Item 8c — Lomita City Council, December 19, 2023

1 TO: City Council
FROM: Ryan Smoot, City Manager
PREPARED BY: Susan Kamada, Administrative Services Director MEETING DATE: December 19, 2023
SUBJECT: Discussion and Consideration of the Acceptance of the City’s Audit Report for Fiscal Year 2022-2023

RECOMMENDATION
Receive and file the Fiscal Year 2022-2023 Annual Comprehensive Financial Report (ACFR), Fiscal Year 2022-2023 Single Audit Report, and the Measure W Audit Report for Fiscal Years 2020-2021, 2021-2022, and 2022-2023.

BACKGROUND
Attached is the City of Lomita’s Annual Comprehensive Financial Report (ACFR), the Single Audit Report for the fiscal year ended June 30, 2023, and the Measure W Audit Reports for Fiscal Years 2020-2021, 2021-2022, and 2022-2023. These reports are in full compliance with the most recent financial reporting model developed by the Governmental Accounting Standards Board (GASB) Statement No. 34, Generally Accepted Accounting Principles (GAAP), and Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). The most recent financial reporting model is intended to improve financial accountability by adding significant information not previously available in local government financial statements. The City’s implementation of the most recent model enables the City Council and residents of Lomita to become more aware of the City’s financial condition and the information contained in its annual financial statements.

During the year ended June 30, 2023, the City adopted Statement on Governmental Accounting Standards (GASB Statement) No. 91-Conduit Debt Obligations and No. 96- Subscription Based Information Technology Software. Statements can be found in Note 1 of the City’s Annual Comprehensive Financial Report.

Item No. SCH 8c

CITY OF LOMITA

CITY COUNCIL REPORT
2 The goal of the annual audit is to provide reasonable assurance that the City’s financial statements are free of material misstatement. The City’s independent auditor, Gruber and Lopez, Inc., found no “material misstatements” or “reportable conditions” during the audit.

The City has once again submitted the ACFR for consideration for the Certificate of Achievement for Excellence in Financial Reporting to the Government Finance Officers Association (GFOA). To receive this award, a government agency must publish an easily readable and efficiently organized comprehensive annual financial report. If the City receives the Certificate of Achievement as expected, this will be the 20th consecutive year that the City has received this award. While this effort was coordinated by the Administrative Services Department, it required the cooperation and participation of all City departments. We would like to thank the Mayor and members of the City Council for their support in planning and conducting the financial operations of the City in a responsible and progressive manner.

Below are the financial highlights of the Annual Comprehensive Financial Report:
➢ The City ended Fiscal Year 2022-2023 with a total net position $62,191,293. Of this amount, $8,319,476 (unrestricted net position) may be used to meet the City’s ongoing obligations to citizens and creditors within fund-specific guidelines. ➢ As of the close of business of the current fiscal year, the City of Lomita’s governmental funds reported a combined ending balance of $22,098,242 ➢ Property Taxes, Sales Tax, Motor Vehicle-in-Lieu Fees, Refuse Taxes, Business License Taxes, Franchise Taxes, and Transient Occupancy Taxes financed approximately 69% of all governmental activities for the fiscal year.

OPTIONS:

None. Information only. Receive and file.

FISCAL IMPACT
None. Information only. Receive and file.

ATTACHMENT

1. Audit Communication Letter

2. Fiscal Year 2022-2023 Annual Comprehensive Financial Report

3. Fiscal Year 2022-2023 Single Audit Report

4. Fiscal Year 2020-2021, 2021-2022 Measure W Audit Report

5. 2022-2023 Measure W Audit Report
3 Reviewed by: Approved by:
____________________________
Gary Y. Sugano Ryan Smoot
Assistant City Manager City Manager
Prepared by:
__________________________
Susan Kamada
Administrative Services Director

CITY OF LOMITA
Lomita, California
Report on Communication
With Those Charged with Governance
June 30, 2023
Attachment 1

CITY OF LOMITA
Lomita, California
Report On Communication
With Those Charged With Governance
June 30, 2023
INDEX
PAGE
REPORT ON COMMUNICATION WITH THOSE CHARGED WITH GOVERNANCE 1 - 3

1 438 Old Newport Blvd, Newport Beach, CA 92663
Phone (949) 346-2900 –www.gruberlopezinc.com

City of Lomita
Lomita, California
To the Honorable Mayor and City Council:

We have audited the financial statements of the government activities, business-type activities, each major fund, and the aggregate remaining fund information of the City of Lomita, California (City) for the year ended June 30, 2023, and have issued our report thereon dated December 15, 2023. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards and Government Auditing Standards, as well as certain information related to the engagement contract dated July 18, 2023.

Professional standards also require that we communicate to you the following information related to our audit.

Significant Audit Findings
Qualitative Aspects of Accounting Practice
Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in Note 1 to the financial statements. The City adopted Statement on Governmental Accounting Standards (GASB Statements) Nos. 91-Conduit Debt Obligations and No. 96-Subscription Based Information Technology Software. The adoption of the GASB No. 91 did not significantly impact the City.

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 were:
 Management’s estimate of capitalizing certain infrastructure assets that prolong its’ useful life (as opposed to classifying as routine maintenance expense) and depreciation expense on capital assets. We have evaluated the key factors and assumptions used to estimate the capitalization of infrastructure assets and useful lives on depreciation expense in determining that they are reasonable in relation to the financial statements taken as a whole.
 Management’s estimate of the net pension liability and net OPEB liability and their allocation to various funds. We have evaluated the key factors and assumptions used to estimate the net pension liability and its allocation to various funds of the City in determining that they are reasonable in relation to the financial statements taken as a whole.
2 City of Lomita
Honorable Mayor and City Council
Certain financial statement disclosures are particularly sensitive because of their significance to financial statement users. The most sensitive disclosure affecting the financial statements was:
 The disclosure of Contingencies in Note 11 to the financial statements concerning potential claims against the City for possible disallowed costs or noncompliance with certain grantor restrictions. As of the date of this letter, Management is not aware of any disallowed costs or noncompliance with grantor restrictions.

Difficulties Encountered in Performing the Audit
We encountered no significant difficulties in dealing with management in performing and completing our audit.

Corrected and Uncorrected Misstatements
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. We noted no significant adjustments as a result of audit procedures. We were not aware of any significant uncorrected misstatements.

Disagreements with Management
For purposes of this letter, professional standards define a disagreement with management as 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.

Management Representations
We have requested certain representations from management that are included in the management representation letter dated December 15 2023.

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.

Other Audit Findings or Issues
We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as City of Lomita’s auditors.

However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention.
3 City of Lomita
Honorable Mayor and City Council
Other Matters
We applied certain limited procedures to City of Lomita, which is 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 supplementary information as described in the table of contents in the financial statements, 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.

We were not engaged to report on the supplementary information as described in the table of contents in the financial statements, which accompany the financial statements but are not RSI.

We did not audit or perform other procedures on this other information and we do not express an opinion or provide any assurance on it.

Restriction on Use
This report is intended solely for the information and use of the City Council and management, and is not intended to be and should not be used by anyone other than these specified parties.

GRUBER AND LOPEZ, INC.

Newport Beach, California
December 15, 2023
Gruber and Lopez, Inc.

