1 CITY COUNCIL REGULAR MEETING AGENDA
DECEMBER 20, 2022
7:00 P.M.
WE ENCOURAGE ALL MEMBERS OF THE PUBLIC TO PARTICIPATE IN THE MEETING VIA TELECONFERENCE BY CALLING (520) 525-8911. ANY MEMBER OF THE PUBLIC PARTICIPATING VIA TELECONFERENCE WILL BE GIVEN THE OPPORTUNITY TO PROVIDE PUBLIC COMMENT.
ADDITIONALLY, THE MEETING WILL BE STREAMED ON YOUTUBE LIVE https://www.youtube.com/channel/UCB_ZmQZIHELh-ECEPZ2VwZg
PERSONS WHO ATTEND THE MEETING ARE ASKED TO FOLLOW THE CURRENT STATE OF CALIFORNIA PUBLIC HEALTH GUIDANCE.
Notice is hereby given that the City Council will hold a Regular Meeting on December 20, 2022, at the City Council Chambers, 1416 C Street, Livingston, California or conducted pursuant to the Government Code Section 52953(e) and City of Livingston City Council Resolution No. 2021-71.
Assistance will be provided to those requiring accommodations for disabilities in compliance with the Americans with Disabilities Act of 1990. Persons requesting accommodation should contact the Deputy City Clerk at least 24 hours prior to this meeting at (209) 394-8041, Ext. 121. Any writings or documents pertaining to an Open Session item provided to a majority of the members of the legislative body less than 72 hours prior to the meeting shall be made available for public inspection by email if requested. Public comments can be submitted via emailed at [email protected]. Comments must be received by 2:00 p.m. on the day of the City Council meeting in order for them to be distributed to the Council prior to consideration of the matter. You will need to provide: Meeting date, item number, name, email and comment (please limit to 300 words or 3 minutes). Please include: PUBLIC COMMENT in the subject for the email. Written comments will not be read aloud at the meeting, but will be reported as received for the record. If you do not receive an acknowledgement of receipt by 4:00 p.m., please call the City Clerk’s Office at (209) 394-8041, Ext. 121 (Note: This technology is not a guaranteed method). 2 REGULAR MEETING
CALL TO ORDER Next Resolution No.: 2022-69
Next Ordinance No.: 650
Pledge of Allegiance.
Moment of Silence – First Responders and Military Members.
Roll Call.
Changes to the Agenda.
CITIZEN COMMENTS
MEMBERS OF THE PUBLIC WISHING TO ADDRESS THE CITY COUNCIL WILL BE GIVEN THE SAME TIME ALLOTMENT FOR COMMENTS (3 MINUTES) AS NORMALLY ALLOWED FOR MEETINGS SUBJECT TO THE PROVISIONS OF EXECUTIVE ORDER N-08-21
This section of the agenda allows members of the public to address the City Council on any item NOT otherwise on the agenda. Members of the public, when recognized by the Mayor, should come forward to the lectern, and identify themselves. Comments are normally limited to three (3) minutes. In accordance with State Open Meeting Laws, no action will be taken by the City Council this evening. For items which are on the agenda this evening members of the public will be provided an opportunity to address the City Council as each item is brought up for discussion.
ANNOUNCEMENTS AND REPORTS
Supervisor Rodrigo Espinoza Announcements and Reports.
City Staff Announcements and Reports.
City Manager Announcements and Reports.
City Council Members’ Announcements and Reports.
Mayor’s Announcements and Reports.
CONSENT AGENDA
Items on the Consent Calendar are considered routine or non-controversial and will be enacted by one vote, unless separate action is requested by the City Manager or City Council Member. There will be no separate discussion of these items unless members of the City Council or City Manager request that specific items be removed.
1. WAIVING OF READING OF ORDINANCE AND RESOLUTIONS
City Council Waive the Reading in Full of Ordinances and Resolutions on Agenda and Adopt by Reading the Title only, Unless Otherwise Requested by the Mayor or a Council Member 3 2. RATIFY CHECK WARRANTS
Ratify Warrant Register Dated December 15, 2022
3. Resolution Approving the Contract Between the City of Livingston and HDL Coren & Cone to Continue Providing Property Tax Consulting/Audit Services and Authorizing the Acting City Manager to Execute a Five Year Service Contract
4. Resolution Approving a Master Services Agreement between the City of Livingston and Hinderliter de Llamas and Associates to Continue Providing Sales Tax Analysis and Authorizing the Acting City Manager to Execute a Five Year Service Contract.
5. Resolution Appropriating $10,000 of the General Fund Unappropriated Fund Balance from Fiscal Year 2022/2023 and Authorizing the Acting City Manager to Execute the Agreement with Institute of Local Government (ILG)
6. Resolution Approving an Amendment to an Agreement with Gilton Solid Waste Management, Inc. to Extend the Agreement for an Additional Five (5) Months to complete the Request for Proposal (RFP) and Related Proposition 218 process, and Authorizing the Acting City Manager to Execute Amendment.
DISCUSSION AND POTENTIAL ACTION ITEMS
7. Discussion and Direction on CMAQ Application Submission for the 2022 CMAQ Call for Projects
8. Fiscal Year (FY) 2020/2021 Financial Statements
CLOSED SESSION
9. CONFERENCE WITH LEGAL COUNSEL – EXISTING LITIGATION
(Gov. Code section 54956.9)
Name of Case: Animal Legal Defense Fund v. Foster Poultry Farms, Merced County Superior Court Case No. 20CV-02493
10. CONFERENCE WITH LABOR NEGOTIATOR
(Government Code section 54957.6)
Agency designated representative: Jennifer Riedeman, Director of Finance Unrepresented Position: Public Service Director
11. Conference with Legal Counsel – Anticipated Litigation Significant exposure to litigation pursuant to Gov. Code, § 54956.9(d): Three (3) Cases
12. Conference with Legal Counsel – Existing Litigation (Gov. Code, § 54956.9)
Name of Case: Hass v. Benjamin Guzman et al.
Merced County Superior Court Case No. 21CV-03305
ADJOURNMENT
STAFF REPORT - JlmmD[ -
AGENDA ITEM:
MEETING DATE:
PREPARED BY:
REVIEWED BY:
Warrant Register December 15, 2022
December 20, 2022
Mayra Dheri, Senior Account Clerk
Jennifer Riedeman, Finance Director/Acting City Manager RECOMMENDATION:
Ratify the warrant register dated December 15, 2022
DISCUSSION:
-J
Government Code sections 37208(b) and 37209 provide that accounts payable warrants or checks drawn in payment of demands certified or approved by the finance director as conforming to a budget approved by ordinance or resolution of the legislative body need not be audited by the legislative body prior to payment.
In addition, Government Code section 37208(a) provides that payroll warrants or checks need not be audited by the legislative body prior to payment. Payrolls shall be presented to the legislative body for ratification and approval at the first meeting after delivery of the payroll warrants or checks. The sum total of any payroll checks issued within the week prior to the date of the check register is also noted on the accompanying check register.
The following checks have been certified to be in accordance with the City's approved budget.
The checks have been issued and the check register is presented to the City Council for ratification:
November 29, 2022- December 15, 2022
GENERAL WARRANTS .......................... $
PAYROLL/WIRE WARRANTS .................. $
TOTAL WARRANTS .............................. $
ATTACHMENTS:
191,500.36
471,521.51
663,021.87
Warrant Register (summarized by date and check number)
1 7999-8067
2421-2450
Accounts Payable
Checks by Date - Summary by Check Date
User: Mayra
Printed: 12/15/2022 3:04 PM
Check No Vendor No Vendor Name
7999 250 Alhambra
8000 396 American Fidelity Assurance
8001 397 American Fidelity Assurance Company
8002 736 ARA, Inc.
8003 282 AT&T Mobility
8004 1099 BBG, Inc.
8005 1039 Jacquie Benoit
8006 UB*02014 LUPE BOURBOIS
8007 193 BSK Associates
8008 421 CA Underground Facilities Safe Excavation
8009 393 California State Disbursement Unit
8010 766 Central Valley Landscape & Tree
8011 914 Cintas Corporation No. 2
8012 283 CoreLogic Solutions, LLC
8013 UB*02015 SONIA CRAWFORD
8014 519 CSMFO
8015 1120 Enrique M. De La Cruz
8016 1122 Department of Forestry and Fire Protection
8017 455 Ernest Packaging Solutions
8018 258 Ewing Irrigation Products, Inc.
8019 163 EZ Auto Supply
8020 260 First Communications, LLC
8021 188 Frontier
8022 164 Garza Tire & Wheel, Inc
8023 262 Gilton Solid Waste
8024 267 Hoffman Security
8025 501 Hunt & Sons, Inc.
8026 1033 Independent Investigations LLC
8027 388 Interstate Battery System of Fresno
8028 786 J.B, Anderson Land Use Planning
8029 167 Kimball Midwest
8030 318 La Rue Communications
8031 461 LEAF
8032 UB*02016 JAIRO ALEJANDRO MARTINEZ BAUTI
8033 403 Merced County Association of Government
8034 559 Merced County Environmental Health
8035 180 Mission Linen Service
8036 194 Modesto Welding Products
8037 199 Northstar Chemical
8038 302 Office Depot, Inc.
8039 205 Paramount Pest Services
8040 203 PG&E
8041 305 Platt
8042 405 Premier Access Insurance Company
8043 849 Ray Morgan Company
8044 208 Saenz Pest Control, Inc.
8045 408 Sapien Family Trust
AP Checks by Date-Summary by Check Date (12/15/2022 3:04 PM) Check Date
12/14/2022
12/14/2022
12/ 14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/ 14/2022
12/ 14/2022
12/14/2022
12/ 14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/ 14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/ 14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/14/2022
12/ 14/2022
12/ 14/2022
City of Livingston
1416 C Street
Livingston, CA 95334
Check Amount
224.94
2,654.37
422.90
3,084.80
1,641.45
4,500.00
274.56
88.11 150.00
532.79
635.83
1,380.00
118.28
200.00
141.81
200.00
766.55
2,950.22
206.67
263.73
70.74 29.92
6,415.86
765.58
8,580.75
394.90
12,196.88
1,250.00
25 1.72
10,652.50
340.95
1,941.00
741.59
75.54 11,504.00
3, 173.00
55.49 21 .00
2,304.30
636.57
389.00
182.31
80.95 4,25 1.50
147.68
127.00
1,000.00
Page I
Check No Vendor No Vendor Name Check Date Check Amount
8046 739 Self- Help Enterprises 12/14/2022 1,620.71
8047 589 Shannon Pump Co. 12/ 14/2022 441.42
8048 307 Shred-It, C/O Stericycle, Inc. 12/ 14/2022 229.17 8049 1121 Special Olympics Northern California 12/14/2022 499.96 8050 308 Sprint 12/ 14/2022 129.48
8051 598 Standard Insurance Company RB 12/ 14/2022 1,991.17 8052 412 State of California Department of Transport 12/14/2022 570.30 8053 564 Texas Life Insurance 12/14/2022 169.64
8054 732 The California Peace Officers' Association 12/14/2022 750.00 8055 542 TNB Towing & Recovery 12/ 14/2022 520.00
8056 973 Ramiro Torres 12/ 14/2022 125.00
8057 310 Totlcom, Inc. 12/ 14/2022 382.72
8058 284 Trans Union LLC 12/14/2022 258.03
8059 391 Ramon Trujillo 12/14/2022 110.00
8060 249 United Site Services 12/14/2022 382.55
8061 487 Albert Poukaldani Village Cleaners 12/ 14/2022 270.00 8062 504 VIP Audio Visual Company, Inc 12/ 14/2022 500.00 8063 608 Vision Service Plan- CA 12/ 14/2022 694.63
8064 753 Warden's 12/14/2022 18,909.05
8065 765 White Brenner LLP 12/ 14/2022 9, 174.80
8066 869 Winner Chevrolet 12/14/2022 48,663.26
Total for 12/14/2022: 174,409.63
8067 422 U.S. Bank Corporate Payment Systems 12/ 15/2022 17,090.73 Total for 12/ 15/2022: 17,090.73
Report Total (69 checks): 19 1,500.36
AP Checks by Date - Summary by Check Date (12/15/2022 3:04 PM) Page 2 AGENDA ITEM:
MEETING DATE:
PREPARED BY:
REVIEWED BY:
STAFF REPORT
Resolution Approving a Contract Agreement between the City of Livingston and HDL Coren & Cone to Continue Providing Property Tax Consulting/Audit and Authorizing the Acting City Manager to Execute a Five Year Service Contract.
December 20, 2022
Jennifer Riedeman, Finance Director/Acting City Manager Jennifer Riedeman, Finance Director/Acting City Manager RECOMMENDATION:
City Council adopt Resolution No. 2022-_,approving the Contract Agreement between the City of Livingston and HDL Coren & Cone to continue to provide contract services in property tax revenue areas and authorizing the Interim City Manager to execute a five year contract.
BACKGROUND:
HDL Coren & Cone has been providing contract staff support services to the City of Livingston since January of 2007. The Scope of Services includes reports, analytical and audit services in the property tax revenue areas. This includes generating property tax revenue projections, monitoring changes (additions/deletions, re-assessments, etc.), generating quarterly reports on trend activities, reconciling of county reports and audit calculations of revenues to ensure the City's fair share. The contract also includes ongoing consultation on the City's inquiries. The scope of work in this contract remains the same.
DISCUSSION & RECOMMENDATION:
The contract approved in January 2007 was for three years with two automatic 1 year extensions pushing the expiration date to January 2013. In February 2014, the City Council authorized another three year contract extension with a new expiration date of December 31 , 2016. In January 2017, the City Council authorized another three year contract extension with a new expiration date of December 31, 2019. In January 2020, the City Council authorized another two year contract extension with a new expiration date of December 31 , 2022.
Staff requests that Council approve a contract with HDL for Property Tax Audit Services through 12/31/27.
FISCAL IMPACT:
Annual fee has increased to $6,000 per year or $2,000 per quarter and is budgeted.
ATTACHMENTS:
1. Resolution No. 2022-
2. Exhibit "A" Agreement between the City of Livingston and HDL Coren & Cone for Property Tax Consulting/Audit Services.
RESOLUTION NO. 2022-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LIVINGSTON
APPROVING THE CONTRACT BETWEEN THE CITY OF LIVINGSTON AND HDL COREN &
CONE TO CONTINUE PROVIDING PROPERTY TAX CONSULTING/AUDIT SERVICES AND
AUTHORIZING THE ACTING CITY MANAGER TO EXECUTE A FIVE YEAR SERVICE
CONTRACT
WHEREAS, the City of Livingston approved an original three (3) year service contract on January 16, 2007; and
WHEREAS, contract included two (2) one (1) year automatic extensions; and WHEREAS, original contract term ended on January 16, 2012; and WHEREAS, in February 2014, the City Council authorized another three (3) year contract extension with an expiration date of December 31, 2016; and WHEREAS, in January 2017, the City Council authorized another three (3) year contract extension with an expiration date of December 31, 2019; and WHEREAS, in January 2020, the City Council authorized another two (2) year contract extension with an expiration date of December 31, 2022; and WHEREAS, scope of work will remain the same; and
WHEREAS, the City wishes to approve a five (5) year contract with HDL Coren & Cone with an expiration date of December 31, 2027; and
WHEREAS, fees will be $6,000 per year or $2,000 per quarter and amount is budgeted.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Livingston hereby adopts a Resolution to approve a five (5) year contract in the form approved by legal counsel with HDL Coren & Cone to provide property tax reporting and analytical services.
Passed and adopted this 20th day of December, 2022, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
Jose A. Moran, Mayor
of the City of Livingston
ATTEST:
I, hereby certify that the foregoing resolution was regularly introduced, passed and adopted at a regular meeting of the City Council of the City of Livingston this 20th day of December, 2022.
Leticia Vasquez-Zurita, City Clerk
of the City of Livingston
EXHIBIT "A"
CITY OF LIVINGSTON
AGREEMENT FOR PROPERTY TAX
CONSULTING/AUDIT SERVICES
This AGREEMENT (the "Agreement") is made and entered into as of the __ day of ____ , 2022 by and between the CITY OF LIVINGSTON a municipal corporation hereinafter called CITY, and HdL Coren & Cone, a California Corporation hereinafter called CONTRACTOR.
RECITALS
WHEREAS, property tax revenues can be verified and potentially increased through a system of continuous monitoring, identification and reconciliation to county records; and WHEREAS, an effective program of property tax management will assist the CITY in fiscal, economic and community development planning; and WHEREAS, CITY desires the property tax data-based reports and data analysis required to effectively manage the CITY property tax base and identify and recover revenues misa!located within the CITY, or to other jurisdictions; and
WHEREAS, CONTRACTOR is a state-wide expert in such data analysis with over 240 public agency clients for whom such services are performed and has the programs, equipment, data and personnel required to deliver the property tax services referenced herein; WHEREAS, CITY prefers to pay for certain of such services through a contingency arrangement where payment is made from monies recovered and CONTRACTOR is willing to base its compensation on such a risk-based formula.
NOW, THEREFORE, CITY and CONTRACTOR, for the consideration hereinafter described, mutually agree as follows:
1.0 DEFINITIONS
For purposes of this Agreement, the following terms shall have the meaning stated below:
Audit Review: "Audit" or "Audit Review" shall mean the comparison of databases to ensure that parcels are correctly coded with the appropriate tax rate area to return revenue to the client city. Audits include the secured and unsecured tax rolls and where secured records are eorrected; the corresponding unsecured records related to those properties are also corrected. A review of the calculation methodologies developed by auditor/controller offices in the administration of property tax is made to ensure compliance. New annexations are audited the 1st or 2nd year after the area's adoption due to the timing of LAFCO and the State Board of Equalization in assigning new tax rate areas and county processing of those changes.
Ol089/000il61175.03
County: "County" shall mean the County in which the CITY is located.
Data Base: "Data Base" shall mean a computerized listing of property tax parcels and information compiled for CITY from information provided by the County.
Days: "Days" shall mean calendar days.
Property Tax Roll: "Property Tax Roll" shall mean the assessed values of parcels on the secured and unsecured lien date rolls as reported by the County.
Proprietary Information: "Proprietary Information" shall be the reports, technical information, compilations of data, methodologies, formula, software, programs, technologies and other processes previously designed and developed by CONTRACTOR and used in the performance of the services hereunder.
Recovered/Reallocated Revenue: "Recovered or Reallocated Revenue" shall mean additional revenue received as a result of an audit or review of properties submitted for correction or for corrections due erroneous calculations or incorrect methods of distributing revenue discovered by the CONTRACTOR and then made by county agencies which result in a return of additional revenue to the AGENCY. Reviews of AGENCY administered pass throughs are performed to ensure the correctness of distributions being made to participating agencies.
Scope of Services: "Scope of Services" shall mean all of the Base Services specified in Section 2.0, the Optional Services in Section 3.0, the Additional Services in Section 4.0, or any other services rendered hereunder.
TRA: "Tax Rate Area" shall mean the area subject to the tax rate.
2.0 BASE SERVICES
The CONTRACTOR shall perform all of the following duties as part of the Base Services provided hereunder, unless otherwise specified in writing by the Contract Officer:
2.1 Analysis And Identification Of Misallocation Errors (Contingent Fee)
(a) In the first year of this Agreement, and as necessary thereafter but not less than once every five (5) years, CONTRACTOR shall conduct an analysis to identify and verify in the CITY parcels on the secured Property Tax Roll which are not properly attributed to a CITY, and will provide the correct TRA designation to the proper County agency. Typical errors include parcels assigned to incorrect TRAs within the CITY or an adjacent city, and TRAs allocated to wrong taxing agencies. (b) CONTRACTOR shall annually reconcile the annual auditorcontroller assessed valuations report to the assessor's lien date rolls and identify discrepancies.
2 01089/0001/61 l75.o3
(c) CONTRACTOR shall annually review parcels on the unsecured Property Tax Roll to identify inconsistencies such as value variations, values being reported to a mailing address rather than the situs address, and errors involving TRAs (to the extent records are available).
(d) CONTRACTOR may audit general fund property tax revenue or other revenues attributable to the CITY and special districts.
2.2 Annual Services (Fixed Fee)
Annually, after the Property Tax Roll is available:
(a) CONTRACTOR shall establish a Data Base for CITY available through CONTRACTOR'S online property tax application
01089/0001/61175.03
(b) Utilizing the Data Base, CONTRACTOR will provide:
(I) A listing of the major property owners in the CITY, including the assessed value of their property.
(2) A listing of the major property tax payers, including an estimate of the property taxes.
(3) A listing of property tax transfers which occurred since the prior lien date.
(4)
code designation.
A comparison of property within the CITY by county-use
(5) A listing by parcel of new construction activity to identify non-residential parcels with new construction activity and to provide reports for use in the CITY's preparation of Gann (Propositions 4 and 111) State Appropriation Limit calculations.
( 6) Calculate an estimate of property tax revenue anticipated to be received for the fiscal year by the CITY. This estimate is based upon the initial information provided by the County and is subject to modification. This estimate shall not be used to secure the indebtedness of the CITY. (7) Development of forecast of estimated general fund
property tax revenue for future fiscal years.
(8) Development of historical trending reports involving taxable assessed values for the CITY, median and average sales prices, and related economic trends.
3 (9) Upon written request, analyses based on geographic areas designated by the CITY to include assessed valuations and square footage computations for use in community development planning. (I 0) One and five-year budget projections for the city general fund and special districts. This report is interactive for tax modeling.
2.3 Quarterly Services/Monthly Services (Fixed Fee)
The CONTRACTOR shall perform the following services quarterly:
(c)
( selected counties).
A listing of property tax appeals filed on properties in the CITY (d) A listing of property transfers that have occurred since the last report.
(e) Monthly update of CONTRACTOR'S web-based software
program to include parcel transfer data and, in select counties, appeal updates.
2.4 On-Going Consultation (Fixed Fee)
During the term of this Agreement, CONTRACTOR will serve as the CITY's resource staff on questions relating to property tax and assist in estimating current year property tax revenues.
On-going consultation would include, but not be limited to, inquiries resolved through use of the CITY's data base.
3.0 OPTIONAL SERVICES
The following services are available on a time and materials basis:
3.1 Specified Data
Generation of specialized data-based reports which would require additional programming, the purchase of additional data, costs for county staff research, or similar matters not necessary to carry out services outlined in Section 2.0.
3.2 County Research
Any research with County agencies for which CONTRACTOR does not have a current database.
3.3 Bond Services
Bond services are available for a fixed negotiated fee, including:
(a) Tax Allocation Bonds fiscal consultant reports
4 0!089/0001/61175.03
(b) Mello-Roos Special Tax studies
3.4 Additional Meetings Requested
Meetings in excess of the annual meeting to review the analysis of property tax data, trending information, and other findings with AGENCY shall be considered an Optional Service.
4.0 ADDITIONAL SERVICES
CITY shall have the right at any time during the performance of the services, without invalidating this Agreement, to order extra work beyond that specified in the Scope of Services or make changes by altering, adding to or deducting from said work. No such extra work may be undertaken unless a written order is first given by the Contract Officer to the Contractor, incorporating therein any material adjustment in the contract and/or the time to perform this Agreement, which said adjustments are subject to the written approval of the Contractor. Any increase in compensation ofup to $75,000, or in the time to perform ofup to one hundred eighty (180) days may be approved by the Contract Officer. Any greater increases, taken either separately or cumulatively must be approved by the CITY Council. It is expressly understood by Contractor that the provisions of this Section shall not apply to services specifically set forth in the Scope of Services or reasonably contemplated therein.
5.0 OBLIGATIONS OF THE PARTIES WITH RESPECT TO SERVICES
5.1 City Materials and Support
CITY agrees to provide the following information:
01089/0001/61175.03
I. Current CITY maps and zoning map;
2. A copy of reports received by the CITY annually from the AuditorController's office detailing assessed values (secured, unsecured and utilities), as well as unitary values for reconciliation analysis;
3. Parcel listing and maps of CITY parcel annexations since the lien date roll;
4. A listing of completed new construction projects with Assessor's map book, page and parcel numbers (APN) for proper identification and tracking for two years prior to the date of this Agreement. If the data does not include the APN information, CONTRACTOR will research this information at an additional cost;
5. A listing of the CITY levies assessment districts and direct assessments.
5.2 Compliance with Law
5 All services rendered hereunder shall be provided in accordance with all ordinances, resolutions, statutes, rules, and regulations of the CITY and any Federal, State or local goverrunental agency having jurisdiction in effect at the time service is rendered.
5.3 License, Permits, Fees and Assessments
CONTRACTOR shall obtain such licenses, permits and approvals ( collectively the "Permits") as may be required by law for the performance of the services required by this Agreement. CITY shall assist CONTRACTOR in obtaining such Permits, and CITY shall absorb all fees, assessments and taxes which are necessary for any Permits required to be issued by CITY.
5.4 Further Responsibilities of Parties
Both parties agree to use reasonable care and diligence to perform their respective obligations under this Agreement. Both parties agree to act in good faith to execute all instruments, prepare all documents and take all actions as may be reasonably necessary to carry out the purposes of this Agreement. Unless hereafter specified, neither party shall be responsible for the service of the other.
6.0 CONSIDERATION
6.1 Base Fixed Fee Services
CONTRACTOR shall provide the Base Services described in Section 2.0 above, for a fixed armual fee of $6,000.00 (invoiced quarterly).
The Base Fixed Fee shall be adjusted annually by the California Consumer Price Index (CCPI) for all items as determined by the California Department oflndustrial Relations as measured February to February by the California All Urban Consumers index.
