515 2025 126,989
2026 12,930 Totals $ 798,362
Lease Liability
For the year ended June 30, 2022, the financial statements include the adoption of GASB Statement No. 87, Leases. The primary objective of this statement is to enhance the relevance and consistency of information about governments' leasing activities. This statement establishes a single model for lease accounting based on the principle that leases are financings of the right to use an underlying asset. Under this Statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred inflow of resources. For additional information, refer to the disclosures below.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-50-
Note 10: Long-Term Liabilities (Continued)
Lease Liability
On July 1, 2021, the City entered into a 60 month lease as Lessee for the use of Printers - Advanced Imaging Care (AIS). An initial lease liability was recorded in the amount of $146,143. As of June 30, 2022, the value of the lease liability is $116,376.

The City is required to make monthly fixed payments of $2,582. The lease has an interest rate of 1.340%. The value of the right to use asset as of June 30, 2022 of $146,143 with accumulated amortization of $31,316 is included with Equipment on the Lease Class activity.

The following is a schedule by years, of future debt service payments as of June 30:

Year Ending Lease liability
June 30, Principal Interest
2023 31,174 $ 1,368 $
2024 31,595 948 2025 32,021 522
2026 21,586 109
Totals $ 2,947 116,376 $

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-51-
Ill. OTHER INFORMATION
Note 11: Pensions
General Information about the Pension Plan
Plan Description
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 8 rate plans (three miscellaneous and five safety). Benefit provisions under the Plan are established by State statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plan regarding benefit provisions, assumptions and membership information that can be found on the CalPERS’ website, at www.calpers.ca.gov.

Benefits Provided
CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 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 Imperial Beach
Notes to Financial Statements
June 30, 2022
-52-
Note 11: Pensions (Continued)
The Plan’s provisions and benefits in effect at June 30, 2022 are summarized as follows:

Miscellaneous Plan
Classic Second Tier PEPRA
On or after
Prior to March 9, 2012 but prior On or after
Hire date March 9, 2012 to Janunary 1, 2013 January 1, 2013 Benefit formula 2.7% @ 55 2.0% @ 60 2.0% @ 62
Benefit vesting schedule 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 and up 50 and up 52 and up
Monthly benefits, as a % of eligible compensation 2.0% to 2.7% 1.092% to 2.418% 1.0% to 2.5% Required employer contribution rates 14.020% 8.650% 7.590% Safety Plan
Other Safety
Lifeguard Lifeguard Second Tier PEPRA
On or after
Prior to March 9, 2012 but prior On or after
Hire date March 9, 2012 to Janunary 1, 2013 January 1, 2013 Benefit formula 2.0% @ 50 2.0% @ 50 2.7% @ 57
Benefit vesting schedule 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 and up 50 and up 50 and up
Monthly benefits, as a % of eligible compensation 2.0% to 2.7% 2.0% to 2.7% 2.0% to 2.7% Required employer contribution rates 19.250% 18.190% 13.130% Fire Fire PEPRA
Prior to On or after
Hire date March 9, 2012 January 1, 2013
Benefit formula 3.0% @ 50 2.7% @ 57
Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50 and up 50 and up
Monthly benefits, as a % of eligible compensation 3.00% 2.0% to 2.7% Required employer contribution rates 23.710% 13.130%

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-53-
Note 11: Pensions (Continued)
Contributions
Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The employer is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions. Employer Contributions to the Plan for the fiscal year ended June 30, 2022 were $1,498,066.

The actual employer payments of $1,386,331 made to CalPERS by the City during the measurement period ended June 30, 2021 differed from the City’s proportionate share of the employer’s contributions of $2,642,822 by $1,256,491, 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 of the Plan is measured as of June 30, 2021, using an annual actuarial valuation as of June 30, 2020 rolled forward to June 30, 2021 using standard update procedures. A summary of principal assumptions and methods used to determine the net pension liability is as follows.