Attachment 2

CITY OF LOMITA,

CALIFORNIA

ANNUAL COMPREHENSIVE FINANCIAL REPORT
Year Ended June 30, 2023
Prepared by: The Administrative Services Department
Susan Kamada, Administrative Services Director

CITY OF LOMITA
Annual Comprehensive Financial Report
Year Ended June 30, 2023

TABLE OF CONTENTS
Page
INTRODUCTORY SECTION:

Transmittal Letter i
List of Principal Officials vii
Organization Charts viii
GFOA Certificate of Achievement for Excellence in Financial Reporting iv FINANCIAL SECTION:

Independent Auditors’ Report 1
Management’s Discussion and Analysis
(Required Supplementary Information) 4
Basic Financial Statements
Government-wide Financial Statements:

Statement of Net Position 13
Statement of Activities 14
Fund Financial Statements:

Government Funds:

Balance Sheet 16
Reconciliation of the Balance Sheet of Governmental Funds to Statement of Net Position 17
Statement of Revenues, Expenditures and Changes in Fund Balances 18 Reconciliation of Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to Statement of Activities 19 Proprietary Fund:

Statement of Net Position 20
Statement of Revenues, Expenses and Changes in Net Position 21 Statement of Cash Flows 22
Fiduciary Fund:

Statement of Fiduciary Net Position – Private Purpose Trust Funds 23 Statement of Changes in Fiduciary Net Position – Private Purpose Trust Funds 24 Notes to the Financial Statements 25

CITY OF LOMITA
Annual Comprehensive Financial Report
Year Ended June 30, 2023

TABLE OF CONTENTS, (CONTINUED)
Page
FINANCIAL SECTION, (CONTINUED):

Required Supplementary Information
Schedule of Proportionate Share of Net Pension Liability and Related Ratios 60 Schedule of Plan Contributions 62
Schedule of Changes in the Net OPEB Liability and Related Ratios 64 Budgetary Comparison Schedule – Major Funds:

General Fund 66
America Rescue Plan Act Special Revenue Fund 67
Notes to Required Supplementary Information 68

Supplementary Schedules
Non-Major Government Funds:

Combining Balance Sheet 69
Combining Statement of Revenues, Expenditures and Changes in Fund Balances 73 Non-Major Funds:

Budgetary Comparison Schedules 77

Fiduciary Funds:

Combining Statements of Net Position 94
Combining Statements of Changes in Net Position 95

CITY OF LOMITA
Annual Comprehensive Financial Report
Year Ended June 30, 2023

TABLE OF CONTENTS, (CONTINUED)
Page
STATISTICAL SECTION:

Net Position by Component – Last Ten Fiscal Years 96
Changes in Net Position – Last Ten Fiscal Years 98
Fund Balances of Governmental Funds – Last ten Fiscal Years 102 Changes in Fund Balance of Governmental Funds – Last Ten Fiscal Years 104 Assessed Value and Estimated Actual Value of Taxable Property – Last Ten Fiscal Years 106
Direct and Overlapping Property Tax Rates – Last Ten Fiscal Years 107 Principal Property Owners – Current Year and Prior Year 108 Property Tax Levies and Collections – Last Ten Fiscal Years 109 Ratio of Outstanding Debt by Type – Last Ten Fiscal Years 110 Legal Debt Margin Information 112
Pledged Revenue Coverage 114
Direct and Overlapping Debt – Current Year 115
Top 25 Sales Tax Producers 116
Demographic and Economic Statistics – Last Ten Calendar Years 117 Principle Employers – Current Year and Nine Years Ago 118 Full-time and Part-time City Employees by Function – Last Ten Fiscal Years 119 Operating Indicators by Function – Last Ten Fiscal Years 120 Capital Asset Statistics by Function – Last Ten Fiscal Years 121 Water Sold by Type of Customer – Last Ten Fiscal Years 122 Water Rates – Last Ten Fiscal Years 123
Ratios of General Bonded Debt Outstanding – Last Ten Fiscal Years 124

CITY COUNCIL ADMINISTRATION

BARRY WAITE RYAN SMOOT

BILL UPHOFF CITY MANAGER

JAMES GAZELEY

CINDY SEGAWA
MARK A. WARONEK

CITY OF LOMITA
CITY HALL OFFICES • 24300 NARBONNE AVENUE, LOMITA • CALIFORNIA 90717 (310) 325-7110 • FAX (310) 325-4024 • www.lomita.com/cityhall i
December 19, 2023
Honorable Mayor,
Members of the City Council,
and Citizens of Lomita

ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR 2022-2023

LETTER OF TRANSMITTAL

It is with great pleasure that we present to you the City of Lomita’s Annual Comprehensive Financial Report (ACFR) for the fiscal year ended June 30, 2023. This report complies with the most recent financial reporting model developed by the Governmental Accounting Standards Board (GASB) Statement 34 and Generally Accepted Accounting Principles (GAAP). The most recent financial reporting model is intended to improve financial accountability by adding significant information not previously available in local government financial statements. The City’s implementation of the most recent model enables the City Council and residents of Lomita to become more aware of the City’s financial condition and the information contained in its annual financial statements.

This report was prepared by the Administrative Services Department in conformity with GAAP and has been audited in accordance with Generally Accepted Auditing Standards (GAAS) by a firm of licensed Certified Public Accountants. Our audit firm, Gruber and Lopez, Inc., is registered with the California State Board of Accountancy and, therefore, because of this, the City’s auditors follow the same required rigor and quality control standards of all firms who are registered with the State. The report contains management’s representation of the finances of the City. Consequently, responsibility for both the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, rests with the City. To the best of our knowledge and belief, the enclosed information is accurate in all material respects and is reported in a manner designed to present fairly the financial position of the City. All disclosures necessary to enable an understanding of the City’s financial activities have been included.

This ACFR includes the financial activity for all funds of the City. The City provides its citizens a wide range of services either directly or through contractual arrangements including public safety, planning, building, public works, water utility, engineering, parks and recreation, and general management.

In addition to the fund-by-fund financial information presented in the City’s financial statements, also included are government-wide financial statements. The government-wide financial statements, required by GASB 34, include a Statement of Net Position that provides the total net equity of the City including its infrastructure assets. The Statement of Activities illustrates the cost of providing government services.

CITY HALL OFFICES • 24300 NARBONNE AVENUE, LOMITA • CALIFORNIA 90717 (310) 325-7110 • FAX (310) 325-4024 • www.lomita.com/cityhall ii
These statements have been prepared using the accrual basis of accounting versus the modified accrual method used in the fund financial statements, as required by GASB 34.

The most recent reporting model includes an emphasis on the City’s major funds as shown in the Governmental Fund Statements. These most recent statements combined with other financial information are further described in a narrative section called Management’s Discussion and Analysis (MD&A). The MD&A provides financial highlights and interprets the financial reports by analyzing trends and by explaining changes, fluctuations and variances in the financial data. The MD&A is intended to disclose any known significant events or decisions that affect the financial condition of the City.

During the year ended June 30, 2023, the City adopted Statement on Governmental Accounting Standards (GASB Statement) No. 91-Conduit Debt Obligations and No. 96-Subscription Based Information Technology Software. The adoption of GASB No. 91 did not significantly impact the City.

