Attach 1 - FY25 Annual Comprehensive Financial Report — Laguna Beach City Council, May 12, 2026

Attachment 1
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6 CITY OF LAGUNA BEACH

LAGUNA BEACH, CALIFORNIA
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025
Prepared by Finance Division
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8 CITY OF LAGUNA BEACH, CALIFORNIA
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025
Table of Contents
INTRODUCTORY SECTION........................................................................................................................................ I Letter of Transmittal........................................................................................................................................................ iii Organizational Structure................................................................................................................................................ viii GFOA Certificate of Achievement................................................................................................................................ x FINANCIAL SECTION .................................................................................................................................................. 1 Independent Auditor’s Report....................................................................................................................................... 3 Management’s Discussion and Analysis..................................................................................................................... 7 Basic Financial Statements........................................................................................................................................... 20 Government-Wide Financial Statements............................................................................................................. 21 Statement of Net Position............................................................................................................................. 22 Statement of Activities ................................................................................................................................... 24 Governmental Fund Financial Statements.......................................................................................................... 28 Balance Sheet................................................................................................................................................. 29 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position............ 30 Statement of Revenues, Expenditures and Changes in Fund Balances ............................................. 31 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities.................................................................................. 32 Statement of Net Position - Proprietary Funds .......................................................................................... 34 Statement of Revenues, Expenses and Changes in Net Position - Proprietary Funds ...................... 35 Statement of Cash Flows - Proprietary Funds........................................................................................... 36 Fiduciary Fund Financial Statements................................................................................................................... 38 Statement of Fiduciary Net Position - Fiduciary Funds ............................................................................ 39 Statement of Changes in Fiduciary Net Position - Fiduciary Funds....................................................... 40 Notes To Financial Statements.............................................................................................................................. 41 Required Supplementary Information.......................................................................................................................... 83 Schedule of Proportionate Share of the Net Pension Liability - Safety Plan................................................. 84 Schedule of Contributions - Safety Plan.............................................................................................................. 85 Schedule of Contributions - Miscellaneous Plan................................................................................................ 85 Schedule of Changes in Total Pension Liability and Related Ratios - Miscellaneous Plan......................... 86 Schedule of Changes in the Total OPEB Liability and Related Ratios - Other Postemployment Benefit Plan.................................................................................................................... 88 Page
9 CITY OF LAGUNA BEACH, CALIFORNIA
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025
Table of Contents
Page
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - General Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92 Supplementary Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94 General Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95 Consolidating Balance Sheet by Sub - Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97 Consolidating Schedule of Revenues, Expenditures and Changes in Fund Balances by Sub - Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual . . . . . . . . . . 108 General Sub Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109 Measure LL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111 Open Space . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112 Capital Improvement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113 Parking Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114 Park In-Lieu . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115 Art In-Lieu . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116 Housing In-Lieu . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117 Transportation Infrastructure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118 South Laguna . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119 Disaster Contingency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120 Wildfire Mitigation and Fire Safety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121 Library Impact Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122 Major Capital Projects Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123 Assessment Districts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124 Non-Major Governmental Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125 Combining Balance Sheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126 Combining Statement of Revenues, Expenditures and Changes in Fund Balance . . . . . . . . . . . . . . 129 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual . . . . . . . 132 Gas Tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133 Street Lighting District . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134 Federal Asset Forfeiture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135 State Asset Forfeiture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136 Housing Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137 National Opioid Settlement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138 AQMD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139 Animal Shelter Donations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140 10 CITY OF LAGUNA BEACH, CALIFORNIA
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025
Table of Contents
Page
Internal Service Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141 Combining Statement of Net Position - Internal Service Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142 Combining Statement of Revenues, Expenses and Changes in Net Position - Internal Service Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143
Combining Statement of Cash Flows - Internal Service Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144 STATISTICAL SECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146 Financial Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147 Net Position by Component, Last Ten Fiscal Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148 Changes in Net Position, Last Ten Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150 Fund Balances of Governmental Funds, Last Ten Fiscal Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154 Changes in Fund Balances of Governmental Funds, Last Ten Fiscal Years . . . . . . . . . . . . . . . . . . . . . . . . 156 Revenue Capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158 Assessed Value and Estimated Actual Value of Taxable Property, Last Ten Fiscal Years . . . . . . . . . . . . . 159 Direct and Overlapping Property Tax Rates, Last Ten Fiscal Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160 Principal Property Tax Payers, Last Fiscal Year and Nine Years Ago . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162 Property Tax Levies and Collections, Last Ten Fiscal Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 163 Debt Capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164 Ratios of Outstanding Debt by Type, Last Ten Fiscal Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165 Direct and Overlapping Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 166 Pledged-Revenue Coverage, Last Ten Fiscal Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 167 Legal Debt Margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 168 Demographic and Economic Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 170 Demographic and Economic Statistics, Last Ten Fiscal Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 171 Principal Employers, Last Fiscal Year and Nine Years Ago . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172 Operating Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173 Full-time City Employees by Function, Last ten Fiscal Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 174 Operating Indicators, Last Ten Fiscal Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 176 Capital Asset Statistics by Function, Last Ten Fiscal Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 178 11 THIS PAGE LEFT INTENTIONALLY BLANK.
12 INTRODUCTORY SECTION
i
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ii
14 Letter of Transmittal
iii
15 iv
16 v
17 vi
18 vii
19 Organizational Structure
viii
20 ix
21 GFOA Certificate of Achievement
x
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xi
23 FINANCIAL SECTION
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Independent Auditors’ Report
Independent Auditor’s Report
To the Honorable Mayor and Members of the City Council
City of Laguna Beach, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-type activities, discreetly presented component unit, each major fund, and the aggregate remaining fund information of the City of Laguna Beach (hereafter, the “City”), as of and for the year ended June 30, 2025, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, discreetly presented component unit, each major fund, and the aggregate remaining fund information of the City as of June 30, 2025, and the respective changes in financial position, and, where applicable, cash flows thereof, for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditors’ 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.

Emphasis of Matter
As described in Note 1 to the financial statements, in 2025, the City adopted new accounting guidance, GASB Statement No. 101, Compensated Absences. Our opinion is not modified with respect to this matter.

Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about 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.
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Auditors’ Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions.

Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards, will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. • Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.

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

Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, the budgetary comparison schedules, and the required pension and other post-employment benefits schedules as listed on the table of contents, 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.

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

Other Information
Management is responsible for the other information included in the annual report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditor’s report thereon.

Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.

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

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 30, 2026, 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 the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering City’s internal control over financial reporting and compliance.

Irvine, California
March 30, 2026
To the Honorable Mayor and Members of the City Council
City of Laguna Beach, California
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Management’s Discussion and Analysis
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9 32
10 33
11 34
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13 36
14 37
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Basic Financial Statements
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Government-Wide Financial Statements
21 44
Statement of Net Position
ASSETS
Cash and investments $ 159,335,166 $ 12,477,027 $ 171,812,193 $ 15,489,816 Receivables (net of uncollectibles):

Accounts receivable 1,641,499 857,669 2,499,168 2,115,649 Taxes receivable 7,459,269 250,197 7,709,466 80,559
Accrued interest receivable 479,245 333,840 813,085 139,373 Due from other governments 555,050 8,999 564,049 —
Notes and loans receivable 1,800,145 — 1,800,145 —
Lease receivables 1,157,591 — 1,157,591 5,457,704
Restricted assets:

I-Bank installment agreements — 1,405,675 1,405,675 —
Property for housing program 797,500 — 797,500 —
Inventories 100,372 — 100,372 485,619
Prepaid costs 4,608,077 — 4,608,077 311,300
Capital assets (not being depreciated/amortized) 160,664,181 5,012,015 165,676,196 9,907,757 Capital assets (net of accumulated depreciation/amortization) 204,102,106 49,394,510 253,496,616 54,462,030 Total assets 542,700,201 69,739,932 612,440,133 88,449,807

DEFERRED OUTFLOWS OF RESOURCES
Deferred amounts related to pension plans 26,129,567 325,355 26,454,922 3,021,824 Deferred amounts related to OPEB 2,341,212 97,551 2,438,763 60,827 Total deferred outflows of resources 28,470,779 422,906 28,893,685 3,082,651

LIABILITIES
Accounts payable 10,152,649 1,814,250 11,966,899 1,306,951 Accrued liabilities 2,717,065 56,862 2,773,927 155,091
Retainage payable 560,891 17,483 578,374 —
Accrued interest payable — 157,213 157,213 69,217
Deposits payable 4,708,125 — 4,708,125 72,670
Unearned revenues 89,724 — 89,724 —
Noncurrent liabilities:

Due within one year:

Direct borrowings, leases, SBITA, claims, and compensated absences 6,043,787 684,682 6,728,469 205,870 Total OPEB Liability 332,751 13,864 346,615 —
Due in more than one year:

Net Pension Liability 84,173,875 1,220,436 85,394,311 9,278,682 Total OPEB Liability 5,052,064 210,503 5,262,567 627,422 Direct borrowings, leases, SBITA, claims, and compensated absences 24,725,222 13,001,844 37,727,066 10,689,899 Total liabilities 138,556,153 17,177,137 155,733,290 22,405,802

DEFERRED INFLOWS OF RESOURCES
Deferred amounts related to pension plans 931,967 — 931,967 107,565 Deferred amounts related to OPEB 650,708 27,113 677,821 336,797 Deferred amounts related to leases 1,070,287 — 1,070,287 5,103,943 Total deferred inflows of resources 2,652,962 27,113 2,680,075 5,548,305

NET POSITION
Net investment in capital assets 347,952,327 40,850,099 388,802,426 57,445,071 Restricted:

South Laguna maintenance 15,399,858 — 15,399,858 —
Street lighting maintenance and projects 6,482,856 — 6,482,856 — Streets and roads maintenance and projects 3,148,908 — 3,148,908 — Public safety programs 188,650 — 188,650 —
Affordable housing 1,766,700 — 1,766,700 —
Opioid remediation activities 76,819 — 76,819 —
Assessment district improvements 6,659,729 — 6,659,729 — Animal shelter activities 1,497,850 — 1,497,850 —
Cultural and environmental stewardship activities 260,000 — 260,000 — Pollution remediation projects 84,038 — 84,038 —
Unrestricted 46,444,130 12,108,489 58,552,619 6,133,280 Total net position $ 429,961,865 $ 52,958,588 $ 482,920,453 $ 63,578,351 Component
Primary Government Unit
Governmental
Activities
Business-Type
Activities Total Water District

CITY OF LAGUNA BEACH
Statement Of Net Position
June 30, 2025
See accompanying Notes to the Basic Financial Statements 22 45 THIS PAGE LEFT INTENTIONALLY BLANK.
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Statement of Activities
Program Revenues
Expenses
Charges for
Services
Operating
Contributions
and Grants
Capital
Contributions
and Grants
Functions/Programs:

Primary government:

Governmental activities:

General Government $ 26,121,782 $ 132 $ 260,000 $ —
Public safety 62,859,451 4,699,808 1,419,382 —
Community development 9,740,785 6,250,157 309,071 —
Transit and community services 6,587,567 2,323,806 41,193 — Public works 30,287,121 11,559,658 996,170 3,955,161
Interest on long-term debt 296,717 — — —
Total governmental activities 135,893,423 24,833,561 3,025,816 3,955,161 Business-type activities:

Sewer Service 8,273,044 11,086,076 — —
Municipal Transit 5,614,599 225,195 2,424,801 —
Total business-type activities 13,887,643 11,311,271 2,424,801 — Total primary government $ 149,781,066 $ 36,144,832 $ 5,450,617 $ 3,955,161 Component Units:

Water District $ 21,342,290 $ 13,722,666 $ — $ 136,991
General revenues and transfers:

General revenues:

Property taxes
Sales taxes
Transient occupancy taxes
Franchise taxes
Business license taxes
Business improvement assessments
Use of money and property
Miscellaneous
Gain on sale of capital asset
Transfers
Total general revenues and transfers
Change in net position
Net position-beginning, as originally reported
Change within financial reporting entity
Restatement - change in accounting principle
Restatement - correction of error
Net position-beginning, restated
Net position-ending

CITY OF LAGUNA BEACH
Statement Of Activities
For The Year Ended June 30, 2025
See accompanying Notes to the Basic Financial Statements 24 47 Net (Expenses) Revenues and Changes in Net Position
Primary Government Component
Governmental
Activities
Business-Type
Activities Total Water District
$ (25,861,650) $ — $ (25,861,650) $ —
(56,740,261) — (56,740,261) —
(3,181,557) — (3,181,557) —
(4,222,568) — (4,222,568) —
(13,776,132) — (13,776,132) —
(296,717) — (296,717) —
(104,078,885) — (104,078,885) —
— 2,813,032 2,813,032 —
— (2,964,603) (2,964,603) —
— (151,571) (151,571) —
(104,078,885) (151,571) (104,230,456) —
(7,482,633)
56,447,392 — 56,447,392 4,337,807
7,372,476 — 7,372,476 —
17,315,618 — 17,315,618 —
1,689,087 — 1,689,087 —
1,179,995 — 1,179,995 —
2,784,149 — 2,784,149 —
8,292,269 551,731 8,844,000 714,037
155,518 711,222 866,740 202,791
526,704 — 526,704 —
(3,673,480) 3,673,480 — —
92,089,728 4,936,433 97,026,161 5,254,635
(11,989,157) 4,784,862 (7,204,295) (2,227,998)
439,891,213 47,241,552 487,132,765 66,060,730
984,938 (984,938)
(557,944) (6,469) (564,413) (254,381)
1,632,815 1,923,581 3,556,396 —
441,951,022 48,173,726 490,124,748 65,806,349
$ 429,961,865 $ 52,958,588 $ 482,920,453 $ 63,578,351
See accompanying Notes to the Basic Financial Statements 25 48 Major Governmental Funds
General Fund
The General fund is used to account for resources which are dedicated to governmental operations of the City, and not required to be accounted for in another fund.

Capital Projects Funds
Capital Projects Funds are used to account for the acquisition and construction of major capital facilities other than those financed by proprietary funds and trust funds.

The City of Laguna Beach has the following major Capital Projects Fund:

Assessment Districts Fund – The Assessment District Fund is used to account for assessment district utility undergrounding projects which are funded by property owners.

Non-Major Governmental Funds
These funds constitute all other governmental funds that do not meet the qualitative or quantitative criteria to be a major fund, which are the 10% test of assets and deferred outflows, liabilities and deferred inflows, revenues or expenditures for the governmental funds and the 5% test of total assets and deferred outflows, liabilities and deferred inflows, revenues or expenditures for the total governmental and enterprise funds combined. These funds include other Special Revenue Funds of the City.
26 49
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27 50
Governmental Fund Financial Statements
28 51
Balance Sheet
Capital Projects
Fund
General Fund
Assessment
Districts
Total Total
Nonmajor Governmental
Funds Funds
ASSETS
Cash and investments $ 111,327,616 $ 8,730,019 $ 13,986,599 $ 134,044,234 Receivables (net of allowance for uncollectible):

Taxes 7,406,839 — 52,430 7,459,269
Accounts 987,997 — 604,194 1,592,191
Interest 479,245 — — 479,245
Intergovernmental 189,027 — 366,023 555,050
Leases 1,157,591 — — 1,157,591
Prepaid expenses 2,219,900 — 2,388,177 4,608,077
Inventory 100,372 — — 100,372
Total assets $ 123,868,587 $ 8,730,019 $ 17,397,423 $ 149,996,029

LIABILITIES
Accounts payable $ 7,207,092 $ 1,731,904 $ 847,005 $ 9,786,001 Retainage payable 78,364 268,871 213,656 560,891
Accrued liabilities 2,717,065 — 2,764 2,719,829
Deposits 4,638,610 69,515 — 4,708,125
Unearned revenues 89,724 — — 89,724
Total liabilities 14,730,855 2,070,290 1,063,425 17,864,570

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 287,398 — 440,000 727,398
Leases 1,070,287 — — 1,070,287
Total deferred inflows of resources 1,357,685 — 440,000 1,797,685

FUND BALANCES (DEFICITS)
Non-spendable 2,320,272 — 2,388,177 4,708,449
Restricted 15,399,858 6,659,729 13,505,821 35,565,408
Committed 17,201,320 — — 17,201,320
Assigned 72,874,848 — — 72,874,848
Unassigned (16,251) — — (16,251)
Total fund balances (deficits) 107,780,047 6,659,729 15,893,998 130,333,774 Total liabilities, deferred inflows of resources, and
fund balances (deficits) $ 123,868,587 $ 8,730,019 $ 17,397,423 $ 149,996,029

CITY OF LAGUNA BEACH
Balance Sheet
June 30, 2025
See accompanying Notes to the Basic Financial Statements 29 52 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position Amounts reported for governmental activities in the Statement of Net Position are different because:

Total fund balances - governmental funds $ 130,333,774
Capital assets, net of accumulated depreciation/amortization, used in governmental activities are not financial resources and, therefore, are not reported in the funds. 358,143,908 Differences between expected and actual experiences, assumption changes and net differences between projected and actual earnings, and contributions subsequent to the measurement date for the postretirement benefits (pension and OPEB) are recognized as deferred outflows of resources and deferred inflows of resources on the Statement of Net Position.

Deferred outflows-pension related $ 26,129,567
Deferred outflows-OPEB related 2,341,212
Deferred inflows-pension related (931,967)
Deferred inflows-OPEB related (650,708)
Total deferred outflows and inflows related to postemployment benefits 26,888,104 Internal service funds provide services to other funds on a cost-reimbursement basis. The assets, deferred outflows of resources, liabilities, and deferred inflows of resources of the internal service funds are included in governmental activities in the Statement of Activities. 16,894,058 Long-term liabilities that are not due and payable in the current period, and therefore, are not reported in the funds.

Lease financing agreements (11,240,000)
Leases and subscription payable (2,226,687)
Net pension liability (84,173,875)
Total OPEB liability (5,384,815)
Total long-term liabilities (103,025,377)
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. 727,398
Net position of governmental activities $ 429,961,865

CITY OF LAGUNA BEACH
Reconciliation Of The Governmental Funds Balance Sheet To The Statement Of Net Position June 30, 2025
See accompanying Notes to the Basic Financial Statements 30 53 Statement of Revenues, Expenditures and Changes in Fund Balances Capital Project
Fund
Assessment
Districts
Total Total
Nonmajor Governmental
General Fund Funds Funds

REVENUES
Taxes $ 84,266,667 $ — $ 2,485,805 $ 86,752,472
License, fees and permits 3,369,833 — — 3,369,833
Fines and forfeitures 1,252,961 — — 1,252,961
Investment income (loss), net 8,285,195 290,611 313,009 8,888,815 Rental 735,917 — — 735,917
Intergovernmental 3,439,239 — 1,930,636 5,369,875
Charges for services 7,496,149 — — 7,496,149
Parking meters, lots and permits 11,431,086 — — 11,431,086 Development fees 228,898 — — 228,898
Other 517,337 — 273,227 790,564
Total revenues 121,023,282 290,611 5,002,677 126,316,570

EXPENDITURES
Current:

General Government 19,562,292 — 25,684 19,587,976
Community development 9,118,545 — — 9,118,545
Public safety 57,402,991 — — 57,402,991
Public works 15,406,905 6,184,512 1,034,677 22,626,094
Transit and community services 5,760,016 — — 5,760,016
Capital outlay 13,568,975 — 4,071,279 17,640,254
Debt service:

Principal retirement 1,057,417 — — 1,057,417
Interest expense and fiscal charges 296,717 — — 296,717 Total expenditures 122,173,858 6,184,512 5,131,640 133,490,010 Excess (deficiency) of revenues
over (under) expenditures (1,150,576) (5,893,901) (128,963) (7,173,440)

OTHER FINANCING SOURCES (USES)
Transfers in 1,000,000 — 2,982,327 3,982,327
Transfers out (7,905,368) — (1,050,439) (8,955,807)
Gain on disposal of capital assets 3,469,439 — — 3,469,439 Issuance of lease and SBITA liability 2,320,683 — — 2,320,683 Total other financing sources (uses) (1,115,246) — 1,931,888 816,642 Net change in fund balances (2,265,822) (5,893,901) 1,802,925 (6,356,798) Fund balances-beginning, as originally reported 110,812,043 12,553,630 14,091,073 137,456,746 Restatements - correction of error (766,174) — — (766,174) Fund balances (deficit)-beginning, restated 110,045,869 12,553,630 14,091,073 136,690,572 Fund balances (deficit)-ending $ 107,780,047 $ 6,659,729 $ 15,893,998 $ 130,333,774

CITY OF LAGUNA BEACH
Statement Of Revenues, Expenditures And Changes In Fund Balances For The Year Ended June 30, 2025
See accompanying Notes to the Basic Financial Statements 31 54 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities Amounts reported for governmental activities in the Statement of Activities are different because:

Net change in fund balances - total governmental funds: $ (6,356,798) Governmental funds report capital outlays are expenditures. However, in the Statement of Activities, the cost of these assets is allocated over their estimated useful lives and reported as depreciation/amortization expense. This is the amount by which capital outlays exceeded depreciation/amortization expense in the current period.

Capital outlay $ 17,089,497
Depreciation/amortization expense (10,021,254)
Total adjustment 7,068,243
The net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, and donations) is to increase/(decrease) net position.

Loss/(gain) on disposal of capital assets (3,411,193)
Total adjustment (3,411,193)
Bond and other debt proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the Statement of Net Position. Repayment of bond and other debt principal is an expenditure in the governmental funds, but repayment reduces long-term liabilities in the Statement of Net Position. Also, governmental funds report the effect of premiums, discounts, and similar items when debt is first issued, whereas these amounts are deferred and amortized in the Statement of Activities.

Principal payments on subscriptions and leases 1,057,417 Initiation of new subscriptions and leases (2,320,683)
Total adjustment (1,263,266)
Internal service funds provide services to other funds on a cost-reimbursement basis. The net revenue of certain activities of internal service funds is reported with governmental activities. (1,669,979) Some expenses reported in the Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds.

Changes in pension liabilities and related deferred outflows and inflows of resources (6,593,889) Changes in OPEB liabilities and related deferred outflows and inflows of resources (489,673) Total adjustment (7,083,562)
Change in net position of governmental activities $ (11,989,157)

CITY OF LAGUNA BEACH
Reconciliation Of The Statement Of Revenues, Expenditures And Changes In Fund Balances Of Governmental Funds To The Statement Of Activities
For The Year Ended June 30, 2025
See accompanying Notes to the Basic Financial Statements 32 55 Major Enterprise Funds
The Enterprise Funds are used to report activity for which a fee is charged to external users for goods or services.

In addition, activities are required to be reported as enterprise funds if the activity is financed with debt that is secured solely by a pledge of the net revenues from fees and charges of the activity.

The City of Laguna Beach has the following major Enterprise Funds:

Municipal Transit Fund – The fund is used to account for the operations of the City's transit system. All activities necessary to provide such services are accounted for in this fund, including but not limited to, administration, operations, and maintenance.

Sewer Service Fund – The fund is used to account for the operations of the City's sewer system. All activities necessary to provide such services are accounted for in this fund, including but not limited to, administration, operations, and maintenance.

Internal Service Funds
Internal Service Funds are used to account for the financing of goods or services provided by one department or agency of a government to other departments or agencies on a cost reimbursement basis.