All other actuarial assumptions used in the June 30, 2020 valuation were based on the results of an actuarial experience study for the period from 1997 to 2015, including updates to salary increase, mortality and retirement rates. The Experience Study report can be obtained at CalPERS’ website, at www.calpers.ca.gov.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-54-
Note 11: Pensions (Continued)
Actuarial Methods and Assumptions Used to Determine Total Pension Liability Valuation Date June 30, 2020
Measurement Date June 30, 2021
Actuarial Cost Method Entry Age Normal in accordance with the requirements of GASB
Asset Valuation Method Market Value of Assets
Actuarial Assumptions:

Discount Rate 7.15%
Inflation 2.50%
Salary Increases Varies by Entry Age and Service
Mortality Rate Table (1) Derived using CalPERS' membership data for all funds
Post Retirement Benefit
Increase
The lesser of contract COLA or 2.50% until
Purchasing Power Protection Allowance floor on
purchasing power applies, 2.50% thereafter.
(1) The mortality table used was developed based on CalPERS’ specific data. The probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. Pre-retirement and Post-retirement mortality rates include 15 years of projected mortality improvement using 90% of Scale MP-2016 published by the Society of Actuaries. For more details on this table, please refer to the CalPERS Experience Study and Review of Actuarial Assumptions report from December 2017 that can be found on the CalPERS website.

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

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-55-
Note 11: Pensions (Continued)
In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations as well as the expected pension fund cash flows. Using historical returns of all of the funds’ asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equal to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses.

The expected real rates of return by asset class are as follows:

Asset Class1
Assumed Asset
Allocation
Real Return
Years 1 - 102
Real Return
Years 11+3
Public equity 50.0% 4.80% 5.98%
Fixed income 28.0% 1.00% 2.62%
Inflation assets - 0.77% 1.81%
Private equity 8.0% 6.30% 7.23%
Real assets 13.0% 3.75% 4.93%
Liquidity 1.0% - (0.92%)
2 An expected inflation of 2.00% used for this period
3 An expected inflation of 2.92% used for this period
1 In the System's ACFR, Fixed Income is included in Global Debt Securities; Liquidity is included in Short-Term Investments; Inflation Assets are included in both Global Equity Securities and Global Debt Securities.

Change of Assumptions
There were no change of assumptions for measurement date June 30, 2021.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-56-
Note 11: Pensions (Continued)
Discount Rate
The discount rate used to measure the total pension liability for PERF C was 7.15%.

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

Subsequent Events
On July 12, 2021, CalPERS reported a preliminary 21.3% net return on investments for fiscal year 2020-21. Based on the thresholds specified in CalPERS Funding Risk Mitigation policy, the excess return of 14.3% prescribes a reduction in investment volatility that corresponds to a reduction in the discount rate used for funding purposes of 0.20%, from 7.00% to 6.80%. Since CalPERS was in the final stages of the fouryear Asset Liability Management (ALM) cycle, the board elected to defer any changes to the asset allocation until the ALM process concluded, and the board could make its final decision on the asset allocation in November 2021.

On November 17, 2021, the board adopted a new strategic asset allocation. The new asset allocation along with the new capital market assumptions, economic assumptions and administrative expense assumption support a discount rate of

6.90% (net of investment expense but without a reduction for administrative expense) for financial reporting purposes. This includes a reduction in the price inflation assumption from 2.50% to 2.30% as recommended in the November 2021 CalPERS Experience Study and Review of Actuarial Assumptions. This study also recommended modifications to retirement rates, termination rates, mortality rates and rates of salary increases that were adopted by the board. These new assumptions will be reflected in the GASB 68 accounting valuation reports for the June 30, 2022, measurement date.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-57-
Note 11: Pensions (Continued)
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 Plan’s proportionate share of the net pension liability over the measurement period.

Plan Total
Pension Liability
Plan Fiduciary
Net Position
Plan Net Pension
Liability
Balance at: 6/30/2020 (VD) 58,454,949 $ 48,949,972 $ 9,504,977 $ Balance at: 6/30/2021 (MD) 61,282,085 59,004,413 2,277,672 Net Changes during 2020-21 2,827,136 $ 10,054,441 $ (7,227,305) $ Increase (Decrease)
Valuation Date (VD), Measurement Date (MD).

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 for the total Plan as of June 30, 2021 and 2022 was as follows:

Proportionate Share - June 30, 2021 0.08736%
Proportionate Share - June 30, 2022 0.04211%
Change - Increase (Decease) -0.04525%

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-58-
Note 11: Pensions (Continued)
Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate
The following presents the City’s proportionate share of the net pension liability of the total Plan as of the measurement date, calculated using the discount rate of 7.15 percent, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower (6.15 percent) or 1 percentage-point higher (8.15 percent) than the current rate:

Discount Rate Current Discount Rate Discount Rate
- 1% (6.15%) (7.15%) + 1% (8.15%)
Net Pension Liability / (Asset) 10,430,770 $ 2,277,672 $ (4,445,197) $ 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).