PROFILE OF THE GOVERNMENT
The City of Lomita, California, was founded in 1907 and incorporated on June 30, 1964, as a General Law City under the laws of the State of California. The City of Lomita is located 26 miles south of downtown Los Angeles and is bounded by the City of Torrance on the north and west, the City of Los Angeles to the east, and the City of Rolling Hills Estates on the southwest. Southeast of Lomita is the City of Rancho Palos Verdes and unincorporated County land. The City’s total land area is 1,196.8 acres, or 1.97 square miles. As of 2023, the City’s population is 20,092.

The City operates under the Council-Manager form of government. The City Council is comprised of five members elected at large for staggered four-year terms of office. Three incumbents filed papers to run for office in the City’s November 3, 2022 municipal election. The three candidates were appointed to the three open seats and the election was canceled. The Mayor and Mayor Pro-Tem are selected by the Council from among its members to serve a one-year term. The City Council serves as the legislative and policy-making body of the City, enacting all laws and directing such actions as are required to provide for the general welfare of the community. As a contract city, the City provides most of its municipal services, such as legal and public safety services, waste collection, street sweeping and others through contracts with other agencies or organizations. The City of Lomita contracts with a private firm for its legal services. It contracts with the Los Angeles County Sheriff’s Department for law enforcement services. Fire protection services are provided by the Los Angeles County Fire Department. The Lomita Public Library is administered by Los Angeles County.

Building and safety services are also provided by the County. There are currently six City parks in Lomita including Lomita Park.

The City Manager, appointed by the City Council, serves as the Chief Executive Officer and is responsible to the City Council for the administration of all City affairs and the implementation of all policies established by the City Council. The City Attorney serves under contract to the City and is also appointed by the City Council.

The Assistant City Manager is appointed by and reports to the City Manager. All other department directors are also appointed by the City Manager and report to the City Manager.

CITY HALL OFFICES • 24300 NARBONNE AVENUE, LOMITA • CALIFORNIA 90717 (310) 325-7110 • FAX (310) 325-4024 • www.lomita.com/cityhall iii

LOCAL ECONOMIC CONDITIONS AND OUTLOOK
The City of Lomita is comprised of single- and multi-family homes, condominiums, and apartments with a mixture of retail, light industrial and service entities providing a tax base for the City. Property Taxes, Sales and Use Taxes, Motor Vehicle-in-Lieu Fees, and Transient Occupancy Taxes financed approximately 68% of all governmental activities for the fiscal year.

As of June 30, 2023, the City’s unemployment rate was 2.2 percent, which compares favorably to 4.9 percent for Los Angeles County and 4.6 percent for the State of California. The City’s three largest employers are Lomita Post-Acute Care Center, WDC Kitchen & Bath Center, and Kaiser Permanente, and they continue to be stable employers.

The City adopted a balanced biennial budget for Fiscal Years 2022-2024 using a conservative approach to forecast revenues and maintain expenditures. The City’s sales tax and vehicle license fees revenues performed better than or as expected primarily due to conservative forecasting and stronger than expected sales, and other revenue sources performed as projected, if not slightly better. The budget maintained public safety services and infrastructure projects at a high level of importance. One-time influxes of revenue and the approval of Measure L by the voters in 2020 have added much needed revenue that will support the City in accomplishing its financial and infrastructure improvement goals.

Though hopeful that the economy continues to steadily grow, the City expects long term revenues to remain stable while expenditures are expected to steadily grow. The City will remain conservative in its revenue forecasts, contain costs as much as possible while maintaining essential services for the community. We will continue to explore ways to stimulate the local economy by vigorously pursuing economic development and housing opportunities and developing projects and programs that support the continued growth of our community.

LONG-TERM FINANCIAL PLANNING AND MAJOR INITIATIVES
The City has adopted a new five-year Capital Improvement Program and continues to work through the projects listed as funding is available. An annual review of this report is an integral part of the budget process. This is a plan for short and long-term development, improvement, maintenance, and acquisition of infrastructure assets City-wide. Current projects include facility improvements; information technology upgrades; engineering studies; major street repairs; storm water best management programs; water system upgrades including water main, water meter, water valves and service line replacements and ongoing upgrades to our water facilities. Although the plan identifies an ambitious set of capital needs, the City’s ongoing annual funding over the period has simply not kept pace with the increasing costs of construction and the overall needs of the City’s infrastructure. As such, currently, there remains more than $100,000,000 in unfunded capital needs, which have been updated as part of the 5-Year Capital Improvement and Water Master Plan. One-time influxes of revenue, grants, and the approval of Measure L by the voters of the City will help to offset this need, but as it has in the past, the City will need to remain creative in its financing and infrastructure improvement goals.

During the fiscal year of 2022-2023, the Cypress Water Production Facility, which generally provides water service through a blend of imported and locally produced ground water, remained offline while construction is ongoing to upgrade the facility. Water service continues to be provided to the City’s residents through CITY HALL OFFICES • 24300 NARBONNE AVENUE, LOMITA • CALIFORNIA 90717 (310) 325-7110 • FAX (310) 325-4024 • www.lomita.com/cityhall iv
100% imported water. Although fluctuations in blend ratios are anticipated over time, this transition continues to result in significant, short-term increases in the City’s costs to provide water service. The City Council has approved a funding plan and is currently under construction, a secondary Granular Activated Carbon filtration system to remove benzene and improve the aesthetic qualities of the City’s groundwater and has secured $5 Million in external funding through WRD and ARPA to be used toward construction of the upgrades. Construction is scheduled to be complete in 2024.

The City has adopted updated water rate structures for the next five years and will continue capital improvements in an effort to be proactive in reducing service delivery costs and determining future revenue requirements to meet the operational needs of the water system while building and maintaining reserves for capital projects, and its debt service obligations.

The City has also completed and received certification from the State of California for its Housing Element of its General Plan. The updated plan prepares the City for development of more than 1100 new housing units over the next eight years and commits the City to ambitious housing production and redevelopment goals. It also commits the City to revisioning for its major corridors and lays the foundation for more broad scale updates to the residents of the City’s General Plan. This update will guide the future of development and shape the Lomita community for many decades to come.

RELEVANT FINANCIAL POLICIES
The City’s finances continue to be positively impacted by actual revenues which exceed conservative estimates, business license rates which are revised annually to reflect the changes in the consumer price index, and the updated valuation of the Infrastructure Assets which accurately reflect the true value of the City’s assets.

Internal Controls
The management of the City is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the government are protected from loss, theft, or other misuse and to ensure that adequate accounting data is compiled to allow for the preparation of financial statements in conformity with Generally Accepted Accounting Principles. The internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that the costs of a control should not exceed the benefits likely to be achieved. The valuation of the costs and benefits requires estimates and judgments by management.

As a recipient of Federal, State and County financial resources, the City is also responsible for ensuring that an adequate internal control structure is in place to ensure compliance with applicable laws and regulations related to those programs. The internal control structure is subject to annual evaluation by its independent auditors and periodic evaluation by management of the City.