6.2 Base Contingent Fee Services
For Base Services pursuant to Section 2.1 which are payable on a contingent basis, CONTRACTOR shall receive 25 percent of net general fund attributable to CITY departments, districts, or funds recovered or reallocated which are directly or indirectly the result of an audit, analysis or consultation performed by CONTRACTOR (including but not limited to base year value audits; administration of tax sharing agreements; tax increment allocation reviews; county allocation reviews). CONTRACTOR shall separate and support said reallocation and provide CITY with an itemized invoice showing all amounts due as a result of revenue recovery or reallocation. CITY shall pay audit fees after Contractor's submittal of evidence that corrections have been made by the appropriate agency. Payment to CONTRACTOR shall be made within thirty (30) days after CITY receives its first remittance advice during the fiscal year for which the correction applies.
6.3 Optional Services
6 01089/0001/61175.03
Fees for Optional Services as outlined in Services in Section 3.0 above (except Section 3.3) shall be billed at the following hourly rates:
Partner $250 per hour
Principal $225 per hour
Programmer $200 per hour
Associate $175 per hour
Senior Analyst $ 125 per hour
Analyst $ 90 per hour
Administrative $ 70 per hour
Hourly rates are exclusive of expenses and are subject to adjustment by CONTRACTOR annually. On July 1st of each year CONTRACTOR shall provide CITY with an updated schedule of hourly rates. The rates will not be increased by more than five percent (5%) per year.
6.4 Fees for Bond Services
Services under Section 3.3 above will be determined depending upon the complexity of the bond issue and the time available for completion of the task and will be mutually agreed to be the parties.
6.5 Indirect Expenses
Except as specified above, no other charges shall be made for direct or indirect expenses incurred by CONTRACTOR in performing the services in the Scope of Services including for administrative overhead, salaries of CONTRACTOR'S employees, travel expenses or similar matters.
6.6 Due Date
All fees are due 30 days immediately following billing. All amounts that are not paid when due shall accrue interest from the due date at the rate of one percent per month (12% per annum).
7.0 TERM PERFORMANCE SCHEDULE
7.1 Time of Essence
Time is of the essence in the performance of this Agreement.
7.2 Schedule of Performance
CONTRACTOR shall commence the services pursuant to this Agreement upon receipt of a written notice to proceed and shall perform all services within the time period(s) established in the "Schedule of Performance" attached hereto as Exhibit "A", and incorporated herein by this reference. When requested by the CONTRACTOR, extensions to the time period(s) specified in the Schedule of Performance may be approved in writing by the Contract Officer but not exceeding one hundred eighty (180) days cumulatively.
7 01089/0001/61175.03
7.3 Force Majeure
The time period( s) specified in the Schedule of Performance for performance of the services rendered pursuant to this Agreement shall be extended because of any delays due to unforeseeable causes beyond the control and without the fault or negligence of the CONTRACTOR, including, but not restricted to, acts of God or of the public enemy, unusually severe weather, fires, earthquakes, floods, epidemics, quarantine restrictions, riots, strikes, freight embargoes, wars, litigation, and/or acts of any governmental agency, including the CITY, if the CONTRACTOR shall within ten (10) days of the commencement of such delay notify the Contract Officer in writing of the causes of the delay. The Contract Officer shall ascertain the facts and the extent of delay, and extend the time for performing the services for the period of the enforced delay when and if in the judgment of the Contract Officer such delay is justified.
7.4 Term
Unless earlier terminated in accordance with Section 11.6 of this Agreement, this Agreement shall continue in full force and effect for five (5) years, and, unless a notice of termination is given on the fourth anniversary date, shall be automatically extended from year to year until and such notice shall be given.
8.0 COORDINATION OF WORK
8.1 Representative of Contractor
The following principals of CONTRACTOR are hereby designated as being the principals and representatives of CONTRACTOR authorized to act in its behalf with respect to the work specified herein and make all decisions in connection therewith:
Nichole Cone-Morishita
HdL COREN & CONE
120 S State College Boulevard, Suite 200
Brea, California 92821
It is expressly understood that the experience, knowledge, capability and reputation of the foregoing principals were a substantial inducement for CITY to enter into this Agreement.
Therefore, the foregoing principals shall be responsible during the term of this Agreement for directing all activities of CONTRACTOR and devoting sufficient time to personally supervise the services hereunder. For purposes of this Agreement, the foregoing principals may not be replaced nor may their responsibilities be substantially reduced by CONTRACTOR without the express written approval of CITY.
8.2 Contract Officer
The Contract Officer shall be such person as may be designated by the CITY Manager of CITY. It shall be the CONTRACTOR'S responsibility to assure that the Contract Officer is kept informed of the progress of the performance of the services and the CONTRACTOR shall refer any decisions which must be made by CITY to the Contract Officer. Unless otherwise specified herein, any approval of CITY required hereunder shall mean the approval of the Contract Officer. 8 0!089/0001/61175.03
The Contract Officer shall have authority to sign all documents on behalf of the CITY required hereunder to carry out the terms of this Agreement.
8.3 Prohibition Against Subcontracting or Assignment
The experience, knowledge, capability and reputation of CONTRACTOR, its principals and employees were a substantial inducement for the CITY to enter into this Agreement.
Therefore, CONTRACTOR shall not contract with any other entity to perform in whole or in part the services required hereunder without the express written approval of the CITY. In addition, neither this Agreement nor any interest herein may be transferred, assigned, conveyed, hypothecated or encumbered voluntarily or by operation oflaw, whether for the benefit of creditors or otherwise, without the prior written approval of CITY. Transfers restricted hereunder shall include the transfer to any person or group of persons acting in concert of more than fifty percent (50%) of the present ownership and/or control of CONTRACTOR, taking all transfers into account on a cumulative basis. In the event of any such unapproved transfer, including any bankruptcy proceeding, this Agreement shall be void. No approved transfer shall release the CONTRACTOR or any surety of CONTRACTOR of any liability hereunder without the express consent of CITY.
8.4 Independent Contractor
Neither the CITY nor any of its employees shall have any control over the manner, mode or means by which CONTRACTOR, its agents or employees, perform the services required herein, except as otherwise set forth herein. CITY shall have no voice in the selection, discharge, supervision or control of CONTRACTOR'S employees, servants, representatives or agents, or in fixing their number, compensation or hours of service. CONTRACTOR shall perform all services required herein as an independent CONTRACTOR of CITY and shall remain at all times as to CITY a wholly independent CONTRACTOR with only such obligations as are consistent with that role. CONTRACTOR shall not at any time or in any manner represent that it or any of its agents or employees are agents or employees of CITY. CITY shall not in any way or for any purpose become or be deemed to be a partner of CONTRACTOR in its business or otherwise or a joint venturer or a member of any joint enterprise with CONTRACTOR.
9.0 INSURANCE AND INDEMNIFICATION
9.1 Insurance
The CONTRACTOR shall procure and maintain, at its sole cost and expense, in a form and content satisfactory to CITY, during the entire term of this Agreement including any extension thereof, the following policies of insurance:
(a) Commercial General Liability. The policy shall include coverage for premises and operations, products and completed operations, personal and advertising injury, bodily injury and property damage, including contractual liability, with a minimum policy limit of $5,000,000 per occurrence and $5,000,000 in the annual general aggregate ( occurrence form). A combination of primary, excess and umbrella limits are acceptable to satisfy minimum policy limit requirements.
9 01089/0001/61175.03
(b) Statutory Worker's Compensation. Statutory coverage and limits pursuant to the laws, rules and regulations of the jurisdictions in which any CONTRACTOR employee or agent performs work under this Agreement.
( c) Business Automotive Liability. Insurance including coverage for all owned, non-owned and hired automobiles used in the performance of this Agreement and with minimum limits of$ I ,000,000 combined single limit each accident. ( d) Errors and Omissions (Professional Liability). A policy of professional liability issuance written on a claims made basis in an amount not less than One Million Dollars ($1,000,000).
( e) General Requirements. All of the above policies of insurance shall be primary insurance and shall name the CITY, its officers, employees and agents as additional insureds. The insurer shall waive all rights of subrogation and contribution it may have against the CITY, its officers, employees and agents and their respective insurers. All of said policies of insurance shall provide that said insurance may not be amended or cancelled without providing thirty (30) days prior written notice by registered mail to the CITY. In the event any of said policies of insurance are cancelled, the CONTRACTOR shall, prior to the cancellation date, submit new evidence of insurance in conformance with this Section 9.0 to the Contract Officer. No work or services under this Agreement shall commence until the CONTRACTOR has provided the CITY with Certificates of Insurance or appropriate insurance binders evidencing the above insurance coverages and said Certificates of Insurance or binders are approved by the CITY.
9.2 Indemnification
CONTRACTOR agrees to indemnify the CITY, its officers, agents and employees against, and will hold and save them and each of them harmless from, any and all actions, suits, claims, damages to persons or property, losses, costs, penalties, obligations, errors, omissions or liabilities, (herein "claims or liabilities") that may be asserted or claimed by any person, firm or entity arising out of or in connection with the negligent performance of the work, operations or activities of CONTRACTOR, its agents, employees, subcontractors, or invitees, provided for herein, or arising from the negligent acts or omissions of CONTRACTOR hereunder, or arising from CONTRACTOR'S negligent performance of or failure to perform any term, provision, covenant or condition of this Agreement, whether or not there is concurrent passive or active negligence on the part of the CITY, its officers, agents or employees but excluding such claims or liabilities arising from the sole negligence or willful misconduct of the CITY, its officers, agents or employees, who are directly responsible to the CITY.
9.3 Sufficiency of Insurer or Surety
Insurance or bonds required by this Agreement shall be satisfactory only if issued by companies qualified to do business in California, rated "A" or better in the most recent edition of Best Rating Guide, The Key Rating Guide or in the Federal Register, and only if they are of a financial category Class VII or better, unless such requirements are waived by the Risk Manager of the CITY due to unique circumstances. In the event the Risk Manager of CITY ("Risk Manager") determines that the work or services to be performed under this Agreement creates an 10 01089/0001/61175.03
increased or decreased risk of loss to the CITY, the CONTRACTOR agrees that the minimum limits of the insurance policies and the performance bond required by this Section 9.0 may be changed accordingly upon receipt of written notice from the Risk Manager; provided that the CONTRACTOR shall have the right to appeal a determination of increased coverage by the Risk Manager to the CITY Council of CITY within 10 days of receipt of notice from the Risk Manager.
10.0 RECORDS AND REPORTS
10.1 Reports
CONTRACTOR shall periodically prepare and submit to the Contract Officer such reports concerning the performance of the services required by this Agreement as the Contract Officer shall require.
10.2 Records
CONTRACTOR shall keep, and require subcontractors to keep, such books and records as shall be necessary to perform the services required by this Agreement and enable the Contract Officer to evaluate the performance of such services. The Contract Officer shall have full and free access to such books and records at all times during normal business hours of CITY, including the right to inspect, copy, audit and make records and transcripts from such records. Such records shall be maintained for a period of three (3) years following completion of the services hereunder, and the CITY shall have access to such records in the event any audit is required.
10.3 Non-Disclosure of Proprietary Information
In performing its duties under this Agreement, CONTRACTOR will produce reports, technical information and other compilations of data to CITY. These reports, technical information and compilations of data are derived by CONTRACTOR using methodologies, formulae, programs, techniques and other processes designed and developed by CONTRACTOR at a substantial expense. CONTRACTOR'S reports, technical information, compilations of data, methodologies, formulae, software, programs, techniques and other processes designed and developed by CONTRACTOR shall be referred to as Proprietary Information. CONTRACTOR'S Proprietary Information is not generally known by the entities with which CONTRACTOR competes.
CONTRACTOR desires to protect its Proprietary Information. Accordingly, CITY agrees that neither it nor any of its employees, agents, independent contractors or other persons or organizations over which it has control, will at any time during or after the term of this Agreement, directly or indirectly use any of CONTRACTOR'S Proprietary Information for any purpose not associated with CONTRACTOR'S activities. Further, CITY agrees that it nor any of its employees, agents, independent contractors or other persons or organizations over which it has control, will disseminate or disclose any of CONTRACTOR'S Proprietary Information to any person or organization not connected with CONTRACTOR, without the express written consent of CONTRACTOR. The CITY also agrees that consistent with its obligations under the California Public Records Act and related disclosure laws, it will undertake all necessary and appropriate steps to maintain the proprietary nature of CONTRACTOR'S Proprietary Information. 11 01089/0001/61175.03
Any use of the Proprietary Information or any other reports, records, documents or other materials prepared by CONTRACTOR hereunder for other projects and/or use of uncompleted documents without specific written authorization by the CONTRACTOR will be at the CITY's sole risk and without liability to CONTRACTOR, and the CITY shall indemnify the CONTRACTOR for all damages resulting therefrom.
10.4 Release of Documents Pursuant to Public Records Act Notwithstanding any other provision in this Agreement, all obligations relating to disclosure of Proprietary Information remain subject to the Freedom of Information Act or California Public Records Act, Cal. Gov't Code §§ 6250 et seq. (collectively, the "PRA"). The Parties intend that if CITY is served with a request for disclosure under the PRA, or any similar statute, the CITY in good faith will make the determination as to whether the material is disclosable or exempt under the statute, and shall resist the disclosure of Proprietary Information which is exempt from disclosure to the extent allowable under the law. CITY shall advise CONTRACTOR in writing five (5) days prior to the intended disclosure of any decision to disclose Proprietary Information, and the reasons therefore, and if CONTRACTOR then timely advises CITY in writing that it objects to the disclosure, CITY shall not disclose the information. In such case, CONTRACTOR shall then be solely liable for defending the non-disclosure and shall indemnify and hold CITY harmless for such nondisclosure.
11.0 ENFORCEMENT OF AGREEMENT
11.1 California Law
This Agreement shall be construed and interpreted both as to validity and to performance of the parties in accordance with the laws of the State of California. Legal actions concerning any dispute, claim or matter arising out of or in relation to this Agreement shall be instituted in the Superior Court of the County of Los Angeles, State of California, or any other appropriate court in such county, and CONTRACTOR covenants and agrees to submit to the personal jurisdiction of such court in the event of such action.
11.2 Disputes
In the event of any dispute arising under this Agreement, the injured party shall notify the injuring party in writing of its contentions by submitting a claim therefor. The injured party shall continue performing its obligations hereunder so long as the injuring party commences to cure such default within ten (10) days of service of such notice and completes the cure of such default within forty-five (45) days after service of the notice, or such longer period as may be permitted by the injured party; provided that if the default is an immediate danger to the health, safety and general welfare, such immediate action may be necessary. Compliance with the provisions of this Section shall be a condition precedent to tennination of this Agreement for cause and to any legal action, and such compliance shall not be a waiver of any party's right to take legal action in the event that the dispute is not cured, provided that nothing herein shall limit CITY' s or the CONTRACTOR'S right to terminate this Agreement without cause pursuant to Section 11.6. 12 01089/0001/61175.03
11.3 Waiver
No delay or omission in the exercise of any right or remedy by a nondefaulting party on any default shall impair such right or remedy or be constrned as a waiver. A party's consent to or approval of any act by the other party requiring the party's consent or approval shall not be deemed to waive or render unnecessary the other party's consent to or approval of any subsequent act. Any waiver by either party of any default must be in writing and shall not be a waiver of any other default concerning the same or any other provision of this Agreement.
11.4 Rights and Remedies are Cumulative
Except with respect to rights and remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the parties are cumulative and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party.
11.5 Legal Action
In addition to any other rights or remedies, either party may take legal action, in law or in equity, to cure, correct or remedy any default, to recover damages for any default, to compel specific performance of this Agreement, to obtain declaratory or injunctive relief, or to obtain any other remedy consistent with the purposes of this Agreement.
11.6 Termination Prior to Expiration of Term
This Section shall govern any termination of this Agreement. The Parties reserve the right to terminate this Agreement at any time, with or without cause, upon forty-five (45) days' written notice to the non-terminating party, except that where termination is for cause, the Parties will comply with the dispute resolution process in Section 11.2. Upon issuance of any notice of termination, CONTRACTOR shall immediately cease all services hereunder except such as may be specifically approved by the Contract Officer. The CONTRACTOR shall be entitled to compensation for all services rendered prior to the effective date of the notice of termination and for any services authorized by the Contract Officer thereafter. In the event of termination without cause pursuant to this Section, the terminating party need not provide the non-terminating party with the opportunity to cure pursuant to Section 11.2.
11.7 Attorneys' Fees
If either party to this Agreement is required to initiate or defend or made a party to any action or proceeding in any way connected with this Agreement, the prevailing party in such action or proceeding, in addition to any other relief which may be granted, whether legal or equitable, shall be entitled to reasonable attorney's fees. Attorney's fees shall include attorney's fees on any appeal, and in addition a party entitled to attorney's fees shall be entitled to all other reasonable costs for investigating such action, taking depositions and discovery and all other necessary costs the court allows which are incurred in such litigation. All such fees shall be deemed to have accrned on commencement of such action and shall be enforceable whether or not such action is prosecuted to judgment.
13 01089/0001/61175.03
12.0 CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION
12.1 Non-liability of CITY Officers and Employees
No officer or employee of the CITY shall be personally liable to the CONTRACTOR, or any successor in interest, in the event of any default or breach by the CITY or for any amount which may become due to the CONTRACTOR or to its successor, or for breach of any obligation of the terms of this Agreement.
12.2 Conflict of Interest
No officer or employee of the CITY shall have any financial interest, direct or indirect, in this Agreement nor shall any such officer or employee participate in any decision relating to the Agreement which effects his financial interest or the financial interest of any corporation, partnership or association in which he is, directly or indirectly, interested, in violation of any State statute or regulation. The CONTRACTOR warrants that it has not paid or given and will not pay or give any third party any money or other consideration for obtaining this Agreement.
12.3 Covenant Against Discrimination
CONTRACTOR covenants that, by and for itself, its heirs, executors, assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin, or ancestry in the performance of this Agreement. CONTRACTOR shall take affirmative action to ensure that applicants are employed and that employees are treated during employment without regard to their race, color, creed, religion, sex, marital status, national origin, or ancestry.
13.0 MISCELLANEOUS PROVISIONS
13.1 Notice
Any notice, demand, request, document, consent, approval, or communication either party desires or is required to give to the other party or any other person shall be in writing and either served personally or sent by prepaid, first-class mail addressed as follows:
CITY
CONTRACTOR:
0!089/0001/61175.03
City of Livingston
1416 C Street
Livingston, California 95334
HdL COREN & CONE
120 S State College Boulevard, Suite 200
Brea, California 92821
14 Either party may change its address by notifying the other party of the change of address in writing. Notice shall be deemed communicated at the time personally delivered or in seventytwo (72) hours from the time of mailing if mailed as provided in this Section.
13.2 Interpretation
The terms of this Agreement shall be construed in accordance with the meaning of the language used and shall not be construed for or against either party by reason of the authorship of this Agreement or any other rule of construction which might otherwise apply.
13.3 Integration; Amendment
It is understood that there are no oral agreements between the parties hereto affecting this Agreement and this Agreement supersedes and cancels any and all previous negotiations, arrangements, agreements and understandings, if any, between the parties, and none shall be used to interpret this Agreement. This Agreement may be amended at any time by the mutual consent of the parties by an instrument in writing.
13.4 Severability
In the event that any one or more of the phrases, sentences, clauses, paragraphs, or sections contained in this Agreement shall be declared invalid or unenforceable by a valid judgment or decree of a court of competent jurisdiction, such invalidity or unenforceability shall not affect any of the remaining phrases, sentences, clauses, paragraphs, or sections of this Agreement which are hereby declared as severable and shall be interpreted to carry out the intent of the parties hereunder unless the invalid provision is so material that its invalidity deprives either party of the basic benefit of their bargain or renders this Agreement meaningless.
13.5 Corporate Authority
The persons executing this Agreement on behalf of the parties hereto warrant that (i) such party is duly organized and existing, (ii) they are duly authorized to execute and deliver this Agreement on behalf of said party, (iii) by so executing this Agreement, such party is formally bound to the provisions of this Agreement, and (iv) the entering into this Agreement does not violate any provision of any other Agreement to which said party is bound. 15 01089/0001/61175.03
IN WITNESS WHEREOF, the parties have executed and entered into this Agreement as of the date first written above.
CONTRACTOR:
HdL COREN & CONE
A California Corporation
Nichole Cone-Morishita, CFO
APPROVED AS TO FORM:
01089/0001/61175.03
CITY OF LIVINGSTON
City Manager
16 EXHIBIT "A"
SCHEDULE OF PERFORMANCE
TIMELINE FOR DELIVERABLES
July/ August Data available for purchase from counties
September 30 Data available on HdLCC's web-based property tax application September-October Unsecured audits performed and forwarded to county assessor October Appeals quarterly updates emailed in counties where the data is available October-February Delivery of preliminary property tax reports January Appeals quarterly updates emailed in counties where the data is available March/ April General Fund Budget Projections
April Appeals quarterly updates emailed in counties where the data is available April/May Final Books - Addendums emailed to clients
July Appeals quarterly updates emailed in counties where the data is available Ongoing Secured Audits - City
Property sales reports
01089/0001/61175.03
City mid-year budget reviews and budget projections
Analytical work at the request of clients
Monthly updates of database with property sale information AGENDA ITEM:
MEETING DATE:
PREPARED BY:
REVIEWED BY:
STAFF REPORT
Resolution Approving a Master Services Agreement between the City of Livingston and Hinderliter de Llamas and Associates to Continue Providing Sales Tax Analysis and Authorizing the Acting City Manager to Execute a Five Year Service Contract.
December 20, 2022
Jennifer Riedeman, Finance Director/Acting City Manager Jennifer Riedeman, Finance Director/Acting City Manager RECOMMENDATION:
City Council adopt Resolution No. 2022-_, approving the Master Services Agreement between the City of Livingston and Hinderliter de Llamas and Associates to continue to provide sales and use tax analysis services and authorizing the Acting City Manager to execute a five year contract.
City Council adopt Resolution No. 2022-_, Authorizing examination of sales and use tax records by the City of Livingston and Hinderliter de Llamas and Associates.
BACKGROUND:
Hinderliter de Llamas and Associates has been providing contract staff support services to the City of Livingston since January of 2007. The Scope of Services includes sales and use tax and economic analysis/forecasting services and reports. This includes generating sales tax revenue projections, monitoring changes, generating quarterly reports on activity trends.
DISCUSSION & RECOMMENDATION:
The current contract also includes optional services such as Allocation and Recovery Services for a fee of $15% of recovered revenues as well as Consulting and Other Optional Services at the stated hourly rate.
Staff requests that Council approve a contract with Hinderliter de Llamas and Associates for sales and use tax analysis services through 12/31/27.
FISCAL IMPACT:
Annual fee for the sales and use tax analysis and economic analysis/forecasting services and reports increased from $375 to $400 per month and is budgeted.
ATTACHMENTS:
1. Resolution No. 2022-
2. Resolution No. 2022-
3. Exhibit "A" Agreement between the City of Livingston and Hinderliter de Llamas and Associates for Sales Tax Analysis Services.
RESOLUTION NO. 2022-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LIVINGSTON
APPROVING A MASTER SERVICES AGREEMENT BETWEEN THE CITY OF LIVINGSTON
AND HINDERLITER DE LLAMAS AND ASSOCIATES TO CONTINUE PROVIDING SALES
TAX ANALYSIS SERVICES AND AUTHORIZING THE ACTING CITY MANAGER TO
EXECUTE A FIVE YEAR SERVICE CONTRACT
WHEREAS, the City of Livingston has contracted with Hinderliter de Llamas and Associates since January 30, 2007 for analysis of sales and use tax analysis and economic analysis/forecasting services and reports; and
WHEREAS, the scope of work will remain the same; and
WHEREAS, the City wishes to approve a five (5) year Master Services Agreement with Hinderliter de Llamas and Associates with an expiration date of December 31, 2027; and WHEREAS, the fee will be $400 per month and is budgeted.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Livingston hereby adopts a Resolution to approve a five (5) year contract in the form approved by legal counsel with Hinderliter de Llamas and Associates to provide property tax reporting and analytical services.
Passed and adopted this 20th day of December, 2022, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
Jose A. Moran, Mayor
of the City of Livingston
I, hereby certify that the foregoing resolution was regularly introduced, passed and adopted at a regular meeting of the City Council of the City of Livingston this 20th day of December, 2022.
Leticia Vasquez-Zurita, City Clerk
of the City of Livingston
RESOLUTION NO. 2022-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LIVINGSTON AUTHORIZING
EXAMINATION OF SALES AND USE TAX RECORDS
WHEREAS, pursuant to Ordinance Number 260, the City of Livingston (City) entered into a contract with the California Department of Tax and Fee Administration (Department) to perform all functions incident to the administration and collection of sales and use taxes; and WHEREAS, the City Council of the City of Livingston deems it desirable and necessary for authorized officers, employees and representatives of the City to examine confidential sales or transactions and use tax records of the Department pertaining to sales and use taxes collected by the Department for the City pursuant to that contract; and WHEREAS, Section 7056 of the California Revenue and Taxation Code sets forth certain requirements and conditions for the disclosure of Department records, and Section 7056.5 of the California Revenue and Taxation Code establishes criminal penalties for the unlawful disclosure of information contained in, or derived from, the sales and use tax records of the Department;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LIVINGSTON HEREBY RESOLVES AS FOLLOWS:
Section 1. That the City Manager and Finance Director, or other officer or employee of the City designated in writing by the City Manager to the California Department of Tax and Fee Administration is hereby appointed to represent the City with authority to examine sales or transactions and use tax records of the Department pertaining to sales and use tax collected for the City by the Department pursuant to the contract between the City and the Department.
Section 2. The information obtained by examination of Department records shall be used only for purposes related to the collection of City sales and use tax by the Department pursuant to that contract, and for purposes related to the following governmental functions of the City:
(a) Budget Planning
(b) Economic Development
(c) Financial Reporting
The information obtained by examination of Department records shall be used only for those governmental functions of the City listed above.