See accompanying Notes to the Basic Financial Statements 33 56 Statement of Net Position - Proprietary Funds
Business-Type Activities
Governmental
Activities
Sewer Service Municipal Transit
Total
Enterprise
Funds
Internal
Service Funds
ASSETS
Current assets:

Cash and investments $ 10,545,852 $ 1,931,175 $ 12,477,027 $ 25,290,932 Receivables (net of uncollectibles):

Taxes 136,168 114,029 250,197 49,308
Accounts 21,117 836,552 857,669 —
Interest 333,840 — 333,840 —
Intergovernmental — 8,999 8,999 —
Total current assets 11,036,977 2,890,755 13,927,732 25,340,240 Noncurrent:

I-Bank installment agreements 1,405,675 — 1,405,675 —
Notes receivable — — — 1,800,145
Property for housing program — — — 797,500
Capital assets, not being depreciated/amortized 4,815,909 196,106 5,012,015 — Capital assets, being depreciated/amortized, net 48,445,261 949,249 49,394,510 6,622,379 Total noncurrent assets 54,666,845 1,145,355 55,812,200 9,220,024 Total assets 65,703,822 4,036,110 69,739,932 34,560,264

DEFERRED OUTFLOWS OF RESOURCES
Deferred amounts related to pensions 244,016 81,339 325,355 — Deferred amounts related to OPEB 73,163 24,388 97,551 — Total deferred outflows of resources 317,179 105,727 422,906 —

LIABILITIES
Current liabilities:

Accounts payable 958,421 855,829 1,814,250 314,030
Accrued liabilities 37,232 19,630 56,862 49,854
Retainage payable 17,483 — 17,483 —
Interest payable 157,202 11 157,213 —
Compensated absences, due within one year 60,417 867 61,284 2,054,166 Inusrance claims payable, due within one year — — — 3,049,186 Lease liabilities, due within one year — 38,306 38,306 — Subscription IT liabilities, due within one year 3,970 1,324 5,294 — I-Bank installement agreements, due within one year 579,798 — 579,798 — Total OPEB liability, due within one year 10,398 3,466 13,864 — Total current liabilities 1,824,921 919,433 2,744,354 5,467,236 Noncurrent liabilities:

Compensated absences 43,665 42,634 86,299 5,084,203
Insurance claims payable — — — 7,114,767
I-Bank installment agreements 12,915,545 — 12,915,545 — Total OPEB liability 157,877 52,626 210,503 —
Net pension liability 915,327 305,109 1,220,436 —
Total noncurrent liabilities 14,032,414 400,369 14,432,783 12,198,970 Total liabilities 15,857,335 1,319,802 17,177,137 17,666,206

DEFERRED INFLOWS OF RESOURCES
Deferred amounts related to OPEB 20,335 6,778 27,113 —
Total deferred inflows of resources 20,335 6,778 27,113 —

NET POSITION
Net investment in capital assets 39,744,374 1,105,725 40,850,099 6,571,569 Unrestricted 10,398,957 1,709,532 12,108,489 10,322,489 Total net position $ 50,143,331 $ 2,815,257 $ 52,958,588 $ 16,894,058

CITY OF LAGUNA BEACH
Statement Of Net Position
Proprietary Funds
June 30, 2025
See accompanying Notes to the Basic Financial Statements 34 57 Statement of Revenues, Expenses and Changes in Net Position - Proprietary Funds Business-Type Activities
Governmental
Activities
Sewer Service Municipal Transit
Total
Enterprise Funds
Internal
Service Funds

OPERATING REVENUES
Passenger revenues $ — $ 225,195 $ 225,195 $ —
Rental — — — 2,535,200
Employee benefits charges — — — 1,322,000
Insurance charges — — — 13,509,609
Planning and zoning fees 11,086,076 — 11,086,076 —
Total operating revenues 11,086,076 225,195 11,311,271 17,366,809

OPERATING EXPENSES
Personnel services 376,353 343,649 720,002 130,068
Contractual services 3,522,672 3,804,451 7,327,123 —
Materials and supples 463,673 921,155 1,384,828 159,609 General and administrative 1,896,024 149,685 2,045,709 381,249 Employee benefits — — — 1,788,501
Insurance premiums and claim payments — — — 17,282,040
Depreciation/amortization 1,635,541 392,494 2,028,035 1,158,053 Total operating expenses 7,894,263 5,611,434 13,505,697 20,899,520 Operating income (loss) 3,191,813 (5,386,239) (2,194,426) (3,532,711)

NONOPERATING REVENUES (EXPENSES)
Investment income 536,183 15,548 551,731 7,074
Intergovernmental — 2,424,801 2,424,801 —
Interest expense and fiscal charges (378,781) (3,165) (381,946) — Miscellaneous — — — 47,346
Gain on disposal of capital assets — — — 468,458
Other revenue 710,806 416 711,222 —
Total nonoperating revenues (expenses) 868,208 2,437,600 3,305,808 522,878 Income (loss) before transfers 4,060,021 (2,948,639) 1,111,382 (3,009,833) Capital contributions — — — 39,854
Transfers in — 3,673,480 3,673,480 1,300,000
Change in net position 4,060,021 724,841 4,784,862 (1,669,979) Net position-beginning, as originally stated 44,244,411 2,997,141 47,241,552 17,882,690 Restatements - change within financial reporting entity (71,308) (913,630) (984,938) 984,938 Restatements - change in accounting principle (12,807) 6,338 (6,469) (557,944) Restatements - correction of error 1,923,014 567 1,923,581 254,353 Net position-beginning, as restated 46,083,310 2,090,416 48,173,726 18,564,037 Net position-ending $ 50,143,331 $ 2,815,257 $ 52,958,588 $ 16,894,058

CITY OF LAGUNA BEACH
Statement Of Revenues, Expenses And Changes In Net Position Proprietary Funds
For The Year Ended June 30, 2025
See accompanying Notes to the Basic Financial Statements 35 58 Statement of Cash Flows - Proprietary Funds
Business-Type Activities
Governmental
Activities
Sewer Service Municipal Transit Totals
Internal
Service Funds

CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers $ 11,093,891 $ 213,958 $ 11,307,849 $ 17,363,459 Payments to suppliers and service providers (5,858,870) (4,294,331) (10,153,201) (17,218,274) Payments to employees for salaries and benefits (3,763,143) (674,276) (4,437,419) (2,721,654) Other receipts (payments) — (3,953) (3,953) —
Net cash provided by (used for)
operating activities 1,471,878 (4,758,602) (3,286,724) (2,576,469)

CASH FLOWS FROM NONCAPITAL

FINANCING ACTIVITIES
Transfers from other funds — 3,673,480 3,673,480 1,300,000 Principal paid on non-capital debt (562,812) — (562,812) — Issuance of notes receivable to housing program — — — (569,638) Taxes 2,716 — 2,716 —
Operating grants and contributions 6,805,131 2,424,514 9,229,645 — Net cash provided by (used for)
noncapital financing activities 6,245,035 6,097,994 12,343,029 730,362

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES
Proceeds from capital debt 9,191 3,064 12,255 —
Capital contributions — — — 39,854
Acquisition and construction of capital assets (2,777,792) — (2,777,792) (1,602,391) Principal paid on capital debt (13,791) (307,003) (320,794) — Interest paid on capital debt (378,781) (5,131) (383,912) — Proceeds from sales of assets — — — 1,011,120
Net cash provided by (used for)
capital and related financing activities (3,161,173) (309,070) (3,470,243) (551,417)

CASH FLOWS FROM INVESTING ACTIVITIES
Interest on investments 609,101 4,922 614,023 54,420
Net cash provided by (used for)
investing activities 609,101 4,922 614,023 54,420
Net increase (decrease) in
cash and cash equivalents 5,164,841 1,035,244 6,200,085 (2,343,104) Cash and cash equivalents-beginning 5,381,011 895,931 6,276,942 27,634,036 Cash and cash equivalents-ending $ 10,545,852 $ 1,931,175 $ 12,477,027 $ 25,290,932

CITY OF LAGUNA BEACH
Statement Of Cash Flows
Proprietary Funds
For The Year Ended June 30, 2025
See accompanying Notes to the Basic Financial Statements 36 59 RECONCILIATION OF OPERATING INCOME (LOSS)

TO NET CASH PROVIDED BY (USED FOR)

OPERATING ACTIVITIES
Operating income (loss) $ 3,191,813 $ (5,386,239) $ (2,194,426) $ (3,532,711) Adjustments to reconcile operating income (loss) to
net cash provided by (used for) operating activities:

Depreciation/amortization expense 1,635,541 392,494 2,028,035 1,158,053 (Increase) decrease in accounts receivable 7,815 (15,190) (7,375) (3,350) (Increase) decrease in notes and loans receivable — — — (940,590) (Increase) decrease in prepaid items 1,603 534 2,137 —
Increase (decrease) in accounts payable (1,759,911) 425,824 (1,334,087) 49,506 Increase (decrease) in accrued liabilities (121,569) 4,917 (116,652) (55,543) Increase (decrease) in compensated absences 27,649 4,173 31,822 518,754 Increase (decrease) in claims and judgments — — — 229,412 Increase (decrease) in net pension liability (1,510,570) (212,606) (1,723,176) — Increase (decrease) in net OPEB liability (493) 27,491 26,998 — Total adjustments (1,719,935) 627,637 (1,092,298) 956,242 Net cash provided by (used for)
operating activities $ 1,471,878 $ (4,758,602) $ (3,286,724) $ (2,576,469)

SCHEDULE OF NON-CASH NONCAPITAL, CAPITAL,

AND INVESTING ACTIVITIES
Capital assets acquired through leasing/software arrangements $ 9,191 $ 3,064 $ 12,255 $ —

CITY OF LAGUNA BEACH
Statement Of Cash Flows (Continued)
Proprietary Funds
For The Year Ended June 30, 2025
See accompanying Notes to the Basic Financial Statements 37 60 Fiduciary Fund Financial Statements
See accompanying Notes to the Basic Financial Statements 38 61 Statement of Fiduciary Net Position - Fiduciary Funds Custodial
Funds
ASSETS
Cash and investments $ 809,455
Investments with fiscal agent 1,008,712
Receivables:

Taxes 24,060
Total assets 1,842,227

LIABILITIES
Accounts payable 4,080
Deferred revenue 47,403
Total liabilities 51,483

NET POSITION
Restricted for:

Individuals, organizations, and other governments 1,790,744 Total net position $ 1,790,744

CITY OF LAGUNA BEACH
Statement Of Fiduciary Net Position
Fiduciary Funds
June 30, 2025
See accompanying Notes to the Basic Financial Statements 39 62 Statement of Changes in Fiduciary Net Position - Fiduciary Funds Custodial
Funds

ADDITIONS
Special assessments $ 1,201,508
Investment income 57,267
Total additions 1,258,775

DEDUCTIONS
General and administrative 17,285
Debt service 1,118,294
Total deductions 1,135,579
Net increase (decrease) in fiduciary net position 123,196 Net position-beginning 1,667,548
Net position-ending $ 1,790,744

CITY OF LAGUNA BEACH
Statement Of Changes In Fiduciary Net Position
Fiduciary Funds
For The Year Ended June 30, 2025
See accompanying Notes to the Basic Financial Statements 40 63 Notes To Financial Statements
41 64
The financial statements of the City of Laguna Beach, California have been prepared in conformity with Generally Accepted Accounting Principles (GAAP) as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The following is a summary of the significant policies:

A. The Reporting Entity
The City of Laguna Beach was incorporated in 1927 under the General Laws of the State of California. The City operates under a Council – Manager form of government governed by a five – member council and provides the following services public safety (police, fire, paramedic, and marine safety), highway and streets, parks and recreation, public improvements, planning and zoning and general administrative service.

1. Discretely Presented Component Unit
The Laguna Beach County Water District (the District) was incorporated in 1925, under the County Water District Act of the State Water Code, and is the second oldest operating district of its type in California. The District is governed by the publicly elected Laguna Beach City Council members, serving as the District's Board of Directors. In 1998, the Local Agency Formation Commission of the County of Orange, California approved the District's application to become a subsidiary district of the City of Laguna Beach, effective November 1, 2000. The District has a separately issued report that can be obtained from Laguna Beach County Water District, 306 Third Street, Laguna Beach, California, 92652.

The District is considered a component unit because the City Council also serves as its Board of Directors, and the City Council (District's Board of Directors) is considered to be financially accountable. There is no financial benefit or burden relationship between the City and the District, as the City does not have access to District resources, nor is the City legally obligated to assume debt of the District. Further management of the City does not have operating responsibilities for the District. Therefore, the District is presented as a discretely presented component unit.

2. Blended Component Unit
The Laguna Beach Financing Authority (Financing Authority) was established pursuant to a Joint Exercise of Powers Agreement dated October 1, 2022, between the City and the California Statewide Communities Development Authority. The purpose of the Authority is to provide the financing necessary for the purchase or construction of various facilities or improvements through the issuance of debt. Although the Financing Authority is legally separate, it is reported as if it were part of the City because the City Council also serves as the governing board of the Financing Authority and the management of the City has operational responsibility for the Financing Authority. The activities of the Financing Authority are recorded in the debt service fund. Separate Financial Statements of the Financing Authority are prepared and can be obtained at City Hall.

B. Basis of Accounting and Measurement Focus
The basic financial statements of the City are composed of the following:
• Government – wide financial statements
• Fund financial statements
• Notes to basic financial statements
Financial reporting is based upon all GASB pronouncements required to be adopted and implemented by the end of the fiscal year.

1. Government - Wide Financial Statements
Government – wide financial statements display information about the reporting government as a whole, except for its fiduciary activities. The effect of interfund activity has been removed from these statements. These statements include separate columns for the governmental and business – type activities of the primary government.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 1 - REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 42 65
Eliminations have been made in the Statement of Activities so that certain allocated expenses are recorded only once (by the function to which they were allocated). However, general government expenses have not been allocated as indirect expenses to the various functions of the City.

Government – wide financial statements are presented using the economic resources measurement focus and the accrual basis of accounting. Under the economic resources measurement focus, all (both current and long – term) economic resources and obligations of the reporting government are reported in the government – wide financial statements. Basis of accounting refers to when revenues and expenses are recognized in the accounts and reported in the financial statements. Under the accrual basis of accounting, revenues, expenses, gains, losses, assets liabilities, and deferred inflows/outflows of resources resulting from exchange and exchange – like transactions are recognized when the exchange takes place.

Program revenues include charges for services, special assessments, and payments made by parties outside of the reporting government's citizenry if that money is restricted to a particular program. Program revenues are netted with program expenses in the statement of activities to present the net cost of each program.

Amounts paid to acquire capital assets are capitalized as assets in the government – wide financial statements, rather than reported as an expenditure. Proceeds of long – term debt are recorded as a liability in the government – wide financial statements, rather than as another financing source. Amounts paid to reduce long – term indebtedness of the reporting government are reported as a reduction of the related liability, rather than as an expenditure.

As discussed earlier, the City also presents the Water District as a discretely presented component unit on the government – wide statements.

2. Fund Financial Statements
The underlying accounting system of the City is organized and operated on the basis of separate funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a separate set of self – balancing accounts that comprise its assets liabilities, fund equity, revenues and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled.

Fund financial statements for the primary government's governmental, proprietary, and fiduciary funds are presented after the government – wide financial statements. These statements display information about the major funds individually and nonmajor funds in the aggregate for governmental and enterprise funds. Fiduciary statements include financial information for fiduciary funds. Fiduciary funds of the City primarily represent assets held by the City in a custodial capacity for other individuals or organizations.

3. Governmental Funds
In the fund financial statements, governmental funds are presented using the current financial resources measurement focus and the modified – accrual basis of accounting. The revenues are recognized when they become measurable and available. Measurable means that the amounts can be estimated, or otherwise determined. Available means that the amounts were collected during the reporting period or soon enough thereafter to be available to finance the expenditures accrued for the reporting period. The City uses an availability period of 60 days for most of its material revenues including property taxes and uses an availability per od of 180 days for grants.

SaIes taxes, property taxes, franchise taxes, gas taxes, transient occupancy taxes, grants 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 to the extent normally collected within the availability period, as defined above. All other revenue items are considered to be measurable and available when cash is received by the government.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 1 - REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 43 66
Revenue recognition is subject to the measurable and availability criteria for the governmental funds in the fund financial statements. Exchange transactions are recognized as revenues in the period in which they are earned (i.e., the related goods or services are provided). Locally imposed derived tax revenues are recognized as revenues in the period in which the underlying exchange transaction upon which they are based takes place.

Imposed nonexchange transactions are recognized as revenues in the period for which they were imposed. If the period of use is not specified, they are recognized as revenues when an enforceable legal claim to the revenues arises or when they are received, whichever occurs first. Government-mandated and voluntary nonexchange transactions are recognized as revenues when all applicable eligibility requirements have been met.

As stated above, in the fund financial statements, governmental funds are presented using the current financial resources measurement focus. This means that only current assets and current liabilities are generally included on their balance sheets. The reported fund balance (net current assets) is considered to be a measure of "available spendable resources. "Governmental fund operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in fund balance. Accordingly, they are said to present a summary of sources and uses of "available spendable resources" during a period.

Noncurrent portions of long-term receivables due to governmental funds are reported on their balance sheets in spite of their spending measurement focus.

Because of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by noncurrent liabilities. Since they do not affect fund balance, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities.

Amounts expended to acquire capital assets are recorded as expenditures in the year that resources were expended, rather than as fund assets. The proceeds of long-term debt are recorded as other financing sources rather than as a fund liability. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuance are reported as other financing uses. Amounts paid to reduce long-term indebtedness are reported as fund expenditures. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.

4. Proprietary and Fiduciary Funds
The City's enterprise and internal service funds are proprietary funds. In the fund financial statements, the proprietary funds and fiduciary funds are presented using the accrual basis of accounting. Revenues are recognized when they are earned, and expenses are recognized when the related goods or services are delivered. In the fund financial statements, proprietary and fiduciary funds are presented using the economic resources measurement focus. Th s means that all assets, liabilities (whether current or noncurrent), and deferred inflows/outflows of resources associated with their activity are included. Proprietary fund-type operating statements present increases (revenues) and decreases (expenses) in total net position.

Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values. Nonoperating revenues, such as subsidies, taxes, and investment earnings result from nonexchange transactions or ancillary activities. Amounts paid to acquire capital assets are capitalized as assets in the enterprise fund financial statements, rather than reported as an expenditure. Proceeds of long-term debt are recorded as a liability in the enterprise fund financial statements, rather than as another financing source.

Amounts paid to reduce long-term indebtedness of the enterprise fund are reported as a reduction of the related liability, rather than as an expenditure.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 1 - REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 44 67
C. Fund Classifications
The City of Laguna Beach reports the following major governmental funds:

1. General Fund
This is the primary operating fund of the City. It accounts for all activities of the general government, except those required to be accounted for in another fund.

2. Assessment Districts Capital Projects Fund
This fund is used to account for assessment district utility undergrounding projects which are funded by property owners of the assessment district. Revenues include contributions from property owners restricted for projects within the Assessment District and interest earned on such funds. The City has designated this fund as a major fund.

The City of Laguna Beach reports the following major enterprise funds:

3. Municipal Transit Fund
This fund is used to account for the operations of the City's transit system. All activities necessary to provide such service are accounted for in this fund, including, but not limited to, administration, operations, and maintenance.

The City has designated this fund as a major fund.

4. Sewer Service Fund
This fund is used to account for the operations of the City's sewer services. All activities necessary to provide such service are accounted for in this fund.

The City's fund structure also includes the following fund types:

5. Special Revenue Funds
The Special Revenue Funds are used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditures for specified purposes other than debt services or capital projects.

6. Debt Service Fund
This fund accounts for the servicing of long-term debt.

7. Internal Service Funds
The Internal Service Funds are used to account for the City's cost of providing employe benefits and various forms of insurance provided to the City departments, and the cost of maintaining and replacing the City's vehicles.

8. Custodial Fund
The Fiduciary fund is used to account for assets held by the City as an agent for improvement district bond holders and property owners.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 1 - REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 45 68
D. Encumbrances
The City utilizes an encumbrance system as a management control technique to assist in controlling expenditures. Under this system, encumbrances are recorded in the general, special revenue, and capital projects fund store present purchase orders, contracts and other commitments. Encumbrances at year-end are reported with in the restricted, committed, or assigned fund balance depending on the resources that have been identified to fund the applicable encumbrance. The total encumbrances outstanding as of June 30, 2025 were as follows:

General Fund $ 6,184,399
Assessment Districts Capital Projects Fund 50,207
Nonmajor Governmental Funds 707,161
Enterprise Funds 2,024,739
Total Encumbrances $ 8,966,506
E. Cash and Investments
All cash and investments other than that held by fiscal agents are either held in certificates of deposits in IocaI banks or in a City-wide investment pool. Accordingly, all cash and investments in the proprietary fund types are considered cash and cash equivalents.

Investments are reported at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Changes in fair value that occur during a fiscal year are recognized as investment income reported for that fiscal year. Investment income includes interest earnings, changes in fair value, and any gains and looses realized upon the liquidation, maturity, or sale of investments.

F. Lease Receivables
Lease receivables are recorded by the City as the present value of future lease payments expected to be received from the lessee during the lease term, reduced by any provision for estimated uncollectible amounts. Lease receivables are subsequently reduced over the life of the lease as cash is received in the applicable reporting period. The present value of future lease payments to be received are discounted based on the interest rate the City charges the lessee.

G. Advances to Other Funds
Long-term interfund advances are recorded as a receivable and as non-spendable fund balance by the advancing governmental fund, when reported in the General Fund or with in restricted fund balance for other governmental funds.

H. Inventory
Inventories are valued at cost and are consumed using the first-in/first-out (FIFO) method. The costs of governmental fund type inventories are recorded as expenditures when consumed rather than when purchased.

I. Prepaids
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. The cost of prepaid items is recorded as expenditures/expenses when consumed rather than when purchased (consumption method).

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 1 - REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 46 69
J. Investments with Fiscal Agent
Certain proceeds from the issuance of debt, as well as certain resources set aside for the payment of debt, are classified as investments with fiscal agent because they are held by an agent and their use is limited by applicable debt agreements. These funds are held in custodial funds only.

K. Capital Assets
Capital assets (including infrastructure) are recorded at cost where historical records are available and at an estimated historical cost where no historical records exist. Contributed capital assets are valued at their estimated acquisition value at the date of the contribution. Generally, capital asset purchases in excess of $5,000 are capitalized if they have an expected useful life of three years or more.

Capital assets include public domain (infrastructure) consisting of certain improvements other than buildings, including storm drains, beach stairways, streets, sidewalks, sewer line relining, sewer lines, and nuisance water diversification units.

Capital assets used in operations are depreciated over their estimated useful lives. The City uses the straight – line method in the government – wide financial statements and the proprietary fund financial statements for depreciating storm drains, beach stairways, streets, sidewalks, sewer line relining, sewer lines, nuisance water diversification units, buildings and improvements, office equipment and machines, furniture and fixtures, equipment, machinery and tools, and automotive equipment. Depreciation is charged as an expense against operations and accumulated depreciation is reported on the respective statement of net position.

Right to use leased assets are recognized at the lease commencement date and represent the City's right to use an underlying asset for the lease term. Right to use leased assets are measured at the initial value of the lease liability plus any payments made to the lessor before commencement of the lease term, less any lease incentives received from the lessor at or before the commencement of the lease term, plus any initial direct costs necessary to place the leased asset into service. Right to use leased assets are amortized over the shorter of the lease term or useful life of the underlying asset using the straight – line method.

Right to use subscription IT assets are recognized at the subscription commencement date and represent the City's right to use the underlying IT asset for the subscription term. Right to use subscription IT assets are measured at the initial value of the subscription liability plus any payments made to the vendor at the commencement of the subscription term, less any subscription incentives received from the vendor at or before the commencement of the subscription term, plus any capitalizable initial implementation costs necessary to place the subscription asset into service. Right to use subscription IT assets are amortized over the shorter of the subscription term or useful life of the underlying asset using the straight – line method.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 1 - REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 47 70
The ranges of lives used for depreciation/amortization for each fixed asset class are as follows:

Asset Years
Storm Drains 40 years
Beach Stairways 30 years
Streets 50 years
Sidewalks 50 years
Sewer Line Relining 40 years
Sewer Lines 50 years
Nuisance Water Diversification Units 30 years
Buildings and Improvements 30 years
Office Equipment and Machines 5 years
Furniture and Fixtures 3 to 8 years
Equipment, Machinery, and Tools 3 to 8 years
Automotive Equipment 2 to 20 years
Right to Use Asset Shorter of useful life or lease term/subscription term L. Property Taxes
Property taxes attach as an enforceable lien on property as of January1. Taxes are levied on July 1 and are payable in two installments on December 10 and April 10. The County bills and collects the property taxes and remits them to the City in installments during the year. City property tax revenues are recognized when levied to the extent that they result in current receivables. The County is permitted by state law (Proposition 13) to levy taxes at 1% of full market value (at time of purchase) and can increase the property tax value base no more than 2% per year.