Budgetary Controls
In addition to internal controls, the City maintains budgetary controls. The objective of these budgetary controls is to ensure compliance with legal provisions embodied in the annual appropriated budget approved CITY HALL OFFICES • 24300 NARBONNE AVENUE, LOMITA • CALIFORNIA 90717 (310) 325-7110 • FAX (310) 325-4024 • www.lomita.com/cityhall v
by the City Council. Activities of the General Fund, Special Revenue Funds, Proprietary Funds (including Internal Service and Enterprise Funds) and Fiduciary Funds are included in the annual appropriated budget.

The budget is arranged by department, function and fund and presented to the City Council by the City Manager and Administrative Services Director. The budget is then adopted annually by the City Council prior to the beginning of the fiscal year and serves as the foundation for the City's financial planning and control. The budget is reviewed at mid-year and necessary adjustments are made to ensure that expenditures are not outpacing anticipated revenues.

The City maintains an encumbrance accounting system as an additional technique of accomplishing budgetary control. As demonstrated by the statements and schedules included in the financial section of this report, the City has enhanced its responsibility for sound financial management. The legal level of control of which expenditures cannot exceed appropriations is at the functional level. The City Council is informed of expenditures over appropriations and such amounts are informally approved as a part of the bi-monthly review of the demand warrants.

Annual Audit
Gruber & Lopez, Inc., was selected by the City to audit the City's financial statements. The goal of the independent audit was to provide reasonable assurance that the financial statements of the City for the fiscal year ending June 30, 2023, are free of material misstatement. As part of the City's annual audit, reviews are made to determine the adequacy of the internal control structure as well as to determine that the City has complied with applicable laws and regulations. The independent auditor concluded there was a basis for rendering an unmodified opinion and the City’s financial statements are fairly presented in conformity with Generally Accepted Accounting Principles and GASB 34 requirements. The independent auditor’s report is presented as the first component of the financial section of this report

AWARDS AND ACKNOWLEDGEMENTS
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Lomita for its ACFR for the fiscal year ended June 30, 2022. This was the nineteenth consecutive year that the City has achieved this prestigious award.

In order to be awarded a Certificate of Achievement, the City had to publish an easily readable and efficiently organized ACFR that satisfied both generally accepted accounting principles and applicable program requirements.

A Certificate of Achievement for Excellence in Financial Reporting is valid for a period of one year only.

However, we believe that our current ACFR continues to meet the Certificate of Achievement for Excellence in Financial Reporting Program’s requirements, and we are submitting it to the GFOA to determine its eligibility for another certificate.

CITY HALL OFFICES • 24300 NARBONNE AVENUE, LOMITA • CALIFORNIA 90717 (310) 325-7110 • FAX (310) 325-4024 • www.lomita.com/cityhall vi
The preparation and publication of this report would not have been possible without the collaborative assistance of the Department Heads and staff in all City departments. First and foremost, we want to recognize the dedicated employees of the Administrative Services Department. Their professional expertise and unwavering commitment to excellence is constantly manifested in the quality of the City’s financial records and reporting.

Appreciation is also expressed to the audit staff of Gruber & Lopez, Inc., for their advice and assistance in the preparation of this report. Finally, we would like to thank the Mayor and members of the City Council for their support in planning and conducting the financial operations of the City in a responsible and progressive manner.

Respectfully submitted,
___________________________
Ryan Smoot Susan Kamada
City Manager Administrative Services Director
vii

CITY OF LOMITA

LIST OF CITY OFFICIALS

ELECTED OFFICIALS
Mayor Barry Waite
Mayor Pro Tem William Uphoff
Council Member James Gazeley

Council Member Cindy Segawa
Council Member Mark A. Waronek

CITY STAFF
City Manager Ryan Smoot
Assistant City Manager Gary Sugano
City Attorney Trevor Rusin, Best, Best & Krieger
Administrative Services Director Susan Kamada
Community & Economic
Development Director Brianna Rindge
Public Works Director Carla Dillon

CM and Directors (5) New Positions Reclassification Position Full-Time Employees (43) Planning Manager Code Enforcement Officer II (from Part-Time Employees Neighborhood Preservation Officer)
*One Treatment Operator is being underfilled at the Water Service Tech II.

Citizens of Lomita
City Council
City Manager Administrative Services Director Finance Supervisor Senior Accountant Junior Accountant Administrative Clerk III Account Clerk Assistant City Manager City Clerk Deputy City Clerk/Executive Assistant Administrative Clerk III PT Video Technician Management Analyst PT Parking Enforcement Officers Human Resources Analyst Management Assistant (0.5 FTE) Recreation & Facilities Manager Recreation Manager PT Asst Recreation Coordinators PT Recreation Leaders Recreation Supervisor PT Asst Recreation Coordinators PT Recreation Leaders (Museum) PT Recreation Leaders Maintenance Worker II Maintenance Worker I PT Maintenance Workers Management Analyst Administrative Clerk II Community & Economic Dev Director Associate Planner Assistant Planner Code Enforcement Officer II Management Assistant (0.5 FTE) PT Planning Manager* PT Planning InternPublic Works Director Chief Water Operations Manager Treatment Plant Operator (2)* Water Service Tech II* Water Service Tech I (3) PW Superintendent Streets/Trees/ Park Maint. PW Lead Worker- Street/Trees Maintenance Worker III Maintenance Worker I (3) PT Maintenance Workers PW Lead Worker-Park Maintenance Maintenance Worker II (3) Maintenance Worker I Senior Civil Engineer Assistant Engineer PT Engineering Intern Administrative Analyst Planning Commission (7) Public Safety & Traffic Commission (5) Parks & Recreation Commission (5) City Attorney viii
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Lomita
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2022
Executive Director/CEO
iv
1 438 Old Newport Blvd – Newport Beach, CA 92663
Phone (949) 346-2900 – Fax (714) 901-0024 – www.gruber-inc.com Honorable Mayor and City Council
City of Lomita, California
Independent Auditors’ Report
Opinions
We have audited the accompanying financial statements of the governmental activities, business-type activities, each major fund, and the aggregate remaining fund information of the City of Lomita, California, as of and for the year ended June 30, 2023, and the related notes to the financial statements, which collectively comprise the City of Lomita, California’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 activity, each major fund, and the aggregate remaining fund information of the City of Lomita, California, as of June 30, 2023, 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.

Emphasis of Matter
As described in Note 1 to the basic financial statements, the City adopted the provisions of Governmental Accounting Standards Board Statement No. 91 and 96. Our opinion is not modified with respect to this matter.

Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America 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 of Lomita, California, and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

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

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

City Council
City of Lomita, California
2 In performing an audit in accordance with generally accepted 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 of Lomita, California’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 of Lomita, California’s ability to continue as a going concern for a reasonable period of time.

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

Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, the schedules of proportionate share of the net pension liability and the schedules of contributions for the CalPERS miscellaneous pension plan, the schedule of changes in the net other postemployment benefit (OPEB) liability (asset) and related ratios, and the budgetary comparison schedules for the General Fund and Major Special Revenue Fund, identified as Required Supplementary Information (RSI) in the accompanying table of contents, be presented to supplement the basic financial statements. Such 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. We have applied certain limited procedures to the RSI 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 RSI because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Lomita’s basic financial statements. The combining and individual fund financial statements and schedules, and financial data schedules, as listed in the table of contents, are presented for purposes of additional analysis and are not a required part of the basic financial statements.