Section 3. That Hinderliter de Llamas and Associates is hereby designated to examine the sales or transactions and use tax records of the Department pertaining to sales and use tax collected for the City by the Department. The person or entity designated by this section meets all of the following conditions, which are also included in the contract between the City and the Hinderliter de Llamas and Associates:
a) has an existing contract with the City to examine those sales or transactions and use tax records;
b) is required by that contract to disclose information contained in, or derived from, those sales or transactions and use tax records only to the officer or employee authorized under Section 1 of this resolution to examine the information.
c) is prohibited by that contract from performing consulting services for a retailer during the term of that contract;
d) is prohibited by that contract from retaining the information contained in, or derived from those sales or transactions and use tax records, after that contract has expired.
BE IT FURTHER RESOLVED that the information obtained by examination of Department records shall be used only for purposes related to the collection of City sales and use tax by the Department pursuant to the contract between the City and the Department and for those purposes relating to the governmental functions of the City listed in section 2 of this resolution.
Passed and adopted this 20th day of December, 2022, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
Jose A. Moran, Mayor
of the City of Livingston
I, hereby certify that the foregoing resolution was regularly introduced, passed and adopted at a regular meeting of the City Council of the City of Livingston this 20th day of December, 2022.
Leticia Vasquez-Zurita, City Clerk
of the City of Livingston
EXHIBIT "A"
MASTER SERVICES AGREEMENT
THIS MASTER SERVICES AGREEMENT (this "Agreement") is entered into as of ______ , 2022 (the "Agreement Date") by and between Hinderliter de Llamas and Associates ("Consultant"), and City of Livingston ("Client"), which is located within the state of California (the "State").
WITNESS ETH:
WHEREAS, Consultant is engaged in the business of providing consulting, software and other services that help public agencies understand and maximize their collection of sales, use and transactions taxes, business license taxes, property and lodging taxes, and other revenues, as well as their delivery of public services ( collectively, "Consultant's Business"); and WHEREAS, Client desires to contract with Consultant to obtain one or more of the services included within Consultant's Business ( as provided for in Section 1) upon the terms and conditions contained in this Agreement;
WHEREAS, Consultant desires to contract with Client to render such services upon the terms and conditions contained in this Agreement.
NOW THEREFORE, in consideration of the covenants and promises contained herein, Client and Consultant mutually agree as follows:
1. Services.
1.1 Consultant will perform those services included within Consultant's Business that are described in any and all schedule(s) referencing this Agreement and signed by Client and Consultant as of the Agreement Date or hereafter (individually and collectively, the "Schedule(s)"), upon the terms and conditions contained in this Agreement (including the Schedules) (such services are, collectively, the "Services"). In performing the Services, Consultant is acting as an independent contractor (and not as an agent or employee of Client).
1.2 Client acknowledges and agrees that any other public agency (including, without limitation, any participating government agency) located within or outside of the State (e.g., city, municipality, county, district, public authority or other political subdivision) may procure services for fees and other terms and conditions that are substantially similar to any of the Services, Fees and other terms and conditions set forth in this Agreement, provided that such other public agency executes a separate agreement with Consultant wherein the services rendered to such other public agency, the fees payable by such other public agency, and the other terms and conditions of such separate agreement are the responsibility of Consultant and such other public agency and not Client.
1.3 This Agreement does not limit the right of Consultant to enter into additional contracts with Client or to contract with third parties to provide them with merchandise or services of any kind whatsoever, including, but not limited to, services similar to the Services.
During the Term of this Agreement, Client will not, directly or indirectly ( except through 1269745.1 Pagel of JO
Consultant), engage any third party to provide the Services or any services similar to the Services.
2. Fees. As compensation for performing the Services, Client will pay Consultant the fees, costs and expenses as described in the Schedules (individually and collectively these fees and costs are, the "Fees"). Consultant may perform the Services using professionals from its staff or Consultant's affiliated entities, and such Services will be invoiced to Client under the same terms applicable to Consultant's staff. Consultant may increase the Fees from time to time (including, without limitation, as may be described in any of the Schedules). Other than a Fee increase as described in the Schedules, Client may notify Consultant of a request that such Fee increase be modified or revoked and, if Consultant fails to do so to Client's satisfaction within thirty (30) days after the receipt of such request, Client may terminate this Agreement without cause pursuant to Section 7 .3.
3. Invoices; Payment.
3.1 Consultant will invoice Client for the Fees earned and/or incurred by Consultant pursuant to this Agreement.
3.2 Invoices are due and payable upon receipt. Interest will begin to accrue on the thirty-first (31st) day following the invoice date on all unpaid balances at a rate of one and onehalf percent (I½%) per month, or the maximum rate permitted by law, whichever is less.
Payments will first be credited to interest and then to principal. In the event that Client disputes an invoice, only that portion so disputed in good faith will be withheld from payment, and the undisputed portion must be timely paid. Interest will accrue on any disputed portion of the invoice not timely paid and will be payable immediately if the disputed invoice is resolved in favor of Consultant.
3.3 If Client fails to fully pay an invoice within 30 days after the invoice date, Consultant may, after giving five (5) days' prior written notice to Client, suspend the rendering of Services under this Agreement until said invoice is paid in full, together with all interest that has accrued thereon. In the event of such a suspension of Services, Consultant will have no liability to Client for any delays or damages arising therefrom.
4. Insurance. Throughout the term of this Agreement, Consultant will maintain the following insurance in not less than the referenced amounts: (a) workers compensation and employers liability insurance as may be required by the State; (b) property damage liability of $1,000,000 per incident; (c) bodily injury liability of $1,000,000 per incident; and (d) professional liability for any errors or omissions of$1,000,000.
5. Client Support.
5.1 Client will promptly provide in writing to Consultant all data and other information relating to or which may be necessary for Consultant's performance of the Services.
Without limiting the foregoing, Client will keep Consultant informed on a timely basis in writing as to the existence and amendments of the laws, ordinances and/or regulations under which Consultant is performing the Services (including any adopted by Client). Consultant will be 1269745.1 Page 2 of JO
permitted to rely on the accuracy, timeliness and completeness of the information provided by Client, and in no event will Consultant be liable to Client or others as a result of such reliance. 5 .2 Client will examine all of Consultant's reports, specifications, notices, proposals and other documents. In the event that Consultant asks for a decision from Client in order for Consultant to perform the Services, Client will render such decision in writing in a timely manner.
5.3 Promptly following any request from Consultant, Client will adopt and maintain in full force and effect resolutions in forms acceptable to Client and in accordance with applicable law authorizing Consultant to examine the confidential sales tax and other relevant records of Client throughout the Term and, for so long as any Fees are still accruing pursuant to this Agreement, after the Term.
5 .4 Client will assist Consultant in obtaining such licenses, permits and approvals as may be required by law for performing the Services, and Client will pay all fees, assessments and taxes related to the application, issuance and maintenance thereof.
5.5 The Services do not include services to support, prepare, document, bring, respond to subpoenas, act as a witness, defend or otherwise assist in litigation undertaken or defended by Client, which Consultant may be required by legal process or otherwise or requested by Client to provide (collectively, "Litigation Services"). In this regard, if Consultant agrees with Client or is otherwise required to perform Litigation Services, Client will promptly pay or reimburse Consultant for all of Consultant's costs and expenses related to Litigation Services (including, without limitation, Consultant's attorneys' fees and costs) at Consultant's actual cost, plus ten percent (10%) thereof (all of which are deemed to be additional Fees).
6. Confidentiality; Software Use and Warranty; Records.
6.1 Consultant will comply with the requirements of the applicable laws, ordinances and/or regulations of which it has been informed by Client pursuant to Section 5.1 concerning the confidentiality of tax records. Consultant may publicly state that it performs Services for Client.
6.2 As used herein, the term "proprietary information" means all information, techniques, processes, services or material that has or could have commercial value or other utility for Consultant or in Consultant's Business, including without limitation, (i) software, computer or data processing programs; (ii) data processing applications, routines, subroutines, techniques or systems; (iii) desktop or web-based software; (iv) audit, tax or fee collection/administration or business processes, methods or routines; (v) marketing plans, analyses and strategies; (vi) materials, techniques and intellectual property used; and (vii) the Software and the Software's documentation. Except as otherwise required by law, Client must hold in confidence and may not use ( except as expressly authorized by this Agreement) or disclose to any other party any proprietary information provided, learned of or obtained by Client in connection with this Agreement. The terms of this Section 6.2 do not apply to information that is public information; provided, however, that proprietary information will not qualify as public information ifit became public due to Client's (or its employees' or agents') disclosure. 1269745.1 Page 3 oflO
6.3 If access to any software which Consultant owns is provided to Client as part of the Services under this Agreement (including, without limitation, if Client chooses to subscribe to such software and/or related reports as part of the Services pursuant to a Schedule to this Agreement) (such Consultant-owned software is, collectively, the "Software"), Consultant hereby provides a limited, non-exclusive, non-transferable license to Client (including such of Client's staff as may be designated from time to time by Client and approved by Consultant in writing) to use the Software pursuant to and during the Term of this Agreement.
6.4 The Software must only be used by such authorized Client staff, and Client must not sublicense, sublet, duplicate, modify, decompile, reverse engineer, disassemble, or attempt to derive the source code of the Software. The license granted hereunder does not imply ownership by Client or any of Client's staff of the Software nor any rights of Client or any of Client's staff to sublicense, transfer or sell the Software, or rights to use the Software for the benefit of others. Client may not create ( or allow the creation ot) any derivative work or product based on or derived from the Software or the Software's documentation, nor modify (or allow the modification ot) the Software or the Software's documentation without the prior written consent of Consultant. In the event of a breach of this provision ( and without limiting Consultant's remedies), such modification, derivative work or product based on the Software or the Software's documentation is hereby deemed assigned to Consultant. Upon termination of this Agreement or this Software license, this Software license will be deemed to have expired and Client must immediately deactivate, cease using and remove, delete and destroy all the Software (including, without limitation, from Client's computers and network). Consultant warrants that the Software will perform in accordance with the Software's documentation.
6.5 Notwithstanding anything to the contrary in this Agreement (including any Schedule hereto), if access to any software which Consultant does not own is provided to Client as part of the Services pursuant to this Agreement (including pursuant to any Schedule hereto), Client hereby agrees (i) to comply with all of the terms and conditions imposed on Client's access to such software (including, without limitation, by Consultant, such software's owner, and pursuant to applicable law), and (ii) Consultant has no obligation during the Term of this Agreement or thereafter to provide Client with access to such software.
6.6 All documents, preliminary drafts, communications and any and all other work product related to the Services and provided by Consultant to Client either in hard copy or electronically are the joint property of Client and Consultant. This does not include the Software or any other software, any programs, any methodologies or any systems used in the creation of such work product, nor does it include any drafts, notes or internal communications prepared by Consultant in the course of performing the Services that were not otherwise provided to Client in either hardcopy or electronic form, all of which may be protected by Consultant or third party copyrights or other intellectual property and remain Consultant's or such third parties' exclusive property (as the case may be). It is possible that any documents, drafts, communications or other work product provided to Client may be alleged to be public records under applicable law and/or may be discoverable through litigation. Well in advance of when Client may disclose such information in response to any request for public records, Client must notify Consultant in writing about the request and, if Consultant requests it, Client must apply for any potential exemption from disclosure that may exist under applicable law. 1269745.1 Page 4 of!O
6.7 Subject to applicable law, Consultant is responsible for retaining all final documents and other final work product related to the Services for a period of not less than three (3) years from the date provided to Client. Retention of any other documents, preliminary drafts, communications and any and all other work product provided to Client by Consultant is the responsibility of Client. Consultant has no responsibility to retain any drafts, notes, communications, emails or other writings created or received by Client in the course of performing the Services ( other than the final documents and other final work product related to the Services and provided to Client for the term of years referenced above).
7. Term and Termination.
7 .1 The initial term of this Agreement commences as of the Agreement Date and, unless terminated earlier pursuant to any of this Agreement's express provisions, will continue in full force and effect for five (5) years unless earlier terminated as set forth in Section 7 .2 or 7 .3. 7 .2 This Agreement may be terminated by either party for cause upon not less than forty-five (45) days' prior written notice given to and received by the other party, if the other party has materially breached this Agreement through no fault of the notifying party and fails to (i) commence correction of such material breach within thirty (30) days of receipt of the above-referenced written notice and (ii) diligently complete the correction thereafter.
7.3 In addition, either party may terminate this Agreement without cause upon not less than forty-five (45) days' prior written notice to the other party.
7.4 On termination, Client will pay Consultant for all Fees and other compensation (including for Litigation Services) earned and/or incurred through the termination date and will thereafter timely pay Consultant for all other Fees and compensation to which Consultant may be entitled pursuant to this Agreement (including the Schedules hereto).
8. Indemnification.
8.1 Consultant, on behalf of itself and its directors, officers, employees, agents, direct and indirect equity holders, and affiliates ( collectively, "Consultant Group"), agrees to fully and promptly protect, indemnify, reimburse and hold harmless Client, its directors, officers, employees, agents, direct and indirect equity holders, and affiliates ( collectively, "Client Group"), from and against any and all liabilities, losses, claims, damages, personal injuries, death, expenses, and costs (including, without limitation, for attorneys' fees and costs) (each, a "Liability", and collectively, "Liabilities") which are the direct or indirect result of (a) any breach of any representation, warranty or covenant made by or given on behalf of Consultant under this Agreement, or (b) any gross negligence or willful misconduct on the part of any one or more of Consultant Group.
8.2 Client, on behalf of itself and the other members of Client Group, agrees to fully and promptly protect, indemnify, reimburse and hold harmless Consultant and the other members of Consultant Group from and against any and all Liabilities which are the direct or indirect result of (a) any breach of any representation, warranty or covenant made by or given on behalf of Client under this Agreement, or (b) any action or failure to act on the part of any one or more of 1269745.1 Page 5 oflO
Consultant Group where such action or failure to act was in good faith believed by any of Consultant Group at the time to be in conformity with this Agreement, or ( c) otherwise related to or arising out of any act or omission by any one or more Client Group. In this regard, Client hereby acknowledges that it is responsible for instructing Consultant regarding Consultant's performance of Services under this Agreement, as well as the interpretation and meaning of the ordinances and/or regulations under which Consultant is performing Services under this Agreement.
8.3 Promptly after any member of Client Group or any member of Consultant Group (in each case, the "Indemnified Group") receives notice of the commencement of any proceeding for which Client or Consultant ( as the case may be) intends to make a claim for indemnification under this Agreement, it should notify the other party (the "Indemnifying Party'"), but the failure to so notify will not result in the loss of any rights of any of the Indemnified Group to indemnification hereunder except to the extent that the Indemnifying Party does not otherwise become aware of such proceeding and is actually adversely affected thereby to a material extent.
The Indemnifying Party will assume the defense of the Indemnified Group (including the employment of legal counsel reasonably satisfactory to the Indemnified Group) and payment of such counsel's fees and disbursements (including retainers). Should the Indemnified Group reasonably determine that separate counsel is necessary (whether due to the existence of different defenses, potential conflicts of interest or otherwise), or if the Indemnifying Party has not assumed the defense, then any of the Indemnified Group may employ separate legal counsel, and the Indemnifying Party will pay such counsel's reasonable fees and disbursements as incurred (including retainers). The obligations of defense and indemnification under this Agreement apply, without limitation, to those situations where someone brings a cross claim for indemnity or contribution against any one or more of the Indemnified Group.
8.4 Neither Consultant nor Client shall, without the other party's prior written consent, settle, compromise or consent to the entry of any judgment in any pending or threatened claim, action, or proceeding or investigation in respect of which indemnification could be sought hereunder (whether or not any of the other party or any other member of the Indemnified Group is an actual or potential party to such claim, action or proceeding or investigation), unless such settlement, compromise or consent includes an unconditional release of the other party and any other member of the Indemnified Group from all liability arising out of such claim, action, proceeding or investigation and includes an explicit disclaimer of responsibility of any kind on the part of the other party and any other member of the Indemnified Group.
9. Liability Limitations; Governing Law; Dispute Resolution.
9.1 To the maximum extent permitted by law and notwithstanding anything to the contrary in this Agreement:
9.1.1 Except for Consultant's gross negligence or willful misconduct in connection with the performance of its obligations under this Agreement, Client's sole and exclusive remedies for any breaches of Consultant's obligations under this Agreement (including, without limitation, for any breaches relating to the Services or the Software, including any breaches of warranty, express or implied) (i) are limited to making reasonable and necessary repairs, replacements or corrections without additional cost to the Client, and (ii) will 1269745.1 Page6ofl0
not exceed, under any circumstances, the amount of the Fees paid by Client to Consultant for the twelve-month period prior to the alleged breaches, calculated without reference to any payments constituting the payment of costs or expenses. All amounts paid to Consultant hereunder are deemed first to be for the reimbursement of costs or expenses and then any excess will be regarded as payments for other portions of the Fees under this Agreement. Any references to breaches of this Agreement will include any supplements, additions or amendments to this Agreement.
9.1.2 Except as may otherwise be expressly set forth in this Agreement, Consultant makes no warranty of any kind with respect to the Services or the Software, express or implied. Consultant hereby disclaims all other warranties, express or implied, including the implied warranties of merchantability, fitness for a particular purpose, title and non infringement.
Consultant disclaims all warranties and responsibility for third party software.
9.1.3 In no event will any of Consultant Group be liable for any lost revenues or lost profits, or any special, incidental, or consequential damages of any nature whatsoever, even if such restrictions deprive one or more remedies of their essential purpose. This damage exclusion is independent of any remedies provided for herein.
9.1.4 None of Consultant Group will have any Liability (whether direct or indirect, in contract or tort or otherwise) related to, arising out of, or in connection with this Agreement or to any of Client Group acting on any advice given or opinion rendered by any of Consultant Group, except to the extent that such Liability is found by a court of competent jurisdiction in a judgment which has become final and that it is no longer subject to appeal or review to have resulted solely from such Consultant Group's willful misconduct or gross negligence.
9.1.5 No claim may be brought by Client against any one or more of Consultant Group arising out of this Agreement (including, without limitation, in connection with the Services or the Software) more than one year after the date on which such claim arose (regardless of the date when Client may have discovered a basis for the claim).
9.1.6 Client acknowledges that this Agreement is with Consultant in its capacity as a corporation or a limited liability company, and Client agrees that in no event will it seek to hold any of the Consultant Group ( other than Consultant) responsible for any Liabilities.
9.2 The law of the State will govern the validity of this Agreement, its interpretation and performance, and any other claims related to it, without regard to the State's conflict of laws rules. Venue for any legal action arising out of this Agreement will be proper only in the State courts or the federal courts located within the State. The parties hereby submit to the exclusive jurisdiction of such courts and waive any other venue to which either patty might be entitled by domicile or otherwise.
9.3 If either party is required to bring legal action to enforce its rights under this Agreement or as the result of a breach of this Agreement, the costs and expenses of the prevailing party, including reasonable attorneys' fees, will be paid by the non-prevailing party. 9 .4 A breach of this Agreement by either party may cause the other party hereto irreparable harm, the amount of which may be difficult to ascertain, and therefore such other 1269745.1 Page 7 of IO
party will have the right to apply to a court of competent jurisdiction for specific performance and/or an order restraining and enjoining any further breach and for such other relief as such other party may deem appropriate. Such right is in addition to the remedies otherwise available to such other party at law or in equity. The parties hereto expressly waive the defense that a remedy in damages will be adequate and any requirement in an action for specific performance or injunction hereunder for the posting of a bond.
10. General Legal Provisions.
10.1 Authorization to Proceed. Each Schedule must be signed by both Client and Consultant before such Schedule will be binding on the parties hereto.
10.2 Force Majeure. Consultant is not responsible for damages or delay in performance caused by acts of God, strikes, lockouts, accidents, epidemics, pandemics or other health emergencies, or other events beyond the control of Consultant.
10.3 Amendment; Waiver. Any provisions of this Agreement (including, without limitation, any Schedules or provisions within any Schedules) may be amended or terminated if in writing and signed by both Client and Consultant. No waiver by any party of any default, misrepresentation or breach of warranty or covenant hereunder, whether intentional or not, will be deemed to be valid unless acknowledged by such party in writing, and such waiver will not extend to any prior or subsequent default, misrepresentation or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence.
10.4 Severability and Survival. If any provision in this Agreement is held illegal, invalid or unenforceable, the enforceability of the remaining provisions will not be impaired thereby. Notwithstanding any other provisions of this Agreement (including, without limitation, Section 7), Sections 3, 5.5, 6, 7, 8, 9 and 10 will survive the termination of this Agreement.
10.5 No Third-Party Beneficiaries; Services Limited to Agreement. Except as set forth in Section 8, this Agreement gives no rights or benefits to anyone other than Client and Consultant and has no third-party beneficiaries. The Services to be performed for Client by Consultant are defined solely by this Agreement (including the Schedules), and not by any other contract or agreement that may be associated with performing the Services.
10.6 Assignment. This is a bilateral personal services agreement. Neither party will have the power to or will assign any of the duties or rights or any claim arising out of or related to this Agreement, whether arising in tort, contract or otherwise, without the written consent of the other party. Any unauthorized assignment is void and unenforceable. This Agreement is binding on the successors and assigns of the parties hereto. Notwithstanding anything to the contrary, Consultant may, from time to time, utilize one or more third parties to provide certain of the Services (including, but not limited to, as may be set forth in one or more of the Schedules).
10.7 Notices. All notices under this Agreement must be in writing and will be deemed to have been given when such notice is received (i) from United States Postal Service 1269745.1 Page 8 of IO
First Class Certified Mail, Return Receipt Requested, (ii) by courier service, or (iii) by email; provided, however, that notices received on a weekend or holiday or on a business day after 4:00 p.m. local time will be deemed to have been received on the next business day. Notices will, unless another address is specified in writing, be sent to the addresses indicated below ( each of which must include a street address and an email address): Consultant: 120 S. State College, STE 200, Brea, CA 92821, Attn: Andrew Nickerson, Email: [email protected] ; and Client: 1416 C Street, Livingston CA, 95334, Attn: Jennifer Riedeman, Email:
[email protected] .
10.8 Entire Agreement; Conflict. This Agreement (which includes any Schedules or amendments dated as of the Agreement Date or hereafter, including without limitation, amendments of the main body of this Agreement or the Schedules that may add to, subtract from, modify or clarify the Term, the scope of Services and/or the amount of Fees) constitutes the entire agreement between the parties and supersedes any prior understandings, agreements, or representations by or between the parties, written or oral, to the extent they relate in any way to the subject matter hereof. Should there ever be a conflict between the terms and conditions of any Schedules and the remainder of this Agreement as set forth in the main body of this Agreement, the terms and conditions of the remainder of this Agreement as set forth in the main body of this Agreement will prevail and be controlling; provided, however, that should there ever be a conflict between the terms and conditions of this Agreement (including any Schedules) and (i) any amendments hereof, the terms and conditions of the amendments hereof will prevail and be controlling, and (ii) the terms and conditions of any Schedule that expressly provides for them to supersede any terms and conditions of the main body of this Agreement, such terms and conditions of such Schedule will prevail and be controlling.
10.9 Counterparts; Electronic Signatures; Authority. This Agreement may be signed in any number of counterparts, each of which will constitute an original and all of which, when taken together, will constitute one agreement. Any signed signature pages of this Agreement transmitted by email or other electronic means in a portable document format (PDF) or other clear and visible electronic format will have the same legal effect as an original. Each of the persons signing on behalf of a party hereto represents that he or she has the authority to sign this Agreement on such party's behalf.
10.10 No Adverse Construction. Both parties acknowledge having had the opportunity to participate in the drafting of this Agreement. This Agreement will not be construed against either party based upon authorship. The section headings contained in this Agreement are inserted for convenience only and will not affect in any way the meaning or interpretation of this Agreement.
[Signatures are on the next page]
1269745.1 Page 9 of 10
IN WITNESS WHEREOF, the parties hereto have entered into this Agreement through their duly authorized representatives as of the Agreement Date.
CONSULTANT:
Hinderliter de Llamas and Associates
By:, _________ _
Andrew Nickerson, President
CLIENT:
City of Livingston
By: _________ _
Its: _________ _
By:, ________ _
Its: ----------
[ Any Schedule or Schedules may (but is/are not required to) be attached hereto] 1269745.1 Page to of JO
SCHEDULE A
Sales and Use Tax/ Allocation and Audit Services
Economic Analysis/Forecasting and Related Services
SERVICES
1. Sales and Use Tax and Economic Analysis/Forecasting Services/Reports
1.1. Establish a special database identifying the name, address, and quarterly allocations of all sales tax producers within the City. This database will be utilized to generate special reports to City on major sales tax producers by rank and category, sales tax activity by categories, or business districts, identification of reporting aberrations, and per capita and outlet comparisons with regional and statewide sales.
1.2. Provide periodic updated reports to City identifying changes in sales by individual businesses, business groups and categories, and by geographic area. These reports may include, without limitation, quarterly aberrations due to State audits, fund transfers, and receivables, along with late or double payments, and quarterly reconciliation worksheets to assist with budget forecasting.
Consultant shall meet quarterly by in person or virtually with City.
1.3. Shall additionally provide following each calendar quarter a summary analysis for City to share with Council Members, Chamber of Commerce, other economic development interest groups and the public that analyze City's sales tax trends by major groups and geographic areas without disclosing confidential individual tax records.
I .4. Establish a special database with California Department of Tax and Fee Administration ("CDTFA") registration data for businesses within applicable district boundaries holding seller's permit accounts.
1.5. Periodically license for the limited, non-exclusive, non-transferable use by City's staff certain of Consultant's web-based sales, use and/or transactions tax program(s) containing sellers permit, registration, allocation and related information for business outlets within City's jurisdiction registered with the CDTF A.
1.6. Provide periodic updated reports endeavoring to identify and assist with budget forecasting (i) changes in allocation totals by individual businesses, business groups and categories, and (ii) aberrations due to State audits, fund transfers, and receivables, along with late or double payments.
2. Allocation and Audit Recovery Services
2.1. Conduct (when mutually agreed with City) initial and on-going sales and use tax audits of businesses to help identify and correct distribution and allocation errors, and to proactively affect favorable registration, reporting or formula changes thereby generating previously unrealized sales and use tax income for the City and/or recovering misallocated tax from registered taxpayers.