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-59-
Note 11: Pensions (Continued)
The EARSL for PERF C for the measurement period ending June 30, 2021 is 3.7 years, which was obtained by dividing the total service years of 561,622 (the sum of remaining service lifetimes of the active employees) by 150,648 (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.

Pension Expense and Deferred Outflows and Deferred Inflows of Resources Related to Pensions
As of the start of the measurement period (July 1, 2020), the City’s net pension liability was $9,504,977. For the measurement period ending June 30, 2021 (the measurement date), the City incurred a pension income of $3,208,175.

As of June 30, 2022, the City has deferred outflows and deferred inflows of resources related to pensions as follows:

Deferred Outflows Deferred Inflows
of Resources of Resources
Changes of assumptions - $ - $
Difference between expected and
actual experience 325,116 - Difference between projected and actual investment earnings - 1,658,544 Differences between employer's Contributions and Proportionate
share of contributions 1,360,381 1,435,280 Change in employer's proportion 1,225,531 856,668 Pension contributions subsequent to measurement date 1,498,066 - Total 4,409,094 $ 3,950,492 $

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-60-
Note 11: Pensions (Continued)
The amounts above are net of outflows and inflows recognized in the 2020-21 measurement period expense. Contributions subsequent to the measurement date of $1,498,066 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:

Year Ended Deferred Outflows/
June 30, (Inflows) of Resources
2023 144,696 $
2024 (374,508) 2025 (352,138)
2026 (457,514)
2027 - Thereafter -
Payable to the Pension Plan
At June 30, 2022, the City reported a payable of $0 for the outstanding amount of contributions to the pension plan required for the year then ended.

Allocation of the Proportional Share of the Net Pension Liability The allocation of the proportionate share of the net pension liability, pension expense, deferred outflows and inflows of resources are allocated as follows:

Percentage Allocation
Governmental Activities 97.78%
Business-Type Activities 2.22%
The governmental activities portion is allocated to the general fund departments as follows:

Percentage Allocation
General Government 26.93%
Public Safety 52.16%
Public Works 14.70%
Parks, Recreation and Senior Center 6.21%

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-61-
Note 12: Other Post-Employment Benefits
Plan Description
The City provides other post-employment benefits (OPEB) through a single-employer defined benefit healthcare plan by contributing up to a maximum of $149 per month for of all premiums charged under the health benefit plan for all eligible employees and qualified family members. These benefits are provided per contract between the City and the employee associations. A separate financial report is not available for the plan. This plan is not administered through a qualifying trust.

Employees Covered
As of the June 30, 2022 measurement date, the following current and former employees were covered by the benefit terms under the Plan:

Inactive employees benefit payments 82
Inactive employees entitled to but not yet receiving benefit payments - Participating active employees 16 Total 98
Funding Policy
The contribution requirements of plan members and the City are established and may be amended by the City, City Council, and/or employee associations. Currently, contributions are not required from plan members. A contribution of $29,182 was made during the 2021-2022 fiscal year. The purpose of the contribution was to pay current year premiums for retirees.

Total OPEB Liability
The City's total OPEB liability was measured as of June 30, 2022 and the total OPEB liability was determined by an actuarial valuation dated June 30, 2022 based on the following actuarial methods and assumptions:

Actuarial Cost Method Entry Age Normal
Actuarial Assumptions
Discount Rate 3.54%
Inflation 2.50%
Salary Increases 2.75%
Investment Rate of Return 3.54%
Mortality Rate 2017 CalPERS Mortality Rates
Pre-Retirement Turnover 2017 CalPERS Rates
Healthcare Trend Rate 4.00%

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-62-
Note 12: Other Post-Employment Benefits (Continued)
Discount Rate
The discount rate was 3.54% per year net of expenses. This is based on the Bond Buyer 20 Bond Index.

Change of Assumptions
The discount rate was changed from 2.16% to 3.54% for the measurement date as of June 30, 2022.