City Council
City of Lomita, California
3 Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statements and schedules, and financial data schedules, are fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Information
Management is responsible for the other information included in the annual report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditor’s report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.

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

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 15, 2023, on our consideration of the City of Lomita’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 of Lomita’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 of Lomita’s internal control over financial reporting and compliance.

Gruber and Lopez, Inc.

Newport Beach, California
December 15, 2023
Gruber and Lopez, Inc.
4 CITY OF LOMITA
Management’s Discussion and Analysis
The following discussion and analysis of the City of Lomita’s financial statements provides an overview of the financial activities for the fiscal year ended June 30, 2023. This document should be read in conjunction with the accompanying transmittal letter which can be found on pages i-v of this report; and the basic financial statements.

FINANCIAL HIGHLIGHTS
 The City’s assets and deferred outflows of resources exceeded its liabilities and deferred inflows of resources at the close of the 2022-2023 fiscal year by $62,191,293 (total net position). Of this amount, $8,319,476 (unrestricted net position) may be used to meet the government’s ongoing obligations to citizens and creditors.
 The City’s total net position increased $10,449,370. Net position of governmental activities increased $6,561,151 and net position of business-type activities increased $3,888,219.  As of the close of the 2022-2023 fiscal year, the City’s governmental funds reported combined fund balances of $22,098,242, an increase of $4,879,585 in comparison to the prior year. General Fund increased by $2,107,818 and American Rescue Plan Fund increased by $367,140.  At the end of the 2022-2023 fiscal year, fund balance (the total of the committed, assigned, and unassigned components of fund balance) for the General Fund was $10,662,050 or approximately 86% of total General Fund expenditures.

USING THE ANNUAL REPORT
The annual comprehensive financial reports are comprised of three components: 1) government-wide financial statements provide information about the activities of the City as a whole, except for its fiduciary activities, 2) fund financial statements illustrate how City services were financed, as well as, what remains for future spending; these statements also report the City’s operations in more detail than the government-wide statements by providing information about the City’s most significant funds, and 3) notes to the financial statements. This report also contains other supplementary information.

GOVERNMENT-WIDE FINANCIAL STATEMENTS
The Statement of Net Position and the Statement of Activities report information about the City as a whole.

These statements include all assets and liabilities using the accrual basis of accounting, which is similar to the accounting method used by most private sector companies. All of the current fiscal year’s revenues and expenses are considered regardless of when cash is received or paid.

These two statements report the City’s net position and changes in the net position. Net position, the difference between assets and liabilities, may serve over time as a useful indicator of a government’s financial position.

The City’s change in net position increased during Fiscal Year 2022-2023 despite ongoing fiscal challenges.

Consideration should also be given to other non-financial factors, such as the condition of the City’s infrastructure, to assess the overall health of the City.

The City’s basic services fall into two categories: governmental and business-type activities. Governmental activities are activities generally financed through taxes, intergovernmental revenues, and other non-exchange revenues. Business-type activities are financed in whole or in part by fees charged to external parties for goods

CITY OF LOMITA
Management’s Discussion and Analysis (Continued)
5 or services provided by the City. These activities are usually reported in enterprise funds. The City’s only business-type activity is its Water utility.

The Statement of Net position and the Statement of Activities present information about governmental and business-type activities, including General Government, Public Safety, Public Works, Community Development, Cultural and Recreation and the Water Enterprise. General revenues such as Property Taxes, Sales Taxes, Motor Vehicle-in-Lieu Fees, Refuse Taxes, Business License Taxes, Franchise Taxes, and Transient Occupancy Taxes financed approximately 68% of all governmental activities for the fiscal year.

The government-wide financial statements can be found on pages 13-15 of this report.

FUND FINANCIAL STATEMENTS
The Fund Financial Statements provide specific detailed information about the most significant funds. Included are the General Fund, Measure R Highway Special Revenue Fund, and Water Enterprise Fund. Smaller specific funds are reported collectively as Other Governmental Funds. Some funds are required to be established by State law; however, the City establishes many other funds to help control and manage costs for specific purposes or to demonstrate compliance with legal requirements for using certain taxes, grants, and other monies. The City currently has three types of funds – governmental, proprietary, and fiduciary funds.

Governmental Funds Most of the City’s basic services are reported under governmental funds. These financial statements focus on how money flows into and out of governmental funds and the balances left at fiscal yearend that are available for future appropriation. These funds are reported using the modified accrual accounting method. Under this method, revenues are recognized in the accounting period in which they become measurable and available to finance expenses of the current fiscal period while expenses are recognized in the accounting period in which the liability is incurred. There are five different types of governmental funds: the general fund, special revenue funds, debt service funds, capital projects funds, and permanent funds.

The Governmental Fund statements provide a detailed view of the City’s general government operations and the basic services it provides. Governmental fund information helps the reader determine whether there are more or less financial resources that can be spent in the near future to finance the City’s programs. The relationship (or difference) between governmental activities (reported in the Statement of Net position and Statement of Activities) and Governmental Funds are described in the reconciliation at the bottom of the fund financial statements.

The basic governmental fund financial statements can be found on pages 16-19 of this report.

Proprietary Funds This category includes enterprise and internal service funds. The City’s water operations are reflected in the Water Enterprise Fund. The cost of allocating vehicle and equipment purchases to all applicable departments citywide is represented in the Equipment Replacement and Park Equipment Replacement Fund.

The basic proprietary fund financial statements can be found on pages 20-22.

Fiduciary Funds This fund type reflects monies held on behalf of outside entities such as the Railroad Museum Foundation, and Tom Rico Memorial Fund. These funds do not belong to the City and are not used for city government activities. Fiduciary activities are reported in separate fiduciary fund financial statements. We exclude these activities from the City’s other financial statements because the City cannot use these assets to

CITY OF LOMITA
Management’s Discussion and Analysis (Continued)
6 finance its operations. The City is responsible for ensuring that the assets reported in these funds are used exclusively for their intended purpose.

The basic fiduciary fund financial statements can be found on pages 23-24.

Notes to the financial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found on pages 25-59.

Other information. In addition to the basic financial statements and accompanying notes, this report also presents required supplementary information. This required supplementary information can be found on pages 60-68 of this report.

The combining statements in connection with nonmajor governmental funds are presented on pages 69-76.

Individual fund schedules can be found on pages 77-95.