Common errors that will be monitored and corrected include but are not limited to: transposition errors resulting in misallocations; erroneous consolidation of multiple outlets; formula errors; misreporting of "point of sale" to the wrong location; delays in reporting new outlets; misallocating use tax payments to the allocation pools or wrong jurisdiction; and erroneous fund transfers and adjustments.
2.2. Initiate contacts with the CDTFA and sales management and accounting officials in companies that have businesses where a probability of error exists to endeavor to help verify whether current tax receipts accurately reflect the local sales activity. Such contacts will be conducted in a professional and courteous manner.
2.3. Prepare and submit to the CDTFA information for the purpose of correcting any identified allocation errors, and follow-up with individual businesses and the CDTFA to promote recovery by the City of back or prospective quarterly payments that may be owing. 1248933.1 Page 1 of 4
SCHEDULE A
Sales and Use Tax/ Allocation and Audit Services
Economic Analysis/Forecasting and Related Services
2.4. If, during the course of its audit, Consultant finds businesses located in the City's jurisdiction that are properly reporting sales and use tax but have the potential for modifying their operation to provide an even greater share to City, Consultant may so advise City and collaborate with those businesses and City to encourage such changes.
3. Consulting and Other Optional Services
Consultant may from time to time in its sole discretion, consult with City's staff, including without limitation, regarding (i) technical questions and other issues related to sales and use tax, (ii) utilization of reports to enhance business license collection efforts; (iii) sales tax projections for proposed annexations, economic development projects and budget planning, (iv) negotiating/review of tax sharing agreements, (v) establishing purchasing corporations, (vi) meeting with taxpayers to encourage self-assessment of tax obligations, and (vii) other sales and use tax revenue-related matters.
FEES
4. Sales and Use Tax and Economic Analysis/Forecasting Services/Reports
4.1. Fees for performing the sales tax and economic analysis/forecasting Services as described above shall initially be $400 per month, commencing with the month of the Effective Date (hereafter referred to as "monthly fee"). The monthly fee shall be invoiced quarterly in arrears and shall be paid by City no later than 30 days after the invoice date.
4.2. Consultant may change the non-hourly Fees established above upon at least 30 days' prior written notice to City (but not more than once a year). Any such change must be with reference to the 12- month percent change in the most recently published annual Consumer Price Index for All Urban Consumers (CPI-U), as reported by the U.S. Bureau of Labor Statistics (the "CPI Change").
5. Allocation and Audit Recovery Services
5.1. Fees for performing the allocation and audit recovery Services described above shall be 15% of all new, increased and recovered sales and use tax revenue received by the City as a result, in whole or in part, of the allocation audit and recovery services (hereafter referred to as "audit fee").
The fee shall be paid notwithstanding any related City assistance, work in parallel, and/or incurrence of attorneys' fees or other costs or expenses in connection, with the relevant Services.
5.2. The Fee described above include, without limitation, State fund transfers received for back quarter reallocations and monies received in the first eight (8) consecutive reporting quarters following completion of Consultant's allocation audit and confirmation of the corrections by the CDTFA.
5.3. These Fees shall be paid by City upon Consultant's submittal of evidence of Consultant's relevant Services in support thereof, including, without limitation, copies of relevant communications between Consultant and the CDTF A and/or taxpayers.
5.4. Consultant recognizes City's authority to waive or reduce the tax/fee-related debt of a business.
Should City decide to do so for a business whose deficiency was identified by Consultant, Consultant shall be entitled to compensation in the amount of one half(l/2) of the Fees Consultant would have otherwise earned. Deficiencies which are uncollectable due to insolvency or dissolution of the business, or for deficiencies which are otherwise incapable of collection (i.e., statute of limitation or other legal defense) shall not be considered a City voluntary election to waive, and thus, Consultant would not be entitled to compensation related thereto under this provision.
6. Consulting and Other Optional Services
1248933.1 Page 2 of 4
SCHEDULE A
Sales and Use Tax/ Allocation and Audit Services
Economic Analysis/Forecasting and Related Services
6.1. Fees for performing the consulting and other optional Services described above shall be based on the following initial hourly rates: (i) Principal - $325; (ii) Programmer - $295; (iii) Senior Analyst - $245; and (iv) Analyst- $195.
6.2. Consultant may change the rates for its hourly Fees from time to time. A 30 days' prior written notice to City will be given.
7. General Provisions Relating to Fees
7. I. Fees for travel and lodging expenses will be invoiced at cost and applied to all meetings (including implementation, training, operations, and support). Travel expenses only apply to out of scope travel and must therefore be pre-approved by City.
7.2. Fees will be invoiced monthly to City for Services performed during the prior month. To the extent that Consultant has commercially reasonable means to do so, Fees will be netted out of City's monthly revenue disbursement.
8. Confidentiality Information
Section 7056 of the State of California Revenue and Taxation Code ("R&T Code") specifically limits the disclosure of confidential taxpayer information contained in the records of the CDTFA. Section 7056 specifies the conditions under which a city, county or district may authorize persons other than such city, county or district's officers and employees to examine state sales and use tax records.
The following conditions specified in Section 7056-(b )(I) of the State of California R&T Code are hereby made part of this Agreement:
8.1. Consultant is authorized by this Agreement to examine sales, use or transactions and use tax records of the CDTFA provided to City pursuant to contract under the Bradley-Burns Uniform Local Sales and Use Tax Law R&T Code Section 7200 et.seq.
8.2. Consultant is required to disclose information contained in, or derived from, those sales or transactions and use tax records only to an officer or employee of City who is authorized by City resolution provided to the CDTFA to examine the information.
8.3. Consultant is prohibited from performing consulting services for a retailer (as defined in R&T Code Section 6015), during the term of this agreement.
8.4. Consultant is prohibited from retaining the information contained in or derived from those sales, use or transactions and use tax records after this agreement has expired. Information obtained by examination of the CDTFA records shall be used only for purposes related to collection of local sales and use tax or for other governmental functions of the City as set forth by resolution adopted pursuant to Section 7056 (b) of the Revenue and Taxation Code. The resolution shall designate the Consultant as a person authorized to examine sales and use tax records and certify that this agreement meets the requirements set forth above and in Section 7056 (b ), (I) of the Revenue and Taxation Code.
9. Software Use and Proprietary Information
Software Use. Consultant hereby provides authorization to City to access Consultant's Sales Tax website if City chooses to subscribe to the software and reports option. The website shall only be used by authorized City staff. No access will be granted to any third party without explicit written 1248933.1 Page 3 of 4
SCHEDULE A
Sales and Use Tax/ Allocation and Audit Services
Economic Analysis/Forecasting and Related Services
authorization by Consultant. City shall not sublet, duplicate, modify, decompile, reverse engineer, disassemble, or attempt to derive the source code of said software. The software use granted hereunder shall not imply ownership by City of said software, or any right of City to sell said software or the use of same, or any right to use said software for the benefit of others. This software use authorization is not transferable. Upon termination or expiration of this Agreement, the software use authorization shall expire, and all City staff website logins shall be de-activated.
Proprietary Information. As used herein, the term "proprietary information" means all information or material that has or conld have commercial value or other utility in Consultant's business, including without limitation: Consultant's (i) computer or data processing programs; (ii) data processing applications, routines, subroutines, techniques or systems; desktop or web-based software; (iii) business processes; (iv) marketing plans, analysis and strategies; and (v) materials and techniques used; as well as the terms and conditions of this Agreement. Except as otherwise required by law, City shall hold in confidence and shall not use (except as expressly authorized by this Agreement) or disclose to any other party any proprietary information provided, learned of or obtained by City in connection with this Agreement. The obligations imposed by this Section shall survive any expiration or termination of this Agreement or otherwise. The terms of this Section shall not apply to any information that is public information.
1248933.1 Page 4 of4
STAFF REPORT
AGENDA ITEM: Resolution to Approve a Supplemental Appropriation from the General Fund Unappropriated Fund Balance in the amount of$10,000 for State Mandated Training for City Council and Commission Members to be provided by Institute for Local Government (ILG) and Authorizing the Acting City Manager to Execute the Agreement.
MEETING DATE: December 20, 2022
PREPARED BY: Jennifer Riedeman, Finance Director/Acting City Manager REVIEWED BY: Jennifer Riedeman, Finance Director/ Acting City Manager RECOMMENDATION:
City Council adopt a motion, adopting Resolution No. 2022-_, appropriating $10,000 of the General Fund Unappropriated Fund Balance from Fiscal Year 2022/23 and authorizing the Acting City Manager to execute the agreement with Institute for Local Government to provide mandated trainings.
BACKGROUND:
The City Manager has the authority to make transfers of budget appropriations between classifications and activities within a fund. Any additional appropriation authority requires City Council approval.
DISCUSSION:
Because City Council and Commission Members are required to AB 1234 Ethics Training and AB 1661 Sexual Harassment Training in order to meet compliance requirements, management reached out to the Institute for Local Government (ILG) to get a quote for services. Founded in 1955, ILG has been serving local officials' information needs for 65 years. The Institute's effectiveness in promoting good government at the local level is greatly enhanced by its close working relationship with the associations that represent counties, cities and special districts: the California State Association of Counties, the League of California Cities and the California Special Districts Association.
FISCAL IMP ACT:
The additional $ 10,000 in appropriated funds would be used to fund the ILG workshops. They cannot be used for any other purpose.
ATTACHMENTS:
I. Resolution No. 2022-
2. Proposal from ILG
1 RESOLUTION NO. 2022 -
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LIVINGSTON APPROPRIATING $10,000 OF THE GENERAL FUND UNAPPROPRIATED FUND BALANCE FROM FISCAL YEAR 2022/23 AND AUTHORIZING THE ACTING CITY MANAGER TO EXECUTE THE
AGREEMENT WITH INSTITUTE OF LOCAL GOVERNMENT (ILG)
WHEREAS, the City Council and Commission Members are required to AB 1234 Ethics Training and AB 1661 Sexual Harassment Training in order to meet compliance requirements.
WHEREAS, California State Government Code Section 532.35 requires that specified local agency officials receive at least two hours training in ethics within one year of taking office and every two years thereafter.
WHEREAS, Chapter 816, Statutes of 2016 requires the City Council and Commission Members to attend AB 1661 Sexual Harassment Training within the first six months of taking office and every two years thereafter.
WHEREAS, the City received a quote from Institute of Local Government (ILG) to perform the trainings as part of a two-part Governance Workshop that satisfies the compliance requirements.
WHEREAS, the City Council and Commission Members will receive certificates for completing these workshops as evidence of their state mandated training compliance.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LIVINGSTON AS FOLLOWS:
1. The sums of money therein set forth are hereby appropriated and are to be used for the agreement with ILG to host the workshops.
Passed and adopted this 20th day of December 2022, by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
1 Jose A. Moran, Mayor
of the City of Livingston
ATTEST:
I, hereby certify, that the foregoing resolution was regularly introduced, passed and adopted at a regular meeting of the City Council of the City of Livingston this 20th day of December 2022. 2 Leticia Vasquez-Zurita, City Clerk
of the City of Livingston
PROPOSAL
November 28, 2022
TO:
FROM:
RE:
City of Livingston
Jennifer Riedeman, Interim City Manager
Monica Cisneros, Deputy City Clerk
The Institute for Local Government
Melissa Kuehne, Senior Program Manager
Governance Workshop Proposal
PROPOSAL
Thank you for contacting the Institute for Local Government to inquire about a Leadership & Governance Workshop.
As requested, ILG has outlined a workshop for Livingston's city council that addresses the governance topics of highest interest to you. Below please find the proposed scope of work and associated costs for your consideration. As discussed, this workshop can be provided in either virtual or in-person formats taking place at a mutually agreeable time in early 2023. If the workshops take place in-person, it is our expectation that the city will provide the venue, AV, refreshments, and materials (as needed).
We welcome your feedback and are happy to refine this as needed to meet your long-term objectives.
Governance Workshop - Proposed Scope of Work
Our Approach
ILG believes exceptional councils understand their role is to serve as policy maker- to represent the values, beliefs and priorities of their community while serving in the community's best interest. They carry out a variety of responsibilities including: developing and adopting a vision for the agency; focusing and aligning plans, policies, agreements and budgets in furtherance of this vision; and holding themselves and executive staff accountable for results. They understand the distinction between the roles and responsibilities of the governing body as a whole, the individual elected official and executive staff. In successful agencies, elected officials and executive staff also work as a team as they undertake a series of tasks to further their common purpose. I LG also believes that exceptional elected and appointed officials have a strong understanding of the ethics required to serve with integrity and transparency.
We are proud to offer leadership and governance trainings that provide an orientation for your new council members and a refresher for staff on the principles of good governance. We work closely with our local agency clients to develop a customized, interactive session that reinforces important principals, strengthens teams and unifies participants around a shared vision. We will also work with you so we understand the unique characteristics of your community and the specific issues you're facing to develop a workshop that aligns with your goals. We know that rural, urban and suburban communities have different challenges and approaches, so we design our trainings to meet the needs of your agency. We also collaborate with our legal and law firm partners to provide effective and engaging AB 1234 and AB 1661 trainings when requested.
INSTITUTE FOR LOCAL GOVERNMENT 1400 K STREET. SUITE 205. SACRAMENTO. CA 95814 WWW.CA-ILG.ORG
PROPOSAL
Scope of Work
Per your request, we have outlined the following scope of work:
• Task 1: Conduct assessment interviews of city council members and key executive staff to assess their understanding of their roles, responsibilities, and policy priorities. o Develop a high-level summary of key themes to discuss during the training and share with appropriate city staff and leadership.
• Task 2: Identify goals for the training and develop an agenda in conjunction with city leadership. • Task 3: Facilitate two, 2-hour training sessions for city council members that meets the city's objectives, each followed by a 2-hour AB 1234 or AB 1661 ethics training facilitated by ILG's legal partners.
• Task 4: Develop a summary of key takeaways and recommendations for consideration from the session for attendees' reference and provide certificates of attendance for the AB 1234 and AB 1661 sessions.
Governance Workshop Part 1 - Draft Agenda (final agenda to be developed in conjunction with city leadership)
1. Welcome and Introductions
2. Setting the Stage-Why is good governance important?
3. Review Key Themes from the Assessment Interviews
4. Understanding Local Government Mechanics
a. Overview of council-manager system and local government basics i. Overview of services provided by cities, counties and special districts ii. Overview of the council-manager form of government
iii. Overview of policy setting process
5. Effective Leadership and Culture
a. Self-Assessment Exercise
b. Overview of the qualities and characteristics of effective governing teams c. Polling: How is the Council doing?
d. Group discussion about key areas for improvement
6. Break
7. AB 1234 Ethics Training
a. /LG legal partner will facilitate a presentation for council and commission members to earn their certification
8. Closing Remarks/Wrap Up
9. Adjourn
Governance Workshop Part 2 - Draft Agenda (final agenda to be developed in conjunction with city leadership)
1. Welcome
2. Setting the Stage - Reflections from the last session
3. Review Key Themes/Take Aways from the last session
INSTITUTE FOR LOCAL GOVERNMENT 1400 K STREET SUITE 205. SACRAMENTO CA 95814 WWW.CA-ILG.ORG
4. Roles and Responsibilities
a. Overview
b. Exercise:
i. What is the role of an individual councilmember?
ii. What is the role of the council as a whole?
iii. What is the role of staff?
c. Reflections and Discussion
5. Promoting Civility in Public Meetings
a. Interpersonal Strategies
b. Organizational Strategies
c. Governance Tools, Policies & Protocols
d. Meeting Design & Management Techniques
6. Break
7. AB 1661 Ethics Training
PROPOSAL
a. JLG legal partner will facilitate a presentation for council and commission members to earn their certification
8. Closing Remarks/Wrap Up
9. Adjourn
Governance Workshops - Cost
The total cost for facilitating both workshops in-person, and other related expenses is $10,000. This cost includes travel expenses, materials preparation, and compensation for our legal partners.
The total cost of facilitating both workshops virtually, via Zoom, and other related expenses is $8,000.
Payment will be made in two installments, 50% upon execution of the contract, 50% upon completion of the scope of work.
About the Institute for Local Government
ILG is the non-profit training and education affiliate of three statewide local government associations - the League of California Cities, the California State Association of Counties and the California Special Districts Association. Together with these affiliates, I LG serves over 2,500 local agencies - including cities, counties and special districts. ILG provides practical and easy-to-use resources so local agencies can effectively implement policies on the ground. Our work covers four main areas - leadership and governance, public engagement, sustainable and resilient communities and workforce and civics education.
Leadership and Governance Program
California's local governments face a myriad of challenges -- from housing and homelessness to budget shortfalls to aging infrastructure. Elected leaders and staff cannot effectively address these challenges without a strong foundation of good government - trust, accountability, responsiveness and transparency. ILG's Leadership and Governance pillar helps local government leaders build that foundation, develop leadership skills and increase public trust. The ILG team provides the state mandated ethics training, leadership training, customized facilitated workshops, written resources and sample policies and ordinances.
INSTITUTE FOR LOCAL GOVERNMENT 1400 K STREET SUITE 205. SACRAMENTO. CA 95814 WWW.CA-ILG.ORG
PROPOSAL
Primary ILG Project Team
Melissa Kuehne, Senior Program Manager
Melissa leads projects around leadership, housing, governance and community engagement. She has over 15 years of experience in outreach, facilitation, project management and training development.
Prior to joining ILG in 2013, she served as staff for a member of Congress handling constituent services around housing and veterans affairs, worked on environmental issues at a collaborative policy center and conducted outreach efforts for a housing consortium in Washington State. She holds a bachelor's degree in Political Science from UC San Diego and a Master's degree in Public Administration from the University of Washington's Evans School of Public Policy and Governance.
Erica Manuel, CEO & Executive Director
Erica is a central valley native with over 20 years of experience helping public, private and nonprofit organizations implement innovative policies to provide strong leadership, advance climate resilience, support economic development, engage communities, and drive positive change.
In her role as ILG's Executive Director, Erica wears many hats - from moderating discussions about leadership and good governance to facilitating community conversations about civility and equity, to supporting ILG's workforce development and environmental work. Prior to joining ILG in 2019, Erica served as a senior leader at the Sacramento Municipal Utility District, the 6th largest electric utility in the nation where she led economic development, education, sustainable communities, and corporate social responsibility. She has a long and varied professional career that includes being an appointee of Governor Schwarzenegger and a public relations executive with Edelman Public Relations, among others. Erica also spent nearly 10 years as a strategic communications consultant for Fortune 500 companies where she advised on leadership, branding, messaging, and strategy.
Erica studied at Stanford University, Boston College's Carroll Graduate School of Management and Northwestern University's Kellogg Center for Nonprofit Management. She is also certified in Nonprofit Management, Dignity Infused Community Engagement (DICE), Corporate Social Responsibility and GRI Sustainability Reporting. Erica is also a Senior Fellow with American Leadership Forum, Mountain Valley Chapter.
Erica has provided official and unofficial strategic counsel to dozens of local agencies in the past three years, including: City of Sacramento, San Joaquin Valley Air Pollution Control District, City of San Jose, Placer County, City of South Gate, City of Arcata, City of Arvin, City of El Centro, City of San Diego, and more. She also provides statewide strategic counsel to the California Air Resources Board, California Strategic Growth Council, Public Policy Institute of California and more.
Erica is also a frequent keynote speaker, facilitator, and moderator. In the past year alone, she has led workshops and sessions on:
• Bridging Divides
• Adaptive Leadership
• Leadership Through Times of Crisis
• Modeling Civility
• Managing Disruptive Meetings
INSTITUTE FOR LOCAL GOVERNMENT 1400 K STREET SUITE 205 SACRAMENTO, CA 95814 WWW.CA-ILG.ORG 1 1111 INSTITUTE FOR
Iii.I LOCAL GOVERNMENT"
Taylor Buck, Program Manager
While new to ILG, Taylor brings over five years of community engagement, civics education and communications experience. She most recently served as an Account Executive at Lucas Public Affairs providing project management and strategic communications support to clients across several issue areas including higher education, insurance and biotechnology. Taylor began her career working for PRO Youth and Families launching and facilitating the Sacramento Area Council of Governments' Youth Leadership Academy. She previously led the Sacramento Youth Alliance Community Action Team, advocating for transitional-aged youth. Earlier, she served as an intern for Congressmember Ami Bera, State Senator Darrell Steinberg and Sacramento City Councilmember Rick Jennings 11.
INSTITUTE FOR LOCAL GOVERNMENT 1400 K STREET SUITE 205. SACRAMENTO. CA 95814 WWW.CA-ILG.ORG
STAFF REPORT
AGENDA ITEM: Resolution Approving an Amendment to an Agreement with Gilton Solid Waste Management, Inc. to Extend the Agreement for an Additional Five (5) Months to complete the Request for Proposal (RFP) and Related Proposition 218 process, and Authorizing the Acting City Manager to Execute Amendment.
MEETING DATE: December 20, 2022
PREPARED BY: Jennifer Riedeman, Finance Director/ Acting City Manager REVIEWED BY: Jennifer Riedeman, Finance Director/ Acting City Manager RECOMMENDATION:
Adopt Resolution No. 2022-__ , approving an amendment to an Agreement with Gilton Solid Waste Management, Inc. to extend the term for an additional five (5) months, and authorizing the Acting City Manager to execute the Amendment.
BACKGROUND:
The City has contracted with Gilton Solid Waste Management, lnc. since 1986 and the current contract is set to expire on December 31, 2022. The City issued an RFP for Solid Waste Services and it is expected that the process to receive, evaluate, select and negotiate a contract will take approximately 5 months.
This no cost contract extension affords the City the time to complete the RFP and Proposition 2 18 process.
DISCUSSION & RECOMMENDATION:
Staff requests that Council approve an extension to the agreement with Gilton Solid Waste Management.
Inc. to extend Agreement for five (5) additional months, and authorizing the Acting City Manager to execute amendment.
FISCAL IMP ACT:
The five month contract extension does not reflect a fee increase and the current rates charged are budgeted for FY 2022/23.
ATTACHMENTS:
I. Resolution 2022-_Approving an Amendment to an Agreement with Gilton Solid Waste Management, lnc., and Authorizing the Acting City Manager to Execute Amendment.
2. Five month contract extension through May 30, 2023
RESOLUTION NO. 2022-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LIVINGSTON
APPROVING AN AMENDMENT TO AN AGREEMENT WITH GIL TON SOLID WASTE MANAGEMENT, INC. TO EXTEND THE AGREEMENT FOR AN ADDITIONAL FIVE (5)
MONTHS TO COMPLETE THE REQUEST FOR PROPOSAL (RFP) AND RELATED PROPOSITION 218 PROCESS, AND AUTHORIZING THE ACTING CITY MANAGER TO EXECUTE AMENDMENT.
WHEREAS, the City of Livingston has contracted with Gilton Solid Waste Management, Inc. since 1986; and
WHEREAS, the current contract is set to expire on December 31, 2022; and WHEREAS, scope of work and costs will remain the same; and WHEREAS, the City wishes to approve a five (5) month contract extension with Gilton Solid Waste Management, Inc. with an expiration date of May 30, 2023; and NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Livingston hereby adopts a Resolution to approve a five (5) months, and authorizing the Acting City Manager to execute the Amendment.
Passed and adopted this 20th day of December, 2022, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
Jose A. Moran, Mayor
of the City of Livingston
I, hereby certify that the foregoing resolution was regularly introduced, passed and adopted at a regular meeting of the City Council of the City of Livingston this 20th day of December, 2022.
Leticia Vasquez-Zurita, City Clerk
of the City of Livingston
Page I of I Pages
@ GILTON
11111
SOLID WASTE
~~~AGEMENT,
December 6, 2022
Jennifer Riedeman
Finance Director
City of Livingston
1416 C Street
Livingston, CA 95334
RE: Contract Extension between City of Livingston and Gilton Solid Waste Management for Solid Waste Services.
Dear Ms. Riedeman,
On April 2, 2013, the City of Livingston and Gilton Solid Waste Management, Inc. entered into a contract for Solid Waste Services within the City of Livingston. The term of this Agreement is expiring December 31, 2022. Per your request Gilton agrees to extend the Agreement for an additional five (5) months. This extension, if granted, would allow our services to continue under the same provisions from January 1, 2023 through May 30, 2023.
Should you have any questions regarding this request or our solid waste operations, please do not hesitate to contact me directly. I can be reached at any of the following:
Office phone:
Cell phone:
Email:
Richard Gilton
209-840-5634
209-988-5016
[email protected]
President / General Manager
Gilton Solid Waste Management, Inc.
0 755 S Yosemite Ave.
~ Oakdale CA 95361-4039 (@ Gilton.com ~ 209.527.3781
AGENDA ITEM:
MEETING DATE:
PREPARED BY:
REVIEWED BY:
STAFF REPORT
Discussion and Direction on CMAQ Application Submission for the 2022 CMAQ Call for Projects
December 20, 2022
Mario Gouveia, City Engineer
Jennifer Riedeman, Finance Director/Acting City Manager RECOMMENDATION:
Staff recommends Council to hold discussion and provide direction to submit the presented Sidewalk Infill Project to MCAG to compete for CMAQ funding.
BACKGROUND:
The Merced County Association of Governments (MCAG) initiated a Call for Projects on October 24, 2022. MCAG is in the process of programming $3 million in future federal funds for the Congestion Mitigation and Air Quality (CMAQ) Program. This funding is to be awarded to member agencies based on competitively scoring applications submitted to MCAG by its member agencies. MCAG provided the following Tentative schedule for the Call for Projects:
Schedule:
• Application Deadline - December 21 , 2022
• CMAQ Committee to Evaluate Applications - January 2023 (tentative) • MCAG Board to Act on Recommendations - February 2023 (tentative) • Expected Federal approval of FTIP Amendment -April 2023 (tentative) The CMAQ program's primary goals are to improve air quality and reduce congestion. CMAQ funding is used to fund transportation projects that will contribute to the attainment or maintenance of the National Ambient Air Quality Standards for ozone, and particulate matter (both PM1 O and PM2.5).