M. Compensated Absences
Accumulated unpaid vacation and sick leave amounts are currently funded and recorded as expenditures in the individual funds. These amounts are recorded as employee benefit charges and are accrued when incurred in the Municipal Transit and Sewer Service Enterprise Fund, and the Insurance and Employee Benefits Internal Service Fund. The majority of sick leave is paid out at a rate of one hour for every two hours banked and, therefore, is recorded at 50% of the total leave balance. Vacation accruals have no such limitations and are recorded at 10% of the total leave balance.

N. Lease Liabilities
Lease liabilities represent the City's obligation to make lease payments arising from leases. Lease liabilities are recognized at the lease commencement date based on the present value of future lease payments expected to be made during the lease term. The present value of lease payments are discounted based on a borrowing rate determined by the City.

O. Subscription Liabilities
Subscription liabilities represent the City's obligation to make subscription payments arising from the subscription contract. Subscription liabilities are recognized at the subscription commencement date based on the present value of future subscription payments expected to be made during the subscription term. The present value of subscription payments are discounted based on a borrowing rate determined by the City.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 1 - REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 48 71
P. Net Position
Net position is the excess of all the City's assets and deferred outflows of resources over all its liabilities and deferred inflows of resources, regardless of fund. Net position is divided into three categories. These categories apply only to net position, which is determined only at the government – wide level, proprietary funds, and fiduciary funds and are described below.

Net Investment in Capital Assets – describes the portion of net position which is represented by the current net book value of the City's capital assets, lest the outstanding balance of any debt issued to finance these assets and capital – related payables.

Restricted – describes the portion of net position which is restricted as to use by the terms and conditions of agreements with outside parties, governmental regulations, laws, or other restrictions which the City cannot unilaterally alter.

Unrestricted – describes the portion of net position which is not restricted as to use.

Q. 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 practice to consider restricted – net position to have been depleted before unrestricted – net position is applied, however it is at the Council's discretion.

R. Fund Balances
Fund balances are reported in the fund statements in the following classifications:

1. Nonspendable Fund Balance
Nonspendable Fund Balance – This includes amounts that cannot be spent because they are either not spendable in form (such as prepaid amounts and inventory) or legally or contractually required to be maintained intact (such as endowments).

2. Spendable Fund Balances
Restricted Fund Balance – This includes amounts that can be spent only for specific purposes stipulated by legal requirements imposed by other governments, external resource providers, enabling legislation, or creditors.

Restrictions may effectively be changed or lifted only with the consent of resource providers.

Committed Fund Balance – This includes amounts that can only be used for specific purposes pursuant to constraints imposed by the highest level of formal action of the City Council. Those committed amounts cannot be used for any other purpose unless City Council removes or changes the specified use by taking the same type of action. The constraints are imposed by Resolution of the City Council, the highest level of approval.

Assigned Fund Balance – This includes amounts that are intended to be used for specific purposes as indicated by City Council or by persons to whom City Council has delegated the authority to assign amounts for specific purposes. City Council has not delegated such authority.

Unassigned Fund Balance – This includes the remaining spendable amounts which are not included none of the other classifications. The use of this classification is limited to the General Fund or other governmental funds with a deficit fund balance.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 1 - REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 49 72
It is the City's policy that restricted resources will be applied first, followed by (in order of application) restricted, committed, assigned, and unassigned resources, in the absence of a formal policy adopted by the Council.

S. General Fund Balance Policy
It is the policy of the City to maintain a minimum reserve in unassigned fund balance for unforeseen emergencies or catastrophic impacts upon the City, and whenever fiscally possible and financially prudent, to maintain a greater target reserve. The minimum reserve of the General Fund is 10% of General Fund operating expenditures (single fund, not combined General Fund) per the City's municipal code. However, the City Council has established a policy of a higher reserve target of 20%. Total expenditures were $98,142,962 and the minimum reserve requirement was $19,628,592. The City's General Fund (single fund, not combined) reported $16,665,455 in reserves in committed and assigned fund balance as of June 30, 2025.

T. Deficit Fund Balance
The City had the following funds with deficit fund balance as of June 30, 2025:

Fund Name Fund Type Deficit
Deposits General Fund Subfund $ 16,251
Insurance and Employee Benefits Internal Service Fund $ 4,896,903 U. Grant and Allocations
The City is a recipient of state and federal grants, which are governed by laws and regulations established by the granting agencies. Costs charged to the respective grant programs are subject to review and adjustment by the granting agencies. Certain requests relating to this funding are pending approval by the funding agency. The amount of disallowed cost, if any, that might be associated with this funding, cannot be reasonably estimated.

V. Deferred Outflows and Inflows of Resources
In addition to assets, the statement of net position reports a separate section for deferred outflows of resources.

This separate financial statement element, deferred outflows of resources, represents a consumption of net assets that applies to future periods and so will not be recognized as an outflow of resources (expense/ expenditure) until that time. The City has the following items that qualify for reporting in this category:
• Deferred outflows related to pensions equal to employer contributions made after the measurement date of the net pension liability.
• Deferred outflows related to pensions for differences between expected and actual experience, changes of assumptions, and differences between actual contributions and proportionate share of contributions and changes in proportion. These amounts are amortized over a closed period equal to the average of the expected remaining service lives of all employees that are provided with pensions through the plans. • Deferred outflows related to OPEB for differences between expected and actual experience and changes in assumptions. These amounts are amortized over a closed period equal to the average of the expected remaining service lives of all employees that are provided with retiree healthcare benefits through the plans.

In addition to liabilities, the statement of net position and governmental funds balance sheet reports a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net assets that applies to future periods and will not be recognized as an inflow of resources (revenue) until that time. The City has the following item that qualifies for reporting in this category:

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 1 - REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 50 73
• Deferred inflows related to pensions for differences between expected and actual experience, changes of assumptions, and differences between actual contributions and proportionate share of contributions and changes in proportion. These amounts are amortized over a closed period equal to the average of the expected remaining service lives of all employees that are provided with pensions through the plans. • Deferred inflows related to pensions resulting from the net differences between projected and actual earnings on investments of the pension plans fiduciary net position. These amounts are amortized over 5 years. • Deferred inflows related to OPEB for differences between expected and actual experience. These amounts are amortized over a closed period equal to the average of the expected remaining service lives of all employees that are provided with retiree healthcare benefits through the plans. • Deferred inflows related to leases where the City is the lessor, which may be reported in the governmental funds statement of net position. These amounts are recognized on a straight-line basis over the term of the lease.

W. Pensions
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the City's California Public Employees Retirement System (CalPERS) plans and additions to/deductions from the Plan's fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms.

Investments are reported at fair value.

X. Use of Estimates
The preparation of financial statements requires management to make certain estimates and assumptions that affect the reported amounts of assets, deferred outflows of resources, liabilities, and deferred inflows of resources, at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Y. New Accounting Pronouncements
GASB Statement No. 101 – In June 2022, the GASB issued Statement No. 101, Compensated Absences. The objective of this Statement is to better meet the information needs of financial statement users by updating the recognition and measurement guidance for compensated absences. That objective is achieved by aligning the recognition and measurement guidance under a unified model and by amending certain previously required disclosures. The requirements of this Statement are effective for fiscal years beginning after December 15, 2023, and all reporting periods thereafter. The City has evaluated the impact of this statement and made adjustments as noted in footnote 18.

GASB Statement No. 102 – In December 2023, the GASB issued Statement No. 102, Certain Risk Disclosures.

The objective of this Statement is to provide users of government financial statements with essential information about risks related to a state or local government’s vulnerabilities due to the variety of risks they face. The requirements of this Statement are effective for fiscal years beginning after June 15, 2024. The City has evaluated the impact of this statement and determined that no additional disclosures are necessary at this time.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 1 - REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 51 74
A. Cash and Investments
Cash and investments of the primary government as of June 30, 2025 are classified in the accompanying financial statements as follows:

Statement of Net Position
Cash and investments - Governmental Activities $ 159,335,166 Cash and investments - Business-type Activities 12,477,027 Statement of Fiduciary Net Position
Cash and cash equivalents 809,455
Investments with fiscal agent 1,008,712
Total cash and investments $ 173,630,360
Cash and investments as of June 30, 2025 consisted of the following:

Cash on hand $ 10,070
Deposits with financial institutions 34,137,150
Investments 139,483,140
Total cash and investments $ 173,630,360
B. Investments Authorized by the California Government Code and the City's Investment Policy The table below identifies the investment types that are authorized for the City by the California Government Code (or the City's investment policy, where more restrictive). The table also identifies certain provisions of the California Government Code (or the City's investment policy, where more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by the bond trustee that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City's investment policy.

Authorized by Maximum Maximum
Investment Types Investment Maximum Percentage Investment Authorized by State Law Policy Maturity * of Portfolio * in One Issuer * U.S. Treasury obligations Yes 5 years None None
Federal agency securities Yes 5 years None None
Bankers acceptances Yes 180 days 25% None
Supranational Securities Yes 5 years 5% None
Commercial paper Yes 270 days 25% 3%
Certificates of deposit (nonnegotiable) Yes 5 years None None Certificates of deposit (negotiable) Yes 5 years 25% None Medium-term notes Yes 5 years 25% 3%
Municipal bonds** Yes 5 years 25% 5%
Money market mutual funds Yes N/A 20% 20%
Local Agency Investment Fund Yes N/A None $75 million
*Based on state law requirements or investment policy requirement, whichever is more restrictive. **Includes City of Laguna Beach debt/bonds and may be authorized by City Council in excess of five years.

City Of Laguna Beach
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 2 - CASH AND INVESTMENTS
52 75
C. Investment Authorized by Debt Agreements
Investments of debt proceeds held by bond trustee are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City's investment policy. The debt agreements permit the investments held by bond trustee to be invested in investment types that are permitted by California Government Code Section 53601 as directed by the City Treasurer.

D. Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity as necessary to provide the cash flow and liquidity needed for operations.

Information about the sensitivity of the fair values of the City’s investments (including investments held by bond trustee) to market interest rate fluctuations are provided by the following tables that show the distribution of the City’s investments by maturity as of June 30, 2025.

Remaining Maturity (in Months)
12 Months 13 to 36 37 to 60
Investment Type Total or Less Months Months
Federal Agency Securities $ 75,070,499 $ 52,332,234 $ 22,738,265 $ — Municipal Bonds 2,542,326 2,542,326 — —
Local Agency Investment Fund 26,691,519 26,691,519 — —
Medium-Term Notes 7,608,474 2,727,614 2,943,330 1,937,530 Supranational 1,965,490 1,965,490 — —
City Bonds* 529,000 — — 529,000
United States Treasury Bill 23,089,840 13,960,480 9,129,360 — Certificates of Deposit (negotiable) 977,280 251,020 726,260 — Held by Fiscal Agent:

Local Agency Investment Fund 310,209 310,209 — —
Money market mutual funds 698,503 698,503 — —
Total investments $ 139,483,140 $ 101,479,395 $ 35,537,215 $ 2,466,530 *City Council has approved the investment in the debt/bonds of Assessment Districts 13-6, 14-1 and 15-2 in the amount of $529,000 which have maturities in excess of five years and are nonnegotiable.

E. Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the minimum rating required by (where applicable) the California Government Code, the City's investment policy, or debt agreements, and the Standard & Poor's (S&P) actual rating as of yearend for each investment type.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 2 - CASH AND INVESTMENTS (CONTINUED)
53 76
Moody's Rating as of Fiscal Year End
Minimum Exempt or
Investment Type Total Legal Rating AAA AA A BBB Not Rated Federal Agency Securities $ 75,070,499 N/A $ — $ 75,070,499 $ — $ — $ — Municipal Bonds 2,542,326 A* 498,456 2,043,870 — — —
Local Agency Investment Fund 26,691,519 N/A — — — — 26,691,519 Medium-Term Notes 7,608,474 A — 3,693,644 2,939,350 975,480 — Supranational 1,965,490 AA 1,965,490 — — — —
City Bonds* 529,000 N/A — — — — 529,000
United States Treasury Bill 23,089,840 N/A — — — — 23,089,840 Certificates of Deposit (negotiable) 977,280 N/A — — — — 977,280 Held by Fiscal Agent:

Local Agency Investment Fund 310,209 — — — — 310,209
Money market mutual funds 698,503 698,503 — — — —
Total investments $ 139,483,140 $ 3,162,449 $ 80,808,013 $ 2,939,350 $ 975,480 $ 51,597,848 *City of Laguna Beach debt/bonds in the amount of $529,000 are exempt from the minimum legal rating.

F. Concentration of Credit Risk
Concentration credit risk is the heightened risk of potential loss when investments are concentrated none issuer.

The investment policy of the City contains a 3% limitation on the amount that can be invested in anyone issuer of Commercial Paper or Medium-Term Notes and a 5% limitation on the amount that can be invested in anyone issuer of Municipal Bonds. The City has no investments in excess of these limitations.

Investments in anyone issuer (other than external investment pools) that represent 5% or more of total City investments are as follows:

Issuer Investment Type Amount
United States Treasury U.S. Treasury obligations $ 23,089,840 Federal Home Loan Bank Federal Agency Securities 45,691,079 Federal Home Loan Mortgage Corporation Federal Agency Securities 12,815,470 Federal Farm Credit Bank Federal Agency Securities 10,722,410 G. 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 City’s investment policy requires that all investment transactions be conducted on a delivery-versus-payment (DVP) basis. The City’s investment policy also requires that an independent, third-party custodian designated by the Treasurer hold all securities. For all executed transactions, the third-party custodian is required to issue a safe keeping receipt to the City that lists the specific instrument, rate, maturity and other information pertinent to the transaction.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 2 - CASH AND INVESTMENTS (CONTINUED)
54 77
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 fair value of the pledged securities In the collateral pool must equal at least 10% 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. As of June 30, 2025, all of the City’s funds are held in accordance with these provisions.

For investments identified herein as held by the fiscal agent, the City Treasurers elects the investment under the terms of the applicable trust agreement, acquires the investment, and holds the investment on behalf of the reporting government.

H. Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code under the oversight of the Treasurer of the state of California. The fair value of the City's investment in this pool is reported in the accompanying financial statements at amounts based upon the City's pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis and is limited to the account balance. The California Local Agency Investment Fund is not insured or collateralized. The Fund is subject to regulatory oversight by the state of California Treasurer, although it is not registered with the Securities and Exchange Commission. Deposits and withdrawals to and from LAIF are made on the basis of $1 and not at fair value. According, under the fair value hierarchy, the investment with LAIF is uncategorized.

I. Fair Value Measurements
The City categorizes its fair value measurement 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 assets.

Level 1 inputs are quoted prices inactive markets for identical assets, Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the assets and liabilities through corroboration with market data (the market approach), and Level 3 inputs are significant unobservable inputs. Federal agency securities, municipal bonds, medium term notes, and supranational, classified in Level 2 of the fair value hierarchy, are valued using a matrix pricing technique. Matrix pricing is used to value securities based on the securities' relationship to benchmark quoted prices.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 2 - CASH AND INVESTMENTS (CONTINUED)
55 78
The City has the following recurring fair value measurements as of June 30, 2025:

Fair Value
Observable
Inputs Level 2
Investment Type (Subject to Hierarchy)
Federal Agency Securities $ 75,070,499 $ 75,070,499
Municipal Bonds 2,542,326 2,542,326
Medium-Term Notes 7,608,474 7,608,474
Supranational 1,965,490 1,965,490
City Bonds 529,000 529,000
United States Treasury Bill 23,089,840 23,089,840
Certificate of Deposit (negotiable) 977,280 977,280
Total Subject to Hierarchy 111,782,909 $ 111,782,909
Uncategorized (Not Subject to Hierarchy)
Local Agency Investment Fund 27,001,728
Money Market Mutual Funds 698,503
Total Investment Portfolio $ 139,483,140
NOTE 3 - INTERFUND ACTIVITY
Interfund transfers at June 30, 2025 consisted of the following:

Transfer Out
Transfer In General Fund
Nonmajor
Governmental
Funds Total
General Fund $ — $ 1,000,000 $ 1,000,000
Non-Major Governmental Funds 2,931,888 50,439 2,982,327 Municipal Transit Enterprise Fund 3,673,480 — 3,673,480 Internal Service Funds 1,300,000 — 1,300,000
Total $ 7,905,368 $ 1,050,439 $ 8,955,807
Transfers were used to:

1. Transfer from the General Fund to various Non-Major Governmental Funds totaling $2,931,888 to support various City activities and projects.Transfer from the General Fund (Parking) to the Municipal Transit Fund in the amount of $3,673,480 to cover the balance of operating and capital expenditures not funded from grants or other revenues.

2. Transfer from the General Fund to the Vehicle Replacement Fund in the amount of $1,000,000 for the repayment of internal loan for sale of 31729 and 31735 Coast Highway. Transfer from the General Fund (Parking) to the Vehicle Replacement Fund in the amount of $300,000 to fund replacement of transit trolleys.

3. Transfer from the Street Lighting District Fund to the General Fund (Wildfire Mitigation and Fire Safety) in the amount of $1,000,000 to fund wildfire mitigation and undergrounding.

4. Transfer from the Asset Forfeiture Fund to the State Asset Forfeiture Fund in the amount of $50,439 to establish a separate State Asset Forfeiture Fund.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 2 - CASH AND INVESTMENTS (CONTINUED)
56 79
Capital asset activity for the fiscal year ended June 30, 2025 were as follows:

Capital assets, not being depreciated/amortized
Land $ 114,407,234 $ — $ (2,700,001) $ 111,707,233
Works of Art — — 1,507,913 1,507,913
Construction-in-progress 45,029,639 12,664,615 (10,245,219) 47,449,035 Total capital assets, not being depreciated/amortized 159,436,873 12,664,615 (11,437,307) 160,664,181 Capital assets, being depreciated/amortized
Buildings and Improvements 84,905,556 — 930,449 85,836,005 Office Equipment and Machinery 5,853,189 — — 5,853,189
Furniture and Fixtures 2,987,035 — (1,507,913) 1,479,122 Equipment, Machinery, and Tools 8,620,320 944,832 235,442 9,800,594 Automotive Equipment 17,963,095 1,606,067 (872,418) 18,696,744 Software — 94,520 — 94,520
Lease Assets
Building 212,112 — — 212,112
Office Equipment and Machinery 250,329 914,394 (69,755) 1,094,968 Automotive Equipment 485,394 — — 485,394
Software as a Service 1,024,434 2,401,730 (15,760) 3,410,404 Infrastructure 256,979,121 69,406 8,238,183 265,286,710 Total capital assets, being depreciated/amortized 379,280,585 6,030,949 6,938,228 392,249,762 Less accumulated depreciation/amortization for
Buildings (41,012,604) (2,338,728) — (43,351,332)
Office Equipment and Machinery (5,513,028) (131,947) — (5,644,975) Furniture and Fixtures (827,524) (72,952) — (900,476)
Equipment, Machinery, and Tools (5,670,560) (489,681) 129,953 (6,030,288) Automotive Equipment (11,786,892) (1,158,053) 870,580 (12,074,365) Software — (13,419) — (13,419)
Lease Assets
Building (83,912) (27,971) — (111,883)
Office Equipment and Machinery (87,687) (257,558) 69,755 (275,490) Automotive Equipment (152,360) (60,674) — (213,034)
Software as a Service (544,967) (1,199,334) 15,760 (1,728,541) Infrastructure (112,374,863) (5,428,990) — (117,803,853) Total accumulated depreciation/amortization (178,054,397) (11,179,307) 1,086,048 (188,147,656) Total capital assets, being depreciated/amortized, net 201,226,188 (5,148,358) 8,024,276 204,102,106 Governmental activities capital assets, net $ 360,663,061 $ 7,516,257 $ (3,413,031) $ 364,766,287 Balance
Governmental Activities
June 30, 2024,
as Restated Additions
Deletions/
Transfers
Balance
June 30, 2025

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 4 - CAPITAL ASSETS
57 80
Balance
Total Business-Type Activities
June 30, 2024,
as Restated Additions
Deletions/
Transfers
Balance
June 30, 2025
Capital assets, not being depreciated/amortized
Land $ 196,106 $ — $ — $ 196,106
Construction-in-progress 3,731,174 2,670,564 (1,585,829) 4,815,909 Total capital assets, not being depreciated/amortized 3,927,280 2,670,564 (1,585,829) 5,012,015 Capital assets, being depreciated/amortized
Buildings and Improvements 1,916,298 — — 1,916,298
Office Equipment and Machinery 725,014 — — 725,014
Furniture and Fixtures 38,605 — — 38,605
Equipment, Machinery, and Tools 1,686,209 74,101 — 1,760,310 Automotive Equipment — — — —
Sewer Plant and Lines 62,290,056 — 585,825 62,875,881
Lease Assets
Automotive Equipment 1,232,715 — (299,543) 933,172
Software as a Service 34,191 44,169 — 78,360
Capacity Rights 40,385,424 — 1,000,004 41,385,428
Total capital assets, being depreciated/amortized 108,308,512 118,270 1,286,286 109,713,068 Less accumulated depreciation/amortization
Buildings and Improvements (1,036,365) (62,866) — (1,099,231) Office Equipment and Machinery (586,587) (19,816) — (606,403) Furniture and Fixtures (31,928) (1,722) — (33,650)
Equipment, Machinery, and Tools (736,583) (86,705) — (823,288) Automotive Equipment — — — —
Sewer Plant and Lines (27,918,094) (1,162,910) — (29,081,004) Lease Assets
Automotive Equipment (896,541) (298,848) 299,543 (895,846) Software as a Service (18,994) (35,490) — (54,484)
Capacity Rights (27,364,974) (359,678) — (27,724,652)
Total accumulated depreciation/amortization (58,590,066) (2,028,035) 299,543 (60,318,558) Total capital assets, being depreciated/amortized, net 49,718,446 (1,909,765) 1,585,829 49,394,510 Business-Type Activities Capital Assets, Net $ 53,645,726 $ 760,799 $ — $ 54,406,525 Depreciation and amortization expense was charged to the following functions of governmental activities in the statement of activities:

General government $ 2,276,863
Community Development 5,969
Public Safety 666,554
Public Works 6,385,279
Transit and Community Services 686,589
Internal Service Funds 1,158,053
Total $ 11,179,307

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 4 - CAPITAL ASSETS (CONTINUED)
58 81
Depreciation and amortization expense was charged to the following functions of business-type activities in the statement of activities:

Municipal Trust $ 392,494
Sewer Service 1,635,541
Total $ 2,028,035
NOTE 5 - CONSTRUCTION COMMITMENTS
As of June 30, 2025, contract commitments for major capital projects included the following:

Project Expenditures Unexpended
Description Contract to Date Balance
AD 2014-2 Woods Cove Undergrounding $ 9,247,568 $ 3,616,201 $ 5,631,367 Anita St Sewer LS & Beach Access 5,311,250 — 5,311,250
PAED Documents for Laguna Canyon Road
Improvements 2,706,412 780,881 1,925,531
Upgrade Computer Aided Dispatch system 1,373,861 137,386 1,236,475 North Coast Interceptor Intertie 3,500,000 2,487,968 1,012,032 Zones 5 & 11A Slurry Rehab 1,538,559 666,881 871,678
Anita St Sewer LS & Beach Access 764,150 — 764,150
Main Beach Park Renovation 1,480,944 864,263 616,681
Fuel Modification 1,386,000 789,043 596,957
AD 2014-2 Woods Cove Undergrounding 827,642 299,305 528,337 Total $ 28,136,386 $ 9,641,928 $ 18,494,458
NOTE 6 - RISK MANAGEMENT
The City is exposed to various risks of loss related to torts, theft of, damage to, and destruction of assets, errors and omissions, injuries to employees, and natural disasters.