GOVERNMENT-WIDE FINANCIAL ANALYSIS
The analysis focuses on the net position and changes in net position of the City’s governmental and businesstype activities. At fiscal year-end, the City is able to report positive balances in all three categories of net position.
2023 2022 2023 2022 2023 2022
Current and other assets $ 27,199,107 $ 23,228,234 $ 8,067,442 $ 6,450,733 $ 35,266,549 $ 29,678,967 Capital assets 22,718,159 22,198,828 27,080,733 26,699,780 49,798,892 48,898,608 Total Assets: 49,917,266 45,427,062 35,148,175 33,150,513 85,065,441 78,577,575 Deferred Outflow of Resources 3,271,445 1,605,410 1,217,336 429,991 4,488,781 2,035,401 Current liabilities 2,099,218 3,341,504 1,104,265 1,287,683 3,203,483 4,629,187 Non-current liabilities 13,431,848 9,123,682 7,556,530 7,286,618 20,988,378 16,410,300 - - Total Liabilities: 15,531,066 12,465,186 8,660,795 8,574,301 24,191,861 21,039,487 Deferred Inflows of Resources 2,872,738 6,343,530 298,330 1,488,036 3,171,068 7,831,566 Net Investment in Capital
Assets 22,718,159 22,183,927 21,559,554 20,844,231 44,277,713 43,028,158 Restricted 9,594,104 7,593,689 - 9,594,104 7,593,689
Unrestricted 2,472,644 (1,553,860) 5,846,832 2,673,936 8,319,476 1,120,076 Total Net Position, as restated: $ 34,784,907 $ 28,223,756 $ 27,406,386 $ 23,518,167 $ 62,191,293 $ 51,741,923 Governmental Activities Business-type Activities TOTAL

CITY OF LOMITA NET POSITION

CITY OF LOMITA
Management’s Discussion and Analysis (Continued)
7 Net Position
The City’s assets and deferred outflows of resources exceeded its liabilities and deferred inflows of resources by $62,191,293 (net position).
 $44,277,713 (71%) of net position reflects investment in capital assets (e.g., land, buildings, machinery, equipment, vehicles, and infrastructure), net of related debt. The City uses these capital assets to provide a variety of services to its citizens. Accordingly, these assets are not available for future spending. Although the City’s investment in capital assets is reported net of related debt, it should be noted that the resources used to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.  $9,594,104 (15%) of net position is subject to external restrictions on how they may be used.  $8,319,476 (13%) of unrestricted net position may be used to meet the ongoing obligations to citizens and creditors which include the net OPEB and Pension obligations.

The City’s overall net position increased $10,449,370 from the prior year. The reasons for this overall increase are discussed in the below sections for governmental activities and business-type activities:

Governmental Activities. The net position for governmental activities increased $6,561,151 during the 2022- 2023 fiscal year for an ending balance of $34,784,307. General revenues for the governmental activities increased from the prior year by $1,857,149 or approximately 18%. The overall increase is primarily due to the approval of Measure L, vehicle license fees, and a Proposition A exchange.

Expenses increased by $278,910 from the prior year or approximately 1% primarily due to increased spending in contractual services and information technology; these expenses are driven and affected largely by increases in public health, welfare and safety and engagement of technology to meet resident expectations around data and transparency.

Additional information can be found in the statement of activities (Primary Government, pages 14-15).

CITY OF LOMITA
Management’s Discussion and Analysis (Continued)
8 Business-type Activities. The net position increased $3,888,219 during the 2022-2023 fiscal year for an ending balance of $27,406,386. The Water Enterprise business charges for water services to offset its operation expenses. Total revenues decreased $(131,011) or approximately 2% from the prior year. In comparison to the prior fiscal year, the charges for services decreased by $(236,010) or 4% due, in part, to a decrease in water usage. Related business-type activity expenses decreased during the fiscal year by $(1,843,263) or 26% compared to the previous fiscal year, a decrease resulting from the Cypress Water Production Facility project nearing its completion.
2023 2022 2023 2022 2023 2022
Revenues:

Program Revenues:

Charges for services 3, $ 3,032,299 788,818 $ 6,108,357 $ 6,344,367 $ 9,897,175 $ 9,376,666 $ Operating grants and contributions 5, 5, 790,820 - 347,576 - 5, 5, 790,820 347,576 Capital grants and contributions 723,342 - 621,557 - 723,342 621,557 General Revenues:

Property taxes 2, 1, 112,200 - 990,207 - 2, 1, 112,200 990,207 Sales and other taxes 6, 6, 655,527 - 648,700 - 6, 6, 655,527 648,700 Investment income and miscellaneous 3, 1, 477,135 1, 748,806 217,510 1,112,511 4,694,645 2, 861,317 Total Revenues: 22, 19,389,145 547,842 7,325,867 7, 29, 456,878 26, 873,709 846,023 Expenses:

General government 3, 4, 651,972 - 615,742 - 3, 4, 651,972 615,742 Public safety 4, 4, 624,434 - 385,150 - 4, 4, 624,434 385,150 Public works 1, 1, 584,797 - 557,665 - 1, 1, 584,797 557,665 Community development 1, 022,436 - 985,098 - 1, 022,436 985,098 Community services 1, 684,425 - 701,673 - 1, 684,425 701,673 Cultural and recreation 1, 1, 688,139 - 731,965 - 1, 1, 688,139 731,965 Water Enterprise operations - - 5, 7, 168,136 5, 011,399 7, 168,136 011,399 Total Expenses: 14, 13,977,293 256,203 5,168,136 7, 19, 011,399 20, 424,339 988,692 Increase (decrease) in Net Position 8,291,639 5,411,852 2,157,731 445,479 10,449,370 5,857,331 before other revenues and transfers
Transfers (1,730,488) (1,269,512) 1,730,488 1,269,512
Net position - beginning of year 28,223,756 24,081,416 23,518,167 21, 51, 803,176 45, 741,923 884,592 Net position - end of year $ 28,223,756 34,784,907 $ 27,406,386 $ 23,518,167 $ 62,191,293 $ 51,741,923 $

CITY OF LOMITA'S CHANGES IN NET POSITION
Governmental Activities Business -type Activities TOTAL $-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
$4,500,000
$5,000,000
General
government
Public safety Public works Community
development
Community
services
Culture and
recreation
Expenses and Program Revenues - Governmental Activities Expenses Program Revenues

CITY OF LOMITA
Management’s Discussion and Analysis (Continued)
9 FINANCIAL ANALYSIS OF GOVERNMENTAL FUNDS
Governmental Funds. On June 30, 2023, the City’s governmental funds reported combined fund balances of $22,098,242, an increase of $4,879,585 in comparison with the prior year. $2,761,741 or approximately 12% of this amount constitutes an unassigned fund balance, which is available for spending at the government’s discretion. The remainder of the fund balance is either non-spendable, restricted, committed, or assigned to indicate that it is: (1) not in spendable form $26,835; (2) restricted for particular purposes $4,070,880; (3) committed for particular purposes $3,919,868; or (4) assigned for particular purposes $11,318,918.

The general fund is the chief operating fund of the City. At the end of the 2022-2023 fiscal year, the unassigned fund balance of the general fund was $1,531,302, while the total fund balance increased by $2,107,818 to $10,662,050; the overall increase is primarily due to the approval of Measure L, vehicle license fees, and a Proposition A exchange. As a measure of the general fund’s liquidity, it may be useful to compare both the unassigned fund balance and the total fund balance to total general fund expenditures. Unassigned fund balance represents approximately 14% of total general fund balance, while total fund balance represents approximately 86% of that total general fund expenditures.

The American Rescue Plan Act Special Revenue Fund, a major fund, reported a fund balance of $1,336,976.

Transfers of $332,860 and $1,730,488 from the American Rescue Plan Act Fund were to reimburse the General Fund and Water Enterprise Funds for various capital related projects in the City.

Proprietary Funds. The City’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail.

Unrestricted net position of the Water Enterprise at the end of the fiscal year was $5,846,832. The total increase in net position was $3,888,219; this increase is primarily due to a transfer of $1,730,488 from the American Rescue Plan Act.