DISCUSSION:
City Staff met and developed a list of potential projects that best fit the application guidelines using the CMAQ project criteria and existing transportation documents. From the potential projects list, the proposed project was created. The proposed project is summarized below:
1. Sidewalk Infill Proiect
The project consists of constructing new sidewalks and wheelchair ramps at various locations on the North side of the City of Livingston (City). This is a "quality of life" project and a continuation of the current CMAQ Pedestrian Improvement project currently under construction in this area. It focuses on the construction of sidewalks where there are still discontinuities in pedestrian facilities, hence providing connectivity and safe pedestrian access to schools, commercial areas, parks, churches, etc. The preliminary total estimated project cost is $500,000.
FISCAL IMPACT:
All CMAQ funded projects require a local match of 11.47%. These local matching funds can be committed from the City's Local Measure V allocation, S81 allocation, or use other available local funds should the City receive funding for the submitted application. Upon receipt of funding the City would need to budget for the local match expenditures.
ATTACHMENTS:
Scoping Exhibit - Sidewalk Infill Project
Doc: 12, 2022-9:12am
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1·"' DGR I 111tr: 12/11/'121 City of Livingston - Infill Sidewalks Pro1ect Location Map Scope Gouveia Engineering, Inc. • 456 Sixth Street • Gustine, California 95322 • (209) 854-3300 AGENDA ITEM:
MEETING DATE:
PREPARED BY:
REVIEWED BY:
STAFF REPORT
Fiscal Year (FY) 2020/21 Financial Statements
December 20, 2022
Jennifer Riedeman, Finance Director/ Acting City Manager Jennifer Riedeman, Finance Director/Acting City Manager RECOMMENDATION:
City Council accept the City of Livingston Independent Auditor's Report and Financial Statements dated June 30, 2021, City of Livingston Independent Auditor's Report and Financial Statements dated June 30, 2021, and Management Report for Year Ended June 30, 2021.
BACKGROUND:
State law requires that all general-purpose local governments publish a complete set of financial statements presented in conformity with generally accepted accounting principles (GAAP) and audited in accordance with generally accepted auditing standards by a firm of licensed Certified Public Accountants.
Pursuant to that requirement, staff hereby submits the Annual Independent Auditor's Report and Financial Statements for the period ending June 30, 2021.
DISCUSSION:
I am pleased to report that the audit report was an unqualified (clean) audit opinion. However, as indicated on the Schedule of Findings and Questioned Costs on page 75, there was a Finding of Material Weakness related to the recording of Capital Assets. Per the Management's Response and Corrective Action section, the Finance Department acknowledged the error and will reconcile Fixed Assets periodically going forward.
Copies of the Fiscal Year 2020/21 audited financial statements for the general City audit and Management Report as prepared by Lance, Soll & Lunghard, LLP have been provided for your review.
Staff recommends that the City Council ask any questions or address concerns they may have regarding the reports or the financial status of the City.
FISCAL IMP ACT:
Audit fee of $38,920 per previously approved contract with Lance, Soll & Lunghard, LLP (budgeted expenditure).
ATTACHMENTS:
I. City of Livingston - Independent Auditor's Report and Financial Statements dated June 30, 2021.
2. City of Livingston-Management Report for Year Ended June 30, 2021. 1 &,7<2)/,9,1*6721&$/,)251,$
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Lance, Soll & Lunghard, LLP 2151 River Plaza Dr., Suite 150 Sacramento ,CA95833 Phone: 916.503.9691 INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and Members of the City Council
City of Livingston, California
Report on the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of City of Livingston, California, (the City) as of and for the year ended June 30, 2021, 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, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2021, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of 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 date of the financial statements.
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To the Honorable Mayor and Members of the City Council
City of Livingston, California
Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if, there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with GAAS and Government Auditing Standards, we:
Exercise professional judgment and maintain professional skepticism throughout the audit. Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed. Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Other Reporting Responsibilities
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the budgetary comparison schedules for the general fund and major special revenue funds, the schedule of proportionate share of the net pension liability, the schedule of plan contributions, the schedule of changes in the net OPEB liability and related ratios, and the schedule of OPEB plan contributions, be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. 2 Ls~ ....
•••• ••
To the Honorable Mayor and Members of the City Council
City of Livingston, California
Management has omitted the management’s discussion and analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, 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. Our opinion on the basic financial statements is not affected by this missing information.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining and individual fund financial statements, and budgetary schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual fund financial statements and schedules are the responsibility of management and were derived from and relate 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 combining and individual fund financial statements and schedules are fairly stated, in all material respects in relation to the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated November 16, 2022, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.
Sacramento, California
November 16, 2022
3 Ls~ ....
•••• ••
7+,63$*(,17(17,21$//</()7%/$1.
4 CITY OF LIVINGSTON
STATEMENT OF NET POSITION
Governmental Business-Type
Activities Activities Total
Assets
Cash and investments $ 13,926,216 $ 15,313,483 $ 29,239,699 Receivables:
Accounts (net of allowance for uncollectibles) 221,426 888,865 1,110,291 Notes and loans 1,122,680 - 1,122,680
Prepaid costs - 42,275 42,275
Due from other governments 1,049,505 240,552 1,290,057
Restricted assets:
Cash with fiscal agent 829,165 319,702 1,148,867
Capital assets not being depreciated 5,581,924 7,544,972 13,126,896 Capital assets, net of depreciation 11,576,654 21,688,782 33,265,436 Total Assets 34,307,570 46,038,631 80,346,201
Deferred Outflows of Resources
Deferred charge on refunding - 47,013 47,013
Deferred pension outflows 1,355,318 425,473 1,780,791
Deferred OPEB outflows 537,968 168,951 706,919
Total Deferred Outflows of Resources 1,893,286 641,437 2,534,723 Liabilities
Accounts payable 436,789 376,196 812,985
Accrued expenses 160,752 - 160,752
Accrued interest 28,833 8,612 37,445
Deposits payable 594,794 89,487 684,281
Long-term liabilitites
Compensated absences due within one year 54,426 15,946 70,373 Bonds, notes, and capital leases due within one year 130,834 342,193 473,027 Compensated absences due in more than one year 489,836 143,517 633,353 Bonds, notes, and capital leases due in more than one year 2,065,117 11,102,196 13,167,313 Net pension liability 5,704,367 1,114,830 6,819,197
Net OPEB liability 1,931,361 606,564 2,537,925
Total Liabilities 11,597,109 13,799,541 25,396,650
Deferred Inflows of Resources
Deferred pension inflows 186,846 58,683 245,529
Deferred OPEB inflows 206,553 64,870 271,423
Total Deferred Inflows of Resources 393,399 123,553 516,952 Net Position
Net investment in capital assets 14,962,627 17,836,378 32,799,005 Restricted for:
Capital improvement projects 3,988,127 10,178,457 14,166,584 Circulation improvement projects 3,147,580 - 3,147,580
Lighting, landscape & park maintenance 2,788,758 - 2,788,758 Public safety programs 183,431 - 183,431
Low-income housing activities 342,223 - 342,223
Debt service - 78,778 78,778
Unrestricted (deficit) (1,202,398) 4,663,361 3,460,963
Total Net Position $ 24,210,348 $ 32,756,974 $ 56,967,322 JUNE 30, 2021
Primary Government
See Notes to Financial Statement.
5 CITY OF LIVINGSTON
STATEMENT OF ACTIVITIES
YEAR ENDED JUNE 30, 2021
Operating Capital
Charges for Contributions Contributions
Expenses Services and Grants and Grants
Functions/Programs
Primary Government:
Governmental Activities:
General government $ 1,220,210 $ - $ 420,996 $ -
Public safety 4,029,481 45,927 388,115 -
Planning and community development 839,406 827,274 551,905 - Parks and community services 779,031 - - -
Public works 1,683,890 21,509 1,633,154 1,924,207
Interest on long-term debt 94,343 - - -
Total Governmental Activities 8,646,361 894,710 2,994,170 1,924,207 Business-Type Activities:
Water 2,664,162 4,661,665 - -
Sanitation 1,515,952 1,532,177 - -
Domestic Waste Water 1,872,781 2,243,638 - -
Industrial Waste Water 600 - - -
Total Business-Type Activities 6,053,495 8,437,480 - -
Total Primary Government $ 14,699,856 $ 9,332,190 $ 2,994,170 $ 1,924,207 General Revenues:
Taxes:
Property taxes, levied for general purpose
Transient occupancy taxes
Sales taxes
Franchise taxes
Business licenses taxes
Utility users tax
Other taxes & assessments
Motor vehicle in lieu - unrestricted
Use of money and property
Other
Contribution to permanent fund
Gain on sale of capital asset
Total General Revenues
Change in Net Position
Net Position at Beginning of Year
Restatement of Net Position
Net Position at End of Year
Program Revenues
See Notes to Financial Statement.
6 Net (Expenses) Revenues and Changes in Net Position
Primary Government
Governmental Business-Type
Activities Activities Total
$ (799,214) $ - $ (799,214)
(3,595,439) - (3,595,439)
539,773 - 539,773
(779,031) - (779,031)
1,894,980 - 1,894,980
(94,343) - (94,343)
(2,833,274) - (2,833,274)
- 1,997,503 1,997,503
- 16,225 16,225
- 370,857 370,857
- (600) (600)
- 2,383,985 2,383,985
(2,833,274) 2,383,985 (449,289)
3,935,218 - 3,935,218
136,331 - 136,331
1,580,870 - 1,580,870
373,581 - 373,581
123,691 - 123,691
- - -
- - -
- - -
108,498 71,564 180,062
36,277 580,827 617,104
- - -
165,000 4,200 169,200
6,459,466 656,591 7,116,057
3,626,192 3,040,576 6,666,768
20,516,571 28,565,603 49,082,174
67,585 1,150,795 1,218,380
$ 24,210,348 $ 32,756,974 $ 56,967,322
See Notes to Financial Statement.
7 CITY OF LIVINGSTON
BALANCE SHEET
GOVERNMENTAL FUNDS
JUNE 30, 2021
Non-Major
Governmental
General Funds
Assets
Cash and investments $ 4,482,178 $ 251,047 $ 3,245,717 5,947,274 Accounts and interest receivable 60,199 25,262 1,425 134,540 Due from other governments 438,646 65,914 16,106 528,839 Notes and loans receivable 1,973 1,120,707 - -
Restricted assets:
Cash and investments with fiscal agents - - - 829,165
Total Assets $ 4,982,996 $ 1,462,930 $ 3,263,248 $ 7,439,818 Liabilities, Deferred Inflows of Resources,
and Fund Balances
Liabilities
Accounts payable $ 290,255 $ - $ 25,854 $ 120,680
Accrued expenses 160,752 - - -
Accrued interest payable 28,833 - - -
Deposits payable 146,158 - 448,636 -
Total Liabilities 625,998 - 474,490 120,680
Deferred Inflows of Resources
Unavailable revenues - 1,120,707 - -
Total Deferred Inflows of Resources - 1,120,707 - -
Fund Balances
Nonspendable:
Notes and loans receivable 1,973 - - -
Restricted for:
Capital improvement projects - - - 3,988,127
Circulation improvement projects - - - 3,147,580
Lighting, landscape & park maintenance - - 2,788,758 -
Public safety programs - - - 183,431
Low-income housing activities - 342,223 - -
Unassigned 4,355,025 - - -
Total Fund Balances 4,356,998 342,223 2,788,758 7,319,138 Total Liabilities, Deferred Inflows of
Resources, and Fund Balances $ 4,982,996 $ 1,462,930 $ 3,263,248 $ 7,439,818 Program Income
Miscellaneous
Districts
Special Revenue Funds
See Notes to Financial Statements.
8 CITY OF LIVINGSTON
BALANCE SHEET
GOVERNMENTAL FUNDS
JUNE 30, 2021
Assets
Cash and investments
Accounts and interest receivable
Due from other governments
Notes and loans receivable
Restricted assets:
Cash and investments with fiscal agents
Total Assets
Liabilities, Deferred Inflows of Resources,
and Fund Balances
Liabilities
Accounts payable
Accrued expenses
Accrued interest payable
Deposits payable
Total Liabilities
Deferred Inflows of Resources
Unavailable revenues
Total Deferred Inflows of Resources
Fund Balances
Nonspendable:
Notes and loans receivable
Restricted for:
Capital improvement projects
Circulation improvement projects
Lighting, landscape & park maintenance
Public safety programs
Low-income housing activities
Unassigned
Total Fund Balances
Total Liabilities, Deferred Inflows of
Resources, and Fund Balances
Total
Governmental
Funds
$ 13,926,216
221,426
1,049,505
1,122,680
829,165
$ 17,148,992
$ 436,789
160,752
28,833
594,794
1,221,168
1,120,707
1,120,707
1,973
3,988,127
3,147,580
2,788,758
183,431
342,223
4,355,025
14,807,117
$ 17,148,992
See Notes to Financial Statements.
9 THIS PAGE INTENTIONALLY LEFT BLANK
10 CITY OF LIVINGSTON
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET POSITION
JUNE 30, 2021
Fund balances of governmental funds $ 14,807,117
Amounts reported for governmental activities in the statement of net position are different because:
Capital assets net of depreciation have not been included as financial resources in governmental fund activity. 17,158,578
Long-term liabilities are not due and payable in the current period and, therefore, are not Capital leases payable and other bond obligations $ (2,195,951) Net pension liability (5,704,367)
Net OPEB liabilities (1,931,361)
Compensated absences (544,262) (10,375,941)
Deferred outflows related to the net pension liability 1,355,318 Deferred inflows related to the net pension liability (186,846) Deferred outflows related to the net OPEB liability 537,968 Deferred inflows related to the net OPEB liability (206,553) 1,499,887 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. 1,120,707
Net Position of Governmental Activities $ 24,210,348
reported in the funds. The details of this $10,375,941 difference is as follows:
See Notes to Financial Statement.
11 12
CITY OF LIVINGSTON
STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
YEAR ENDED JUNE 30, 2021
Seecial Revenue Funds
Non-Major
Program Miscellaneous Governmental
General Income Districts Funds
Revenues
Taxes $ 6,149,691 $ $ $
Development impact fees 492,008
Licenses and permits 511,771
Intergovernmental 650,300 244,673 2,272,418
Charges for services 211,253
Use of money and property 45,242 24,177 10,783 28,296
Fines and forfeitures 32,298
Maintenance assessments 1,617,794
Other 31,939 96 3,747 495
Total Revenues 7,632,494 268,946 1,632,324 2,793,217
Expenditures
Current:
General government 1,030,675
Public safety 3,583,788 120,501
Planning and community development 662,933 25,603 149,045 Parks and community services 589,958
Public works 318,751 1,176,034 488,269
Capital outlay 202,179 43,647 1,574,075
Debt service:
Principal retirement 127,049
Interest and fiscal charges 30,707 63,636
Total Expenditures 6,546,040 25,603 1,219,681 2,395,526 Excess revenue over expenditures 1,086,454 243,343 412,643 397,691 Other Financing Sources (Uses)
Transfers in 20,000 121,923
Transfers out (70,313) (20,000) (51 ,610)
Proceeds from sale of capital asset 165,000
Total Other Financing Sources (Uses) {50,313) {20,000) 235,313 Net Change in Fund Balances 1,036,141 243,343 392,643 633,004 Fund Balances, Beginning of Year 3,320,857 98,880 2,396,115 6,686,134 Fund Balances, End of Year $ 4,356,998 $ 342,223 $ 2,788,758 $ 7,319,138 See Notes to Financial Statement.
13 CITY OF LIVINGSTON
STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
YEAR ENDED JUNE 30, 2021
Revenues
Taxes
Development impact fees
Licenses and permits
Intergovernmental
Charges for services
Use of money and property
Fines and forfeitures
Maintenance assessments
Other
Total Revenues
Expenditures
Current:
General government
Public safety
Planning and community development
Parks and community services
Public works
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total Expenditures
Excess revenue over expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Proceeds from sale of capital asset
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances, Beginning of Year
Fund Balances, End of Year
See Notes to Financial Statement.
Total
Governmental
Funds
$ 6,149,691
492,008
511,771
3,167,391
211 ,253
108,498
32,298
1,617,794
36,277
12,326,981
1,030,675
3,704,289
837,581
589,958
1,983,054
1,819,901
127,049
94,343
10,186,850
2,140,131
141,923
(141 ,923)
165,000
165,000
2,305,131
12,501,986
$ 14,807,117
CITY OF LIVINGSTON
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
YEAR ENDED JUNE 30, 2021
Net change in fund balances - total governmental funds $ 2,305,131 Amounts reported for governmental activities in the statement of activities are different because:
Governmental funds report capital outlays as expenditures. However, in the statement of activities, the costs of those assets is allocated over their estimated useful lives as depreciation expense. This is the amount by which depreciation exceeded capital outlay in the current period.
Capital outlay $ 2,379,931
Depreciation (562,359) 1,817,572
Repayment of capital leases is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position.
Principal repayments of capital leases 127,049
Compensated absences expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. (10,971)
Pension obligation expenses are expenditures in governmental funds, but reduce the net pension liability in the statement of net position. (407,415) OPEB obligation expenses are expenditures in governmental funds, but reduce the net OPEB liability in the statement of net position. 14,254 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. (219,428)
Change in Net Position of Governmental Activities $ 3,626,192 See Notes to Financial Statement.
14 CITY OF LIVINGSTON
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
JUNE 30, 2021
Totals
Assets
Current assets:
Cash and investments $ 12,045,683 $ 1,252,486 $ 2,015,314 $ - $ 15,313,483 Accounts and interest receivable, net 470,304 161,009 257,552 - 888,865 Prepaid costs - - 42,275 - 42,275
Due from other governments 3,407 - 237,145 - 240,552
Restricted:
Cash with fiscal agent 319,702 - - - 319,702
Total Current Assets 12,839,096 1,413,495 2,552,286 - 16,804,877 Noncurrent assets:
Advances to other funds 1,269,129 - - - 1,269,129
Property, plant and equipment,
net of allowance for depreciation 17,650,130 14,865 11,371,007 197,752 29,233,754 Total Noncurrent Assets 18,919,259 14,865 11,371,007 197,752 30,502,883 Total Assets 31,758,355 1,428,360 13,923,293 197,752 47,307,760 Deferred Outflows of Resources
Deferred charge on refunding - - 47,013 - 47,013
Deferred pension outflows 211,579 57,169 156,725 - 425,473 Deferred OPEB outflows 83,981 22,763 62,207 - 168,951
Total Deferred Outflows of Resources 295,560 79,932 265,945 - 641,437 Liabilities
Current liabilities:
Accounts payable 214,307 110,241 51,648 - 376,196
Accrued interest 8,612 - - - 8,612
Deposits payable 89,487 - - - 89,487
Accrued compensated absences 7,600 2,132 6,214 - 15,946 Bonds, notes, and capital leases 142,193 - 200,000 - 342,193 Total Current Liabilities 462,199 112,373 257,862 - 832,434 Noncurrent liabilities:
Advances to other funds - - - 1,269,129 1,269,129
Compensated absences 68,402 19,191 55,924 - 143,517
Bonds, notes, and capital leases 4,354,640 - 6,747,556 - 11,102,196 Net pension liability 554,254 150,142 410,434 - 1,114,830 Net OPEB liability 301,506 81,721 223,337 - 606,564
Total Noncurrent Liabilities 5,278,802 251,054 7,437,251 1,269,129 14,236,236 Total Liabilities 5,741,001 363,427 7,695,113 1,269,129 15,068,670 Deferred Inflows of Resources
Deferred pension inflows 29,169 7,907 21,607 - 58,683
Deferred OPEB inflows 32,244 8,740 23,886 - 64,870
Total Deferred Inflows of Resources 61,413 16,647 45,493 - 123,553 Net Position
Net investment in capital assets 13,153,297 14,865 4,470,464 197,752 17,836,378 Restricted for capital improvements projects 4,228,061 29,434 5,920,962 - 10,178,457 Restricted for debt service 78,778 - - - 78,778
Unrestricted (deficit) 8,791,365 1,083,919 (3,942,794) (1,269,129) 4,663,361 Total Net Position $ 26,251,501 $ 1,128,218 $ 6,448,632 $ (1,071,377) $ 32,756,974 Business-Type Activities - Enterprise Funds
Water Sanitation
Domestic
Waste Water
Industrial
Waste Water
See Notes to Financial Statements.
15 CITY OF LIVINGSTON
STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET POSITION
PROPRIETARY FUNDS
YEAR ENDED JUNE 30, 2021
Totals
Operating Revenues
Charges for services $ 4,661,665 $ 1,532,177 $ 2,243,638 $ - $ 8,437,480 Other income 136,367 30 444,430 - 580,827
Total Operating Revenues 4,798,032 1,532,207 2,688,068 - 9,018,307 Operating Expenses
Administration and general 769,579 221,737 638,629 - 1,629,945 Services and supplies 1,347,233 1,292,184 646,087 - 3,285,504 Depreciation expense 483,469 2,031 415,174 600 901,274
Total Operating Expenses 2,600,281 1,515,952 1,699,890 600 5,816,723 Operating income (loss) 2,197,751 16,255 988,178 (600) 3,201,584 Nonoperating Revenues (Expenses)
Interest revenue 43,034 3,659 24,871 - 71,564
Interest expense (63,881) - (172,891) - (236,772)
Gain on disposal of capital assets 4,200 - - - 4,200
Total Nonoperating
Revenues (Expenses) (16,647) 3,659 (148,020) - (161,008) Change in Net Position 2,181,104 19,914 840,158 (600) 3,040,576 Net Position
Beginning of Year, as
previously reported 22,919,553 1,108,304 5,608,770 (1,071,024) 28,565,603 Restatements 1,150,844 - (296) 247 1,150,795
Beginning of Year, as restated 24,070,397 1,108,304 5,608,474 (1,070,777) 29,716,398 End of Year $ 26,251,501 $ 1,128,218 $ 6,448,632 $ (1,071,377) $ 32,756,974 Business-Type Activities - Enterprise Funds
Water Sanitation
Domestic
Waste Water
Industrial
Waste Water
See Notes to Financial Statements.
16 CITY OF LIVINGSTON
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
YEAR ENDED JUNE 30, 2021
Totals
Operating Activities
Receipts from customers and users $ 4,787,700 $ 1,523,997 $ 2,666,123 $ 8,977,820 - $ Payments to suppliers of goods and services (1,827,110) (1,271,990) (715,183) - (3,814,283) Payments to employees (819,287) (228,746) (679,516) - (1,727,549) Net Cash Provided by Operating Activities 2,141,303 23,261 1,271,424 - 3,435,988 Non-Capital Financing Activities
Payments from other governments (3,407) - (237,145) - (240,552) Net Cash Used by
Non-Capital Financing Activities (3,407) - (237,145) - (240,552) Capital and Related Financing Activities
Purchase of property, plant and equipment (2,215,555) - (94,537) - (2,310,092) Proceeds from the issuance of long-term debt 2,768,518 - - - 2,768,518 Proceeds from the sale of capital assets 10,200 - - - 10,200 Principal paid on long-term debt (97,984) - (195,000) - (292,984) Interest paid on long-term debt (63,995) - (213,124) - (277,119) Net Cash Provided (Used) by
Capital and Related Financing Activities 401,184 - (502,661) - (101,477) Investing Activities
Interest received 43,034 3,659 24,871 - 71,564
Net Cash Provided by Investing Activities 43,034 3,659 24,871 - 71,564 Net Increase in Cash
and Cash Equivalents 2,582,114 26,920 556,489 - 3,165,523 Cash and Cash Equivalents at Beginning of Year 9,783,271 1,225,566 1,458,825 - 12,467,662 Cash and Cash Equivalents at End of Year $ 12,365,385 $ 1,252,486 $ 2,015,314 $ 15,633,185 - $ Cash Flows from Operating Activities
Operating income (loss) $ 16,255 2,197,751 $ 988,178 $ (600) $ $ 3,201,584 Adjustments to reconcile operating income (loss)
net cash provided by operating activities:
Depreciation 483,469 2,031 415,174 600 901,274
(Increase) decrease in accounts receivable 16,320 (8,210) (21,945) - (13,835) Increase in deferred outflows of resources (136,032) (36,698) (100,796) - (273,526) Increase in prepaid costs - - (42,275) - (42,275)
Increase (decrease) in accounts payable and accrued liabilities (511,353) 11,678 (52,624) - (552,299) Decrease in deposits payable (26,652) - - - (26,652)
Increase in compensated absences 12,578 9,743 7,757 - 30,078 Increase in deferred inflows of resources 15,563 4,222 11,541 - 31,326 Increase in net OPEB liability 17,340 4,700 12,844 - 34,884 Increase in net pension liability 72,319 19,540 53,570 - 145,429 Total Adjustments (56,448) 7,006 283,246 600 234,404
Net Cash Provided (Used) by
Operating Activities $ 2,141,303 $ 23,261 $ 1,271,424 $ 3,435,988 - $ Water Sanitation
Domestic
Waste Water
Industrial
Waste Water
Business-Type Activities - Enterprise Funds
See Notes to Financial Statements.
17 7+,63$*(,17(17,21$//</()7%/$1.
18 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 1: Summary of Significant Accounting Policies
The financial statements of the City of Livingston (the City) have been prepared in conformity with Accounting Principles Generally Accepted in the United States of America (GAAP) as applicable to governmental entities. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The following sections further describe the significant accounting policies of the City.
Reporting Entity
The City operates under a Council-Manager form of government. The City's major operations include public safety; highways and streets; water, sewer, and refuse collection; parks and recreation; building inspection; public improvements; planning and zoning, and general administrative services.