Changes in the OPEB Liability
The changes in the total OPEB liability for the Plan are as follows:

Total OPEB
Liability
Balance at June 30, 2021 2,407,169 $
(Valuation Date: June 30, 2022)
Changes recognized for the measurement period:

Service cost 141,432
Interest 52,597 Difference between expected and actual experience (90,018) Changes of assumptions (400,373) Benefit payments (85,701) Net changes (382,063)
Balance at June 30, 2022 2,025,106 $
Sensitivity of the total OPEB Liability to Changes in the Discount Rate The following presents the total OPEB liability of the City if it were calculated using a discount rate that is one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2022:

Current
1% Decrease Discount Rate 1% Increase
Total OPEB Liability 2,304,264 $ 2,025,106 $ 1,793,705 $

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-63-
Note 12: Other Post-Employment Benefits (Continued)
Sensitivity of the total OPEB Liability to Changes in the Health Care Cost Trend Rates
The following presents the total OPEB liability of the City if it were calculated using health care cost trend rates that are one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2022:

Current Healthcare
1% Decrease Cost Trend Rates 1% Increase
Total OPEB Liability 1,490,789 $ 2,025,106 $ 2,403,393 $ OPEB Expense and Deferred Outflows and Deferred Inflows of Resources Related to OPEB
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB. For the fiscal year ended June 30, 2022, the City recognized OPEB expense of $267,868.

As of fiscal year ended June 30, 2022, the City reported deferred outflows of resources related to OPEB from the following sources:

Deferred Outflows Deferred Inflows
of Resources of Resources
Changes between expected and
actual experience $ 82,985 129,671 $
Changes of assumptions 937,122 369,093 Total 1,066,793 $ 452,078 $ Amounts reported as deferred inflows of resources related to OPEB will be recognized as expense as follows:

Year Ended Deferred Outflows/
June 30 (Inflows) of Resources
2023 73,839 $
2024 73,839 2025 73,839
2026 73,839
2027 73,839
Thereafter 245,520

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
-64-
Note 13: Self-Insurance Program
General Liability
Since July 1, 2015, the City of Imperial Beach has been a member of Public Risk Innovation and Management (PRISM), an insurance risk sharing pool. The City's selfinsurance retention is $100,000 per occurrence.

In addition to its coverage through PRISM, effective July 1, 1993, the San Diego Unified Port District agreed to fund an Escrow Reserve Account in the amount of $300,000 for the purpose of reimbursing the City for any claim costs not covered by the insurance risk sharing pool, provided the claim is directly related to services provided to the District and arising from incidents actually occurring on tidelands and/or lands leased by the City to the District.

Workers Compensation
The City is a member of Public Risk Innovation and Management (PRISM). The City is self-insured for the first $125,000 of workers' compensation claims. Claims between $125,000 and $5,000,000 are covered through the City's risk sharing membership in PRISM. Claims between $5,000,000 and $50,000,000 are covered by excess purchased insurance.

The City established a Self-Insurance Fund (an internal service fund) to account for and finance its uninsured risk of loss when it became a member of SANDPIPA, PEPIP and PRISM for liability, property casualty and workers' compensation coverage. All funds of the City participate in the program and make payments to the Self-Insurance Fund based on estimates of the amounts needed to pay prior and current year claims and to establish a reserve for catastrophe losses. The estimated claims liability of $700,000 reported at June 30, 2022, is based on the requirements of Governmental Accounting Standards Board Statement 10, which requires that a liability for claims be reported if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated. The above amount includes an estimate for incurred but not reported claims.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
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Note 13: Self-Insurance Program (Continued)
During the last three fiscal years none of the above programs of protection have had settlements or judgments that exceeded pooled or insured coverage. There have been no significant reductions in pooled or insured liability coverage from coverage in the prior year.

Changes in the reported liability for the last three fiscal years are as follows:
2019-2020 2020-2021 2021-2022
Claims outstanding at beginning of year 1,949,504 $ 963,000 $ 792,000 $ Claims and changes in estimates (846,985) 41,602 (40,582) Claim payments (139,519) (212,602) (51,418) Claims outstanding at end of year 963,000 $ 792,000 $ 700,000 $ Note 14: Commitments and Contingencies
THE AFFORDABLE HOUSING COALITION OF SAN DIEGO V. TRACY SASNOVAL, ET AL-. the San Diego County Affordable Housing Coalition of San Diego County (“Petitioner”) filed a petition for a writ of mandate seeking to have unmet affordable housing development obligations, including the projects and /or funds need to meet them, as well as repayment of all deferrals and loans owed to the Low and Moderate Income Housing Fund (“Housing Fund”), to be recognized as “enforceable obligations” under the Dissolution Laws and placed on the Successor Agency’s Recognized Obligation Payment Schedule (“ROPS”) for future payment with the Redevelopment Property Tax Trust Funds (“RPTTF”) (See Health and Safety Code §§34172(c) and (d); 34182(c)(2); 34183). The City is named in the action as a real party in interest. The Successor Agency is named as a respondent and defendant.