The City retains the risk of loss for general/auto liability claims of up to $400,000 per occurrence and workers' compensation claims of up to $300,000 per person per occurrence. Additionally, the City has retained risk of loss for employee PPO dental insurance claims. The City is fully insured for medical claims. The City has established the Insurance and Employee Benefits Internal Service Fund to account for and finance these uninsured risks of loss, and liabilities are accrued when incurred, including estimates for incurred but not reported (IBNR) loss, in this fund. An estimate for incurred but not reported claims for PPO dental coverage has not been accrued because management believes the liability for incurred but not recorded claims would be immaterial to the financial statements.

The City is also a member of the California Insurance Pool Authority (CIPA), a public entity risk pool consisting of 14 member cities in Southern California, which was established to pool resources, share risks, purchase excess insurance, and share costs for professional risk management and claims administration. The coverage for general and auto liability extends to $3,000,000 self-insured retention with a $43,000,000 annual aggregate. The coverage for workers' compensation extends to a limit of $2,000,000. Member cities' CIPA premiums are based on actuarial reports and underwriting estimates and are calculated based on the member cities' individual experience and exposure for a particular program. Members may be charged assessments if losses exceed the amount of premium collected.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 4 - CAPITAL ASSETS (CONTINUED)
59 82
All funds of the City participate in the risk management program and make payments to the Insurance and Employee Benefits Internal Service Fund based on estimates of the amounts needed to pay prior-year and current year claims. A claims liability of $10,163,953 is reported in the Insurance and Employee Benefits Internal Service Fund, at June 30, 2025. Changes in the Insurance and Employee Benefits Internal Service Fund's claims liability amounts in fiscal years 2025 and 2024 were as follows:
2025 2024
Beginning of Year Liability $ 9,934,541 $ 9,486,010
Current Year Claims as Changes in Estimates 6,450,571 3,712,278 Claims Payments (6,221,159) (3,263,747)
Insurance Claims Payable $ 10,163,953 $ 9,934,541
Current Portion of Claims Payable
General Liabilities Claims $ 683,513
Workers' Compensation Claims 2,365,673
Total Current Portion of Claims Payable $ 3,049,186
For the past three fiscal years, claims paid did not exceed the amount of applicable insurance coverage and there have been no significant changes in insurance policies or coverage amounts.

NOTE 7 - IMPROVEMENT DISTRICTS
Bonds issued for improvement districts are liabilities of the property owners and are secured by liens against the assessed property. The City is not liable for repayment and is only acting as an agent to expend the project funds on behalf of the property owners and to collect principal and interest payments from property owners and remit such monies to the bond holders. As of June 30, 2025, special assessment debt outstanding was:

District
Principal
Outstanding
June 30, 2025
AD 09-1 $ 2,130,000
AD 13-1 207,318
AD 13-6 105,000
RAD 14-3 85,550
AD 15-2 62,000
AD 13-2 1,360,000
AD 14-1 362,000
AD 14-2 8,820,000
Total $ 13,131,868

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 6 - RISK MANAGEMENT (CONTINUED)
60 83
A. Deferred Compensation Plan
The City offers its employees a deferred compensation plan created in accordance with internal Revenue Code Section 457. The plan, available to all City employees, permits them to defer a portion of their salary until future years. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. Federal legislation requires that the Section 457 plan assets be held in trust for employes. This change, which was implemented in the 1999 fiscal year, means that employee assets held in Section 457 plans are no longer the property of the City and are no longer subject to claims of the City's general creditors. The City makes no contributions to the plan and has no liability for losses under the plan but does have the duty of due care that would be required of an ordinary prudent investor. At June 30, 2025, the deferred compensation assets are not reflected in the City's financial statements.

B. Defined Contribution Plan
The City has established a defined contribution plan administered through a private administrator known as Public Agency Retirement System ("PARS") for all of its part-time employees, pursuant to the requirements of section 132 of the Social Security Act. All part-time employees are eligible to participate from the date of employment. Federal legislation requires contributions of at least 7.5% to a retirement plan. The City contributes

3.75%, 4.75%, or 8.5% of employee compensation depending on the employee’s classification. The City's contributions for each employee are fully vested immediately. For the year ended June 30, 2025, the City contributed $213,396 to the plan.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 8 - OTHER EMPLOYEE BENEFITS
61 84
The following is a summary of the changes in the principal balance of long-term liabilities for the year ended June 30, 2025:

Balance Balance Due Within Due in More
June 30, 2024,
as Restated* Additions Deletions June 30, 2025 One Year Than One Year Governmental activities
Lease Liabilities $ 662,560 $ 810,237 $ (268,083) $ 1,204,714 $ 274,315 $ 930,399 SBITA Liabilities 300,861 1,510,446 (789,334) 1,021,973 229,120 792,853 Lease Financing Arrangement 11,240,000 — — 11,240,000 437,000 10,803,000 Compensated Absences* 6,619,615 518,754 — 7,138,369 2,054,166 5,084,203 Insurance Claims Payable 9,934,541 6,450,571 (6,221,159) 10,163,953 3,049,186 7,114,767 Total governmental activities 28,757,577 9,290,008 (7,278,576) 30,769,009 6,043,787 24,725,222 Business-type activities
Municipal Transit Fund
Lease Liabilities 340,710 — (302,404) 38,306 38,306 —
SBITA Liabilities 2,857 3,064 (4,597) 1,324 1,324 —
Compensated Absences* 39,330 4,171 — 43,501 867 42,634
Total Municipal Transit Fund 382,897 7,235 (307,001) 83,131 40,497 42,634 Sewer Service Fund
Compensated Absences* 76,433 27,649 — 104,082 60,417 43,665 SBITA Liabilities 8,570 9,191 (13,791) 3,970 3,970 —
Direct Borrowings
I-Bank Installment Agreement 3,179,913 — (181,120) 2,998,793 187,278 2,811,515 I-Bank Installment Agreement 3,740,489 — (194,568) 3,545,921 201,280 3,344,641 I-Bank Installment Agreement 7,137,753 — (187,124) 6,950,629 191,240 6,759,389 Total Sewer Service Fund 14,143,158 36,840 (576,603) 13,603,395 644,185 12,959,210 Total long-term liabilities $ 43,283,632 $ 9,334,083 $ (8,162,180) $ 44,455,535 $ 6,728,469 $ 37,727,066 *Compensated absences changes are presented as net on the additions line, balance as of June 30, 2024 is as restated by GASB 101.

For long-term liabilities, such as insurance claims payable and compensated absences, the general fund, municipal transit enterprise fund, sewer service enterprise fund, and internal service funds have been used in prior years to liquidate such amounts. A description of the City's lease activity is described in Note 10. A description of the City's SBITA liabilities is described in Note 11.

A. Lease Financing Arrangement
In November 2022, the Authority entered into a lease financing arrangement in the amount of $11,660,000 in order to secure funding for the purchase of property. Proceeds of the lease financing received by the Authority totaled $11,660,000 and were transferred to the general fund as payment for the right to use the property. The Authority has leased back the property to the City for an amount of $17,092,755, which will cover future principal and interest debt service payments of the Authority. The finance charge of the lease financing arrangement, including all fees and charges paid to third parties totaled $160,000.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 9 - LONG-TERM LIABILITIES
62 85
Interest on the Authority's debt is payable semiannually on July 1 and January 1 at a rate of 3.95%. Principal is payable in annual installments on July 1 ranging from $420,000 to $855,000. The debt matures on July 1, 2042.

The annual debt service requirement for the lease financing arrangement outstanding as of June 30, 2025, are as follows:

Year Ending
June 30, Principal Interest Total
2026 $ 437,000 $ 435,349 $ 872,349
2027 455,000 417,732 872,732
2028 473,000 399,404 872,404
2029 492,000 380,346 872,346
2030 512,000 360,517 872,517
2031-2035 2,887,000 1,475,937 4,362,937
2036-2040 3,516,000 845,577 4,361,577
2041-2043 2,468,000 148,757 2,616,757
Total 11,240,000 4,463,619 15,703,619
B. I-Bank Installment Sale Agreement
The City entered into a 20-year loan on June 1, 2018 from the I-Bank Installment Sale Agreement with the California Infrastructure and Economic Development Bank (CIEDB). The maximum loan amount is $4,000,000 and will be utilized for the City's Sewer System Collection and Treatment Facility Rehabilitation and Replacements project. The loan is secured by revenues generated by the Sewer Service Fund and bears interest at a rate of

3.40% per annum, including amounts that have not yet been disbursed. Additionally, there is an annual life due on August 1 of each year equal to 0.30% of the outstanding principal. Repayment of the loan is payable solely from Sewer Service user charges. The revenues are pledged for the total debt service until the year 2038. As of June 30, 2025, $4,000,000 of the Ioan proceeds were disbursed under the Ioan agreement. Interest is due semiannually on February 1 and August 1 and principal is due annually on August 1, which commenced on August 1, 2019.

The City is not permitted prepay all or a portion of the outstanding principal until June 1, 2028, which is 10 years after the effective date. After the 10-year period, the prepayment amount is 102%, 101%, and 100% for the tenth year, eleventh year, and remaining years, respectively.

As of June 30, 2025, the outstanding principal amount was $2,998,793. Total revenue available from the Sewer Service Fund for debt service is $11,086,076 and total debt service, including interest, was $286,157.

The annual payment amounts required to retire the SaIes Agreement as of June 30, 2025 are as follows:

Year Ending
June 30, Principal Interest Total
2026 $ 187,278 $ 98,774 $ 286,052
2027 193,645 92,299 285,944
2028 200,229 85,604 285,833
2029 207,037 78,680 285,717
2030 214,076 71,521 285,597
2031-2035 1,184,639 241,407 1,426,046
2036-2038 811,889 42,021 853,910
Total $ 2,998,793 $ 710,306 $ 3,709,099

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 9 - LONG-TERM LIABILITIES (CONTINUED)
63 86
The City entered in to a 20-year Ioan on June 5, 2019 from the I-Bank Installment Sale Agreement with the California Infrastructure and Economic Development Bank (CIEDB). The maximum loan amount is $4,456,000 and will be utilized for the City's Coastal Treatment Plan Facility Improvements Project. The loan is secured by revenues generated by the Sewer Service Fund and bears interest at a rate of 3.45% per annum, including amounts that have not yet been disbursed. Additionally, there is an annual fee due on August 1 of each year equal to 0.30% of the outstanding principal. Repayment of the Ioan is payable solely from Sewer Service user charges.

The revenues are pledged for the total debt service until the year 2039. As of June 30, 2025, $4,456,000 of the Ioan proceeds were disbursed under the loan agreement. Interest is due semiannually on February 1 and August 1 and principal is due annually on August 1, which commenced on August 1, 2020.

The City is not permitted prepay all or a portion of the outstanding principal until June 5, 2029, which is 10 years after the effective date. After the 10-year period, the prepayment amount is 102%, 101%, and100% for the 10th year, 11th year, and remaining years, respectively.

As of June 30, 2025, the outstanding principal amount was $3,545,921. Total revenue available from the Sewer Service Fund for debt service is $11,086,076 and total debt service, including interest, was $320,259.

The annual payment amounts required to retire the SaIes Agreement as of June 30, 2025 are as follows:

Year Ending
June 30, Principal Interest Total
2026 $ 201,280 $ 118,862 $ 320,142
2027 208,224 111,798 320,022
2028 215,408 104,491 319,899
2029 222,840 96,931 319,771
2030 230,528 89,110 319,638
2031-2035 1,277,568 318,466 1,596,034
2036-2039 1,190,073 83,855 1,273,928
Total $ 3,545,921 $ 923,513 $ 4,469,434
The City entered into a 30-year Ioan on June 1, 2022 from the I-Bank Installment Sale Agreement with the California Infrastructure and Economic Development Bank (CIEDB). The maximum loan amount is $7,500,000 and will be utilized for the South Orange County Wastewater Authority Coastal Treatment Plant upgrades. The Ioan is secured by revenues generated by the Sewer Service Fund and bears interest at a rate of 2.20% per annum, including amounts that have not yet been disbursed. Additionally, there is an annual fee due on August 1 of each year equal to 0.30% of the outstanding principal. Repayment of the loan is payable solely from Sewer Service user charges. The revenues are pledged for the total debt service until the year 2051. As of June 30, 2025, $6,094,325 of the loan proceeds were disbursed under the Ioan agreement, and accordingly, a receivable in the amount of $1,405,675 is recorded in the Sewer Service Enterprise Fund. Interest is due semiannually on February 1 and August 1 and principal is due annually on August 1, which will commence on August 1, 2022.

The City is not permitted prepay all or a portion of the outstanding principal until June 1, 2032, which is 10 years after the effective date.

As of June 30, 2025, the outstanding principal amount was $6,950,629. Total revenue available from the Sewer Service Fund for debt service is $11,086,076 and total debt service, including interest, was $342,095.

The annual payment amounts required to retire the SaIes Agreement as of June 30, 2025 are as follows:

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 9 - LONG-TERM LIABILITIES (CONTINUED)
64 87
Year Ending
June 30, Principal Interest Total
2026 $ 191,240 $ 150,810 $ 342,050
2027 195,447 146,557 342,004
2028 199,747 142,210 341,957
2029 204,141 137,767 341,908
2030 208,632 133,226 341,858
2031-2035 1,114,064 594,449 1,708,513
2036-2040 1,242,122 464,982 1,707,104
2041-2045 1,384,902 320,632 1,705,534
2046-2050 1,544,093 159,690 1,703,783
2051-2052 666,241 14,737 680,978
Total $ 6,950,629 $ 2,265,060 $ 9,215,689
NOTE 10 - LEASES
A. Lessee Activities
As of June 30, 2025, the City had entered into various lease agreements as the lessee for the use of land, a building, various automotive equipment, and equipment, for terms ranging from four to seven years. The City is required to make principal and interest payments through December 2033. The various lease agreements have an interest rate ranging from 2.33% to 2.99% based on the City’s estimated incremental borrowing rate at the inception of the lease or the stated interest rate. As of June 30, 2025, the total combined value of right to use assets, and the related accumulated amortization on right to use assets, was $2,725,646 and $1,496,252, respectively. The total combined value of the lease liability was $1,243,020. The current year amortization and interest expense associated with the right to use assets were $645,051 and $21,670.

Remaining principal and interest payments on the leases are as follows:

Governmental
Activities
Fiscal Year
Ending
June 30, Principal Interest Total
2026 $ 274,315 $ 30,008 $ 304,323
2027 265,416 22,911 288,327
2028 235,137 16,591 251,728
2029 170,664 10,365 181,029
2030 58,662 6,044 64,706
2031-2034 200,520 9,551 210,071
Totals $ 1,204,714 $ 95,470 $ 1,300,184
Business Activities
Year Ending June 30, Principal Interest Total
2026 $ 38,306 $ 118 $ 38,424

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 9 - LONG-TERM LIABILITIES (CONTINUED)
65 88
B. Lessor Activities
As of June 30, 2025, the City had had 7 active leases. The leases have receipts that range from $6,648 to $108,000 and interest rates that range from 0.6820% to 3.0700%. As of June 30, 2025, the total combined value of the lease receivable is $1,157,591, the total combined value of the short-term lease receivable is $293,497, and the combined value of the deferred inflow of resources is $1,070,287.

NOTE 11 - SUBSCRIPTION-BASED INFORMATION TECHNOLOGY ARRANGEMENTS (SBITAS) As of June 30, 2025, the City has entered into various contracts for the use of software subscription services. As of June 30, 2025, the combined value of the subscription liability was $1,027,267. The City is required to make principal and interest payments through 2034. The SBITA liabilities were valued using a discount rate ranging from 0.33% to 3.23% based on the City's incremental borrowing rate at the inception of the SBITAs. The total combined value of subscription assets, and the related accumulated amortization on subscription assets was $33,488,764 and $1,783,025 as of June 30, 2025, respectively. Remaining principal and interest on SBITAs are as follows:

Governmental
Activities
Fiscal Year
Principal
Payments
Interest
Payments
Total
Payments
2026 $ 229,120 $ 25,292 $ 254,412
2027 104,732 20,614 125,346
2028 107,455 17,891 125,346
2029 110,249 15,097 125,346
2030 113,116 12,231 125,347
2031-2034 357,301 18,739 376,040
Totals $ 1,021,973 $ 109,864 $ 1,131,837
Business-type
activities
Fiscal Year
Principal
Payments
Interest
Payments
Total
Payments
2026 $ 5,294 $ 84 $ 5,378
NOTE 12 - OTHER POST EMPLOYMENT BENEFIT PLAN
A. Plan Description
The City administers a single-employer defined benefit plan which provides medical and dental insurance benefits to eligible retirees and their dependents in accordance with various labor agreements. The City does not pay any of the cost of retiree health benefits however, eligible retirees and their dependents are permitted to participate in the City's medical insurance plan until eligible for Medicare, typically at age 65. Once eligible, coverage under the City plan ceases. The medical plans consist of two Cigna options (HMO and PPO) and the dental benefits are provided through Delta Care HMO and a self-insured Delta Dental PPO.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 10 - LEASES (CONTINUED)
66 89
Employees who have completed at least three years of service with the City and have coverage immediately prior to retirement are eligible to retire and participate in the City's healthcare plans by paying premiums identical to those charged for the City's active employees. For employees hired on or after July 1, 2013 (January 1, 2014 for Police), the three year service requirement has been increased to ten years. Spouses and eligible dependent children of retirees may also be covered at the retiree's expense. All of the City's Memoranda of Understanding (MOU) specify the ability to elect self-paid retiree medical coverage, and this benefit has been extended to selfpaid dental coverage as well.

While the City does not directly contribute toward the cost of premiums for retirees, the ability to obtain coverage at an active employee rate constitutes a significant economic benefit to the retirees, called an "implicit subsidy” under GASB 75. The inclusion of the retirees increases the City's overall health insurance rates.

The benefits and contribution requirements of the City and plan members are established and may be amended by City Council. The City has not established an irrevocable trust for the purpose of holding assets accumulated for plan benefits and funds the plan on a pay-as-you-go basis (i.e., as medical insurance premiums become due).

For fiscal year 2024-2045, age-adjusted premium benefits paid by the City totaled $365,754.

B. Employees Covered
As of the June 30, 2025 measurement date, membership consisted of the following:

Inactive members currently receiving benefits 33
Active members 320
Total 353
C. Total OPEB Liability
The City's total OPEB liability of $5,609,182 was measured as of June 30, 2025, was determined by an actuarial valuation as of July 1, 2024 rolled forward to June 30, 2025 using standard update procedures, and is included in the government-wide financial statements as follows:

Governmental
Activities
Business-Type
Activities Total
Deferred Outflows - OPEB $ 2,341,212 $ 97,551 $ 2,438,763 Total OPEB Liability $ 5,384,815 $ 224,367 $ 5,609,182
Deferred Inflows - OPEB $ 650,708 $ 27,113 $ 677,821
The general fund, municipal transit enterprise fund, and sewer service enterprise fund have been used in prior years to liquidate the total OPEB liability.

D. Actuarial Assumptions and Other Inputs
The total OPEB liability as of the July 1, 2024, actuarial valuation was determined using the following actuarial assumptions and other inputs, applied to all periods included in the measurement, unless otherwise specified:

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 12 - OTHER POST EMPLOYMENT BENEFIT PLAN (CONTINUED) 67 90
Valuation Date Jun 30, 2024
Measurement Date Jun 30, 2025
Actuarial Cost Method Entry Age Normal Cost Method
Actuarial Assumptions
Discount Rate 4.71%
Inflation 2.30%
Projected Salary Increases 2.80%
Healthcare Cost Trend Rates 4.90% for 2024 through 2074; 4.04% for 2075 and later years Mortality (1)
(1) Mortality rates were based on the CalPERS mortality rates, in the most recent experience study, for CalPERS members. The actuarial assumptiond used in the July 1, 2022 valuation were based on the results of the most recent applicable experience study and a review of plan experience during the period July 1, 2020 to June 30, 2022.

The discount rate utilized is based on whether the plan assets are projected to be sufficient to make future payments. Since there are no plan assets held in trust, the discount rate was based on a high-quality 20-year taxexempt general obligation municipal bond yield or index rate. "High quality" is defined as being rated AA or higher (or an equivalent rating). The municipal bond rate utilized was 4.71% and was determined using the Fidelity AA Municipal Bond 20-Year High Grade rate index as of June 30, 2025.

E. Change in Total OPEB Liability
Increase
(Decrease)
Total OPEB
Liability
Balance at June 30, 2024 $ 5,815,435
Changes recognized for the
measurement period:

Service cost 290,465
Interest on total OPEB liability 235,144
Changes of assumptions (366,108)
Implicit subsidy credit (365,754)
Net Changes (206,253)
Balance at June 30, 2025 (Measurement Date) $ 5,609,182 F. Change of Assumptions
The discount rate was raised from 3.97% to 4.71% from June 30, 2024, to June 30, 2025, respectively.

G. Sensitivity of the Total OPEB Liability to Changes in the Discount Rate The following presents the total OPEB liability of the City, calculated using the discount rate for the Plan, as well as what the City's total OPEB liability would be fit were calculated using a discount rate that is one-percentage point lower or one-percentage point higher than the current rate:

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 12 - OTHER POST EMPLOYMENT BENEFIT PLAN (CONTINUED) 68 91
1% Discount Rate 1%
Decrease (3.71%) (4.71%) Increase (5.71%)
Total OPEB Liability $ 6,111,225 $ 5,609,182 $ 5,160,040 H. Sensitivity of the Total OPEB Liability to Changes in Medical Trend Rates Healthcare Cost
1% Trend Rates 1%
Decrease (5.50%) (6.50%) Increase (7.50%)
Decreasing to Decreasing to Decreasing to

3.04 4.04% 5.04%
Total OPEB Liability $ 4,969,249 $ 5,609,182 $ 6,372,812 I. OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB For the year ended June 30, 2025, the City recognized OPEB expense of $882,425. At June 30, 2025, the City reported deferred outflows of resources related to OPEB from the following sources:

Deferred Outflows Deferred Inflows
of Resources of Resources
Differences between expected and
actual experience $ 2,084,163 $ —
Changes of assumptions 354,600 677,821
Total $ 2,438,763 $ 677,821
The above amounts reported as deferred outflows of resources related to OPEB will be recognized in OPEB expense as follows:

Year Ended
June 30, Amount
2026 $ 338,387
2027 251,489
2028 213,773
2029 134,339
2030 178,165
Thereafter 644,789
Total $ 1,760,942

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 12 - OTHER POST EMPLOYMENT BENEFIT PLAN (CONTINUED) 69 92
Fund balances are classified as follows:

Inventories $ 100,372 $ — $ — $ 100,372
Prepaids 2,219,900 — 2,388,177 4,608,077
Total nonspendable 2,320,272 — 2,388,177 4,708,449
Restricted for:

South Laguna maintenance 15,399,858 — — 15,399,858
Assessment district improvements — 6,659,729 — 6,659,729 Street lighting maintenance and projects — — 6,482,856 6,482,856 Streets and roads maintenance and projects — — 3,148,908 3,148,908 Public safety programs — — 188,650 188,650
Affordable housing — — 1,766,700 1,766,700
Animal shelter activities — — 1,497,850 1,497,850
Cultural and environmental stewardship activities — — 260,000 260,000 Pollution remediation projects — — 84,038 84,038
Opioid remediation activities — — 76,819 76,819
Total restricted 15,399,858 6,659,729 13,505,821 35,565,408 Committed for:

Drainage improvements 85,497 — — 85,497
Affordable housing 801,612 — — 801,612
Parking 1,038 — — 1,038
Park and recreation facilities 47,058 — — 47,058
Art in public places 502,809 — — 502,809
Library operations and improvements 83,680 — — 83,680
Disaster contingency 7,129,626 — — 7,129,626
Reserves (10%) 8,550,000 — — 8,550,000
Total committed 17,201,320 — — 17,201,320
Assigned for:

Measure LL programs 1,789,692 — — 1,789,692
Open space 1,086,044 — — 1,086,044
Parking 14,733,919 — — 14,733,919
Transportation infrastructure projects 1,919,989 — — 1,919,989 Wildfire mitigation and fire safety 4,072,493 — — 4,072,493 Laguna Beach Marketing and Tourism 1,053,900 — — 1,053,900 CAD/RMS implementation 948,900 — — 948,900
Recycling and solid waste programs 1,801,900 — — 1,801,900 Community development programs 542,150 — — 542,150
Citywide Classification & Compensation Study 121,800 — — 121,800 Fire Hazard Mitigation Contracts 331,000 — — 331,000
EOC Design 225,000 — — 225,000
Other programs 60,100 — — 60,100
Other capital improvement projects 36,072,506 — — 36,072,506 Reserves (10%) 8,115,455 — — 8,115,455
Total assigned 72,874,848 — — 72,874,848
Unassigned** (16,251) — — (16,251)
Total fund balances (deficits) $ 107,780,047 $ 6,659,729 $ 15,893,998 $ 130,333,774 General Fund*
Assessment
Districts Capital
Projects Fund
Nonmajor
Governmental
Funds Total
Fund Balances
Nonspendable for:
*For financial statement reporting the City has included the following sub-funds in the General Fund: General Fund, Parking In-Lieu, Park InLieu, Drainage, Housing In-Lieu, Transportation Infrastructure, South Laguna, Deposits, Disaster Contingency, Open Space Parking Authority, Capital Improvement, Measure LL, and Library Impact Fees. **See footnote 1 for the General Fund Balance Reserve Policy.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 13 - FUND BALANCES
70 93
In March 1972, the City, five water districts, and one sanitation district entered into a joint exercise of powers agreement to form the Aliso Water Management Agency, which ultimately joined other agencies and created the South Orange County Wastewater Authority (SOCWA), a public corporation. SOCWA currently includes ten member agencies, including the City. SOCWA was formed to develop a total water management program for its members' consolidated service areas. Specifically, SOCWA is to provide for construction, maintenance and operation of a regional wastewater transmission, treatment and disposal system. This system consists of an interceptor system, pumping stations, wastewater treatment plants and an ocean outfall.