Basis of Presentation – Fund Accounting
Government-Wide Financial Statements - The Government-Wide Financial Statements (the Statement of Net Position and the Statement of Activities) report information of all of the nonfiduciary activities of the government. Eliminations have been made to minimize the double counting of internal activities. These statements distinguish between the governmental and business-type activities of the City. Governmental activities, which normally are supported by taxes and inter-governmental revenues, are reported separately from business-type activities, which rely significantly on fees charged to external parties.
The Statement of Activities presents a comparison between direct expenses and program revenues for each segment of the business-type activities of the City and for each function of the City’s governmental activities. Direct expenses are those that are specifically associated with a program or function and are clearly identifiable to a particular function.
Program revenues include 1) charges paid by the recipients of goods or services offered by the programs and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues.
Net position is restricted when constraints placed on them are either externally imposed or are imposed by constitutional provisions or enabling legislation. Internally imposed designations of resources are not presented as restricted net position. When both restricted and unrestricted resources are available for use, generally, it is the City’s policy to use restricted resources first, then unrestricted resources as they are needed.
Fund Financial Statements - The Governmental Fund Financial Statements provide information about the City’s funds. Separate statements for each fund category - governmental and proprietary - are presented. The emphasis of fund financial statements is on major governmental and enterprise funds, each displayed in a separate column. All remaining governmental funds are separately aggregated and reported as non-major funds.
Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values.
Non-operating revenues, such as subsidies and investment earnings, result from non-exchange transactions or ancillary activities.
19 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 1: Summary of Significant Accounting Policies (Continued) The City reports the following major governmental funds:
General Fund – The General Fund is the general operating fund of the City. It is used for all financial resources except those required legally, or by sound financial management to be accounted for in another fund. Generally, the General Fund is used to account for those traditional governmental services of the City, such as police and fire protection, public works, parks and recreation, community development, planning and general administrative services.
Program Income Fund - The Program Income Fund is to account for loan repayments received from low to moderate income home loans.
Maintenance Districts Fund - The Maintenance Districts Fund is to account for maintenance assessments collected for operation and maintenance of special assessment districts within the City’s jurisdiction.
The City reports the following major enterprise funds:
Water Fund – The Water Fund accounts for the operation and maintenance of the City’s water treatment and water transmission and distribution systems.
Sanitation Fund – The Sanitation Fund accounts for the operation and maintenance of the City’s sanitation system.
Domestic Waste Water Fund – The Domestic Waste Water Fund accounts for the operation and maintenance of the City’s sewer system.
Industrial Waste Water Fund – The Industrial Waste Water Fund accounts for the operation and maintenance of the City’s industrial specific sewer system.
The Government-Wide and Proprietary Fund Financial Statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the City gives (or receives) value without directly receiving (or giving) equal value in exchange, include property and sales taxes, grants, entitlements and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenues from sales tax are recognized when the underlying transactions take place. Revenues from grants, entitlements and donations are recognized in the fiscal year in which all eligible requirements have been satisfied.
Governmental Funds are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available. Property and sales taxes, interest, certain state and federal grants and charges for services are accrued when their receipt occurs within sixty days after the end of the accounting period so as to be both measurable and available.
Expenditures are generally recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences, claims and judgments are recorded only when payment is due.
General capital asset acquisitions are reported as expenditures in governmental funds.
Proceeds of general long-term debt and capital leases are reported as other financing sources.
20 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 1: Summary of Significant Accounting Policies (Continued) Proprietary Funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a Proprietary Fund’s principal ongoing operations. Revenues and expenses not meeting this definition are reported as non-operating.
Financial Statement Amounts
Cash and Cash Equivalents - Cash and cash equivalents represent the City's cash bank accounts including, but not limited to, certificates of deposit, money market funds and cash management pools for reporting purposes in the Statement of Cash Flows. Additionally, investments with maturities of three months or less when purchased are included as cash equivalents in the Statement of Cash Flows.
The City maintains a cash and investment pool that is available for use by all funds. Interest earnings as a result of this pooling are distributed to the appropriate funds based on month end cash balances in each fund.
Investments of the pool include only those investments authorized by the California Government Code such as, United States Treasury securities, agencies guaranteed by the United States Government, registered state warrants, and other investments. Investments primarily consist of deposits in the State of California Local Agency Investment Fund. Investments are recorded at amortized cost or fair value. Fair value is based upon quoted market prices.
Accounts Receivable – Billed, but unpaid, services provided to individuals or non-governmental entities are recorded as accounts receivable. The Proprietary Funds include a year-end accrual for services through the end of the fiscal year which have not yet been billed. Accounts receivable are reported net of an allowance for uncollectibles.
Merced County is responsible for the assessment, collection and apportionment of property taxes for all taxing jurisdictions. Property taxes are levied in equal installments on November 1 and February 1. They become delinquent on December 10 and April 10, respectively. The lien date is January 1 of each year. Property taxes are accounted for in the General Fund.
Property tax revenues are recognized when they become measurable and available to finance current liabilities. The City considers property taxes as available if they are collected within 60 days after year end. Property tax on the unsecured roll are due on July 1 and become delinquent if unpaid on August 31. However, unsecured property taxes are not susceptible to year end accrual.
Interfund Receivables/Payables - Items classified as interfund receivable/payable represent short-term lending/borrowing transactions between funds. This classification also includes the current portion of an advance to or from another fund.
Advances To/From Other Funds - This classification represents non-current portions of any long-term lending/borrowing transactions between funds. This amount will be equally offset by a reserve of fund balance which indicates that it does not represent available financial resources and therefore, is not available for appropriation. The current portion of any interfund long-term loan (advance) is included as an interfund receivable/payable. 21 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 1: Summary of Significant Accounting Policies (Continued) Capital Assets - Capital outlays are recorded as expenditures of the General, Special Revenue, and Capital Projects Funds and as assets in the Government-Wide Financial Statements to the extent the City’s capitalization threshold is met.
Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items), are reported in the applicable governmental or business-type activities column in the Government-Wide Financial Statements. Capital assets are defined by the government as assets with an initial individual cost of more than $5,000 and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. Betterments and major improvements which significantly increase values, change capacities or extend useful lives are capitalized.
Upon sale or retirement of fixed assets, the cost and related accumulated depreciation are removed from the respective accounts and any resulting gain or loss is included in the results of operations.
Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business-type activities are included as part of the capitalized value of the assets constructed.
Property, plant, and equipment of the primary government, as well as the component units, are depreciated using the straight line method over the following estimated useful lives:
Years
Infrastructure 10 - 40
Buildings and structures 15 - 20
Improvement other than buildings 15
Machinery and equipment 5
Compensated Absences – Accumulated unpaid compensated absences (vacation, compensatory time and sick leave) are accrued as a liability and reported on the government-wide financial statements as long-term debt.
Payment of unpaid amounts are reported in the fund from which the employees who have accumulated leave are paid.
Deposits – Deposits principally consist of amounts collected from developers for services to be rendered by the City, including engineering, plan checks and inspections and planning review services. The City recognizes such amounts deposited as revenue when the services are performed and the corresponding expenditures are incurred.
Long-Term Obligations - In the Government-Wide Financial Statements and in the Proprietary Fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or Proprietary Fund Type Statement of Net Position. Debt principal payments of both government and business-type activities are reported as decreases in the balance of the 22 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 1: Summary of Significant Accounting Policies (Continued) liability on the Statement of Net Position. Bond premiums and discounts are deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount.
In the fund financial statements, debt principal payments of Governmental Funds are recognized as expenditures when paid. Governmental Fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.
Pension – 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 Employee Retirement System (CalPERS) plan and additions to/deduction 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.
Non-Current Governmental Assets/Liabilities - GASB Statement No. 34 eliminates the presentation of account groups, but provides for these records to be maintained and incorporates the information into the Governmental Activities column in the Government-Wide Statement of Net Position.
Net Position/Fund Balance - The government-wide and business-type activities financial statements utilize a net position presentation. Net position is categorized as net investment in capital assets, restricted and unrestricted.
Net Investment in Capital Assets - This category groups all capital assets, including infrastructure, into one component of net position. Accumulated depreciation and the outstanding balances of debt that are attributable to the acquisition, construction or improvement of these assets reduce the balance in this category. Restricted Net Position - This category presents external restrictions on net position imposed by creditors, grantors, contributors, laws or regulations of other governments and restrictions imposed by law through constitutional provisions or enabling legislation. Unrestricted Net Position - This category represents net position of the City not restricted for any project or other purpose.
Fund Balance – In the fund financial statements, governmental fund balance is made up of the following components:
Nonspendable fund balance typically includes inventories, prepaid items, long-term portion of loans receivable and other items that must be maintained intact pursuant to legal or contractual requirements, such as endowments.
Restricted fund balance category includes amounts that can be spent only for specific purposes imposed by creditors, grantors, contributors, or laws or regulations of other governments or through enabling legislations.
23 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 1: Summary of Significant Accounting Policies (Continued) Committed fund balance classification includes amounts that can be used only for the specific purposes determined by a formal action of the City Council. The City Council has the authority to establish, modify, or rescind a fund balance commitment. Assigned fund balance are amounts designated by the City Council for specific purposes and do not meet the criteria to be classified as restricted or committed. Unassigned fund balance is the residual classification that includes all spendable amounts in the General Fund not contained in other classifications.
When expenditures are incurred for purposes for which both restricted and unrestricted (committed, assigned, or unassigned) fund balances are available, the City’s policy is to apply restricted first. When expenditures are incurred for purposes for which committed, assigned, or unassigned fund balances are available, the City’s policy is to apply committed fund balance first, then assigned fund balance, and finally unassigned fund balance.
Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures/expenses during the reporting period. Actual results could differ from those estimates.
Note 2: Stewardship, Compliance and Accountability
California law authorizes the City to invest in obligations of the United States Treasury, agencies and instrumentalities, certificates of deposit or time deposits in banks and savings and loan associations which are insured by the Federal Deposit Insurance Corporation.
In accordance with applicable sections of the California Government Code and the Livingston Municipal Code, the City prepares and legally adopts an annual balanced budget on a basis consistent with accounting principles generally accepted in the United States of America. Annual appropriated budgets are adopted for the General Fund, specific Special Revenue Funds, and specific Capital Projects Funds. Budget plans are adopted for Proprietary Funds. The Council holds public hearings and may add to, subtract from, or change appropriations within the revenues and reserves estimated as available.
Expenditures may not legally exceed budgeted appropriations at the fund level.
Supplementary appropriations which alter the total expenditures of any fund, or expenditures in excess of total budgeted fund appropriations, must be approved by the City Council.
All annual appropriations lapse at fiscal year end to the extent they have not been expended or encumbered.
24 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 3: Cash and Investments
The City pools all of its cash and investments except those funds required to be held by outside fiscal agents under the provisions of bond indentures. Interest income earned on pooled cash is allocated to the various funds on average cash balances. Interest income from cash investments held with fiscal agents is credited directly to the related funds.
Cash and investments as of June 30, 2021 are classified in the accompanying financial statements as follows:
Cash and Investments $ 29,239,699
Restricted: Cash with Fiscal Agents $ 1,148,867
Total Cash and Investments $ 30,388,566
Cash and investments as of June 30, 2021 consist of the following:
Cash on Hand $ 7,099
Deposits with Financial Institutions 6,994,778
Cash with Fiscal Agent 1,148,867
Local Agency Investment Fund 22,237,822
Total Cash and Investments $ 30,388,566
Investment Pool Oversight
State of California Local Agency Investment Fund (LAIF) LAIF is overseen by the Local Agency Investment Advisory Board, which consists of five members, in accordance with State statute. The State Treasurer's office audits the fund annually.
GASB Statement No. 31
The City adopted GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools, as of July 1, 1997.
GASB Statement No. 31 establishes fair value standards for investments in participating interest earning investment contracts, external investment pools, equity securities, option contracts, stock warrants and stock rights that have readily determinable fair values. Accordingly, the City reports its investments at fair value in the balance sheet. All investment income, including changes in the fair value of investments, is recognized as revenue in the operating statement. 25 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 3: Cash and Investments (Continued)
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. The City’s investment policy does not contain any specific provisions intended to limit the City’s exposure to interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by 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 Investment Type
Maximum
Maturity
Maximum
Percentage
of Portfolio
Maximum
Investment in
One Issuer
Local Agency Bonds 5 years None None
U.S. Treasury Obligations 5 years None None
U.S. Agency Securities 5 years None None
Banker's Acceptances 180 days 40% 30%
Commercial Paper 270 days 25% 10%
Negotiable Certificates for Deposits 5 years 30% None
RepurchaseAgreements 1 year None None
Reverse Repurchase Agreements 92 days 20% None
Medium Term Notes 5 years 30% None
Mutual Funds N/A 20% 10%
Money Market Mutual Funds N/A 20% 10%
Mortgage Pass-Through Securities 5 years 20% None
County Pooled Investment Funds N/A None None
Local Agency Investment Funds (LAIF) N/A None None
JPA Pools (other investment pools) N/A None None
Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates.
The City did not have any investments subject to interest rate risk for the year ended June 30, 2021.
Disclosures Relating to Credit Risk
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 by Standard & Poor’s required by the California Government Code or the City’s investment policy, and the actual rating as of June 30, 2021 for each investment type:
Not Rated:
LAIF $ 22,237,822
Cash with Fiscal Agents 1,148,867
Cash and Cash Equivalents 7,001,877
Total Cash and Investments $ 30,388,566
26 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 3: Cash and Investments (Continued)
Concentration of Credit Risk
The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. The City does not have any investments in any one issuer (other than U.S. Treasury securities, mutual funds, and external investment pools) that represent 5% or more of total City investments.
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party.
The California Government Code and the City’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits, other than the following provision for deposits: The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The market value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.
As of June 30, 2021, the carrying amount of the City’s bank deposits was $8,143,645 per books, and the respective bank balances totaled $8,634,018. Of the bank balances $250,000 is insured through the Federal Deposit Insurance Company. The remaining balance is to be collateralized by the bank.
The custodial risk for investments is the risk that, in the event of the failure of the counterparty to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the City’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for investments. With respect to investments, custodial credit risk generally applies only to direct investments in marketable securities. Custodial credit risk does not apply to a local government’s indirect investment in securities through the use of mutual funds or government investment pools (such as LAIF).
Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by the California Government Code under the oversight of the Treasurer of the State of California. The fair value of the City’s investment in this pool is reported in the accompanying 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. 27 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 4: Notes/Long-Term Receivables
City of Livingston Employee Computer Purchase Program
The City of Livingston established a program for eligible employees to acquire computers and accessories with financial assistance from the City in the form of a no interest loan repaid through automatic payroll deductions. The goal of the program is to improve organizational productivity by encouraging employees to purchase and use home computers.
Only full-time regular employees who have successfully passed their probationary period as new employees, and have no garnishments for credit or tax purposes, or similar liens in place at the time of application, are eligible to participate in this program. Contract employees may participate in this program under the following conditions: their employment contract generally extends to them the same benefits as regular employees, and the repayment period does not extend beyond their contract term.
The maximum loan amount is $3,000 per employee to be paid over a maximum of 36 months interest free. Seven employees are currently participating for a total outstanding balance as of June 30, 2021 of $1,973 due to the City. The receivable is reflected in the General Fund.
CDBG Rehab Loans
The City operates a CDBG rehabilitation loan program for the renovation of low income housing. The total balances outstanding at June 30, 2021 for the 2002-2003 loans were $196,901. These loans are reflected in the Program Income Fund.
First Time Home Buyers Down-Payment Assistance
The City operates a first time home buyers down-payment assistance loan program. The total outstanding balances at June 30, 2021 were $923,806 and are reflected in the Program Income Fund.
Note 5: Advance To and From Funds
Advances represent long-term borrowing between funds. These amounts are not expected to be repaid within the next fiscal year.
Advance To Advance From
Major Funds:
Water Fund 1,269,129 $ - $
Industrial Waste Water Fund - 1,269,129
$ 1,269,129 1,269,129 $
28 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 6: Capital Assets
Capital asset activities for the year ended June 30, 2021 were as follows:
Balance
July 1, 2020 Adjustments Transfers of CIP Additions Retirements Balance
June 30, 2021
Capital assets, not being depreciated
Land 3,485,866 $ - $ - $ - $ - $ 3, $ 485,866
Construction in progress 1,464,162 67,231 ( 146,823) - 711,488 2, 096,058 Total capital assets, not being depreciated 4,950,028 67,231 ( 146,823) - 711,488 5, 581,924 Capital assets, being depreciated
Buildings and improvements 9,705,661 8,155 - 862,872 10, - 576,688 Infrastructure 5,406,972 - 146,823 608,993 6, - 162,788 Machinery and equipment 4,578,246 (8,155) - 196,578 4, - 766,669 Total capital assets, being depreciated 19,690,879 - 146,823 1,668,443 21, - 506,145 Less accumulated depreciation for:
Buildings and improvements (4,456,302) 2,134 (265, - 453) (4, - 723,889) Infrastructure (1,229,009) (5) (115, - 242) (1, - 344,246) Machinery and equipment (3,682,175) (2,483) (181, - 664) (3, - 861,356) Total accumulated depreciation (9,367,486) (354) (562, - 359) (9, - 929,491) Total capital assets, being depreciated, net 10,323,393 354 146,823 1,106,084 11, - 576,654 Governmental activities capital assets, net $ 15,273,421 $ 67,585 $ 1, - $ 817,572 $ 17, - $ 158,578 Governmental Activities:
Capital assets, not being depreciated
Land 2,985,629 $ - $ - $ - $ 6,000 $ 2,979,629 $
Construction in progress 3,031,270 - (705,717) 2,239,790 - 4,565,343 Total capital assets, not being depreciated 6,016,899 - (705,717) 2,239,790 6,000 7,544,972 Capital assets, being depreciated
Buildings and improvements 25,000 - - - - 25,000
Infrastructure 31,239,479 1,151,768 674,986 41,945 - 33,108,178 Machinery and equipment 1,636,340 - 30,731 28,357 - 1,695,428 Total capital assets, being depreciated 32,900,819 1,151,768 705,717 70,302 - 34,828,606 Less: accumulated depreciation (12,237,577) (973) - (901,274) - (13,139,824) Total capital assets, being depreciated, net 20,663,242 1,150,795 705,717 (830,972) - 21,688,782 Business-Type activities capital assets, net 26,680,141 $ 1,150,795 $ - $ 1,408,818 $ 6,000 $ 29,233,754 Buiness-Type Activities:
Depreciation expense was charged to the following functions in the Statement of Activities:
Governmental Activities Total
General Government $ 100,057
Public Safety 96,458
Public Works 200,491
Parks and Community Services 165,353
Totals $ 562,359
29 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 6: Capital Assets (Continued)
Business Type Activities Total
Water $ 483,469
Sanitation 2,031
Domestic Sewer 415,174
Industrial Sewer 600
Totals $ 901,274
Note 7: Long-Term Debt
The City generally incurs long-term debt to finance projects or purchase assets which will have useful lives equal to or greater than the related debt.
In governmental fund types, debt discounts, premiums, and issuance costs are recognized in the current period. Debt discounts and premiums incurred in proprietary funds are deferred and amortized over the term of the debt using the bonds-outstanding method, which approximates the effective interest method. The City’s debt transactions are summarized below and discussed in detail thereafter:
Balance Balance Current
June 30, 2020 Additions Deletions June 30, 2021 Portion U.S. Bancorp Lease $ 2,323,000 $ 127,049 - $ $ 2,195,951 $ 130,834 Total Lease Payable 2,323,000 127,049 - 2,195,951 130,834 Total $ 2,323,000 $ 127,049 - $ $ 2,195,951 $ 130,834
SWRCB Water Loan $ 1,108,157 $ - $ 61,292 $ 1,046,865 $ 60,323 2016 A Sewer Refunding 6,950,000 195,000 - 6,755,000 200,000 SWRCB Water Loan 2020 144,142 2,673,189 2, - 817,331 44,174 U.S. Bancorp Lease 574,000 95,329 36,692 632,637 37,696 Total Notes, Bonds, and Lease Payable 8,776,299 2,768,518 292,984 11,251,833 342,193 Unamortized bond premiums and deferred charges 201,582 9,026 192,556 - Total Notes, Bonds Payable, Net 8,977,881 2,768,518 302,010 11,444,389 342,193 Total $ 8,977,881 $ 2,768,518 $ 302,010 $ 11,444,389 $ 342,193 Governmental Activities:
Business Type Activities:
Long-term debt payable at June 30, 2021 was comprised of the following individual issues:
U.S. Bancorp Lease – In December 2019, The City entered into a capital lease arrangement to finance energy conservation improvements on certain City properties. The lease obligation is accounted for as a capital lease where the related improvements to be acquired will become property of the City when all terms of the lease agreement are met.
The stated interest under terms of the agreement is 2.735%. Present value of the remaining payments as of June 30, 2021 is $2,828,588, the City has allocated Capital Lease proceeds of $2,195,951 to the Capital Projects Fund and $632,637 to the Water Fund, future payments are expected to be made based on this allocation. Annual debt service payments of $238,044 under the agreement start on December 6, 2020 and end on December 6, 2034. As of June 30, 2021, the City had accumulated total capital expenditures of $576,160 in Construction In Progress in the Capital Projects Fund. 30 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 7: Long-Term Debt (Continued)
SWRCB Water Loan – In December 2016, the City entered into an agreement for $1,353,245 with the State Water Resource Control Board to fund major improvements to Well #17. Principal and interest of $39,389 are paid semi-annually on January 1 and July 1 through 2036. The interest rate is 1.6%.
2016A Sewer Revenue Refunding Bonds – In October 2016, the City issued Series 2016A Sewer Revenue Refunding Bonds for the principal amount of $7,715,000. The issuance was to refund the outstanding principal balance of the Refunding Revenue Bonds described above. In addition, the proceeds of the sale of the bond were used to pay the costs of issuance. The reacquisition price exceeded the net carrying amount of the old debt by $57,298. The City refunded the above debts to reduce its total debt service over 26 years by $1,858,942 and to obtain an economic gain (difference between the present values of debt service payments on the old and new debt) of $832,214. The bonds bear interest ranging from 2.0% to 4.0% and are payable semi-annually commencing March 2017 through March 2043. Debt service is secured by a pledge of net revenues of the City’s Sewer System. The City covenants that it shall prescribe, revise and collect such charges for the services and facilities of the sewer system which shall produce revenues sufficient in each fiscal year to provide gross revenues which are sufficient to pay all sewer operation and maintenance costs and all bond installment payments and produce net sewer revenues equal to at least 1.25 times debt service coming due and payable during such fiscal year. The City is in compliance with those covenants as of June 30, 2021. Cash basis debt service paid during the fiscal year ended June 30, 2021 totaled $448,650. Total sewer system net revenues calculated in accordance with the covenants were $1,428,223 at June 30, 2021.
SWRCB Water Loan 2020 – In September 2018, The City entered into a construction installment sale arrangement, a loan in substance, with the State Water Resource Conservation Board to finance certain City water well improvements. The stated interest under terms of the arrangement is 1.8% annually. Annual debt service payments range from $801 to $38,955 under the arrangement and start on July 1, 2020 and end on July 1, 2051. As of June 30, 2021, the City had drawn a total $2,817,331 of the total loaned amount, the remaining loaned balance is expected to be drawn in October 2021. As part of the arrangement the loan is secured by a lien on and pledge of the Enterprise Fund, Net Revenues, and the Reserve Fund in priority as specified in the agreement. The City covenants that it shall prescribe, revise and collect such charges for the services and facilities of the water system which shall produce revenues sufficient in each fiscal year to provide gross revenues which are sufficient to pay all water operation and maintenance costs and all loan installment payments and produce net water revenues equal to at least 1.10 times debt service coming due and payable during such fiscal year. The City did not have any required debt service payments in the fiscal year ended June 30, 2021. 31 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 7: Long-Term Debt (Continued)
The annual requirement to amortize the principal and interest on all long-term debt at June 30, 2021, were as follows:
Years ending June 30, Principal Interest Principal Interest 2022 $ 130,834 $ 59,912 $ 342,193 $ 341,307
2023 134,412 56,342 517,230 326,848
2024 138,088 52,674 486,642 310,556
2025 141,865 48,907 472,237 295,754
2026-2030 769,692 184,309 2,597,547 1,241,734
2031-2035 881,060 73,400 3,034,607 797,535
2036-2040 - 1, - 922,843 393,440
2041-2045 - 1, - 878,534 78,637
$ 2,195,951 $ 475,544 $ 11,251,833 $ 3,785,811
Governmental Activities Business Type Activities
Note 8: Fund Balances and Net Position
Restatement of Net Position
During the fiscal year 2021 fieldwork, various adjustments to capital assets to reconcile City records to prior Annual Comprehensive Financial Reports were noted. The net impact on Net Position of these adjustments totaled $67,585 for Governmental Activities and $1,150,795 for Business-Type Activities as shown on the Statement of Activities.
Note 9: Interfund Transfers
In general, the City uses interfund transfers to (1) move revenues from the funds that collect them to the funds’ that statute or budget requires to expend them, (2) use unrestricted revenues collected in the General Fund to help finance various programs and capital projects accounted for in other funds in accordance with budgetary authorization, and (3) move cash to debt service funds from the funds responsible for payment as debt service payments become due. In general, the effect of the interfund activity has been eliminated from the government-wide financial statements.
Transfers In Transfers Out
Major Governmental Funds:
General Fund 20,000 $ 70,313 $
Maintenace District - 20,000
Nonmajor Governmental Funds:
Gas Tax Fund 70,313 -
Local Transportation - 51,610
Capital Projects Fund 51,610 -
$ 141,923 141,923 $
32 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 10: Deferred Outflows and Deferred Inflows of Resources In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. This separate financial element, deferred outflows of resources, represents a consumption of net position or fund balance that applies to future period(s) and thus, will not be recognized as an outflow of resources (expense/expenditure) until then. The City has three items to report in this category:
The City has $47,013 in deferred charges on a previous refunding of long-term debt that qualifies to be reported in deferred outflows of resources. The entirety of the deferred outflow pertains to debt activity within the Domestic Waste Water Fund. The City has $1,780,791 in pension related items that qualify to be reported in deferred outflows of resources. The pension related deferred outflows of resources are described in Note 12.