On September 27, 2016, Judge Michael Kenny ruled that the Affordable Housing obligations are not enforceable obligations and denied the Petition for Writ of Mandate. The ruling was appealed by Petitioner. After oral argument, on July 20,2020, the Third Appellate District ruled that repayment of all deferrals and loans owed to the Housing Fund were “enforceable obligations” under the Dissolution Laws but denied the remaining claims of Petitioner. On remand to the Trial Court, Judge Shelleyanne W.L. Chang ordered that all respondents file “returns” identifying the status of repayment of deferrals and loans owed to the Housing Fund. The City and the Successor Agency reported that it had no such deferrals or loans. Petitioner never formally challenged the “returns” with a Motion nor did the Petitioner claim that the “return” of Imperial Beach was incorrect. It appears that the case on the claims is over, although there is no statutory provision which limits the time for a challenge to the “returns” by Petitioner.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
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Note 14: Commitments and Contingencies (Continued)
While it is not anticipated that such a challenge by Petitioner will be filed on Imperial Beach’s “return”, there is no certainty that such a challenge will not occur. Petitioner, however, did file a Motion for Attorneys’ Fees, but did not name the City or the Successor Agency as party against whom a demand for attorneys’ fees was made.

If Petitioner does not dismiss the City and Successor Agency from the action in the near future, a Motion to the Court of Appeal will be filed requesting a Dismissal Order.

As there were no claims for attorneys’ fees against the City or the Successor Agency, the attorneys’ fees claim appears to be concluded as to the City and Successor Agency in this matter.

Note 15: Successor Agency Trust for Assets of the Former Redevelopment Agency On December 29, 2011, the California Supreme Court upheld Assembly Bill 1 X 26 ("the Bill ") that provides for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of Imperial Beach that previously had reported a redevelopment agency within the reporting entity of the City as a blended component unit.

The Bill provides that upon dissolution of a redevelopment agency, either the city or another unit of local government will agree to serve as the "successor agency" to hold the assets until they are distributed to other units of state and local government. On November 1, 2011, the City Council elected to become the Successor Agency for the former redevelopment agency in accordance with the Bill.

In accordance with the timeline set forth in the Bill (as modified by the California Supreme Court on December 29, 2011,) all redevelopment agencies in the State of California were dissolved and ceased to operate as a legal entity as of February 1, 2012. After the date of dissolution, the assets and activities of the dissolved redevelopment agency are reported in a fiduciary fund (private-purpose trust fund) in the financial statements of the City.
a. Cash and Investments
Cash and investments reported in the accompanying financial statements consisted of the following:

Cash and investments pooled with the City 1,019,177 $
Cash and investments with fiscal agent 68,764 $ 1,087,941

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
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Note 15: Successor Agency Trust for Assets of the Former Redevelopment Agency (Continued)
b. Long-Term Debt
A description of long-term debt outstanding (excluding defeased debt) of the Successor Agency as of June 30, 2022, follows:

Beginning Ending Due Within
Balance Additions Deletions Balance One Year
Public Offerings:
2013 Tax Allocation Bonds 13,885,000 $ - $ (13,885,000) $ - $ - $ 2013 Tax Allocation Bonds Premium 330,066 - (330,066) - - 2020 Tax Allocation Bonds 13,780,000 - - 13,780,000 - 2020 Tax Allocation Bonds Premium 2,614,898 - (140,009) 2,474,889 - 2022 Tax Allocation Bonds - 11,800,000 - 11,800,000 885,000 2022 Tax Allocation Bonds Premium - 1,542,461 (45,333) 1,497,128 - Total Public Offerings 30,609,964 $ 13,342,461 $ (14,400,408) $ 29,552,017 $ 885,000 $

Tax Allocation Bonds, 2013
In January 2014, the Imperial Beach Public Financing Authority issued $17,260,000 Tax Allocation Bonds, 2013. The proceeds of the bonds were to defease the 2003 Series A Tax Allocation Bonds. In March 2022, the 2013 Tax Allocation Bonds were refunded with the 2022 Tax Allocation Bonds.