The governing board is comprised of one member from each participating agency and is responsible for the selection of management and for the budgeting and financial management of the Agency. As of June 30, 2025, (the most recent information available), SOCWA had total assets and deferred outflows of resources of $159,075,275, total liabilities and deferred inflows or resources of $40,990,792, and total net position of $118,084,483. A separate financial report may be obtained from the South Orange County Wastewater Authority, 34156 Del Obispo Street, Dana Point, California 92629.

The City's share of ownership varies by year depending upon the purchased capacities of each subsystem. Each member is responsible for its share of maintenance and operations costs proportional to its purchased capacity which is billed to each member by SOCWA. Sewer service charges are assessed to fund these and other operating costs. The City paid $2,242,691 and $1,000,004 for its share of operating and capital costs, respectively, during the fiscal year.

Working in partnership with SOCWA, in prior years the City expanded capacity in certain treatment plants and constructed a pumping station. The City's participation in these projects has been capitalized through sewer plant and Iines and capacity rights in the City's sewer funds.

NOTE 15 - DEFINED BENEFIT PENSION PLANS
The City of Laguna Beach participates in the California Public Employees Retirement System (CalPERS), a pension plan available to all qualified employees. The Safety Plan is a cost-sharing multiple employer defined benefit pension plan. The Miscellaneous Plan is an agent multiple employer defined benefit pension plan. A summary of pension amounts for the City's plans at June 30, 2025 is presented below:

Safety Plan
Miscellaneous
Plan Total
Deferred Outflows - Pensions $ 18,321,046 $ 8,133,876 $ 26,454,922 Net Pension Liability (54,883,395) (30,510,916) (85,394,311) Deferred Inflows - Pensions (931,967) — (931,967)
Pension Expense 12,028,372 6,027,898 18,056,270
Pension amounts are reported in the financial statements as follows:

Governmental
Activities
Business-Type
Activities Total
Deferred Outflows - Pensions $ 26,129,567 $ 325,355 $ 26,454,922 Net Pension Liability (84,173,875) (1,220,436) (85,394,311) Deferred Inflows - Pensions (931,967) — (931,967)
Pension Expense 19,929,374 241,116 20,170,490

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 14 - SEWAGE TREATMENT FACILITIES
71 94
A. General Information about the Pension Plans

1. Plan Descriptions
All qualified permanent and probationary employees are eligible to participate in the City's Safety (Police, Fire, and Lifeguard) Employee Pension Plan (Safety Plan), a cost sharing multiple employer defined benefit pension plan, or the City's Miscellaneous Plan, an agent multiple employer defined benefit pension plan, both administered by CalPERS. The CalPERS Safety Plan consists of safety pools (referred to as "risk pools"), which are comprised of individual employer safety rate plans. The risk pools are included within the Public Employees' Retirement Fund C (PERF C). For the Miscellaneous Plan, CalPERS acts as a common investment and administrative agent for its participating member employers, and are included with in Public Employees' Retirement Fund A (PERF A). Benefit provisions under the Plans are established by state statute and may be amended by City resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information. These reports can be found on the CalPERS website.

2. 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 to 62 with statutorily reduced benefits. For employees hired into a plan with the 1.5% at 65 formula, eligibility for service retirement is age 55 with at least five years of services. PEPRA miscellaneous members become eligible for service retirement upon attainment of age 52 with at least five years of service. All members are eligible for nonduty disability benefits after five 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. Safety members can receive a special death benefit if the member dies while actively employed and the death is job-related. Fire members may receive the alternate death benefit in lieu of the Basic Death Benefit or the 1957 Survivor Benefit if the member dies while actively employed and has at least 20 years of total CalPERS service. The cost of living adjustments for each plan are applied as specified by the Public Employees' Retirement law.

The Public Employee's Pension Reform Act of 2013 (PEPRA) requires new benefits and member contributions for new members as defined by PEPRA, that are hired after January 1, 2013. These PEPRA members in pooled plans are reflected in the new Miscellaneous and Safety risk pools created by the CalPERS Board in response to the passage of PEPRA, beginning with the June 30, 2013, risk-pool valuations.

The Plans' provisions and benefits in effect at the measurement date June 30, 2024, are summarized as follows:

Safety - Police
Tier 1 Tier 2 Tier 3
Formula 3.0% @ 50 3.0% @ 55 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 55 57
Monthly benefits, as a % of eligible
compensation 3.0 % 3.0 % 2.7 %
Required employee contribution rates 9.00 % 9.00 % 13.75 % Required employer contribution rates
normal cost rates 27.32 % 24.33 % 13.76 %

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 15 - DEFINED BENEFIT PENSION PLANS (CONTINUED)
72 95
Safety - Fire
Tier 1 Tier 2 Tier 3
Formula 3.0% @ 50 3.0% @ 55 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 55 57
Monthly benefits, as a % of eligible
compensation 3.0 % 3.0 % 2.7 %
Required employee contribution rates 9.00 % 9.00 % 13.75 % Required employer contribution rates
normal cost rate 27.32 % 24.33 % 13.76 %
Safety - Lifeguard
Tier 1 Tier 2 Tier 3
Formula 3.0% @ 55 N/A 2.7% @ 57
Benefit vesting schedule 5 years service N/A 5 years service Benefit payments Monthly for life N/A Monthly for life
Retirement age 55 N/A 57
Monthly benefits, as a % of eligible
compensation 3.0 % N/A 2.7 %
Required employee contribution rates 9.00 % N/A 13.75 % Required employer contribution rates
normal cost rate 24.15 % N/A 13.54 %
Tier 1 Tier 2 Tier 3
Applies to: Police Safety
employees hired on
or before April 2,
2012, Fire Safety
employees hired on
or before October 3,
2011, and Lifeguard
Safety employees
hired before
January 1, 2013
Police Safety
employees hired on
or before April 2,
2012, Fire Safety
employees hired on
or before October 3,
2011, (or laterals
from other CalPERS
agencies who meet
certain requirements)
New CalPERS
covered employees
hired after
January 1, 2013
(mandated by AB
340, the Public
Employees Pension
Reform Act
(PEPRA))
Miscellaneous
Hire Date
Prior to
January 1, 2013
On or After
January 1, 2013
Formula 2.5% @ 55 2.5% @ 62
Benefit vesting schedule 5 years service 5 years service Benefit payments Monthly for life Monthly for life
Retirement age 55 62
Monthly benefits, as a % of eligible
compensation 2.5 % 2.5 %
Required employee contribution rates 8.00 % 7.75 %
Required employer contribution rates
normal cost rate 12.13 % 12.13 %

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 15 - DEFINED BENEFIT PENSION PLANS (CONTINUED)
73 96

3. Employees Covered
As of the June 30, 2024, measurement date, the following employees were covered by the benefit term for the Miscellaneous Plan:

Miscellaneous
Inactive members currently receiving benefits 275
Inactive members entitled to but not yet receiving benefits 250 Active members 210
Total 735

4. Contributions
Section 20814(c) of the California Public Employees' Retirement law 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 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 City is required to contribute the difference between the actuarially determined rate and the contribution rates of employees. City 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 contributions requirements are classified as plan member contributions.

Contributions to the pension plans totaled $7,720,548 for the Safety Plan and $5,496,935 for the Miscellaneous Plan.

B. Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions

1. Proportionate Share of Net Pension Liability-Safety Plan As of June 30, 2025, the City reported a net pension liability for its proportionate share of the collective net pension liability of the Safety Plan as follows:

Proportionate
Share of
Net Pension
Liability
Safety Plan $ 54,883,395
The City's net pension liability for each Plan is measured as the proportionate share of the net pension liability.

The net pension liability of each of the Plans is measured as of June 30, 2024, and the total pension liability for each Plan used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2023.

The City's proportionate share of the net pension liability was based on a project on of the City's long-term share of contributions to the pension plans relative to the projected contributions of all participating employers, actuarially determined.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 15 - DEFINED BENEFIT PENSION PLANS (CONTINUED)
74 97
The City's proportionate share of the net pension liability for each Plan as of the measurement date ended June 30, 2023, and 2024, was as follows:

Safety
Proportion - June 30, 2023 0.7458 %
Proportion - June 30, 2024 0.7528 %
Change - Increase(Decrease) 0.0070 %

2. Actuarial Assumptions
The total pension liability was based on the following actuarial assumptions:

Safety
Police Fire Lifeguard
Valuation Date Jun 30, 2023 Jun 30, 2023 Jun 30, 2023
Measurement Date Jun 30, 2024 Jun 30, 2024 Jun 30, 2024 Actuarial Cost Method Entry Age Normal Cost Method
Actuarial Assumptions
Discount Rate 6.90% 6.90% 6.90%
Inflation 2.30% 2.30% 2.30%
Salary Increases (1) (1) (1)
Mortality Rate Table (2) (2) (2)
Mortality (3) (3) (3)
(1) Varies by entry age and services.
(2) The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. Mortality rates incorporate full generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries. For more details on this table, please refer to the 2021 experience study report from November 2021 that can be found on the CalPERS website. (3) The less of contract COLA or 2.30% until Purchasing Power Protection of Allowance Floor on purchasing power applies, 2.30% thereafter.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 15 - DEFINED BENEFIT PENSION PLANS (CONTINUED)
75 98
Miscellaneous
Valuation Date Jun 30, 2023
Measurement Date Jun 30, 2024
Actuarial Cost Method Entry Age Normal Cost Method
Actuarial Assumptions
Discount Rate 6.90%
Inflation 2.30%
Salary Increases (1)
Mortality Rate Table (2)
Mortality (3)
(1) Varies by entry age and services.
(2) The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. Mortality rates incorporate full generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries. For more details on this table, please refer to the 2021 experience study report from November 2021 that can be found on the CalPERS website. (3) The less of contract COLA or 2.3% until Purchasing Power Protection of Allowance Floor on purchasing power applies, 2.30% thereafter.

3. 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.

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

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 15 - DEFINED BENEFIT PENSION PLANS (CONTINUED)
76 99
The expected real rates of return by asset class are as follows:

Asset Class(a)
New Strategic
Allocation
Real Return
Years 1 - 10(b)
Global Equity - cap-weighted 30.00 % 4.45 %
Global Equity - non-cap-weighted 12.00 % 3.84 %
Private Equity 13.00 % 7.28 %
Treasury 5.00 % 0.27 %
Mortgage-backed Securities 5.00 % 0.50 %
Investment Grade Corporates 10.00 % 1.56 %
High Yield 5.00 % 2.27 %
Emerging Market Debt 5.00 % 2.48 %
Private Debt 5.00 % 3.57 %
Real Estate 15.00 % 3.21 %
Leverage (5.00) % (0.59) %
Total 100.00 %
(a) An expected price inflation of 2.30% used for this period. (b) Figures are based on the 2021-22 Asset Liability Management Study

4. Discount Rate
The discount rate used to measure the total pension liability was 6.90%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan's fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

5. Changes in Net Pension Liability Miscellaneous Plan
The City's net pension liability for the Miscellaneous Plan was measured as the total pension liability, less the pension plan's fiduciary net position. The net pension liability of the Miscellaneous Plan was measured as of June 30, 2024, using an annual actuarial valuation as of June 30, 2023. A summary of principal assumptions and methods used to determine the net pension liability is shown under the section Actuarial Assumptions within this note.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 15 - DEFINED BENEFIT PENSION PLANS (CONTINUED)
77 100
The total Net Pension Liability for the City's Miscellaneous Plan, using the measurement date of June 30, 2024, was $30,510,916. The changes in the Net Pension Liability for the Miscellaneous Plan follows:

Increase (Decrease)
Total Pension
Liability
Plan Fiduciary
Net Position
Net Pension
Liability (Asset)
Balance at June 30, 2023
(Measurement Date) $ 146,726,437 $ 113,884,578 $ 32,841,859 Changes in the Year
Service Cost 3,685,262 — 3,685,262
Interest on the Total Pension Liability 10,059,168 — 10,059,168 Diffferences Between Actual and
Expected Experience 1,183,732 — 1,183,732
Net Plan to Plan Resourse Movement — 2,773 (2,773)
Contribution - Employer — 4,819,761 (4,819,761)
Contribution - Employee — 1,623,543 (1,623,543)
Net Investment Income — 10,905,696 (10,905,696)
Administrative Expenses — (92,668) 92,668
Benefit Payments, Including Refunds
of Employee Contributions (7,935,524) (7,935,524) —
Net Changes 6,992,638 9,323,581 (2,330,943)
Balance at June 30, 2024
(Measurement Date) $ 153,719,075 $ 123,208,159 $ 30,510,916

6. Pension Expense and Deferred Outflows and Inflows of Resources Safety Plan
For the year ended June 30, 2025, the City recognized pension expense of $12,028,372 for the Safety Plan. At June 30, 2025, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources for the Safety Plan:

Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Pension contributions subsequent to measurement date $ 7,720,548 $ — Difference between actual contributions and propotionate share of contributions and changes in proportions 1,125,285 639,877 Change in employer's proportion 991,213 146,459
Net difference between projected and actual earnings
on plan investments 2,652,813 —
Changes in assumptions 1,352,214 —
Differences between expected and actual experience 4,478,973 145,631 Total $ 18,321,046 $ 931,967

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 15 - DEFINED BENEFIT PENSION PLANS (CONTINUED)
78 101
The amount of $7,720,548, reported as deferred outflows of resources related to contributions subsequent to the measurement date, will be recognized as a reduction of the net pension liability in the year ending June 30, 2026.

Differences between projected and actual investment earnings are amortized on a five-year straight-line basis and all other amounts are amortized over the expected average remaining service lives of all members that are provided with benefits. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:

Year Ending
June 30: Amount
2026 $ 3,947,172
2027 6,488,172
2028 140,860
2029 (907,673)
Total 9,668,531
Miscellaneous Plan
For the year ended June 30, 2025, the City recognized pension expense of $6,027,898 for the Miscellaneous Plan. At June 30, 2025, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources for the Miscellaneous Plan:

Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Pension contributions subsequent to measurement date $ 5,496,935 $ — Differences between expected and actual experience 871,440 — Net difference between projected and actual earnings
on plan investments 1,765,501 —
Total $ 8,133,876 $ —
The amount of $5,496,935, reported as deferred outflows of resources related to contributions subsequent to the measurement date, will be recognized as a reduction of the net pension liability in the year ending June 30, 2025.

Differences between projected and actual investment earnings are amortized on a five-year straight-line basis and all other amounts are amortized over the expected average remaining service, lives of all members that are provided with benefits. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:

Year Ending
June 30: Amount
2026 $ 377,305
2027 3,353,631
2028 (472,261)
2029 (621,734)
Total 2,636,941

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 15 - DEFINED BENEFIT PENSION PLANS (CONTINUED)
79 102

7. Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the net pension liability of the City for each Plan, calculated using the discount rate for each Plan, as well as what the City's net pension liability would be if it were calculated using a discount rate that is one-percentage point lower or one-percentage point higher than the current rate:
1% Decrease Current Discount Rate 1% Increase
(5.90)% (6.90)% (7.90)%
Safety Plan's Proportionate Share of
Collective Net Pension Liability $ 83,430,534 $ 54,883,395 $ 31,535,850 Miscellaneous Plan's Net Pension Liability 50,262,571 30,510,916 14,202,185

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

9. Payable to the Pension Plan
The City had $822,841 of outstanding contributions to the Safety and Miscellaneous pension plans required for the year ended June 30, 2025.

NOTE 16 - TRANSPORTATION DEVELOPMENT ACT
In accordance with the requirement of the Transportation Development Act (TDA), the following information is presented.

TDA 50% Limitation
Total Operating Costs $ 5,614,595
Less:Depreciation (460,362)
Net Operating Costs 5,154,233
50% Limitation 2,577,117
TDA Allocation $ 1,433,700
Under (Over) Allocation $ 1,143,417
For the year ended June 30, 2025, the City recognized $1,433,700 of revenues pursuant to the TDA requirements. This amount, along with $991,101 of other grant revenues, is reflected within Intergovernmental revenues in the Municipal Transit Enterprise Fund.

NOTE 17 - RELATED PARTIES
A. Housing Program to Enhance Emergency Response
In order to enhance the ability of key personnel to respond to emergency situations within the community, the City provides assistance for those employes to reside in close proximity to the response area. The accompanying financial statements reflect the City's purchase of one such property in the amount of $797,500 and one loan to an employee. The outstanding balance of the loan was $270,145 for the year ended June 30, 2025. The balance of the loan is reported as part of Notes Receivables in the Vehicle Replacement Internal Service Fund.

CITY OF LAGUNA BEACH
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 15 - DEFINED BENEFIT PENSION PLANS (CONTINUED)
80 103
B. City Manager Housing Agreement
On August 13, 2024 the City Council approved The City Manager’s amendment #1 to the City Manager’s Employment agreement extending a loan to the City Manager in the form of a Promissory Note of $1,530,000 in which interest accrues at the LAIF Quarterly Apportionment Rate as published by the California State Treasurer plus .50%. Monthly interest payments are due on the first of each month beginning October 1, 2024 and all outstanding amounts under the loan are due upon the earlier of within one year of the City Manager’s departure from the City and payable upon sale of the City Manager’s home or if the City Manager determines not to sell the home due, and payable within one year of the City Manager’s departure from the City. At June 30, 2025, the outstanding balance of the was $1,530,000 and is reported as part of Notes Receivables in the Insurance and Employee Benefits Internal Service Fund for $940,590 and Vehicle Replacement Internal Service Fund for $589,410.

NOTE 18 - RESTATEMENTS
During fiscal year 2025, changes to or within the financial reporting entity, an error correction, and the change in accounting principle resulted in adjustments to and restatements of beginning net position and fund balance, as follows:

June 30, 2024
As Previously
Reported
Changes to or
within the
Reporting Entity Error Correction
Changes in
Accounting
Principle
June 30, 2024
As Restated
Government-wide
Governmental activities $ 439,891,213 $ 984,938 $ 1,632,815 $ (557,944) $ 441,951,022 Business-type activities 47,241,552 (984,938) 1,923,581 (6,469) 48,173,726 Total government-wide $ 487,132,765 $ — $ 3,556,396 $ (564,413) $ 490,124,748 Governmental funds
Major funds
General Fund $ 110,812,043 $ — $ (766,174) $ — $ 110,045,869 Assessment Districts 12,553,630 — — — 12,553,630
Nonmajor funds 14,091,073 — — — 14,091,073
Total governmental funds $ 137,456,746 $ — $ (766,174) $ — $ 136,690,572 Proprietary funds
Major funds
Sewer Service $ 44,244,411 $ (71,308) $ 1,923,014 $ (12,807) $ 46,083,310 Municipal Transit 2,997,141 (913,630) 567 6,338 2,090,416 Total proprietary funds $ 47,241,552 $ (984,938) $ 1,923,581 $ (6,469) $ 48,173,726 Internal service funds
Insurance and employee benefits $ 15,199 $ — $ — $ (557,944) $ (542,745) Vehicle replacement fund 17,867,491 984,938 254,353 — 19,106,782 Total internal service funds $ 17,882,690 $ 984,938 $ 254,353 $ (557,944) $ 18,564,037 City Of Laguna Beach
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 17 - RELATED PARTIES(CONTINUED)
81 104
The City evaluated subsequent events for recognition and disclosure through March 30, 2026, the date on which these financial statements were available to be issued. Management concluded that no material subsequent events have occurred since June 30, 2025, that required recognition or disclosure in these financial statements.

City Of Laguna Beach
Notes To Financial Statements
For The Year Ended June 30, 2025
NOTE 19 - SUBSEQUENT EVENTS
82 105
Required Supplementary Information
83 106
Schedule of Proportionate Share of the Net Pension Liability - Safety Plan Proportionate
Share Plan's Fiduciary
Proportion of the Proportionate of the Net Pension Net Position as a Reporting Date 1 Net Pension Share of Net Liability as a % of % of the Total as of June 30, Liability Pension Liability Covered Payroll Covered Payroll Pension Liability Safety Plan
2025 0.7528% $ 54,883,395 $ 15,600,558 351.8% 76.66%
2024 0.7458% 55,748,455 14,724,579 378.6% 74.87%
2023 0.7472% 51,344,026 13,769,103 372.9% 72.54%
2022 0.7059% 24,774,703 12,449,028 199.0% 77.73%
2021 0.6526% 43,480,563 12,906,341 336.9% 74.43%
2020 0.6287% 39,247,379 12,246,434 320.5% 75.26%
2019 0.6522% 36,684,879 11,419,674 321.2% 75.26%
2018 0.6243% 37,303,403 10,671,505 349.6% 73.31%
2017 0.6468% 33,497,317 9,912,852 337.9% 74.06%
2016 0.6492% 26,748,099 9,480,126 282.1% 78.4%
Notes to Schedule of Proportionate Share of the Net Pension Liability:

Benefit Changes: None
Changes of Assumptions: None
1 The proportions and proportionate share of the net pension liability are measured as of one year behind the reporting date. Refer to notes to basic financial statements.