The City has $706,919 in other post-employment benefits related items that qualify to be reported in deferred outflows of resources. The pension related deferred outflows of resources are described in Note 12.
In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represent an acquisition of net position or fund balance that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City has two items to report in this category:
The City has $245,529 in pension related items that qualify to be reported in deferred inflows of resources. The pension related deferred inflows of resources are described in Note 12.
The City has $271,423 in post-employment benefits related items that qualify to be reported in deferred inflows of resources. The pension related deferred inflows of resources are described in Note 11.
Unavailable revenues arise only under a modified accrual basis of accounting and is reported only in the governmental funds balance sheet. The City has $1,120,707 in notes and loans receivable reported as deferred inflows of resources reported for unavailable revenues in the Program Income Fund. See Note 4 for details.
Note 11: Post-Employment Health Care Benefits Plan Description – Single Employer For all employees employed by the City as of July 1, 1989 who retire from the City’s employment under the California Public Employee’s Retirement System (CalPERS) currently in effect other than disability retirement, the City will continue to pay the premiums for health and dental care coverage in an amount equal to the amount paid if the employee was still employed by the City. In disability cases, dependent medical and dental coverage will continue until death of the retired employee or until dependents no longer are qualified as dependents under the current medical and dental plan.
Employees hired after July 1, 1989 (clerical and public works bargaining units only), shall enjoy City paid post-retirement health benefits as follows (a) employee must have been continuously employed by the City for twenty years (disruptions in service due to lay-offs are 33 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 11: Post-Employment Health Care Benefits (Continued) exempted), (b) post-retirement health insurance for employee only shall be limited to the actual cost of insurance, not to exceed $300 per month, (c) disability retirement will be as if employee met the twenty year employment requirement described above and (d) at age sixty-five, Medicare shall become the retired employee’s primary insurance.
Employees Covered
Membership in the plan consisted of the following at June 30, 2020, the date of the latest actuarial valuation:
Number of active plan members 47
Number of inactive plan members currently receiving benefits 11 Number of inactive plan members entitled to but not receiving benefits - Total 58
Contributions
The contribution requirements of plan members and the City are established and may be amended by the City. The City determines the required contributions using the Entry Age Normal Cost Method. The required contribution is based on projected pay-as-you-go financing requirements.
Long Term Expected Rate of Return
The expected long-term return on trust assets was derived from published information by CalPERS. CalPERS expectations are summarized in the chart below:
Years 1-10 Years 11+
Target
Allocation
Expected Real
Rate of Return*
Expected Real
Rate of Return*
Global Equity 59% 4.80% 5.98%
Fixed Income 25% 1.10% 2.62%
Global Real Estate (REITs) 8% 3.20% 5.00%
Treasury Inflation Protected Securities 5% 0.25% 1.46%
Commodities 3% 1.50% 2.87%
Total 100%
CERBT Strategy 1
*Real rates of return come from a geometric representation of returns that assume a general inflation rate of 2.00%
Asset Classification
Currently, CalPERS’ expected returns are split for years 1-10 and years 11 and thereafter.
To derive the expected return for the City of Livingston, plan benefits were projected in each future year. Then applying the plan specific benefit payments to CalPERSs bifurcated return expectations, the single equivalent long term rate of return was determined to be 6.45%.
This rate was used as the discount rate for liabilities for financial statement reporting.
Actuarial Assumptions
The City’s net OPEB liability was measured as of June 30, 2020, and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation date as of June 30, 2020.
34 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 11: Post-Employment Health Care Benefits (Continued) June 30, 2020
June 30, 2020
Entry - Age Normal Cost, level of percent pay
Market value of assets
Long-term Return on Assets 6.45% as of June 30, 2020 and 6.50% as of June 30, 2019, net of plan investment expenses.
Discount Rates 6.35% as of June 30, 2020 and 6.50% as of June 30, 2019.
Participant Valued
Salary Increase
Assumed Wage Inflation
General Inflation Rate 2.5% per year
Mortality Improvement
Healthcare Trend
Measurement Date
Valuation Date
Actuarial Cost Method
Asset Valuation Method
Medical plan premiums and claims costs by age
are assumed to increase once each year.
Increases over the prior year's levels are assumed
to be effective on the dates shown below:
Only current active employees and retired
participants and covered dependents are valued.
No future entrants are considered in this valuation.
3.0% per year; since benefits do not depend on
salary, this is used only to allocate the cost of
benefits between service years.
3.0% per year; used to determine amortization
payments if developed on a level percent of pay
basis.
MacLeod Watts Scale 2020 applied
generationnally
Dental premiums are assumed to increase by
4.5% annually
5.40%
Effective Jan1,
2021
2022
2023
2024
2025 & later
Premium Increase
Actual
6.00%
5.80%
5.60%
35 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 11: Post-Employment Health Care Benefits (Continued) Changes in the Net OPEB Liability
Total OPEB
Liability (a)
Plan Fiduciary
Net Position
(b)
Net OPEB
Liability/Asset
(a) - (b) = (c)
$ 2,618,087 $ 226,121 $ 2,391,966
17,287 - 17,287
164,230 164,230 -
Differences between expeccted and actual experience (276,572) (276,572) - Changes of assumptions 466,400 466,400 -
217,510 - (217,510)
- 7,986 (7,986)
(217,510) (217,510) -
- (110) 110
153,835 7,876 145,959
Balance at June 30, 2021 $ 2,771,922 $ 233,997 $ 2,537,925 Benefit Payments
Contribution - Employer
Net Investment Income
Administrative Expenses
Net Changes
Increase (Decrease)
Balance at June 30, 2020
Change in the Year:
Service Cost
Interest
The only assumption change reflected during this period is the change in the discount rates as required by GASB 75.
Sensitivity of the City’s Net OPEB Liability to Changes in the Discount Rate The following presents the net OPEB liability of the City, as well as what the net OPEB liability would be if it were calculated using a discount rate that is 1 percentage-point lower or 1 percentage-point higher than the current rate:
1% Decrease
4.00%
Current
Discount
5.00%
1% Increase
6.00%
Net OPEB Liability 2,801,345 $ $ 2,537,925 $ 2,308,759
Sensitivity of the City’s Net OPEB Liability to Changes in the Healthcare Cost Trend Rates
The following presents the net OPEB liability of the City, as well as what the net OPEB liability would be if it were calculated using a healthcare cost trend rate that is 1 percentage-point lower or 1 percentage- point higher than the current rate:
Current Trend
-1% Current Trend
Current Trend
+1%
Net OPEB Liability 2,310,396 $ 2,537,925 $ 2,797,981 $
Healthcare cost trend rate was assumed to start at 8.0% (effective January 1, 2009) and grade down to 5% for years 2025 and thereafter.
36 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 11: Post-Employment Health Care Benefits (Continued) Outflows/Inflows Related to OPEB
For the year ended June 30, 2021, the City recognized OPEB expense of $222,020. At June 30, 2021, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:
Deferred
Outflows of
Resources
Deferred Inflows
of Resources
$ 20,869 422,524 $
250,554 67,478
- 2,386
- 214,531
Total 706,919 $ 271,423 $
Differences between expected and actual experience
Changes of Assumptions
Net Difference Between Projected and Actual
Deferred Contributions
The City will recognize the deferred contributions in the next fiscal year. In addition, future recognition of these deferred resources is shown below:
Year Ended
June 30:
2022 24,362 $
2023 24,364
2024 23,594
2025 25,098
2026 23,758
Thereafter 99,789
Total 220,965 $
Note 12: Pension Plan
Plan Description - The City contributes to the California Public Employees' Retirement System (PERS), an agent multiple-employer public employee defined benefit pension plan.
PERS provides retirement and disability benefits, annual cost-of-living adjustments and death benefits to plan members and beneficiaries. PERS acts as a common investment and administrative agent for participating public entities within the State of California. Benefit provisions and all other requirements are established by state statute and city ordinance.
Copies of PERS' annual financial report may be obtained from their Executive Office - 400 P Street - Sacramento, CA 95814.
All full-time employees are eligible to participate in the Plan. Part-time employees appointed to a term of one year or longer and who work an average of 20 hours per week are also eligible to participate. Other part-time non-benefited hourly employees do not participate in the Plan. Related benefits vest after five years of service. Upon five years of service, employees who retire at or after age 55 are entitled to receive an annual retirement benefit.
Funding Policy – Management, clerical, and public works plan members in the Classic Miscellaneous Plan are required to contribute 6% of their covered salary, which is covered by the City. On behalf of Livingston Police Officers Association and Supervisory Unit Classic Safety and Miscellaneous plan members, the City contributes 2% of the 6%. PEPRA employees contribute their portion. The City is required to contribute the actuarially determined remaining amounts necessary to fund the benefits for 37 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 12: Pension Plan (Continued)
its members. The actuarial methods and assumptions used are those adopted by the CalPERS Board of Administration. The contribution requirements of plan members is established by State statute and the employer contribution is established and may be amended by PERS.
The Plans’ provisions and benefits in effect at June 30, 2021, are summarized as follows:
Safety - Classic Miscellaneous - Classic
Hire Date Prior to January 1, 2013 Prior to January 1, 2013 5 years of service 5 years of service
Monthly For Life Monthly For Life
55 55
2.00% 2.00%
6.94% 6.91%
15.662% 11.031%
Safety - PEPRA Miscellaneous - PEPRA
Hire Date On or After January 1, 2013 On or After January 1, 2013 5 years of service 5 years of service
Monthly For Life Monthly For Life
62 62
2.00% 2.00%
10.00% 6.75%
11.114% 7.732%
Retirement Age
Required Employee Contribution Rates
Required Employer Contribution Rates
2.00% at 55; maximum 2%
COLA
2.00% at 55; maximum 2%
COLA
Benefit Vesting Schedle
2.00% at 62; maximum 2%
COLA
2.00% at 62; maximum 2%
COLA
Monthly Benefits, as a % of Annual Salary
Benefit Formula
Benefit Vesting Schedle
Benefit Payment
Retirement Age
Required Employee Contribution Rates
Required Employer Contribution Rates
Benefit Formula
Benefit Payment
Monthly Benefits, as a % of Annual Salary
Contributions – Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on July 1 following notice of a change in the rate. Funding contributions for both Plans are determined annually on an actuarial basis as of June 30 by CalPERS. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.
38 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 12: Pension Plan (Continued)
For the year ended June 30, 2021, the contributions recognized as part of the pension expense is as follows:
Contributions - Employer $ 923,009
Contributions - Employee 854,795
Pension Liabilities, Pension Expenses, and Deferred Outflows/Inflows of Resources Related to Pensions
As of June 30, 2021, the City reported net pension liabilities for its proportionate shares of the net pension liability of each Plan as follows:
$ 4,398,717
Safety 2,420,480
Total 6,819,197 $
Miscellaneous
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, 2021, 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, 2020, rolled forward to June 30, 2021, using standard update procedures. The City’s proportion of the net pension liability was based on a projection of the City’s long-term share of contributions to the pension plans relative to the projected contributions of all participating employers, actuarially determined. The City’s proportionate share of the net pension liability for each Plan as of June 30, 2020, and 2021 was as follows:
Miscellaneous Safety
0.10129% 0.03451%
0.04043% 0.02225%
-0.06086% -0.01226%
Proportion - June 30, 2020
Proportion - June 30, 2021
Change - Increase (Decrease)
For the year ended June 30, 2021, the City recognized pension expense of $1,226,786. At June 30, 2021, the City reported deferred outflows of resources and deferred inflows of resources related to pension from the following sources:
Deferred Outflows
of Resources
Deferred Inflows of
Resources
$ - 923,009 $
(206,093) 260,308
- -
- 414,375
- 183,099
(39,436) -
Total 1,780,791 $ (245,529) $
Net Differences Between Projected and Actual Earnings
Changes in Assumptions
Pension Contributions Subsequent to Measurement Date
Differences Projected and Actual Contributions
Differences Between Projected and Actual Experience
Changes in Employer's Proportion
39 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 12: Pension Plan (Continued)
The $ 923,009 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 ended June 30, 2022. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:
Year Ended
June 30:
2022 $ 116,126
2023 229,210
2024 178,062
2025 89,035
Total $ 612,433
Actuarial Methods and Assumptions – The collective total pension liability for the June 30, 2021, measurement period was determined by an actuarial valuation as of June 30, 2020, with update procedures used to roll forward the total pension liability to June 30, 2021. The collective total pension liability was based on the following assumptions:
June 30, 2019
June 30, 2020
7.15%
2.50%
2.75%
Salary Increase Varies by Entry Age and Service
Derived using CalPERS' Membership 1
Date for all Funds
Contact COLA up to 2.75% until Purchasing Power
Protection
Allowance Floor on Purchasing Power applies
Post Retirement Benefit Increase
1 The mortality table used was developed based on CalPERS-specific data. The table includes 15 years of mortality improvements using Society of Actuaries Scale 90% of scale MP 2016. For more details on this table, please refer to the December 2017 experience study report (based on CalPERS demographic data from 1997 to 2015) that can be found on the CalPERS website.
Measurement Date
Valuation Date
Actuarial Cost Method
Actuarial Assumptions:
Discount Rate
Inflation
Entry - Age Actuarial Cost Method in accordance with
the requirements of GASB Statement No. 68
Payroll Growth
Mortality Rate Table
All other actuarial assumptions used in the June 30, 2019 valuation were based on the results of an December 2017 experience study report (based on CalPERS demographic data from 1997 to 2015), including updates to salary increase, mortality and retirement rates. The Experience Study can be obtained at CalPERS’ website. 40 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 12: Pension Plan (Continued)
Discount rate – The discount rate used to measure the total pension liability for Public Employees Retirement Fund C was 7.15%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability. The long-term expected rate of return on pension plan investments was determined using a building-block method in which best- estimate ranges of expected future real rates of return (expected rate of 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 as well as the expected pension fund cash flows. Using historical returns of all the funds’ asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The expected rate of return was then set equivalent to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses.
The long-term expected real rates of return by asset class can be found in CalPERS’ Comprehensive Annual Financial Report for the fiscal year ended June 30, 2021.
The table below reflects long-term expected real rates of return by asset class. The rate of return was calculated using the capital market assumptions applied to determine the discount rate and asset allocation. The geometric rates of return are net of administrative expenses.
New Strategic
Allocation
Real Return
Years 1-10 2
Real Return
Years 11+ 3
50.00% 4.80% 5.98%
28.00% 1.00% 2.62%
0.00% 77.00% 1.81%
8.00% 630.00% 7.23%
13.00% 3.75% 4.93%
1.00% 0.00% -0.92%
100%
3 An expected inflation of 2.92% used for this period
Liquity
Total
Real Estate
1 In the System's CAFR, Fixed Income is included in Global Debt Securities; Liquidity is included in Short-term Investments; Inflation Assets are included in both Global Equity Securities and Global Debt Securities. 2 An expected inflation of 2.0% used for this period
Asset Class 1
Global Equity
Fixed Income
Inflation Assets
Private Equity
41 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 12: Pension Plan (Continued)
Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate The following presents the City’s proportionate share of the net pension liability for each Plan, calculating using the discount rate of each Plan, as well as what the City’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.15%) or 1-percentage point higher (8.15%) than the current rate:
1% Decrease
6.15%
Current
Discount
7.15%
1% Increase
8.15%
Miscellaneous $ 6,675,104 $ 4,398,717 $ 2,517,810
Safety 3,774,106 2,420,480 1,309,702
Pension Plan Fiduciary Net Position – Detailed information about each pension plan’s fiduciary net position is available in the separately issued CalPERS financial reports.
Note 13: Risk Management
The City participates with other public entities in a joint venture under a joint powers agreement which establishes the Central San Joaquin Valley Risk Management Authority (CSJVRMA). The relationship between the City and CSJVRMA is such that CSJVRMA is not a component unit of the City for financial reporting purposes.
The CSJVRMA is a consortium of cities in the San Joaquin Valley, California. It was established under the provisions of California Government Code Section 6500, et. seq.
The CSJVRMA is governed by a Board of Directors, which meets three to four times each year, consisting of one member appointed by each member city. The day-to-day business is handled by a management group employed by the CSJVRMA. The financial statements of CSJVRMA can be obtained at 1750 Creekside Oaks Drive, Suite 200, Sacramento, California 95833.
Each member government pays a primary deposit to cover estimated losses for a fiscal year (claims year). Six months after the close of a fiscal year, outstanding claims are valued. A retrospective deposit computation is then made for each open claims year.
Costs are spread to members as follows: the first $25,000 of each occurrence is charged directly to the member. Each member maintains a $1,000,000 self- insured retention (SIR) amount covered by the Authority pooled investments. The Authority purchases excess liability coverage through the California Affiliated Risk Management Authority for the amount in excess of $1,000,000. Reinsurance coverage is purchased by the Authority through American Reinsurance for the amount in excess of $1,000,0000 up to $9,000,000 at 25% quota share. The City purchases Workers Compensation insurance through the Authority. The City maintains a $350,000 SIR with the Authority. Excess coverage is purchased by the Authority through Continental Casualty for up to $5,000,000 per accident in excess of the SIR. The City also purchases various property coverage programs. Deductibles and limits per property type can be obtained from the City Manager or directly from the Authority.
42 CITY OF LIVINGSTON
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2021
Note 13: Risk Management (Continued)
The latest audited financial information and the most current information available for CSJVRMA for fiscal year ended June 30, 2021 is as follows:
Total assets $ 150,621,596
Total liabilities 129,774,819
Net position $ 20,846,777
Total revenues $ 55,391,674
Total expenses 54,084,619
Increases/(decrease) in net position $ 1,307,055
Note 14: Contingent Liabilities
The City participates in a number of Federal and State assisted grant programs which are subject to financial and compliance audits. Audits for these programs and the respective findings are to be determined at a future date, and the City expects the amount, if any, of the expenditures which may be disallowed by the granting agency to be immaterial.
The City is a defendant in various lawsuits and claims. The City attorney anticipates that actual or potential claims against the City, not covered by insurance, would not materially affect the financial position of the City.
Note 15: Compensated Absences
As described in Note 1, under certain circumstances and accordingly to the negotiated labor agreements, City employees are allowed to accumulate annual leave. The annual leave amount is accrued and accounted for as compensated absences in the government-wide and proprietary fund statements.
As shown in the table below, the long-term portion of this debt amounts to $489,836 for governmental activities and $143,517 for business-type activities at June 30, 2021. These amounts are expected to be paid in future years from future resources. In prior years, compensated absences have been liquidated primarily by the General Fund and the proprietary funds. The total amount outstanding at June 30, 2021, was $54,426 for governmental activities and $15,946 for business-type activities.
Amounts Amounts Due
Balance Balance Due Within in More than
June 30, 2020 Incurred Satisified June 30, 2021 One Year One Year Governmental
Activities $ 533,291 $ 10,971 $ 544,262 - $ $ 54,426 $ 489,836 Business-Type
Activities $ 129,385 $ 30,078 $ 159,463 - $ $ 15,946 $ 143,517 Note 16: Subsequent Events
The City evaluated subsequent events for recognition and disclosure through September 30, 2022, the date which these financial statements were available to be issued. Management concluded that no material subsequent events have occurred since June 30, 2021 that required recognition or disclosure in such financial statements. 43 7+,63$*(,17(17,21$//</()7%/$1.
44 5(48,5('6833/(0(17$5<,1)250$7,21
45 CITY OF LIVINGSTON
BUDGETARY COMPARISON SCHEDULE
GENERAL FUND
YEAR ENDED JUNE 30, 2021
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Revenues
Taxes $ 5,503,853 6,358,166 $ 6,149,691 $ 645,838 $
Licenses and permits 207,565 492,845 511,771 18,926
Intergovernmental 3,296,346 678,797 650,300 (28,497)
Charges for services 163,340 398,543 211,253 (187,290)
Use of money and property 57,500 57,500 45,242 (12,258) Fines and forfeitures 42,500 48,125 32,298 (15,827)
Other 499,700 25,200 31,939 6,739
Total Revenues 10,625,117 7,204,863 7,632,494 427,631
Expenditures
Current:
General government 3,632,047 918,620 1,030,675 (112,055) Public safety 4,640,290 4,030,776 3,583,788 446,988
Planning and community development 809,636 783,652 662,933 120,719 Parks and community services 724,055 745,143 589,958 155,185 Public works 374,578 332,962 318,751 14,211
Capital outlay 189,521 190,220 202,179 (11,959)
Debt service:
Principal retirement 125,458 - 127,049 (127,049)
Interest and fiscal charges 19,685 - 30,707 (30,707)
Total Expenditures 10,515,270 7,001,373 6,546,040 455,333 Excess revenue over expenditures 109,847 203,490 1,086,454 882,964 Other Financing Sources (Uses)
Transfers in 683,234 373,624 20,000 353,624
Transfers out (646,963) (423,937) (70,313) (353,624)
Total Other Financing Sources (Uses) 36,271 (50,313) (50,313) - Net Change in Fund Balances $ 146,118 $ 153,177 1,036,141 $ 882,964 Fund Balances
Beginning of Year 3,320,857
End of Year $ 4,356,998
46 CITY OF LIVINGSTON
BUDGETARY COMPARISON SCHEDULE
PROGRAM INCOME
YEAR ENDED JUNE 30, 2021
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Revenues
Intergovernmental $ - $ - $ 244,673 $ 244,673
Use of money and property 450 450 24,177 23,727
Other - - 96 96
Total Revenues 450 450 268,946 268,496
Expenditures
Current:
Planning and community development 248,000 71,157 25,603 45,554 Total Expenditures 248,000 71,157 25,603 45,554
Excess (deficit) revenue over expenditures (247,550) (70,707) 243,343 (314,050) Net Change in Fund Balances $ (247,550) $ (70,707) 243,343 $ 314,050 Fund Balances
Beginning of Year 98,880
End of Year $ 342,223
47 CITY OF LIVINGSTON
BUDGETARY COMPARISON SCHEDULE
MAINTENANCE DISTRICTS
YEAR ENDED JUNE 30, 2021
Variance with
Final Budget
Budget Amounts Actual Positive
Original Final Amounts (Negative)
Revenues
Use of money and property $ 13,000 - $ 10,783 $ $ (2,217) Maintenance assessments 1,540,743 1,533,148 1,617,794 84,646 Other - -3,747 3,747
Total Revenues 1,540,743 1,546,148 1,632,324 86,176
Expenditures
Current:
Public works 2,684,379 2,664,906 1,176,034 1,488,872
Capital outlay 45,109 84,753 43,647 41,106
Total Expenditures 2,729,488 2,749,659 1,219,681 1,529,978 Excess (deficit) revenue over expenditures (1,188,745) (1,203,511) 412,643 (1,616,154) Other Financing Uses
Transfers out - - (20,000) 20,000
Total Other Financing Uses - - (20,000) 20,000
Net Change in Fund Balances $ (1,188,745) $ (1,203,511) 392,643 $ (1,596,154) Fund Balances
Beginning of Year 2,396,115
End of Year $ 2,788,758
48 CITY OF LIVINGSTON
SCHEDULE OF CHANGES IN THE NET OPEB LIABILITY AND RELATED RATIOS AS OF JUNE 30, FOR THE LAST TEN FISCAL YEARS (1)
2018 2019 2020 2021
Total OPEB Liability
Service cost $ 18,792 $ 19,403 $ 16,743 $ 17,287
Interest on the total OPEB liability 159,687 161,816 166,007 164,230 Differences between expected and actual experiences - 93,101 - (276,572) Changes in assumptions - (28,792) - 466,400
Benefit payments (139,650) (153,025) (203,753) (217,510) Net change in total OPEB liability 38,829 92,503 (21,003) 153,835 Total OPEB liability - beginning 2,507,758 2,546,587 2,639,090 2,618,087 Total OPEB liability - ending (a) 2,546,587 2,639,090 2,618,087 2,771,922 Plan Fiduciary Net Position
Contributions - employer 139,650 263,080 302,272 217,510 Net investment income - (256) 17,858 7,986
Benefit payments (139,650) (153,025) (203,753) (217,510) Administrative expense - (19) (36) (110)
Net change in plan fiduciary net position - 109,780 116,341 7,876 Plan fiduciary net position - beginning - - 109,780 226,121 Plan fiduciary net position - ending (b) - 109,780 226,121 233,997 Net OPEB Liability - ending (a) - (b) $ 2,546,587 $ 2,529,310 $ 2,391,966 $ 2,537,925 Plan fiduciary net position as a percentage of the total OPEB liability 0.00% 4.16% 8.64% 8.44% Covered-employee payroll $ 3,019,099 $ 3,387,869 $ 3,520,580 $ 4,044,709 Net OPEB liability as a percentage of covered-employee payroll 84.35% 74.66% 67.94% 62.75% (1) Historical information is required only for the measurement periods for which GASB 75 is applicable. Fiscal Year 2018 was the first year of implementation. Future years' information will be displayed up to 10 years as information becomes available. 49 CITY OF LIVINGSTON
COST SHARING MULTIPLE EMPLOYER PLAN
SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY AS OF JUNE 30, FOR THE LAST TEN FISCAL YEARS (1)
2015 2016 2017 2018
Rate Plan's Proportion of the Net Pension Liability 0.03960% 0.09348% 0.09502% 0.09687% Rate Plan's Proportionate Share of the Net Pension Liability $ 2,564,162 2,464,138 $ 3,300,933 $ $ 3,818,551 Rate Plan's Covered Payroll $ 1,685,745 1,803,899 $ 1,688,533 $ $ 1,982,411 Rate Plan's Proportionate Share of the Net Pension Liability as Percentage of Covered Payroll 136.60% 152.11% 195.49% 192.62% The Pension Plan's (PERF-C) Fiduciary Net Position as a Percentage of the Total Pension Liability 79.98% 79.56% 75.06% 73.85% 2015 2016 2017 2018
Rate Plan's Proportion of the Net Pension Liability 0.02230% 0.02793% 0.06184% 0.03184% Rate Plan's Proportionate Share of the Net Pension Liability $ 1,150,641 1,387,572 $ 1,649,184 $ $ 1,933,287 Rate Plan's Covered Payroll $ 892,349 $ 951,670 $ 1,086,467 $ 1,184,979 Rate Plan's Proportionate Share of the Net Pension Liability as Percentage of Covered Payroll 155.50% 120.91% 151.79% 163.15% The Pension Plan's (PERF-C) Fiduciary Net Position as a Percentage of the Total Pension Liability 80.42% 83.85% 78.69% 77.62% Notes to Schedule:
(1) Historical information is required only for measurement for which GASB 68 is applicable. Fiscal Year 2015 was the first year of implementation, therefore only seven years are shown.