Tax Allocation Bonds, 2020
In March 2020, the Imperial Beach Public Financing Authority issued $14,490,000 Tax Allocation Bonds, 2020. The proceeds of the bonds were to defease the 2010 Tax Allocation Bonds. Interest on the bonds is payable semiannually and principal payments are due annually. Debt service payments occur on June 1, 2021, and then from June 1, 2034, through June 1, 2040.

Interest rates on the bonds is 4% per annum. The balance at June 30, 2022, excluding unamortized original issue premium of $2,474,889 is $13,780,000.

The outstanding 2020 bonds contain a provision that upon the occurrence and during the continuance of any event of default the timing of the principal of the bonds, together with the accrued interest thereon, become due and payable immediately.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
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Note 15: Successor Agency Trust for Assets of the Former Redevelopment Agency (Continued)
The following is a schedule by years, of future debt service payments as of June 30:

Year Ending 2020 Tax Allocation Refunding Bonds
June 30, Principal Interest
2023 - $ 551,200 $
2024 - 551,200 2025 - 551,200
2026 - 551,200
2027 - 551,200
2028-2032 - 2,756,000 2033-2037 6,910,000 2,377,200
2038-2040 6,870,000 557,200 Totals $ 8,446,400 13,780,000 $ Tax Allocation Bonds, 2022
In March 2022, the Imperial Beach Public Financing Authority issued $11,800,000 Tax Allocation Bonds, 2022. The proceeds of the bonds were to defease the 2013 Tax Allocation Bonds. Interest on the bonds is payable semiannually and principal payments are due annually. Debt service payments occur from June 1, 2022, through June 1, 2033. Interest rates on the bonds is 4% per annum. The balance at June 30, 2022, excluding unamortized original issue premium of $1,497,128 is $11,800,000.

The refunding resulted in a difference between the reacquisition price and the net carrying amount of the old debt of $6,610. This difference is being amortized on a straight-line basis as interest expense (interest on debt). The City refunded the Series 2013 Tax Allocation Bonds to reduce its total debt service payments by $2,144,313 and to obtain an economic gain (difference between the present values of the debt service payments on the old and new debt, less any prior funds on hand) of $1,783,298.

The outstanding 2022 bonds contain a provision that the principal due on the Bonds is subject to acceleration upon the occurrence of an event of default. As a practical matter in the event of a payment default by the Successor Agency, it is unlikely the Successor Agency would have the financial resources to meet accelerated obligations. No real or personal property in the project area is pledged to secure the bonds, and it is not anticipated that the Successor Agency will have available moneys sufficient to redeem all of the Bonds in the event of a default.

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City of Imperial Beach
Notes to Financial Statements
June 30, 2022
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Note 15: Successor Agency Trust for Assets of the Former Redevelopment Agency (Continued)
The following is a schedule by years, of future debt service payments as of June 30:

Year Ending 2022 Tax Allocation Refunding Bonds
June 30, Principal Interest
2023 885,000 $ 472,000 $
2024 910,000 436,600 2025 955,000 400,200
2026 985,000 362,000
2027 1,015,000 322,600
2028-2032 5,760,000 967,000
2033 1,290,000 51,600 Totals $ 3,012,000 11,800,000 $
Pledged Revenue
The City pledged, as security for bonds issued, either directly or through the Financing Authority, a portion of tax increment revenue (including Low- and Moderate-Income Housing set-aside and pass-through allocations) that it receives. The bonds issued were to provide financing for various capital projects, accomplish Low- and Moderate-Income Housing projects and to defease previously issued bonds. Assembly Bill 1 X 26 provided that upon dissolution of the Redevelopment Agency, property taxes allocated to redevelopment agencies no longer are deemed increment but rather property tax revenues and will be allocated first to successor agencies to make payments on the indebtedness incurred by the dissolved redevelopment agency. Total principal and interest remaining on the debt is $37,038,400 with annual debt service requirements as indicated above. For the current year, the total property tax revenue recognized by the Successor Agency for the payment of indebtedness incurred by the dissolved redevelopment agency was $2,251,387 and the debt service obligation on the bonds was $968,893. In addition, the Successor Agency defeased one of the bonds in the amount of $13,885,000. c. Insurance
The Successor Agency is covered under the City of Imperial Beach's insurance policies. Therefore, the limitation and self-insured retentions applicable to the City also apply to the Successor Agency. Additional information as to coverage and self-insured retentions can be found in Note 13.

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Imperial Beach City CouncilNovember 16, 2022

Imperial Beach City Council
November 16, 2022