CITY OF LAGUNA BEACH
Schedules Of Proportationate Share Of Net Pension Liability As of June 30, for the Last Ten Fiscal Years
84 107
Schedule of Contributions - Safety Plan
Fiscal Year Actuarially Actual Contribution Contribution as a Ending Determined Employer Deficiency Covered % of Covered June 30 Contribution Contributions (Excess) Payroll Payroll Miscellaneous Agent, Multiple-Employer Pension Plan
2025 $ 5,496,935 $ 5,496,935 $ — $ 22,584,444 24.3%
2024 4,847,035 4,847,035 — 20,379,805 23.8%
2023 4,552,455 4,552,455 — 17,527,334 26.0%
2022 4,271,997 4,271,997 — 15,311,611 27.9%
2021 3,905,847 3,905,847 — 15,473,063 25.2%
2020 3,565,431 3,565,431 — 14,762,620 24.2%
2019 3,217,470 3,907,470 (690,000) 14,419,732 27.1%
2018 2,767,304 3,767,304 (1,000,000) 12,558,017 30.0%
2017 2,665,941 3,865,941 (1,200,000) 13,297,509 29.1%
2016 2,337,304 3,737,304 (1,400,000) 12,379,800 30.2%
Safety Cost-Sharing, Multiple-Employer Pension Plan
2025 $ 7,720,548 $ 7,720,548 $ — $ 16,702,035 46.2%
2024 6,820,414 6,820,414 — 15,600,558 43.7%
2023 6,287,267 6,287,267 — 14,724,579 42.7%
2022 5,798,019 5,798,019 — 13,769,103 42.1%
2021 5,338,630 5,338,630 — 12,449,028 42.9%
2020 5,013,694 5,013,694 — 12,906,341 38.8%
2019 4,386,904 5,107,904 (721,000) 12,246,434 41.7%
2018 3,597,721 4,639,721 (1,042,000) 11,419,674 40.6%
2017 3,244,259 4,445,511 (1,201,252) 10,671,505 41.7%
2016 1,575,636 4,132,300 (2,556,664) 9,912,852 41.7%
Schedule of Contributions - Miscellaneous Plan

CITY OF LAGUNA BEACH
Schedule Of Plan Contributions
As of June 30, for the Last Ten Fiscal Years
85 108
Schedule of Changes in Total Pension Liability and Related Ratios - Miscellaneous Plan 2025 2024 2023 2022
Measurement Date 6/30/2024 6/30/2023 6/30/2022 6/30/2021

TOTAL PENSION LIABILITY
Service cost $ 3,685,262 $ 3,179,003 $ 2,968,921 $ 2,826,929 Interest on total pension liability 10,059,168 9,606,469 9,223,908 9,006,005 Changes of benefit terms — 172,608 — —
Changes of assumptions — — 4,094,768 —
Difference between expected and actual experience 1,183,732 246,857 (1,607,276) (1,051,010) Benefit payments, including refunds of employee contributions (7,935,524) (7,387,421) (6,958,539) (6,380,886) Net change in total pension liability 6,992,638 5,817,516 7,721,782 4,401,038 Total pension liability-beginning 146,726,437 140,908,921 133,187,139 128,786,101 Total pension liability-ending (a) 153,719,075 146,726,437 140,908,921 133,187,139

PLAN FIDUCIARY NET POSITION
Contributions-employer 4,819,761 4,572,455 4,272,660 3,905,728 Contributions-employee 1,623,543 1,340,545 1,235,119 1,165,079 Net investment income 10,905,696 6,695,310 (8,988,181) 22,268,683 Benefit payments, including refunds of employee contributions (7,935,524) (7,387,421) (6,958,539) (6,380,886) Net plan to plan resource movement 2,773 1,269 2,598 154 Administrative expense (92,668) (79,964) (74,288) (98,288) Net change in fiduciary net position 9,323,581 5,142,194 (10,510,631) 20,860,470 Plan fiduciary net position-beginning 113,884,578 108,742,384 119,253,015 98,392,545 Plan fiduciary net position-ending (b) 123,208,159 113,884,578 108,742,384 119,253,015 Net pension liability/(asset) (a) - (b) $ 30,510,916 $ 32,841,859 $ 32,166,537 $ 13,934,124 Plan fiduciary net position as a percentage of the total pension liability 80.2% 77.6% 77.2% 89.5%
Covered-employee payroll $ 20,379,805 $ 17,527,334 $ 15,311,611 $ 15,473,063 Plan net pension liability/(asset) as a percentage of coveredemployee payroll 149.7% 187.0% 210.1% 90.1% Notes to Schedule of Changes in the Net Pension Liability and Related Ratios:

Benefit Changes: The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the measurement date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) that occurred after the valuation date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary.

Changes of Assumptions: None in 2020-2022. In 2019, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Assumptions December 2017. There were no changes in the discount rate. In 2018, the discount rate was reduced from 7.65% to 7.15%. In 2017, there were no changes. In 2016, amounts reported reflect an adjustment of the discount rate from 7.50% (net of administrative expense) to 7.65% (without a reduction for pension plan administrative expense). In 2015, amounts reported were based on the 7.50% discount rate.

CITY OF LAGUNA BEACH
Schedule Of Changes In Total Pension Liability And Related Ratios Miscellaneous Plan
As of June 30, for the Last Ten Fiscal Years
86 109
2021 2020 2019 2018 2017 2016
6/30/2020 6/30/2019 6/30/2018 6/30/2017 6/30/2016 6/30/2015 $ 2,691,515 $ 2,730,589 $ 2,510,806 $ 2,418,551 $ 2,020,384 $ 1,936,830 8,699,994 8,297,037 7,862,058 7,557,389 7,292,385 6,979,652 — — — — — —
— — (690,837) 6,050,977 — (1,636,454)
376,773 1,028,702 118,415 (323,188) (439,090) 61,932
(5,875,794) (5,622,361) (5,233,328) (5,143,766) (4,590,588) (4,271,862) 5,892,488 6,433,967 4,567,114 10,559,963 4,283,091 3,070,098 122,893,613 116,459,646 111,892,532 101,332,569 97,049,478 93,979,380 128,786,101 122,893,613 116,459,646 111,892,532 101,332,569 97,049,478 3,565,155 3,916,164 3,774,012 3,865,941 3,733,571 3,457,700 1,135,925 1,259,992 1,091,222 1,011,086 1,051,923 943,694 4,696,099 5,900,000 7,082,777 8,459,926 405,106 1,666,511 (5,875,794) (5,622,361) (5,233,328) (5,143,766) (4,590,588) (4,271,862) — — — — — —
(133,934) (63,743) (376,408) (111,020) (45,489) (84,037) 3,387,451 5,390,052 6,338,275 8,082,167 554,523 1,712,006 95,005,094 89,615,042 83,276,767 75,194,600 74,640,077 72,928,071 98,392,545 95,005,094 89,615,042 83,276,767 75,194,600 74,640,077 $ 30,393,556 $ 27,888,519 $ 26,844,604 $ 28,615,765 $ 26,137,969 $ 22,409,401

76.4% 77.3% 76.9% 74.4% 74.2% 76.9%
$ 14,548,732 $ 14,781,511 $ 13,802,462 $ 13,297,509 $ 12,379,800 $ 11,499,996 208.9% 188.7% 194.5% 215.2% 211.1% 194.9%
87 110
Schedule of Changes in the Total OPEB Liability and Related Ratios - Other Postemployment Benefit Plan
2025 2024 2023 2022
Measurement Date 6/30/2024 6/30/2023 6/30/2022 6/30/2021

TOTAL OPEB LIABILITY
Service cost $ 290,465 $ 233,452 $ 226,653 $ 212,278
Interest on total pension liability 235,144 156,382 152,258 78,800 Changes of assumptions (366,108) (137,870) 143,260 (482,124) Difference between expected and actual experience — 1,949,792 383,765 — Benefit payments, including refunds of employee contributions (365,754) (408,454) (413,506) (340,693) Net change in total OPEB liability (206,253) 1,793,302 492,430 (531,739) Total OPEB liability-beginning 5,815,435 4,022,133 3,529,703 4,061,442 Total OPEB liability-ending (a) $ 5,609,182 $ 5,815,435 $ 4,022,133 $ 3,529,703 Covered-employee payroll $ 35,980,363 $ 36,997,408 $ 33,364,200 $ 30,734,420 Plan net OPEB liability/(asset) as a percentage of coveredemployee payroll 15.6% 15.7% 12.1% 11.5% Notes to Schedule of Changes in the Net OPEB Liability and Related Ratios:

Benefit Changes: None
Changes of Assumptions: None
1 Fiscal year 2018 was the first year of GASB Statement No. 75 implementation; therefore only eight years are shown.

CITY OF LAGUNA BEACH
Schedule of Changes in Total OPEB Liability and Related Ratios As Of June 30, For The Last Ten Fiscal Years1
88 111
2021 2020 2019 2018
6/30/2020 6/30/2019 6/30/2018 6/30/2017
$ 189,348 $ 132,120 $ 121,627 $ 72,904
97,113 91,200 93,555 72,208
539,085 197,388 169,739 —
418,569 — 549,200 —
(305,136) (158,527) (133,701) (158,500)
938,979 262,181 800,420 (13,388)
3,122,463 2,860,282 2,059,862 2,073,250
$ 4,061,442 $ 3,122,463 $ 2,860,282 2,059,862
$ 30,826,492 $ 32,214,300 $ 31,151,981 $ 29,131,464

13.2% 9.7% 9.2% 7.1%
89 112
Notes to Required Supplementary Information
NOTE 1: BUDGET INFORMATION
Budgets are adopted on a basis consistent with generally accepted accounting principles. Annual appropriated budgets are adopted for the general, special revenue, and capital projects funds except for the Cultural & Environmental Stewardship nonmajor fund and the following General Fund sub-funds: Parking In-Lieu, Drainage, and Deposits. Appropriations lapse at fiscal year-end, except for encumbered amounts and capital expenditures which are re-appropriated in the next year's budget until such time as the project is completed or terminated.

The City is required to adopt an annual budget on or before June 30 of each year. From the effective date of the budget, the amounts stated therein as proposed expenditures become appropriations to the various City departments. The City Council may amend the budget through a vote of a majority of the Council during the fiscal year. The City Manager may transfer funds from one objector purpose to another within the same department, excluding capital outlay. Actual expenditures may not exceed budgeted appropriations at the department level within the General Fund and at the fund level for special revenue, and capital projects funds therefore, the legal level of budgetary control is at the department level for the General Fund and the fund level for special revenue and capital projects funds.

Budget information is presented for the general and certain special revenue and capital project fund types.

Budgeted revenue amounts represent the original budget modified by Council authorized adjustments during the year which were contingent upon new or additional revenue sources. Budgeted expenditure amounts represent original appropriations adjusted for supplemental appropriations during the year. Supplemental appropriations include carryover appropriations from the prior year. Supplemental budgetary appropriations of $32,956,781 were made in the General Fund.

The following funds had expenditures in excess of appropriations for the year ended June 30, 2025 as follows:

Final Actual
Budget Amounts Variance
General Fund
General Government
Police protection $ 24,535,550 $ 24,829,026 $ (293,476) Principal Retirement — 1,057,417 (1,057,417)

CITY OF LAGUNA BEACH
Notes To Required Supplementary Information
For The Year Ended June 30, 2025
90 113
Schedules of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual – General Fund
91 114
Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - General Fund

REVENUES
Taxes
Property taxes $ 53,109,000 $ 54,432,000 $ 54,006,979 $ (425,021) Sales and use taxes 7,690,000 6,972,000 7,372,476 400,476 Business improvement assessment — — 2,784,149 2,784,149 Transient occupancy taxes 25,375,500 21,625,500 17,233,981 (4,391,519) Franchise taxes 1,330,000 1,330,000 1,689,087 359,087
Business license taxes 1,100,000 1,100,000 1,179,995 79,995 Total taxes 88,604,500 85,459,500 84,266,667 (1,192,833) License, fees and permits
Construction permits 2,641,000 2,641,000 3,257,915 616,915 Other 110,000 110,000 111,918 1,918
Total licenses, fees and permits 2,751,000 2,751,000 3,369,833 618,833 Fines and forfeitures 906,000 906,000 1,252,961 346,961 Investment income (loss), net 3,660,000 4,035,000 8,285,195 4,250,195 Rental 504,500 504,500 735,917 231,417
Intergovernmental 1,980,000 3,754,450 3,439,239 (315,211) Charges for services
Planning and zoning fees 3,163,500 3,163,500 2,367,773 (795,727) Building department fees 713,000 713,000 406,085 (306,915) Refuse service charges — — 45,194 45,194
Parks and recreation fees 1,411,000 1,456,000 1,475,610 19,610 Other 2,134,400 2,015,500 3,201,487 1,185,987
Total charges for services 7,421,900 7,348,000 7,496,149 148,149 Parking meters, lots, and permits 11,003,001 11,003,001 11,431,086 428,085 Development tax 100,000 100,000 228,898 128,898
Other
Reimbursed expenditures 488,000 449,996 399,261 (50,735) Miscellaneous 844,900 421,000 118,076 (302,924)
Total other 1,332,900 870,996 517,337 (353,659)
Total revenues 118,263,801 116,732,447 121,023,282 4,290,835 Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual General Fund
For The Year Ended June 30, 2025
92 115

EXPENDITURES
Current:

General government
City Council 130,100 342,224 124,983 217,241
City Manager 6,893,900 13,874,450 11,608,579 2,265,871
City Clerk 550,500 588,264 568,424 19,840
City Treasurer 303,500 303,500 259,879 43,621
City Attorney 1,500,000 2,000,000 2,393,679 (393,679)
Administrative services 5,694,200 6,017,136 4,606,748 1,410,388 Total general government 15,072,200 23,125,574 19,562,292 3,563,282 Public safety
Police protection 23,260,700 24,535,550 24,829,026 (293,476) Fire protection 27,098,600 31,205,400 28,232,061 2,973,339 Marine safety 4,414,700 4,439,700 4,341,904 97,796
Total public safety 54,774,000 60,180,650 57,402,991 2,777,659 Community development 10,035,200 10,811,149 9,118,545 1,692,604 Public works 17,085,100 21,433,420 15,406,905 6,026,515 Transit and community services 9,924,600 8,050,150 5,760,016 2,290,134 Capital outlay 12,554,076 53,944,575 13,568,975 40,375,600 Debt service:

Principal retirement — — 1,057,417 (1,057,417)
Interest and fiscal charges 880,600 880,600 296,717 583,883 Total expenditures 120,325,776 178,426,118 122,173,858 56,252,260 Excess (deficiency) of revenues over (under)
expenditures (2,061,975) (61,693,671) (1,150,576) 60,543,095

OTHER FINANCING SOURCES (USES)
Transfers in 611,600 7,271,780 1,000,000 (6,271,780)
Transfers out (4,715,500) (14,177,148) (7,905,368) 6,271,780 Gain on disposal of capital assets 1,000 3,551,000 3,469,439 (81,561) Debt issuance proceeds — — 2,320,683 2,320,683
Total other financing sources (uses) (4,102,900) (3,354,368) (1,115,246) 2,239,122 Net change in fund balance $ (6,164,875) $ (65,048,039) (2,265,822) $ 62,782,217 Fund balance-beginning, as restated 110,045,869
Fund balance-ending $ 107,780,047
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual (Continued) General Fund
For The Year Ended June 30, 2025
93 116
Supplementary Information
94 117
General Fund
The General Fund is used to account for all financial sources except those required to be accounted for in another fund. The following funds conform to this definition:

General Fund
This fund is the main operating fund of the City and is used to account for all financial resources except those required to be accounted for in another fund.

Measure LL Fund
This fund is used to account for the additional transient occupancy taxes received when residents approved Ballot Measure LL in November 2016, which increased the City’s transient occupancy tax rate from 10% to 12%.

Open Space Fund
This fund is used to account for funds set aside by the City Council for the purposes of acquiring or preserving Open Space within the City.

Capital Improvement Fund
This fund is used to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds and bond proceeds). This fund is primarily funded by transfers from other City funds.

Parking Authority Fund
This fund is used to account for the accumulation of those costs related to providing and maintaining public parking and subsidizing public transit in the City. These costs are currently funded by parking revenues.

Parking In-Lieu Fund
This fund is used to account for the parking in-lieu certification development fees collected in accordance with Laguna Beach Municipal Code Section 25.52.006 (E) to fund central or common parking facilities and/or improving public transit.

Park In-Lieu Fund
This fund is used to account for the park and recreation in-lieu development fees collected under Ordinance No 1352 to fund park and recreation facilities.

Art In-Lieu Fund
This fund is used to account for the proceeds of art in-lieu development fees collected under Ordinance No. 1119, which requires certain development projects either provide artwork or pay an in-lieu fee that will be used to provide sites for and works of art in public places.

Drainage Fund
This fund is used to account for the proceeds collected under Ordinance No. 1027, which requires certain development projects to pay a fee to provide for improving and expanding drainage facilities located within the City.

Housing In-Lieu Fund
This fund is used to account for proceeds of housing in-lieu development fees collected under Laguna Beach Municipal Code Section 25.96.070 to fund expenditures directly related to the production or preservation of affordable housing in the City.

Library Impact Fee Fund
The City Council adopted Ordinance No. 1351 in 1999 (Laguna Beach Municipal Code Chapter 25.85 to provide for acquiring, building, improving, maintaining, and operating public libraries located within the City, including, but not limited to the purchase of books, reference materials, equipment, furnishings, and other necessary supplies.

The demand and need for such facilities and services results directly from the increase in density in the City by the development of land that was previously vacant or by the construction of additional residential units on land that is already developed.
95 118
Transportation Infrastructure Fund
This fund is used to account for financial resources to be used for the acquisition or construction of transportation infrastructure related projects. This fund is primarily funded by transfers from other City funds.

South Laguna Fund
This fund is used to account for the accumulation of those costs related to maintaining the beaches located in the South Laguna area that were acquired from the County of Orange on March 1, maintaining public parking and subsidizing public transit in the City. These costs are currently funded by parking revenues located at the beaches and a one-time payment received from the County of Orange of $22,000,000.

Deposits Fund
This fund is used to hold developer and miscellaneous deposits associated with private development projects that will be reimbursed by benefitted parties.

Disaster Contingency Fund
This fund is used to account for funds set aside by the City Council through the adoption of Resolution No. 05.107 to fund the repair of public facilities and the emergency protection of public and private property and lives during natural or manmade disasters. This fund is primarily funded by transfers from other City funds.

Wildfire Mitigation and Safety Fund
This fund is used to account for funs set aside by the City Council to fund wildfire mitigation and fire safety initiatives. This fund is primarily funded by transfers from other City funds. 96 119
Consolidating Balance Sheet by Sub - Fund
General Fund Measure LL Open Space
Capital
Improvement
ASSETS
Cash and investments $ 23,243,193 $ 1,199,054 $ 1,097,594 $ 35,660,173 Receivables (net of allowance for uncollectible):

Taxes 5,146,901 755,351 — 1,504,587
Accounts 685,086 — — 243,464
Interest 479,245 — — —
Intergovernmental 154,060 — — —
Leases 1,079,365 — — —
Prepaid expenses 104,065 338,620 — —
Inventory 100,372 — — —
Total assets $ 30,992,287 $ 2,293,025 $ 1,097,594 $ 37,408,224

LIABILITIES
Accounts payable $ 5,001,008 $ 135,563 $ 11,550 $ 1,171,552 Retainage payable — — — 78,364
Accrued liabilities 2,435,733 24,596 — 1,929
Deposits 366,084 — — —
Unearned revenue 75,000 — — —
Total liabilities 7,877,825 160,159 11,550 1,251,845

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 164,004 4,554 — 83,873
Leases 995,816 — — —
Total deferred inflows of resources 1,159,820 4,554 — 83,873

FUND BALANCES (DEFICITS)
Non-spendable 204,437 338,620 — —
Restricted — — — —
Committed 8,550,000 — — —
Assigned 13,200,205 1,789,692 1,086,044 36,072,506
Unassigned — — — —
Total fund balances (deficits) 21,954,642 2,128,312 1,086,044 36,072,506 Total Liabilities, Deferred Inflows of Resources, and Fund Balance $ 30,992,287 $ 2,293,025 $ 1,097,594 $ 37,408,224

CITY OF LAGUNA BEACH
Combining Balance Sheet By Sub - Fund
General Fund
June 30, 2025
97 120
Parking
Authority Parking In-Lieu Park In-Lieu Art In-Lieu
ASSETS
Cash and investments $ 15,213,172 $ 1,038 $ 47,058 $ 504,809 Receivables (net of allowance for uncollectible):

Taxes — — — —
Accounts 59,447 — — —
Interest — — — —
Intergovernmental — — — —
Leases — — — —
Prepaid expenses — — — —
Inventory — — — —
Total assets $ 15,272,619 $ 1,038 $ 47,058 $ 504,809

LIABILITIES
Accounts payable $ 475,401 $ — $ — $ 2,000
Retainage payable — — — —
Accrued liabilities 63,299 — — —
Deposits — — — —
Unearned revenue — — — —
Total liabilities 538,700 — — 2,000

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues — — — —
Leases — — — —
Total deferred inflows of resources — — — —

FUND BALANCES (DEFICITS)
Non-spendable — — — —
Restricted — — — —
Committed — 1,038 47,058 502,809
Assigned 14,733,919 — — —
Unassigned — — — —
Total fund balances (deficits) 14,733,919 1,038 47,058 502,809 Total Liabilities, Deferred Inflows of Resources,
and Fund Balance $ 15,272,619 $ 1,038 $ 47,058 $ 504,809

CITY OF LAGUNA BEACH
Combining Balance Sheet By Sub - Fund (Continued)
General Fund
June 30, 2025
98 121
Drainage Housing In-Lieu
Transportation
Infrastructure South Laguna
ASSETS
Cash and investments $ 85,497 $ 801,612 $ 1,919,989 $ 15,633,327 Receivables (net of allowance for uncollectible):

Taxes — — — —
Accounts — — — —
Interest — — — —
Intergovernmental — — — —
Leases — — — 78,226
Prepaid expenses — — — —
Inventory — — — —
Total assets $ 85,497 $ 801,612 $ 1,919,989 $ 15,711,553

LIABILITIES
Accounts payable $ — $ — $ — $ 151,187
Retainage payable — — — —
Accrued liabilities — — — 86,037
Deposits — — — —
Unearned revenue — — — —
Total liabilities — — — 237,224

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues — — — —
Leases — — — 74,471
Total deferred inflows of resources — — — 74,471

FUND BALANCES (DEFICITS)
Non-spendable — — — —
Restricted — — — 15,399,858
Committed 85,497 801,612 — —
Assigned — — 1,919,989 —
Unassigned — — — —
Total fund balances (deficits) 85,497 801,612 1,919,989 15,399,858 Total Liabilities, Deferred Inflows of Resources,
and Fund Balance $ 85,497 $ 801,612 $ 1,919,989 $ 15,711,553

CITY OF LAGUNA BEACH
Combining Balance Sheet By Sub - Fund (Continued)
General Fund
June 30, 2025
99 122
Deposits
Disaster
Contingency
Wildfire
Mitigation and
Fire Safety
(WMFS)
ASSETS
Cash and investments $ 4,503,320 $ 7,129,626 $ 4,204,474 Receivables (net of allowance for uncollectible):

Taxes — — —
Accounts — — —
Interest — — —
Intergovernmental — — 34,967
Leases — — —
Prepaid expenses — — 1,777,215
Inventory — — —
Total assets $ 4,503,320 $ 7,129,626 $ 6,016,656

LIABILITIES
Accounts payable $ 129,699 $ — $ 129,132
Retainage payable — — —
Accrued liabilities 102,622 — 2,849
Deposits 4,272,526 — —
Unearned revenue 14,724 — —
Total liabilities 4,519,571 — 131,981

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues — — 34,967
Leases — — —
Total deferred inflows of resources — — 34,967

FUND BALANCES (DEFICITS)
Non-spendable — — 1,777,215
Restricted — — —
Committed — 7,129,626 —
Assigned — — 4,072,493
Unassigned (16,251) — —
Total fund balances (deficits) (16,251) 7,129,626 5,849,708 Total Liabilities, Deferred Inflows of Resources,
and Fund Balance $ 4,503,320 $ 7,129,626 $ 6,016,656

CITY OF LAGUNA BEACH
Combining Balance Sheet By Sub - Fund (Continued)
General Fund
June 30, 2025
100
123
Library
Improvement
District
Total General
Fund
ASSETS
Cash and investments $ 83,680 $ 111,327,616
Receivables (net of allowance for uncollectible):

Taxes — 7,406,839
Accounts — 987,997
Interest — 479,245
Intergovernmental — 189,027
Leases — 1,157,591
Prepaid expenses — 2,219,900
Inventory — 100,372
Total assets $ 83,680 $ 123,868,587

LIABILITIES
Accounts payable $ — $ 7,207,092
Retainage payable — 78,364
Accrued liabilities — 2,717,065
Deposits — 4,638,610
Unearned revenue — 89,724
Total liabilities — 14,730,855

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues — 287,398
Leases — 1,070,287
Total deferred inflows of resources — 1,357,685

FUND BALANCES (DEFICITS)
Non-spendable — 2,320,272
Restricted — 15,399,858
Committed 83,680 17,201,320
Assigned — 72,874,848
Unassigned — (16,251)
Total fund balances (deficits) 83,680 107,780,047
Total Liabilities, Deferred Inflows of Resources,
and Fund Balance $ 83,680 $ 123,868,587