Changes of Assumptions: In 2019, 2020 and 2021 there were no changes. 2018, demographic assumptions and inflation rate were changed in accordance to the CalPERS Experience Study and Review of Actuarial Assumptions December 2017. There were no changes in the discount rate. In 2017, the accounting discount rate reduced from 7.65 percent to 7.15 percent. In 2016, there were no changes. In 2015, amounts reported reflect an adjustment of the discount rate from 7.5 percent (net of adminstrative expense) to 7.65 percent (without a reduction for pension plan adminstrative expense.) In 2014, amount reported were based on the
7.5 percent discount rate.
Benefit Changes: There were no changes to benefit terms. However, the figures above do not include any liability impact that may have resulted from plan changes which occurred after June 30, 2016. This applies for voluntary benefit changes as well as any offers of Two Years Additional Service Credit (a.k.a.
Golden Handshakes).
Miscellaneous Rate Plan
Safety Rate Plan
50 2019 2020 2021
0.09879 0.10129% 0.04043%
$ 3,723,031 $ 4,056,159 $ 4,398,717
$ 2,375,780 $ 2,180,943 $ 2,503,615
156.71% 185.98% 175.69%
76.19% 75.89% 77.73%
2019 2020 2021
0.03331% 0.03451% 0.02225%
$ 1,954,629 $ 2,154,291 $ 2,420,480
$ 1,383,595 $ 1,391,084 $ 1,416,193
141.27% 154.86% 170.91%
77.70% 77.67% 75.10%
Miscellaneous Rate Plan
Safety Rate Plan
51 7+,63$*(,17(17,21$//</()7%/$1.
52 CITY OF LIVINGSTON
SCHEDULE OF OPEB CONTRIBUTIONS
AS OF JUNE 30, FOR THE LAST TEN FISCAL YEARS (1)
2018 2019 2020 2021
$ 192,372 $ 286,831 $ 284,608 $ 251,891
(263,080) (302,272) (217,510) (177,772)
$ (70,708) $ (15,441) $ 67,098 $ 74,119
$ 3,387,869 $ 2,519,808 $ 2,601,702 $ 4,166,050
7.77% 12.00% 8.36% 4.27%
Notes to Schedule:
Methods and assumptions used to determine contributions:
Actuarial Cost Method
Asset Valuation Method
Discount rate 5.00%
Inflation
Salary increases
Mortality Rate*
Pre-Retirement Turnover**
Healthcare Trend Rate Medical plan premiums are assumed to increase at somewhat higher rates than assumed in the prior valuation, with the ultimate trend of 5.0% per year.
*Actuarial methods and assumptions used to set the actuarially determined contribution for fiscal year 2021 were from the June 30, 2019 actuarial valuation. (1) Historical information is required only for the measurement periods for which GASB 75 is applicable. Fiscal Year 2018 was the first year of implementation. Future years' information will be displayed up to 10 years as information becomes available.
Actuarially Determined Contribution
Contribution in Relation to the Actuarially Determined Contributions Contribution Deficiency (Excess)
Covered-employee payroll
Contributions as a percentage of covered-employee payroll Derived using CalPERS' membership data for all
Entry Age Normal
Market value
Derived using CalPERS' membership data for all
3.00% annually
2.50%
53 CITY OF LIVINGSTON
COST SHARING MULTIPLE-EMPLOYER PLAN
SCHEDULE OF PLAN CONTRIBUTIONS
AS OF JUNE 30, FOR THE LAST TEN FISCAL YEARS (1)
2015 2016 2017 2018
Actuarially Determined Contribution $ 195,635 $ 182,947 $ 267,382 $ 300,757 Contribution in Relation to the Actuarially Determined Contribution (195,635) (182,947) (267,382) (300,757) Contribution Deficiency (Excess) $ - $ - $ - $ -
Covered Payroll $ 1,685,745 1,803,899 $ 1, $ 688,533 $ 1,982,411 Contributions as a Percentage of Covered Payroll 10.85% 10.85% 15.84% 15.17% 2015 2016 2017 2018
Actuarially Determined Contribution $ 141,280 $ 143,311 $ 183,062 $ 201,625 Contribution in Relation to the Actuarially Determined Contribution (141,280) (143,311) (183,062) (201,625) Contribution Deficiency (Excess) $ - $ - $ - $ -
Covered Payroll $ 892,349 $ 951,670 $ 1,086,467 $ 1,184,979 Contributions as a Percentage of Covered Payroll 15.83% 15.06% 16.85% 17.02% Note to Schedule:
Valuation Date: June 30, 2018
Methods and assumptions used to determine contribution rates:
Actuarial cost method Entry age normal cost method
Amortization method/period
Assets valuation method Market Value
Inflation 2.63%
Salary Increases
Payroll Growth
Investment rate of return
Retirement age
Mortality
Miscellaneous Rate Plan
(1) Historical information is required only for measurement for which GASB 68 is applicable. Fiscal Year 2015 was the first year of implementation, therefore only seven years are shown.
7.25%, net of pension plan investment expenses, including inflation.
Safety Rate Plan
The probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. Pre-retirement and Post-retirement mortality rates include 15 years of projected mortality improvement using 90% of scale MP-2016 published by the Society of Actuaries
The probabilities of Retirement are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015
Varies by Entry age and Service
2.88%
Level percentage of pay, a summary of the current policy is provided in the table below:
54 Source
(GainYLoss IAssumption/ Method I
Driver I Golden Handshake Investment I Non-investment I Chanae Benefit Chanae Amortization Period 30 years 30 Years 20 Years 20 Years 5 Years Escalation Rate
· Active Plans 2.750% 2.750% 2.750% 2.750% 2.750%
-lnactwe Plans 0% 0% 0% 0% 0%
Ramp Up 5 I 5 I 5 I 0 I 0
Ramp Down 5 I 5 I 5 I 0 I 0
2019 2020 2021
$ 271,882 $ 413,145 $ 477,503
(271,882) (413,145) (477,503)
$ - - $ - $
$ 2,375,780 $ 2,180,943 $ 2,503,615
11.44% 18.94% 19.07%
2019 2020 2021
$ 252,298 $ 273,044 $ 445,506
(252,298) (273,044) (445,506)
$ - - $ - $
$ 1,383,595 $ 1,391,084 $ 1,416,193
18.23% 19.63% 31.46%
Miscellaneous Rate Plan
Safety Rate Plan
55 7+,63$*(,17(17,21$//</()7%/$1.
56 6833/(0(17$/21/<,1)250$7,21
57 CITY OF LIVINGSTON
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
JUNE 30, 2021
Assets
Cash and investments $ 2,981,769 $ 2,965,505 $ 5,947,274 Accounts and interest receivable 490 134,050 134,540
Due from other governments 363,059 165,780 528,839
Restricted assets:
Cash and investments with fiscal agents - 829,165 829,165 Total Assets $ 3,345,318 $ 4,094,500 $ 7,439,818
Liabilities and Fund Balances
Liabilities
Accounts payable $ 14,307 $ 106,373 $ 120,680
Total Liabilities 14,307 106,373 120,680
Fund Balances
Restricted:
Circulation improvements 3,147,580 - 3,147,580
Capital improvement projects Capital improvement projects - 3,988,127 3,988,127 Public safety programs 183,431 - 183,431
Total Fund Balances 3,331,011 3,988,127 7,319,138
Total Liabilities and Fund Balances $ 3,345,318 $ 4,094,500 $ 7,439,818 Totals
Capital
Projects Funds
Special
Revenue
Funds
58 59
CITY OF LIVINGSTON
COMBINING STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
YEAR ENDED JUNE 30, 2021
Revenues
Development impact fees
Intergovernmental
Use of money and property
Other
Total Revenues
Expenditures
Current:
Public safety
Planning and community development
Public works
Capital outlay
Debt service:
Interest
Total Expenditures
Excess (deficiency) revenue over expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Proceeds on sale of asset
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances, Beginning of Year
Fund Balances, End of Year
Special
Revenue Funds
$
2,076,665
3,784
495
2,080,944
120,128
488,269
851,479
1,459,876
621 ,068
70,313
(51 ,610)
18,703
639,771
2,691,240
$ 3,331,011
Capital Project
Funds Totals
$ 492,008 $ 492,008
195,753 2,272,418
24,512 28,296
495
712,273 2,793,217
373 120,501
149,045 149,045
488,269
722,596 1,574,075
63,636 63,636
935,650 2,395,526
(223,377) 397,691
51 ,610 121 ,923
(51 ,610)
165,000 165,000
216,610 235,313
(6,767) 633,004
3,994,894 6,686,134
$ 3,988,127 $ 7,319,138
CITY OF LIVINGSTON
COMBINING BALANCE SHEET
NONMAJOR SPECIAL REVENUE FUNDS
JUNE 30, 2021
Assets
Cash and investments $ 74,544 $ 15,921 $ 738,989 $ 104,355 Accounts and interest receivable 6 50 291 -
Due from other governments - - 183,197 -
Total Assets $ 74,550 $ 15,971 $ 922,477 $ 104,355
Liabilities and Fund Balances
Liabilities
Accounts payable $ 4,003 $ - $ - $ -
Total Liabilities 4,003 - - -
Fund Balances
Restricted:
Circulation improvements 70,547 15,971 922,477 -
Public safety programs - - - 104,355
Total Fund Balances 70,547 15,971 922,477 104,355
Total Liabilities and Fund Balances $ 74,550 $ 15,971 $ 922,477 $ 104,355 Gas Tax
Local
Transportation RSTP
Abandoned
Vehicle
Abatement
60 CITY OF LIVINGSTON
COMBINING BALANCE SHEET
NONMAJOR SPECIAL REVENUE FUNDS
JUNE 30, 2021
Assets
Cash and investments
Accounts and interest receivable
Due from other governments
Total Assets
Liabilities and Fund Balances
Liabilities
Accounts payable
Total Liabilities
Fund Balances
Restricted:
Circulation improvements
Public safety programs
Total Fund Balances
Total Liabilities and Fund Balances
Total
$ 1,168,049 $ 800,600 $ 79,311 $ 2,981,769
119 - 24 490
152,661 27,201 - 363,059
$ 1,320,829 $ 827,801 $ 79,335 $ 3,345,318
$ 10,045 $ - $ 259 $ 14,307
10,045 - 259 14,307
1,310,784 827,801 - 3,147,580
- - 79,076 183,431
1,310,784 827,801 79,076 3,331,011
$ 1,320,829 $ 827,801 $ 79,335 $ 3,345,318
Measure V SB-1 Public Safety
61 62
CITY OF LIVINGSTON
COMBINING STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES
NONMAJOR SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 2021
Abandoned
Local Vehicle
Gas Tax Transeortation RSTP Abatement
Revenues
Intergovernmental $ 323,583 $ 14,836 $ 183,197 $ 13,414 Use of money and property 46 389 2,256
Other
Total Revenues 323,629 15,225 185,453 13,414
Expenditures
Current:
Public safety 11,289
Public works 382,380
Capital outlay 76,450
Total Expenditures 382,380 76,450 11,289
Excess (deficiency) revenue over expenditures (58,751) (61 ,225) 185,453 2,125 Other Financing Sources (Uses)
Transfers in 70,313
Transfers out {51 ,61 Dl
Total Other Financing Sources (Uses) 70,313 {51,610)
Net Change in Fund Balances 11 ,562 (112,835) 185,453 2,125 Fund Balances, Beginning of Year 58,985 128,806 737,024 102,230 Fund Balances, End of Year $ 70,547 $ 15,971 $ 922,477 $ 104,355 63 CITY OF LIVINGSTON
COMBINING STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES
NONMAJOR SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 2021
Revenues
Intergovernmental
Use of money and property
Other
Total Revenues
Expenditures
Current:
Public safety
Public works
Capital outlay
Total Expenditures
Excess (deficiency) revenue over expenditures
Other Financing Sources (Uses)
Transfers in
Transfers out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Fund Balances, Beginning of Year
Fund Balances, End of Year
MeasureV
$ 1,165,530 $
918
495
1,166,943
77,299
775,029
852,328
314,615
314,615
996,169
$ 1,310,784 $
SB-1 Public Safe~ Total
276,096 $ 100,009 $ 2,076,665
175 3,784
495
276,096 100,184 2,080,944
108,839 120,128
28,590 488,269
851,479
28,590 108,839 1,459,876
247,506 (8,655) 621,068
70,313
(51,610~
18,703
247,506 (8,655) 639,771
580,295 87,731 2,691,240
827,801 $ 79,076 $ 3,331 ,011
CITY OF LIVINGSTON
COMBINING BALANCE SHEET
NONMAJOR CAPITAL PROJECTS FUNDS
JUNE 30, 2021
Assets
Cash and investments $ 22,040 $ 279,130 $ 329,073 $ 306,128 Accounts and Interest Receivable 17 132,254 236 158
Due from other governments - 165,780 - -
Restricted assets:
Cash and investments with fiscal agents - 829,165 - -
Total Assets $ 22,057 $ 1,406,329 $ 329,309 $ 306,286
Liabilities and Fund Balances
Liabilities
Accounts payable $ - $ 88,714 $ - $ -
Total Liabilities - 88,714 - -
Fund Balances
Restricted:
Capital improvement projects 22,057 1,317,615 329,309 306,286 Total Fund Balances 22,057 1,317,615 329,309 306,286
Total Liabilities and Fund Balances $ 22,057 $ 1,406,329 $ 329,309 $ 306,286 Amenities
Impact Fees
Capital
Projects
Fire Impact
Fees
Police Impact
Fees
64 CITY OF LIVINGSTON
COMBINING BALANCE SHEET
NONMAJOR CAPITAL PROJECTS FUNDS
JUNE 30, 2021
Assets
Cash and investments
Accounts and Interest Receivable
Due from other governments
Restricted assets:
Cash and investments with fiscal agents
Total Assets
Liabilities and Fund Balances
Liabilities
Accounts payable
Total Liabilities
Fund Balances
Restricted:
Capital improvement projects
Total Fund Balances
Total Liabilities and Fund Balances
$ 978,548 $ 64,085 $ 710,201 $ 276,300
705 17 402 261
- - - -
- - - -
$ 979,253 $ 64,102 $ 710,603 $ 276,561
$ - $ - $ - $ 17,659
- - - 17,659
979,253 64,102 710,603 258,902
979,253 64,102 710,603 258,902
$ 979,253 $ 64,102 $ 710,603 $ 276,561
Municipal
Facilities
Impact Fees
Park Impact
Fees
Streets &
Storm Drain
Impact Fees
General Plan
Impact Fees
65 CITY OF LIVINGSTON
COMBINING BALANCE SHEET
NONMAJOR CAPITAL PROJECTS FUNDS
JUNE 30, 2021
Assets
Cash and investments
Accounts and Interest Receivable
Due from other governments
Restricted assets:
Cash and investments with fiscal agents
Total Assets
Liabilities and Fund Balances
Liabilities
Accounts payable
Total Liabilities
Fund Balances
Restricted:
Capital improvement projects
Total Fund Balances
Total Liabilities and Fund Balances
Total
$ 2,965,505
134,050
165,780
829,165
$ 4,094,500
$ 106,373
106,373
3,988,127
3,988,127
$ 4,094,500
66 7+,63$*(,17(17,21$//</()7%/$1.
67 68
CITY OF LIVINGSTON
COMBINING STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
YEAR ENDED JUNE 30, 2021
Revenues
Development impact fees
Intergovernmental
Use of money and property
Total Revenues
Expenditures
Current:
Public safety
Planning and community development
Capital outlay
Debt service:
Interest
Total Expenditures
Excess (deficiency) revenue over expenditures
Other Financing Sources
Transfers in
Proceeds on sale of asset
Total Other Financing Sources
Net Change in Fund Balances
Fund Balances, Beginning of Year
Fund Balances, End of Year
Amenities
lmeact Fees
$
128
128
128
128
21 ,929
$ 22,057
Capital Fire Impact Police Impact
Projects Fees Fees
$ $ 44,623 $ 76,095
195,753
10,607 1,831 1,221
206,360 46,454 77,316
373
441
720,912
63,636
784,548 441 373
(578,188) 46,013 76,943
51,610
165,000
216,610
(361 ,578) 46,013 76,943
1,679,193 283,296 229,343
$ 1,317,615 $ 329,309 $ 306,286
69 CITY OF LIVINGSTON
COMBINING STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
YEAR ENDED JUNE 30, 2021
Municipal Streets &
Facilities Park Impact Storm Drain General Plan
lmeactFees Fees lmeact Fees lmeact Fees
Revenues
Development impact fees $ 47,121 $ 39,140 $ 176,348 $ 108,681 Intergovernmental
Use of money and property 5,459 134 3,112 2,020
Total Revenues 52,580 39,274 179,460 110,701
Expenditures
Current:
Public safety
Planning and community development 2,375 440 1,894 143,895 Capital outlay 1,684
Debt service:
Interest
Total Expenditures 2,375 2,124 1,894 143,895
Excess (deficiency) revenue over expenditures 50,205 37,150 177,566 (33,194) Other Financing Sources
Transfers in
Proceeds on sale of asset
Total Other Financing Sources
Net Change in Fund Balances 50,205 37,150 177,566 (33,194) Fund Balances, Beginning of Year 929,048 26,952 533,037 292,096 Fund Balances, End of Year $ 979,253 $ 64,102 $ 710,603 $ 258,902 70 CITY OF LIVINGSTON
COMBINING STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
YEAR ENDED JUNE 30, 2021
Revenues
Development impact fees
Intergovernmental
Use of money and property
Total Revenues
Expenditures
Current:
Public safety
Planning and community development
Capital outlay
Debt service:
Interest
Total Expenditures
Excess (deficiency) revenue over expenditures
Other Financing Sources
Transfers in
Proceeds on sale of asset
Total Other Financing Sources
Net Change in Fund Balances
Fund Balances, Beginning of Year
Fund Balances, End of Year
Total
$ 492,008
195,753
24,512
712,273
373
149,045
722,596
63,636
935,650
(223,377)
51,610
165,000
216,610
(6,767)
3,994,894
$ 3,988,127
71 CITY OF LIVINGSTON
SCHEDULE OF NET REVENUE AVAILABLE FOR DEBT SERVICE
YEAR ENDED JUNE 30 2021
Operating Revenues
Charges for services
Other income
Total Operating Revenues
Operating Expenses
Contract services and utilities
Personnel costs
Supplies and materials
Total Operating Expenses
Net Revenue
Non- Operating Revenues
Investment income
Net Non-operating Revenues
Net Revenue Available for Debt Service
Parity Obligation Debt Service
2016A Sewer Refunding Bond Debt Service
Parity Obligation Debt Service Rate Covenant Coverage
Domestic
Waste Water
$ 2,243,638
444,430
2,688,068
385,094
638,629
260,993
1,284,716
1,403,352
24,871
24,871
$ 1,428,223
$ 448,650
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72 Lance, Soll & Lunghard, LLP 2151 River Plaza Dr., Suite 150 Sacramento ,CA95833 Phone: 916.503.9691 INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL
OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE
WITH GOVERNMENT AUDITING STANDARDS
To the Honorable Mayor and Members of the City Council
City of Livingston, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Livingston, California, (the City) as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements, and have issued our report thereon dated November 16, 2022.
Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. During our audit we identified the following deficiency in internal control, described in the accompanying schedule of findings and questioned costs, that we consider to be a material weakness: Finding 2021-001 – Capital Asset Records. We did not identify deficiencies in internal control that we considered to be a significant deficiency.
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To the Honorable Mayor and Members of the City Council
City of Livingston, California
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests did not result in instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
City’s Response to Findings
The City’s response to the findings identified in our audit was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Sacramento, California
November 16, 2022
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To the Honorable Mayor and Members of the City Council
City of Livingston, California
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
Capital Asset Records
Reference Number: 2021-001
Evaluation of Finding:
Material Weakness
Condition:
During our review of capital asset records and transactions, we noted material adjustments that were required to reconcile underlying accounting records to previously issued Annual Comprehensive Financial Reports. The net effect of these adjustments resulted in a restatement of Net Position totaling $67,585 and $1,150,795 for Governmental Activities and Business-Type Activities, respectively.
Criteria:
Accurate recordkeeping and reconciliation of capital assets to issued Annual Comprehensive Financial Reports are an integral part of internal control and financial reporting accuracy in accordance with Generally Accepted Accounting Principles.
Cause of Condition:
City personnel are not routinely reconciling underlying accounting records to the trial balance and general ledger.
Effect or Potential Effect of Condition:
The Net Position of the Governmental Activities and Business-Type Activities were understated in previously issued Annual Comprehensive Financial Reports.
Recommendation:
We recommend the City routinely reconcile underlying accounting records to the trial balance and general leger on a regular basis to ensure capital assets are recorded timely and accurately.
Management’s Response and Corrective Action:
The City of Livingston transitioned from manually tracking Fixed Assets in Excel to using Springbrook accounting software and in the transition of assets into the financial system some items were missed. We made the correcting entries in our financial system and will reconcile Fixed Assets periodically going forward.
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76 Lance, Soll & Lunghard, LLP 2151 River Plaza Dr., Suite 150 Sacramento ,CA95833 Phone: 916.503.9691 November 16, 2022
To the Honorable Mayor and Members of the City Council
City of Livingston, California
We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Livingston, California (the City) for the year ended June 30, 2021. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards, Government Auditing Standards and the Uniform Guidance, as well as certain information related to the planned scope and timing of our audit.
We have communicated such information in our letter to you dated May 4, 2021. Professional standards also require that we communicate to you the following information related to our audit.
Significant Audit Findings and Other Issues
Qualitative Aspects of Significant Accounting Practices Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in the notes to the financial statements. No new accounting policies were adopted and the application of existing policies was not changed during fiscal year 2020-2021. We noted no transactions entered into by the City during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period.
Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the City’s financial statements was:
Management’s estimates of its net pension liability and net other post-employment benefits liability are based on actuarial valuation specialist assumptions. We evaluated the key factors and assumptions used to develop the net pension liability and net other post-employment benefits asset in determining that they are reasonable in relation to the financial statements taken as a whole.
The financial statement disclosures are neutral, consistent, and clear.
Significant Unusual Transactions
Management is responsible for the policies and practices used to account for significant unusual transactions. No significant unusual transactions have occurred during fiscal year 2020-2021.
Difficulties Encountered in Performing the Audit
We encountered no significant difficulties in dealing with management in performing and completing our audit.
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To the Honorable Mayor and Members of the City Council
City of Livingston, California
Corrected and Uncorrected Misstatement
Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. In addition, we detected misstatements as a result of audit procedures which were significant, and were subsequently corrected. The details of these misstatements are described in a separate letter dated November 16, 2022.
Disagreements with Management
For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor’s report. We are pleased to report that no such disagreements arose during the course of our audit.
Circumstances that Affect the Form and Content of the Auditor’s Report New auditing standards were implemented in fiscal year 2020-2021 related to Statement of Auditing Standards 134, Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements, through Statement of Auditing Standards 140, Supplementary Information in Relation to the Financial Statements as a Whole. These standards updated the form and content of the financial statement auditor’s report. The purpose of the change was to present an easier format for users to understand the results of the audit and management’s responsibilities.
Management Representations
We have requested certain representations from management that are included in the management representation letter dated November 16, 2022.
Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to the City’s financial statements or a determination of the type of auditor’s opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants.
Other Audit Findings or Issues Discussed with Management We generally discuss a variety of matters, including the significant events or transactions that occurred during the year, business conditions affecting the City and business plans and strategies that may affect the risks of material misstatements, the application of accounting principles and auditing standards, with management each year prior to retention as the City’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention.
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To the Honorable Mayor and Members of the City Council
City of Livingston, California
Other Matters
We applied certain limited procedures to the budgetary comparison schedules for the general fund and major special revenue funds, the schedule of proportionate share of the net pension liability, the schedule of plan contributions, the schedule of changes in the net OPEB liability and related ratios, and the schedule of OPEB plan contributions which are required supplementary information (RSI) that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding 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 did not audit the RSI and do not express an opinion or provide any assurance on the RSI.
We were engaged to report on the combining and individual fund financial statements and schedules, which accompany the financial statements but are not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves.
The following new Governmental Accounting Standards Board (GASB) pronouncements were effective for fiscal year 2020-2021 audit:
GASB Statement No. 84, Fiduciary Activities.
GASB Statement No. 90, Majority Equity Interests - an Amendment of GASB Statement Nos. 14 and 61.
GASB Statement No. 98, The Annual Comprehensive Financial Report.
The following GASB pronouncements are effective in the following fiscal years’ audits and should be reviewed for proper implementation by management:
Fiscal year 2022
GASB Statement No. 87, Leases.
GASB Statement No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period.
GASB Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans.
Fiscal year 2023
GASB Statement No. 91, Conduit Debt Obligations.
GASB Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangement.
GASB Statement No. 96, Subscription-Based Information Technology Arrangements.
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To the Honorable Mayor and Members of the City Council
City of Livingston, California
Restriction on Use
This information is intended solely for the use of City council and management of City of Livingston and is not intended to be, and should not be, used by anyone other than these specified parties.
Very truly yours,
Sacramento, California
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