CITY OF LAGUNA BEACH
Combining Balance Sheet By Sub - Fund (Continued)
General Fund
June 30, 2025
101
124
Consolidating Schedule of Revenues, Expenditures and Changes in Fund Balances by Sub - Fund
Measure LL Open Space
Capital
General Fund Improvement

REVENUES
Taxes $ 73,729,955 $ 2,887,093 $ — $ 7,649,619
License, fees, and permits 3,369,833 — — —
Fines and forfeitures 3,472 — — 1,249,489
Investment income (loss), net 7,493,460 43,778 — 1,981
Rental 466,949 — — —
Intergovernmental 1,900,412 — — 1,538,827
Charges for services 7,492,036 — — 2,605
Parking meters, lots and permits — — — —
Development fees — — — 124,395
Other 477,668 — — —
Total revenues 94,933,785 2,930,871 — 10,566,916

EXPENDITURES
Current:

General Government 19,310,441 227,539 — —
Community development 9,118,545 — — —
Public safety 49,439,773 2,647,404 — —
Public works 13,580,166 349,065 — 3,639
Transit and community services 2,497,285 — — —
Capital outlay 2,842,618 69,773 79,465 7,907,978
Debt service:

Principal retirement 1,057,417 — — —
Interest expense and fiscal charges 296,717 — — —
Total expenditures 98,142,962 3,293,781 79,465 7,911,617 Excess (deficiency) of revenues
over (under) expenditures (3,209,177) (362,910) (79,465) 2,655,299

OTHER FINANCING SOURCES (USES)
Transfers in 3,387,500 — — 2,636,600
Transfers out (5,715,568) — — (3,726,500)
Gain on disposal of capital assets 3,469,439 — — —
Debt issuance proceeds 2,320,683 — — —
Total other financing sources (uses) 3,462,054 — — (1,089,900) Net change in fund balances 252,877 (362,910) (79,465) 1,565,399 Fund balances-beginning, as originally stated 22,555,765 2,491,222 1,165,509 35,273,281 Restatements - change in reporting entity (854,000) — — — Restatements - correction of error — — — (766,174)
Fund balances-beginning, as restated 21,701,765 2,491,222 1,165,509 34,507,107 Fund balances (deficit)-ending $ 21,954,642 $ 2,128,312 $ 1,086,044 $ 36,072,506

CITY OF LAGUNA BEACH
Combining Statement Of Revenues, Expenditures, And Changes In Fund Balances By Sub - Fund General Fund
For The Year Ended June 30, 2025
102
125
Parking
Authority Parking In-Lieu Park In-Lieu Art In-Lieu

REVENUES
Taxes $ — $ — $ — $ —
License, fees, and permits — — — —
Fines and forfeitures — — — —
Investment income (loss), net — 28 2,887 12,827
Rental 216,290 — — —
Intergovernmental — — — —
Charges for services — — — —
Parking meters, lots and permits 10,650,293 — — —
Development fees — — — 104,503
Other 39,669 — — —
Total revenues 10,906,252 28 2,887 117,330

EXPENDITURES
Current:

General Government — — — 24,312
Community development — — — —
Public safety 1,958,101 — — —
Public works 489,557 — — —
Transit and community services 3,178,179 — — —
Capital outlay 2,003,863 — — —
Debt service:

Principal retirement — — — —
Interest expense and fiscal charges — — — —
Total expenditures 7,629,700 — — 24,312
Excess (deficiency) of revenues
over (under) expenditures 3,276,552 28 2,887 93,018

OTHER FINANCING SOURCES (USES)
Transfers in — — — 14,000
Transfers out (4,498,480) — (86,600) —
Gain on disposal of capital assets — — — —
Debt issuance proceeds — — — —
Total other financing sources (uses) (4,498,480) — (86,600) 14,000 Net change in fund balances (1,221,928) 28 (83,713) 107,018 Fund balances-beginning, as originally stated 15,955,847 1,010 130,771 395,791 Restatements - change in reporting entity — — — —
Restatements - correction of error — — — —
Fund balances-beginning, as restated 15,955,847 1,010 130,771 395,791 Fund balances (deficit)-ending $ 14,733,919 $ 1,038 $ 47,058 $ 502,809

CITY OF LAGUNA BEACH
Combining Statement Of Revenues, Expenditures, And Changes In Fund Balances By Sub - Fund (Continued)
General Fund
For The Year Ended June 30, 2025
103
126
Drainage Housing In-Lieu
Transportation
Infrastructure South Laguna

REVENUES
Taxes $ — $ — $ — $ —
License, fees, and permits — — — —
Fines and forfeitures — — — —
Investment income (loss), net 2,306 21,622 51,788 462,209 Rental — — — 52,678
Intergovernmental — — — —
Charges for services — — — —
Parking meters, lots and permits — — — 780,793
Development fees — — — —
Other — — — —
Total revenues 2,306 21,622 51,788 1,295,680

EXPENDITURES
Current:

General Government — — — —
Community development — — — —
Public safety — — — 2,735,754
Public works — — — 919,869
Transit and community services — — — 84,552
Capital outlay — — — 665,278
Debt service:

Principal retirement — — — —
Interest expense and fiscal charges — — — —
Total expenditures — — — 4,405,453
Excess (deficiency) of revenues
over (under) expenditures 2,306 21,622 51,788 (3,109,773)

OTHER FINANCING SOURCES (USES)
Transfers in — — — —
Transfers out — — — —
Gain on disposal of capital assets — — — —
Debt issuance proceeds — — — —
Total other financing sources (uses) — — — —
Net change in fund balances 2,306 21,622 51,788 (3,109,773) Fund balances-beginning, as originally stated 83,191 779,990 1,868,201 18,509,631 Restatements - change in reporting entity — — — —
Restatements - correction of error — — — —
Fund balances-beginning, as restated 83,191 779,990 1,868,201 18,509,631 Fund balances (deficit)-ending $ 85,497 $ 801,612 $ 1,919,989 $ 15,399,858

CITY OF LAGUNA BEACH
Combining Statement Of Revenues, Expenditures, And Changes In Fund Balances By Sub - Fund (Continued)
General Fund
For The Year Ended June 30, 2025
104
127
Deposits
Disaster
Contingency
Wildfire
Mitigation and
Fire Safety
(WMFS)

REVENUES
Taxes $ — $ — $ —
License, fees, and permits — — —
Fines and forfeitures — — —
Investment income (loss), net — 192,309 —
Rental — — —
Intergovernmental — — —
Charges for services 1,508 — —
Parking meters, lots and permits — — —
Development fees — — —
Other — — —
Total revenues 1,508 192,309 —

EXPENDITURES
Current:

General Government — — —
Community development — — —
Public safety — — 621,959
Public works — — 64,609
Transit and community services — — —
Capital outlay — — —
Debt service:

Principal retirement — — —
Interest expense and fiscal charges — — —
Total expenditures — — 686,568
Excess (deficiency) of revenues
over (under) expenditures 1,508 192,309 (686,568)

OTHER FINANCING SOURCES (USES)
Transfers in — — 1,000,000
Transfers out — — —
Gain on disposal of capital assets — — —
Debt issuance proceeds — — —
Total other financing sources (uses) — — 1,000,000
Net change in fund balances 1,508 192,309 313,432
Fund balances-beginning, as originally stated (17,759) 6,937,317 4,682,276 Restatements - change in reporting entity — — 854,000
Restatements - correction of error — — —
Fund balances-beginning, as restated (17,759) 6,937,317 5,536,276 Fund balances (deficit)-ending $ (16,251) $ 7,129,626 $ 5,849,708

CITY OF LAGUNA BEACH
Combining Statement Of Revenues, Expenditures, And Changes In Fund Balances By Sub - Fund (Continued)
General Fund
For The Year Ended June 30, 2025
105
128
Library
Improvement
District Eliminations
Total General
Fund

REVENUES
Taxes $ — $ — $ 84,266,667
License, fees, and permits — — 3,369,833
Fines and forfeitures — — 1,252,961
Investment income (loss), net — — 8,285,195
Rental — — 735,917
Intergovernmental — — 3,439,239
Charges for services — — 7,496,149
Parking meters, lots and permits — — 11,431,086
Development fees — — 228,898
Other — — 517,337
Total revenues — — 121,023,282

EXPENDITURES
Current:

General Government — — 19,562,292
Community development — — 9,118,545
Public safety — — 57,402,991
Public works — — 15,406,905
Transit and community services — — 5,760,016
Capital outlay — — 13,568,975
Debt service:

Principal retirement — — 1,057,417
Interest expense and fiscal charges — — 296,717
Total expenditures — — 122,173,858
Excess (deficiency) of revenues
over (under) expenditures — — (1,150,576)

OTHER FINANCING SOURCES (USES)
Transfers in 83,680 (6,121,780) 1,000,000
Transfers out — 6,121,780 (7,905,368)
Gain on disposal of capital assets — — 3,469,439
Debt issuance proceeds — — 2,320,683
Total other financing sources (uses) 83,680 — (1,115,246) Net change in fund balances 83,680 — (2,265,822)
Fund balances-beginning, as originally stated — — 110,812,043 Restatements - change in reporting entity — — —
Restatements - correction of error — — (766,174)
Fund balances-beginning, as restated — — 110,045,869
Fund balances (deficit)-ending $ 83,680 $ — $ 107,780,047

CITY OF LAGUNA BEACH
Combining Statement Of Revenues, Expenditures, And Changes In Fund Balances By Sub - Fund (Continued)
General Fund
For The Year Ended June 30, 2025
106
129
THIS PAGE LEFT INTENTIONALLY BLANK.
107
130
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual 108
131
General Sub Fund

REVENUES
Taxes
Property taxes $ 52,459,000 $ 53,782,000 $ 53,289,542 $ (492,458) Sales and use taxes 7,690,000 6,972,000 7,372,476 400,476 Business improvement assessments — — 2,784,149 2,784,149 Transient occupancy taxes 14,426,000 11,226,000 7,414,706 (3,811,294) Franchise taxes 1,330,000 1,330,000 1,689,087 359,087
Business license taxes 1,100,000 1,100,000 1,179,995 79,995 Total taxes 77,005,000 74,410,000 73,729,955 (680,045)
License, fees and permits
Construction permits 2,641,000 2,641,000 3,257,915 616,915 Other 110,000 110,000 111,918 1,918
Total licenses, fees and permits 2,751,000 2,751,000 3,369,833 618,833 Fines and forfeitures 11,000 11,000 3,472 (7,528)
Investment income (loss), net 2,800,000 3,175,000 7,493,460 4,318,460 Rental 504,500 504,500 466,949 (37,551)
Intergovernmental 1,980,000 2,660,200 1,900,412 (759,788) Charges for services
Planning and zoning fees 3,163,500 3,163,500 2,367,773 (795,727) Building department fees 713,000 713,000 406,085 (306,915) Refuse service charges — — 45,194 45,194
Parks and recreation fees 1,411,000 1,456,000 1,475,610 19,610 Other 2,133,400 2,014,500 3,197,374 1,182,874
Total charges for services 7,420,900 7,347,000 7,492,036 145,036 Parking meters, lots, and permits 1,000 1,000 — (1,000) Other
Reimbursed expenditures 488,000 488,000 359,592 (128,408) Miscellaneous 794,900 371,000 118,076 (252,924)
Total other 1,282,900 859,000 477,668 (381,332)
Total revenues 93,756,300 91,718,700 94,933,785 3,215,085 Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual General Sub Fund
For The Year Ended June 30, 2025
109
132

EXPENDITURES
Current:

General government
City Council $ 130,100 $ 342,224 $ 124,983 $ 217,241
City Manager 6,893,900 13,874,450 11,608,579 2,265,871
City Clerk 550,500 588,264 568,424 19,840
City Treasurer 303,500 303,500 259,879 43,621
City Attorney 1,500,000 2,000,000 2,393,679 (393,679)
Administrative services 5,308,500 5,500,936 4,354,897 1,146,039 Total general government 14,686,500 22,609,374 19,310,441 3,298,933 Public safety
Police protection 23,260,700 24,535,550 24,829,026 (293,476) Fire protection 18,807,600 20,059,400 20,268,843 (209,443) Marine safety 4,414,700 4,439,700 4,341,904 97,796
Total public safety 46,483,000 49,034,650 49,439,773 (405,123) Community development 10,034,200 10,810,149 9,118,545 1,691,604 Public works 14,912,200 16,075,000 13,580,166 2,494,834 Transit and community services 6,385,400 4,121,050 2,497,285 1,623,765 Capital outlay 1,236,000 1,351,536 2,842,618 (1,491,082) Debt service:

Principal retirement — — 1,057,417 (1,057,417)
Interest and fiscal charges 880,600 880,600 296,717 583,883 Total expenditures 94,617,900 104,882,359 98,142,962 6,739,397 Excess (deficiency) of revenues over
(under) expenditures (861,600) (13,163,659) (3,209,177) 9,954,482

OTHER FINANCING SOURCES (USES)
Transfers in 525,000 3,387,500 3,387,500 —
Transfers out — (5,715,568) (5,715,568) —
Gain on disposal of capital assets 1,000 3,551,000 3,469,439 (81,561) Debt issuance proceeds — — 2,320,683 2,320,683
Total other financing sources (uses) 526,000 1,222,932 3,462,054 2,239,122 Net change in fund balance $ (335,600) $ (11,940,727) 252,877 $ 12,193,604 Fund balance-beginning, as restated 21,701,765
Fund balance-ending $ 21,954,642
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual (Continued) General Sub Fund
For The Year Ended June 30, 2025
110
133
Measure LL
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)
REVENUES:

Taxes $ 3,610,000 $ 3,060,000 $ 2,887,093 $ (172,907)
Investment income (loss), net 50,000 50,000 43,778 (6,222) Total revenues 3,660,000 3,110,000 2,930,871 (179,129)
EXPENDITURES:

Current:

General Government 385,700 385,700 227,539 158,161
Public safety 3,057,500 3,278,800 2,647,404 631,396
Public works 422,700 422,700 349,065 73,635
Capital outlay — 117,376 69,773 47,603
Total expenditures 3,865,900 4,204,576 3,293,781 910,795 Excess (deficiency) of revenues
over (under) expenditures (205,900) (1,094,576) (362,910) 731,666 Net change in fund balance $ (205,900) $ (1,094,576) (362,910) $ 731,666 Fund balance-beginning 2,491,222
Fund balance-ending $ 2,128,312
City Of Laguna Beach
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Measure LL
For The Year Ended June 30, 2025
111
134
Open Space
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

EXPENDITURES
Capital outlay $ 20,000 $ 167,152 $ 79,465 $ 87,687
Total expenditures 20,000 167,152 79,465 87,687
Net change in fund balance $ (20,000) $ (167,152) (79,465) $ 87,687 Fund balance-beginning 1,165,509
Fund balance-ending $ 1,086,044

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Open Space
For The Year Ended June 30, 2025
112
135
Capital Improvement
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Property taxes $ 650,000 $ 650,000 $ 717,437 $ 67,437
Fines and penalties 895,000 895,000 1,249,489 354,489
Transient lodging taxes 7,339,500 7,339,500 6,932,182 (407,318) Investment income (loss), net — — 1,981 1,981
Development fees 100,000 100,000 124,395 24,395
Intergovernmental — — 1,538,827 1,538,827
Charges for services 1,000 1,000 2,605 1,605
Total revenues 8,985,500 8,985,500 10,566,916 1,581,416

EXPENDITURES
Current:

Public works — 42,700 3,639 39,061
Capital outlay 8,358,076 42,382,145 7,907,978 34,474,167 Total expenditures 8,358,076 42,424,845 7,911,617 34,513,228 Excess (deficiency) of revenues
over (under) expenditures 627,424 (33,439,345) 2,655,299 36,094,644

OTHER FINANCING SOURCES (USES)
Transfers in 86,600 2,636,600 2,636,600 —
Transfers out (700,000) (3,726,500) (3,726,500) —
Total other financing sources (uses) (613,400) (1,089,900) (1,089,900) — Net change in fund balance $ 14,024 $ (34,529,245) 1,565,399 $ 36,094,644 Fund balance-beginning, as restated 34,507,107
Fund balance-ending $ 36,072,506

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Capital Improvement
For The Year Ended June 30, 2025
113
136
Parking Authority
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Rental $ — $ — $ 216,290 $ 216,290
Parking meters, lots and permits 10,302,001 10,302,001 10,650,293 348,292 Other — 38,004 39,669 1,665
Total revenues 10,302,001 10,340,005 10,906,252 566,247

EXPENDITURES
Current:

Community development 1,000 1,000 — 1,000
Public safety 2,360,000 2,360,000 1,958,101 401,899
Public works 805,300 805,300 489,557 315,743
Transit and community services 3,431,500 3,780,500 3,178,179 602,321 Capital outlay 2,400,000 8,337,370 2,003,863 6,333,507
Total expenditures 8,997,800 15,284,170 7,629,700 7,654,470 Excess (deficiency) of revenues
over (under) expenditures 1,304,201 (4,944,165) 3,276,552 8,220,717

OTHER FINANCING SOURCES (USES)
Transfers out (3,928,900) (4,498,480) (4,498,480) —
Total other financing sources (uses) (3,928,900) (4,498,480) (4,498,480) — Net change in fund balance $ (2,624,699) $ (9,442,645) (1,221,928) $ 8,220,717 Fund balance-beginning 15,955,847
Fund balance-ending $ 14,733,919

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Parking Authority
For The Year Ended June 30, 2025
114
137
Park In-Lieu
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Investment income (loss), net $ — $ — $ 2,887 $ 2,887
Total revenues — — 2,887 2,887

OTHER FINANCING SOURCES (USES)
Transfers out (86,600) (86,600) (86,600) —
Total other financing sources (uses) (86,600) (86,600) (86,600) — Net change in fund balance $ (86,600) $ (86,600) (83,713) $ 2,887 Fund balance-beginning 130,771
Fund balance-ending $ 47,058

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Park In-lieu
For The Year Ended June 30, 2025
115
138
Art In-Lieu
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Investment income (loss), net $ — $ — $ 12,827 $ 12,827 Development fees — — 104,503 104,503
Total revenues — — 117,330 117,330

EXPENDITURES
Current:

General Government — 130,500 24,312 106,188
Transit and community services — 17,000 — 17,000
Capital outlay — 10,800 — 10,800
Total expenditures — 158,300 24,312 133,988
Excess (deficiency) of revenues
over (under) expenditures — (158,300) 93,018 251,318

OTHER FINANCING SOURCES (USES)
Transfers in — 14,000 14,000 —
Total other financing sources (uses) — 14,000 14,000 —
Net change in fund balance $ — $ (144,300) 107,018 $ 251,318 Fund balance-beginning 395,791
Fund balance-ending $ 502,809

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Art In-lieu
For The Year Ended June 30, 2025
116
139
Housing In-Lieu
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Investment income (loss), net $ — $ — $ 21,622 $ 21,622 Total revenues — — 21,622 21,622

EXPENDITURES
Current:

Transit and community services — 23,900 — 23,900
Total expenditures — 23,900 — 23,900
Net change in fund balance $ — $ (23,900) 21,622 $ 45,522 Fund balance-beginning 779,990
Fund balance-ending $ 801,612

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Housing In-lieu
For The Year Ended June 30, 2025
117
140
Transportation Infrastructure
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Investment income (loss), net $ 10,000 $ 10,000 $ 51,788 $ 41,788 Total revenues 10,000 10,000 51,788 41,788
Net change in fund balance $ 10,000 $ 10,000 51,788 $ 41,788 Fund balance-beginning 1,868,201
Fund balance-ending $ 1,919,989

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Transportation Infrastructure
For The Year Ended June 30, 2025
118
141
South Laguna
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Investment income (loss), net $ 700,000 $ 700,000 $ 462,209 $ (237,791) Rental — — 52,678 52,678
Parking meters, lots and permits 700,000 700,000 780,793 80,793 Total revenues 1,400,000 1,400,000 1,295,680 (104,320)

EXPENDITURES
Current:

Public safety 2,873,500 2,873,500 2,735,754 137,746
Public works 944,900 944,900 919,869 25,031
Transit and community services 107,700 107,700 84,552 23,148 Capital outlay 540,000 1,330,196 665,278 664,918
Total expenditures 4,466,100 5,256,296 4,405,453 850,843 Net change in fund balance $ (3,066,100) $ (3,856,296) (3,109,773) $ 746,523 Fund balance-beginning 18,509,631
Fund balance-ending $ 15,399,858

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual South Laguna
For The Year Ended June 30, 2025
119
142
Disaster Contingency
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Investment income (loss), net $ 100,000 $ 100,000 $ 192,309 $ 92,309 Total revenues 100,000 100,000 192,309 92,309
Net change in fund balance $ 100,000 $ 100,000 192,309 $ 92,309 Fund balance-beginning 6,937,317
Fund balance-ending $ 7,129,626

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Disaster Contingency
For The Year Ended June 30, 2025
120
143
Wildfire Mitigation and Fire Safety
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental $ — $ 1,094,250 $ — $ (1,094,250)
Total revenues — 1,094,250 — (1,094,250)

EXPENDITURES
Current:

Public safety 158,800 2,633,700 621,959 2,011,741
Public works 900,000 3,142,820 64,609 3,078,211
Capital outlay — 248,000 — 248,000
Total expenditures 1,058,800 6,024,520 686,568 5,337,952 Excess (deficiency) of revenues
over (under) expenditures (1,058,800) (4,930,270) (686,568) 4,243,702

OTHER FINANCING SOURCES (USES)
Transfers in 1,000,000 1,000,000 1,000,000 —
Total other financing sources (uses) 1,000,000 1,000,000 1,000,000 — Net change in fund balance $ (58,800) $ (3,930,270) 313,432 $ 4,243,702 Fund balance-beginning, as restated 5,536,276
Fund balance-ending $ 5,849,708

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Wildfire Mitigation And Fire Safety
For The Year Ended June 30, 2025
121
144
Library Impact Fees
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

OTHER FINANCING SOURCES (USES)
Transfers in $ — $ 83,680 $ 83,680 $ —
Total other financing sources (uses) — 83,680 83,680 —
Net change in fund balance $ — $ 83,680 83,680 $ —
Fund balance-beginning —
Fund balance-ending $ 83,680

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Library Impact Fees
For The Year Ended June 30, 2025
122
145
Major Capital Projects Fund
Capital Projects Funds are used to account for the acquisition and construction of major capital facilities other than those financed by proprietary funds and trust funds.

The City of Laguna Beach has the following Capital Project Fund Assessment District
The fund is used to account for assessment district utility undergrounding projects which are funded by property owners.
123
146
Assessment Districts
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Investment income (loss), net $ — $ — $ 290,611 $ 290,611 Total revenues — — 290,611 290,611

EXPENDITURES
Current:

Public works — 29,814,652 6,184,512 23,630,140
Total expenditures — 29,814,652 6,184,512 23,630,140
Net change in fund balance $ — $ (29,814,652) (5,893,901) $ 23,920,751 Fund balance-beginning 12,553,630
Fund balance-ending $ 6,659,729

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Assessment Districts
For The Year Ended June 30, 2025
124
147
Non-Major Governmental Funds
Special Revenue Funds are used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditures for specified purposes other than debt services or capital projects.

The City of Laguna Beach has the following nonmajor Special Revenue Funds:

Gas Tax Fund
This fund is used to account for the restricted gasoline tax revenues and Measure M2 sales taxes which are used for maintenance and improvements of City streets.

Street Lighting District Fund
This fund is used to account for restricted revenue and expenditures associated with maintenance and use of the City's street lighting system.

Federal Asset Forfeiture Fund
This fund is used to account for restricted money received under federal programs distributing property confiscated from illegal activities.

State Asset Forfeiture Fund
This fund is used to account for restricted money received under state programs distributing property confiscated from illegal activities.

Housing Fund
This fund is used to account for revenue and expenditures committed to affordable housing programs.

National Opioid Settlement Fund
This fund is used to account for the City’s allocated share of multistate settlement agreements with opioid manufacturers, distributors, and pharmacies that resolved lawsuits alleging their role in the opioid crisis, which must be used for opioid abatement activities.

AQMD Fund
This fund is used to account for funds generated by AB 2766, received from the state (passed through South Coast Air Quality Management District, which added a surcharge to vehicle registration fees. The fees are used for mobile source emission reduction projects.

Animal Shelter Donations Fund
This fund is used to account for donations received that are donor-restricted to fund Animal Shelter activities.

Cultural Environmental Stewardship Fund
This fund is used to account for contributions from Visit Laguna Beach pursuant to Amendment No. 1, dated June 10, 2025, which requires the contributions from Visit Laguna Beach are recorded in a separate fund to be used exclusively for City improvements and services that support “Cultural and Environmental Stewardship” as outlined in the 2025 Laguna Beach Tourism Marketing District (LBTMD) Management District Plan. 125
148
Combining Balance Sheet
Special Revenue Funds
Gas Tax
Street
Lighting
District
Federal
Asset
Forfeiture
State Asset
Forfeiture
ASSETS
Cash and investments $ 3,793,152 $ 6,597,336 $ 138,211 $ 50,439 Receivables (net of allowance for uncollectible):

Taxes — 25,484 — —
Accounts 104,194 — — —
Intergovernmental 366,023 — — —
Prepaid expenses — 2,388,177 — —
Total assets $ 4,263,369 $ 9,010,997 $ 138,211 $ 50,439

LIABILITIES
Accounts payable $ 761,248 $ 76,757 $ — $ —
Retainage payable 153,213 60,443 — —
Accrued liabilities — 2,764 — —
Total liabilities 914,461 139,964 — —

DEFERRED INFLOWS OF RESOURCES
Deferred Inflows - Unavailable Revenues 200,000 — — —
Total deferred inflows of resources 200,000 — — —

FUND BALANCES
Non-spendable — 2,388,177 — —
Restricted 3,148,908 6,482,856 138,211 50,439
Total fund balances 3,148,908 8,871,033 138,211 50,439
Total liabilities, deferred inflows, and fund
balances $ 4,263,369 $ 9,010,997 $ 138,211 $ 50,439

CITY OF LAGUNA BEACH
Combining Balance Sheet
Nonmajor Governmental Funds
For The Year Ended June 30, 2025
126
149
Special Revenue Funds
Housing
Fund
National
Opioid
Settlement AQMD
Animal
Shelter
Donations
ASSETS
Cash and investments $ 1,748,754 $ 76,819 $ 84,038 $ 1,497,850 Receivables (net of allowance for uncollectible):

Taxes 26,946 — — —
Accounts — — — —
Intergovernmental — — — —
Prepaid expenses — — — —
Total assets $ 1,775,700 $ 76,819 $ 84,038 $ 1,497,850

LIABILITIES
Accounts payable $ 9,000 $ — $ — $ —
Retainage payable — — — —
Accrued liabilities — — — —
Total liabilities 9,000 — — —

DEFERRED INFLOWS OF RESOURCES
Deferred Inflows - Unavailable Revenues — — — —
Total deferred inflows of resources — — — —

FUND BALANCES
Non-spendable — — — —
Restricted 1,766,700 76,819 84,038 1,497,850
Total fund balances 1,766,700 76,819 84,038 1,497,850
Total liabilities, deferred inflows, and fund
balances $ 1,775,700 $ 76,819 $ 84,038 $ 1,497,850

CITY OF LAGUNA BEACH
Combining Balance Sheet (Continued)
Nonmajor Governmental Funds
For The Year Ended June 30, 2025
127
150
Special
Revenue
Funds
Cultural &
Environmental
Stewardship
Fund
Total
Nonmajor
Funds
ASSETS
Cash and investments $ — $ 13,986,599
Receivables (net of allowance for uncollectible):

Taxes — 52,430
Accounts 500,000 604,194
Intergovernmental — 366,023
Prepaid expenses — 2,388,177
Total assets $ 500,000 $ 17,397,423

LIABILITIES
Accounts payable $ — $ 847,005
Retainage payable — 213,656
Accrued liabilities — 2,764
Total liabilities — 1,063,425

DEFERRED INFLOWS OF RESOURCES
Deferred Inflows - Unavailable Revenues 240,000 440,000 Total deferred inflows of resources 240,000 440,000

FUND BALANCES
Non-spendable — 2,388,177
Restricted 260,000 13,505,821
Total fund balances 260,000 15,893,998
Total liabilities, deferred inflows, and fund
balances $ 500,000 $ 17,397,423

CITY OF LAGUNA BEACH
Combining Balance Sheet (Continued)
Nonmajor Governmental Funds
For The Year Ended June 30, 2025
128
151
Combining Statement of Revenues, Expenditures and Changes in Fund Balance Special Revenue Funds
Gas Tax
Street
Lighting
District
Federal
Asset
Forfeiture
State Asset
Forfeiture

REVENUES
Taxes $ — $ 2,404,168 $ — $ —
Investment income (loss), net 117,955 190,015 5,039 —
Intergovernmental 1,867,414 — 6,308 —
Other 13,227 — — —
Total revenues 1,998,596 2,594,183 11,347 —

EXPENDITURES
Current:

General Government — — — —
Public works — 1,034,677 — —
Capital outlay 3,343,603 727,676 — —
Total expenditures 3,343,603 1,762,353 — —
Excess (deficiency) of revenues
over (under) expenditures (1,345,007) 831,830 11,347 —

OTHER FINANCING SOURCES (USES)
Transfers in 850,000 — — 50,439
Transfers out — (1,000,000) (50,439) —
Total other financing sources (uses) 850,000 (1,000,000) (50,439) 50,439 Net change in fund balances (495,007) (168,170) (39,092) 50,439 Fund balances-beginning 3,643,915 9,039,203 177,303 —
Fund balances-ending $ 3,148,908 $ 8,871,033 $ 138,211 $ 50,439

CITY OF LAGUNA BEACH
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds
For The Year Ended June 30, 2025
129
152
Special Revenue Funds
Housing
Fund
National
Opioid
Settlement AQMD
Animal
Shelter
Donations

REVENUES
Taxes $ 81,637 $ — $ — $ —
Investment income (loss), net — — — —
Intergovernmental — 56,914 — —
Other — — — —
Total revenues 81,637 56,914 — —

EXPENDITURES
Current:

General Government 25,684 — — —
Public works — — — —
Capital outlay — — — —
Total expenditures 25,684 — — —
Excess (deficiency) of revenues
over (under) expenditures 55,953 56,914 — —

OTHER FINANCING SOURCES (USES)
Transfers in 500,000 — 84,038 1,497,850
Transfers out — — — —
Total other financing sources (uses) 500,000 — 84,038 1,497,850 Net change in fund balances 555,953 56,914 84,038 1,497,850 Fund balances-beginning 1,210,747 19,905 — —
Fund balances-ending $ 1,766,700 $ 76,819 $ 84,038 $ 1,497,850

CITY OF LAGUNA BEACH
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds
For The Year Ended June 30, 2025
130
153
Special
Revenue
Funds
Cultural &
Environmental
Stewardship
Fund
Total
Nonmajor
Funds

REVENUES
Taxes $ — $ 2,485,805
Investment income (loss), net — 313,009
Intergovernmental — 1,930,636
Other 260,000 273,227
Total revenues 260,000 5,002,677

EXPENDITURES
Current:

General Government — 25,684
Public works — 1,034,677
Capital outlay — 4,071,279
Total expenditures — 5,131,640
Excess (deficiency) of revenues
over (under) expenditures 260,000 (128,963)

OTHER FINANCING SOURCES (USES)
Transfers in — 2,982,327
Transfers out — (1,050,439)
Total other financing sources (uses) — 1,931,888
Net change in fund balances 260,000 1,802,925
Fund balances-beginning — 14,091,073
Fund balances-ending $ 260,000 $ 15,893,998

CITY OF LAGUNA BEACH
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Nonmajor Governmental Funds
For The Year Ended June 30, 2025
131
154
Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual 132
155
Gas Tax
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Investment income (loss), net $ 10,000 $ 10,000 $ 117,955 $ 107,955 Intergovernmental 1,287,600 1,287,600 1,867,414 579,814 Other — — 13,227 13,227
Total revenues 1,297,600 1,297,600 1,998,596 700,996

EXPENDITURES
Capital outlay 2,500,000 6,511,322 3,343,603 3,167,719
Total expenditures 2,500,000 6,511,322 3,343,603 3,167,719 Excess (deficiency) of revenues
over (under) expenditures (1,202,400) (5,213,722) (1,345,007) 3,868,715

OTHER FINANCING SOURCES (USES)
Transfers in 700,000 850,000 850,000 —
Total other financing sources (uses) 700,000 850,000 850,000 — Net change in fund balance $ (502,400) $ (4,363,722) (495,007) $ 3,868,715 Fund balance-beginning 3,643,915
Fund balance-ending $ 3,148,908

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Gas Tax
For The Year Ended June 30, 2025
133
156
Street Lighting District
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Taxes $ 2,294,000 $ 2,294,000 $ 2,404,168 $ 110,168
Investment income (loss), net 50,000 50,000 190,015 140,015 Total revenues 2,344,000 2,344,000 2,594,183 250,183

EXPENDITURES
Current:

Public works 1,085,100 1,110,100 1,034,677 75,423
Capital outlay 6,000 6,372,833 727,676 5,645,157
Total expenditures 1,091,100 7,482,933 1,762,353 5,720,580 Excess (deficiency) of revenues
over (under) expenditures 1,252,900 (5,138,933) 831,830 5,970,763

OTHER FINANCING SOURCES (USES)
Transfers out (1,000,000) (1,000,000) (1,000,000) —
Total other financing sources (uses) (1,000,000) (1,000,000) (1,000,000) — Net change in fund balance $ 252,900 $ (6,138,933) (168,170) $ 5,970,763 Fund balance-beginning 9,039,203
Fund balance-ending $ 8,871,033

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Street Lighting District
For The Year Ended June 30, 2025
134
157
Federal Asset Forfeiture
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Investment income (loss), net $ — $ — $ 5,039 $ 5,039
Intergovernmental — — 6,308 6,308
Total revenues — — 11,347 11,347

EXPENDITURES
Capital outlay — 82,398 — 82,398
Total expenditures — 82,398 — 82,398
Excess (deficiency) of revenues
over (under) expenditures — (82,398) 11,347 93,745

OTHER FINANCING SOURCES (USES)
Transfers out — (50,439) (50,439) —
Total other financing sources (uses) — (50,439) (50,439) — Net change in fund balance $ — $ (132,837) (39,092) $ 93,745 Fund balance-beginning 177,303
Fund balance-ending $ 138,211

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Federal Asset Forfeiture
For The Year Ended June 30, 2025
135
158
State Asset Forfeiture
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

EXPENDITURES
Capital outlay $ — $ 50,439 $ — $ 50,439
Total expenditures — 50,439 — 50,439

OTHER FINANCING SOURCES (USES)
Transfers in — 50,439 50,439 —
Total other financing sources (uses) — 50,439 50,439 —
Net change in fund balance $ — $ — 50,439 $ 50,439
Fund balance-beginning —
Fund balance-ending $ 50,439

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual State Asset Forfeiture
For The Year Ended June 30, 2025
136
159
Housing Fund
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Taxes $ 80,000 $ 80,000 $ 81,637 $ 1,637
Total revenues 80,000 80,000 81,637 1,637

EXPENDITURES
Current:

General Government — 288,000 25,684 262,316
Community development — 16,100 — 16,100
Total expenditures — 304,100 25,684 278,416
Excess (deficiency) of revenues
over (under) expenditures 80,000 (224,100) 55,953 280,053

OTHER FINANCING SOURCES (USES)
Transfers in — 500,000 500,000 —
Total other financing sources (uses) — 500,000 500,000 — Net change in fund balance $ 80,000 $ 275,900 555,953 $ 280,053 Fund balance-beginning 1,210,747
Fund balance-ending $ 1,766,700

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Housing Fund
For The Year Ended June 30, 2025
137
160
National Opioid Settlement
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental — 55,000 56,914 1,914
Total revenues — 55,000 56,914 1,914

EXPENDITURES
Current:

Public safety — 55,000 — 55,000
Total expenditures — 55,000 — 55,000
Total other financing sources (uses) — — — —
Net change in fund balance $ — $ — 56,914 $ 56,914
Fund balance-beginning 19,905
Fund balance-ending $ 76,819

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual National Opioid Settlement
For The Year Ended June 30, 2025
138
161
AQMD
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

OTHER FINANCING SOURCES (USES)
Transfers in — 84,038 84,038 —
Total other financing sources (uses) — 84,038 84,038 —
Net change in fund balance $ — $ 84,038 84,038 $ —
Fund balance-beginning —
Fund balance-ending $ 84,038

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual AQMD
For The Year Ended June 30, 2025
139
162
Animal Shelter Donations
Budget Amounts Actual
Variance with
Final Budget
Positive
Original Final Amounts (Negative)

EXPENDITURES
Current:

Community development $ — $ 1,497,850 $ — $ 1,497,850
Total expenditures — 1,497,850 — 1,497,850
Excess (deficiency) of revenues
over (under) expenditures — (1,497,850) — 1,497,850

OTHER FINANCING SOURCES (USES)
Transfers in — 1,497,850 1,497,850 —
Total other financing sources (uses) — 1,497,850 1,497,850 — Net change in fund balance $ — $ — 1,497,850 $ 1,497,850 Fund balance-beginning —
Fund balance-ending $ 1,497,850

CITY OF LAGUNA BEACH
Schedule Of Revenues, Expenditures, And Changes In Fund Balance - Budget And Actual Animal Shelter Donations
For The Year Ended June 30, 2025
140
163
Internal Service Funds
Internal Service Funds are used to account for the financing of goods or services provided by one department or agency of a government to other departments or agencies on a cost reimbursement basis.

The City of Laguna Beach has the following Internal Service Funds:

Insurance and Employee Benefits Fund
This fund is used to account for the cost of providing employee benefits and various forms of insurance (general liability, workers' compensation, and all other forms of employee group insurance) provided to the various City departments.

Vehicle Replacement Fund
This fund was created to acquire vehicles and other significant equipment for rental to the operating departments. 141
164
Combining Statement of Net Position - Internal Service Funds Insurance and
Employee
Benefits
Vehicle
Replacement
Total Internal
Service
Funds
ASSETS
Current assets:

Cash and investments $ 10,931,095 $ 14,359,837 $ 25,290,932 Receivables (net of uncollectibles):

Accounts 49,308 — 49,308
Total current assets 10,980,403 14,359,837 25,340,240
Noncurrent:

Notes receivable 940,590 859,555 1,800,145
Property for housing program 797,500 — 797,500
Capital assets, net of depreciation — 6,622,379 6,622,379 Total noncurrent assets 1,738,090 7,481,934 9,220,024
Total assets 12,718,493 21,841,771 34,560,264

LIABILITIES
Current liabilities:

Accounts payable 263,220 50,810 314,030
Accrued liabilities 49,854 — 49,854
Compensated absences, due within one year 2,054,166 — 2,054,166 Insurance claims payable, due within one year 3,049,186 — 3,049,186 Total current liabilities 5,416,426 50,810 5,467,236
Noncurrent liabilities:

Compensated absences 5,084,203 — 5,084,203
Insurance claims payable 7,114,767 — 7,114,767
Total noncurrent liabilities 12,198,970 — 12,198,970
Total liabilities 17,615,396 50,810 17,666,206

NET POSITION
Net investment in capital assets — 6,571,569 6,571,569
Unrestricted (4,896,903) 15,219,392 10,322,489
Total net position $ (4,896,903) $ 21,790,961 $ 16,894,058

CITY OF LAGUNA BEACH
Combining Statement Of Net Position
Internal Service Funds
June 30, 2025
142
165
Combining Statement of Revenues, Expenses and Changes in Net Position - Internal Service Funds Insurance and
Employee
Benefits
Vehicle
Replacement
Total Internal
Service
Funds

OPERATING REVENUES
Rental $ — $ 2,535,200 $ 2,535,200
Employee benefits charges 1,322,000 — 1,322,000
Insurance charges 13,509,609 — 13,509,609
Total operating revenues 14,831,609 2,535,200 17,366,809

OPERATING EXPENSES
General and administrative 381,249 — 381,249
Personnel services 130,068 — 130,068
Employee benefits 1,788,501 — 1,788,501
Materials and supples — 159,609 159,609
Insurance premiums and claim payments 17,282,040 — 17,282,040 Depreciation — 1,158,053 1,158,053
Total operating expenses 19,581,858 1,317,662 20,899,520 Operating income (loss) (4,750,249) 1,217,538 (3,532,711)

NONOPERATING REVENUES (EXPENSES)
Investment income — 7,074 7,074
Miscellaneous — 47,346 47,346
Gain on disposal of capital assets 396,091 72,367 468,458 Total nonoperating revenues (expenses) 396,091 126,787 522,878 Income (loss) before transfers and capital contributions (4,354,158) 1,344,325 (3,009,833) Capital contributions — 39,854 39,854
Transfers in — 1,300,000 1,300,000
Change in net position (4,354,158) 2,684,179 (1,669,979) Net position-beginning, as restated (542,745) 19,106,782 18,564,037 Net position-ending $ (4,896,903) $ 21,790,961 $ 16,894,058

CITY OF LAGUNA BEACH
Combining Statement Of Revenues, Expenses And Changes In Net Position Internal Service Funds
For The Year Ended June 30, 2025
143
166
Combining Statement of Cash Flows - Internal Service Funds Insurance and
Employee
Benefits
Vehicle
Replacement Totals

CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers $ 14,828,259 $ 2,535,200 $ 17,363,459 Payments to suppliers and service providers (17,005,360) (212,914) (17,218,274) Payments to employees for salaries and benefits (2,721,654) — (2,721,654) Net cash provided by (used for)
operating activities (4,898,755) 2,322,286 (2,576,469)

CASH FLOWS FROM NONCAPITAL

FINANCING ACTIVITIES
Transfers from other funds — 1,300,000 1,300,000
Issuance of notes receivable to housing program — (569,638) (569,638) Net cash provided by (used for)
noncapital financing activities — 730,362 730,362

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES
Capital grants and contributions — 39,854 39,854
Acquisition and construction of capital assets — (1,602,391) (1,602,391) Proceeds from sales of assets 940,591 70,529 1,011,120
Net cash provided by (used for)
capital and related financing activities 940,591 (1,492,008) (551,417)

CASH FLOWS FROM INVESTING ACTIVITIES
Interest on investments — 54,420 54,420
Net cash provided by (used for)
investing activities — 54,420 54,420
Net increase (decrease) in
cash and cash equivalents (3,958,164) 1,615,060 (2,343,104) Cash and cash equivalents-beginning 14,889,259 12,744,777 27,634,036 Cash and cash equivalents-ending $ 10,931,095 $ 14,359,837 $ 25,290,932

RECONCILIATION OF OPERATING INCOME (LOSS)

TO NET CASH PROVIDED BY (USED FOR)

OPERATING ACTIVITIES
Operating income (loss) $ (4,750,249) $ 1,217,538 $ (3,532,711) Adjustments to reconcile operating income (loss) to
net cash provided by (used for) operating activities:

Depreciation/amortization expense — 1,158,053 1,158,053 (Increase) decrease in accounts receivable (3,350) — (3,350) (Increase) decrease in notes and loans receivable (940,590) — (940,590) Increase (decrease) in accounts payable 102,811 (53,305) 49,506 Increase (decrease) in accrued liabilities (55,543) — (55,543) Increase (decrease) in compensated absences 518,754 — 518,754 Increase (decrease) in claims and judgments 229,412 — 229,412 Total adjustments (148,506) 1,104,748 956,242
Net cash provided by (used for)
operating activities $ (4,898,755) $ 2,322,286 $ (2,576,469)

CITY OF LAGUNA BEACH
Combining Statement Of Cash Flows
Internal Service Funds
For The Year Ended June 30, 2025
144
167
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145
168

STATISTICAL SECTION
146
169
Financial Trends
This section of the City of Laguna Beach's Annual Comprehensive Financial Report (ACFR) presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City's overall financial health. The statistical information presented herein is un-audited.

The following schedules contain trend information illustrating how the City's financial performance and well-being has changed over time:
• Net Position by Component
• Changes in Net Position
• Fund Balances of Governmental Funds
• Changes in Fund Balance of Governmental Funds
Sources: Unless otherwise noted, the information in these schedules is derived from the Annual Comprehensive Financial Reports and underlying accounting records for the relevant year. 147
170
Net Position by Component, Last Ten Fiscal Years
148
171
149
172
Changes in Net Position, Last Ten Years
150
173
151
174
152
175
153
176
Fund Balances of Governmental Funds, Last Ten Fiscal Years 154
177
155
178
Changes in Fund Balances of Governmental Funds, Last Ten Fiscal Years 156
179
157
180
Revenue Capacity
This section of the City of Laguna Beach's Annual Comprehensive Financial Report (ACFR) presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City's overall financial health. The statistical information presented herein is un-audited.

The following schedules present factor affecting the City's ability to generate its own revenue and its most significant local revenue source, the property tax:
• Assessed Value and Estimated Actual Value of Taxable Property • Direct and Overlapping Property Tax Rates
• Principal Property Tax Payers
• Property Tax Levies and Collections
Sources: Unless otherwise noted, the information in these schedules is derived from the Annual Comprehensive Financial Reports and underlying accounting records for the relevant year. 158
181
Assessed Value and Estimated Actual Value of Taxable Property, Last Ten Fiscal Years 159
182
Direct and Overlapping Property Tax Rates, Last Ten Fiscal Years 160
183
161
184
Principal Property Tax Payers, Last Fiscal Year and Nine Years Ago 162
185
Property Tax Levies and Collections, Last Ten Fiscal Years 163
186
Debt Capacity
This section of the City of Laguna Beach's Annual Comprehensive Financial Report (ACFR) presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City's overall financial health. The statistical information presented herein is un-audited.

The following schedules exhibit the City's levels of outstanding debt over time, to help readers assess the affordability of the current level of outstanding debt, and the City's ability to issue additional debt:
• Ratios of Outstanding Debt by Type
• Direct and Overlapping Debt
• Pledged Revenue Coverage
• Legal Debt Margin Information
Sources: Unless otherwise noted, the information in these schedules is derived from the Annual Comprehensive Financial Reports and underlying accounting records for the relevant year. 164
187
Ratios of Outstanding Debt by Type, Last Ten Fiscal Years 165
188
Direct and Overlapping Debt
166
189
Pledged-Revenue Coverage, Last Ten Fiscal Years
167
190
Legal Debt Margin
168
191
169
192
Demographic and Economic Information
This section of the City of Laguna Beach's Annual Comprehensive Financial Report (ACFR) presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City's overall financial health. The statistical information presented herein is un-audited.

The following schedules depict demographic and economic indicators to assist the reader in understanding the socio-economic, environment in which the City's financial activities take place:
• Demographic and Economic statistics
• Principal Employers
Sources: Unless otherwise noted, the information in these schedules is derived from the Annual Comprehensive Financial Reports and underlying accounting records for the relevant year. 170
193
Demographic and Economic Statistics, Last Ten Fiscal Years 171
194
Principal Employers, Last Fiscal Year and Nine Years Ago 172
195
Operating Information
This section of the City of Laguna Beach's Annual Comprehensive Financial Report (ACFR) presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City's overall financial health. The statistical information presented herein is un-audited.

The following schedules present information on the City's operations and resources including service and infrastructure data to facilitate the readers understanding of how financial statement information relates to the services the City provides and the activities it performs:
• Capital Asset Statistics by Function
Sources: Unless otherwise noted, the information in these schedules is derived from the Annual Comprehensive Financial Reports and underlying accounting records for the relevant year. 173
196
Full-time City Employees by Function, Last ten Fiscal Years 174
197
175
198
Operating Indicators, Last Ten Fiscal Years
176
199
177
200
Capital Asset Statistics by Function, Last Ten Fiscal Years 178
201
179
202

Laguna Beach City CouncilMay 12, 2026

Laguna Beach City Council
May 12, 2026