GENERAL FUND BUDGETARY HIGHLIGHTS
The revised budget estimated an increase in General Fund net change in fund balance of $502,182; however, the actual change in fund balance was an increase of $2,107,818 to arrive at a total ending General Fund Balance of $10,662,050. The overall difference in the original and final amended budgeted expenditures for the General Fund was an increase of $577,908 or 0.05%. The final amended budgeted revenues increased from the original budgeted revenues by $1,357,209 or 10%.

Revenues: In the General Fund, actual revenues were more than the amount budgeted by $860,675 or 6%.

License and permits revenues had a significant increase over budget by $847,329 or 70%, the overall increase is primarily due to increases in building & safety, planning & zoning, and encroachment fees.

Expenditures: In the General Fund, actual expenditures were less than budgeted by $(612,226) or 5%. Actual revenues over actual departmental expenditures for the General Fund were $3,350,703, not including transfers out.

CITY OF LOMITA
Management’s Discussion and Analysis (Continued)
10 CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets
The assets include a broad range of capital resources including land, buildings, equipment, furniture, vehicles, etc. Also included are public domain (infrastructure) capital assets consisting of certain improvements such as roads, streets, sidewalks, buildings, storm drains and the water main system. At the end of fiscal year 2022- 2023, the City’s net capital assets total $49,798,892 in a broad range of resources as listed below:

Major capital asset events, during the 2022-2023 fiscal year, included the following:
 Completed reconstruction of streets in city zones C and F.  Began design for the reconstruction of streets in city zone G.  Continued construction on the Cypress Water Production Facility’s (CWPF) upgrade project for a Granular Activated Carbon filtration unit at the CWPF.
 Began design of the Narbonne South Pipe Replacement Project.  Continued design of the 247th Area Water Main Replacement Project.  Completed the City Council Chambers Audio/Visual Upgrades.

Additional information on the City’s capital assets can be found in Note 5 on pages 43-45 of this report.

Long-term Debt
The City currently has several long-term obligations. The City issued a bond for the first time in its history in fiscal year 2008-09 for the construction of the new Cypress Street Reservoir, and other potential capital improvements to the City’s aged water system. During fiscal year 2022-2023, the City refinanced the water revenue bonds to take advantage of lower interest rates. Other long-term liabilities include net pension liability, compensated absences, and other post-employment benefits (OPEB). 2023 2022 2023 2022 2023 2022
Non-depreciable assets:

Land 4,993,906 $ 4,993,906 $ 70,675 $ 70,675 $ 5,064,581 $ 5,064,581 $ Street trees 1,650,378 1,650,378 - - 1,650,378 1,650,378 $ Construction in progress 295,326 2,598,005 4,497,964 3,548,783 4,793,290 6,146,788 $ Total non-depreciable assets 6,939,610 9,242,289 4,568,639 3,619,458 11,508,249 12,861,747 Capital assets, being depreciated:

Buildings/structures and improvements 984,517 1,074,995 - - 984,517 1,074,995 Equipment and furniture 695,744 310,075 74,874 85,456 770,618 395,531 Right-to-Use - Lease Equipment 11,471 15,294 - - 11,471 15,294 Right-to-Use - Subscription 141,235 - - - 141,235 -
Vehicles 336,956 114,392 77,961 54,418 414,917 168,810
Infrastructure 13,608,626 11,441,783 22,359,259 22,940,448 35,967,885 34,382,231 Total depreciable assets (net) 15,778,549 12,956,539 22,512,094 23,080,322 38,290,643 36,036,861 Total capital assets $ 22,198,828 22,718,159 $ 27,080,733 $ 26,699,780 $ 49,798,892 $ 48,898,608 $ Governmental Activities Business-Type Activities Total

CITY OF LOMITA'S CAPITAL ASSETS
(Net of depreciation)

CITY OF LOMITA
Management’s Discussion and Analysis (Continued)
11 State statutes limit the amount of general obligation debt a governmental entity may issue to 3.75 percent of the average full valuation. The current debt limitation for the City is $109,932,708, which is significantly in excess of the City’s outstanding general obligation debt of $5,416,000.

Additional information can be found in the notes section of this report (Note 6- Long-Term Debt. pages 45- 46).

ECONOMIC FACTORS AND NEXT YEAR’S BUDGET AND RATES
The following economic factors currently affect the City and were considered when developing the 2023-2024 fiscal year budget:
 The City has started the process of updating the City’s General Plan.  The City’s current unemployment rate of 2.2 percent is 2.4 percent lower than the State’s unemployment rate of 4.6 percent. It is a 0.1 percent decrease from the prior fiscal year.

REQUESTS FOR INFORMATION
This financial report is designed to provide a general overview of the City’s finances for all those with an interest in the government’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Administrative Services Department, 24300 Narbonne Avenue, Lomita, California 90717, or call (310) 325-7110. 2023 2022 2023 2022 2023 2022
Net pension liability 7,908,856 $ 3,911,512 $ 2,125,000 $ 1,541,551 $ 10,033,856 $ 5,453,063 $ OPEB 4,910,356 4,773,098 - - 4,910,356 4,773,098
Lease payable 11,234 14,901 - - 11,234 14,901
Subscription leases payable 141,235 - - - 141,235 -
Compensated absences 625,496 534,803 310,901 281,738 936,397 816,541 COP Bonds payable, net of premium - - 5,521,179 5,855,549 5,521,179 5,855,549 $ 9,234,314 13,597,177 $ 7,957,080 $ 7,678,838 $ 21,554,257 $ 16,913,152 $ Governmental Activities Business-type Activities Total

CITY OF LOMITA'S OUTSTANDING DEBT

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BASIC FINANCIAL STATEMENTS

GOVERNMENT WIDE FINANCIAL STATEMENTS
Governmental Business-Type
Activities Activities Total
ASSETS
Current assets:

Cash and investments (note 2) 24,910,429 $ 6,347,363 31,257,792 Receivable:

Accounts 214,684 1,641,237 1,855,921
Taxes 685 68,002 68,687
Interest 68,786 - 68,786
Leases (note 7) 143,180 - 143,180
Due from other governmental entities 1,834,508 - 1,834,508 Inventories 22,805 10,840 33,645
Prepaid items 4,030 - 4,030
Total current assets 27,199,107 8,067,442 35,266,549
Noncurrent assets:

Capital assets (note 5):

Non-depreciable 6,939,610 4,568,639 11,508,249
Depreciable, net 15,778,549 22,512,094 38,290,643
Total capital assets 22,718,159 27,080,733 49,798,892
Total noncurrent assets 22,718,159 27,080,733 49,798,892 Total assets 35,148,175 49,917,266 85,065,441

DEFERRED OUTFLOWS OF RESOURCES
Pensions (note 8) 2,944,143 1,217,336 4,161,479
OPEB (note 9) 327,302 - 327,302
Total deferred outflows of resources 1,217,336 3,271,445 4,488,781

LIABILITIES
Current liabilities:

Accounts payable 1,528,896 643,095 2,171,991
Accrued salaries and benefits 161,646 48,698 210,344
Interest payable - 10,922 10,922
Deposits payable 243,347 1,000 244,347
Long-term - due within one year (note 6) 165,329 400,550 565,879 Total current liabilities 2,099,218 1,104,265 3,203,483 Noncurrent liabilities:

Pension Liability (note 8) 7,908,856 2,125,000 10,033,856 OPEB (note 9) 4,910,356 - 4,910,356
Long-term - due in more than one year (note 6) 612,636 5,431,530 6,044,166 Total noncurrent liabilities 13,431,848 7,556,530 20,988,378 Total liabilities 8,660,795 15,531,066 24,191,861

DEFERRED INFLOWS OF RESOURCES
Pensions (note 8) 721,515 298,330 1,019,845
OPEB (note 9) 2,009,565 - 2,009,565
Lease related items (note 7) 141,658 - 141,658
Total deferred inflows of resources 298,330 2,872,738 3,171,068

NET POSITION
Net investment in capital assets 22,718,159 21,559,554 44,277,713 Restricted for:

Community development and services 1,545,019 - 1,545,019 Public safety 6,351 - 6,351
Public works 7,329,156 - 7,329,156
Cultural and recreation 713,578 - 713,578
Total restricted 9,594,104 - 9,594,104
Unrestricted 2,472,644 5,846,832 8,319,476
Total net position $ 27,406,386 34,784,907 62,191,293

CITY OF LOMITA
Statement of Net Position
June 30, 2023
Primary Government
See accompanying notes to the basic financial statements. 13 Operating Capital Total
Charges for Grants and Grants and Program
Expenses Services Contributions Contributions Revenue
Primary Government:

Governmental activities:

General government 3,651,972 $ 60,000 2,430,488 - 2,490,488 Public safety 4,624,434 727,215 177,287 - 904,502
Public works 1,584,797 203,713 2,345,634 511,884 3,061,231 Community development 1,022,436 2,053,254 - - 2,053,254 Community services 1,684,425 335,681 807,411 211,458 1,354,550 Cultural and recreation 1,688,139 408,955 30,000 - 438,955 Total governmental activities 14,256,203 3,788,818 5,790,820 723,342 10,302,980 Business-type activities:

Water 5,168,136 6,108,357 - - 6,108,357
Total business-type activities 5,168,136 6,108,357 - - 6,108,357 Total primary government 19,424,339 $ 9,897,175 5,790,820 723,342 16,411,337 General revenues:

Taxes:

Property taxes, net
Sales taxes
Business license tax
Franchise taxes
Refuse taxes
Transient occupancy taxes
Other taxes
Total taxes
Motor vehicle in-lieu, unrestricted
Investment income (loss)
Other revenues
Transfers

Total general revenues and transfers
Change in net position
Net position - beginning of year
Net position - end of year

CITY OF LOMITA
Statement of Activities
For the Year Ended June 30, 2023
See accompanying notes to the basic financial statements. 14 Functions/Programs
Program Revenues
Governmental Business-Type
Activities Activities Total
- (1,161,484) (1,161,484)
- (3,719,932) (3,719,932)
- 1,476,434 1,476,434
- 1,030,818 1,030,818
- (329,875) (329,875)
- (1,249,184) (1,249,184)
- (3,953,223) (3,953,223)
940,221 - 940,221
940,221 - 940,221
940,221 (3,953,223) (3,013,002)
- 2,112,200 2,112,200
- 4,944,221 4,944,221
- 678,225 678,225
- 410,506 410,506
- 346,598 346,598
- 230,035 230,035
45,942 - 45,942
- 8,767,727 8,767,727
- 2,789,586 2,789,586
90,970 (316,365) (225,395)
1,126,540 1,003,914 2,130,454
1,730,488 (1,730,488) -
10,514,374 2,947,998 13,462,372
3,888,219 6,561,151 10,449,370
28,223,756 23,518,167 51,741,923
$ 34,784,907 27,406,386 62,191,293
15 Primary Government
Net (Expense) Revenue and Changes in Net Position

FUND FINANCIAL STATEMENTS
Governmental Fund Financial Statements
Proprietary Fund Financial Statements
Fiduciary Fund Financial Statements

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

American Rescue Plan Act – Used to account for the City’s use of emergency and rescue plan activities using ARPA COVID-19 funds received from the Department of Treasury.

Non-major Total
General Rescue Governmental Governmental
Fund Plan Act Funds Funds
ASSETS
Cash and investments (note 2) 10,403,265 $ 1,336,976 10,338,705 22,078,946 Receivables:

Accounts 195,590 - - 195,590
Taxes - - 685 685
Interest 68,786 - - 68,786
Lease (note 7) 143,180 - - 143,180
Due from other governments 1,453,255 - 381,253 1,834,508 Due from other funds (note 3) 121,453 - - 121,453
Inventory 22,805 - - 22,805
Prepaid items - - 4,030 4,030
Total assets $ 12,408,334 1,336,976 10,724,673 24,469,983

LIABILITIES
Accounts payable 1,271,967 $ - 240,111 1,512,078
Accrued liabilities 115,622 - 46,024 161,646
Deposits payable 217,037 - 26,310 243,347
Due to other funds (note 3) - - 121,453 121,453
Total liabilities 1,604,626 - 433,898 2,038,524

DEFERRED IN FLOWS

OF RESOURCES
Lease related items (note 7) 141,658 - - 141,658
Unavailable revenue - - 191,559 191,559
Total deferred in flows
of resources 141,658 - 191,559 333,217

FUND BALANCES
Nonspendable 22,805 - 4,030 26,835
Restricted - - 4,070,880 4,070,880
Committed 85,744 - 3,834,124 3,919,868
Assigned 9,022,199 - 2,296,719 11,318,918
Unassigned 1,531,302 1,336,976 (106,537) 2,761,741
Total fund balances 10,662,050 1,336,976 10,099,216 22,098,242 Total liabilities, deferred inflows
and fund balances $ 12,408,334 1,336,976 10,724,673 24,469,983 Governmental Funds
June 30, 2023
Balance Sheet

CITY OF LOMITA
American
See accompanying notes to the basic financial statements. 16 Fund balances of governmental funds 22,098,242 $
Amounts reported for governmental activities in the statement of net position are different because:

Capital assets used in governmental activities were not current financial resources.

Therefore, they were not reported in the governmental funds balance sheet. Excluding the internal service funds capital assets which are reported below, capital assets were adjusted as follows:
- Capital assets 39,768,363
- Accumulated depreciation (17,393,314)
Certain revenues were not available to pay for current-period expenditures and, therefore, were deferred in funds. 191,559
Internal service funds were used by management to charge the costs of certain activities, such as insurance and fleet management, to individual funds. The assets and liabilities of the internal service funds were included in governmental activities in the government-wide statement of net position. 3,176,869
Deferred outflows related to contributions made after the actuarial measurement date for the net pension liability. 2,944,143
Deferred inflows related to unrecognized actuarial gains and losses for the net pension liability. (721,515)
Proportionate share of net pension liability has not been included in governmental fund activity. (7,908,856)
Long-term liabilities (including compensated absences, lease payable, and OPEB liability) were not due and payable in the current period. Therefore, they were not reported in the governmental funds balance sheet. This amount excludes long-term liabilities reported in Internal Service funds. (7,370,584)
Net position of governmental activities 34,784,907 $

CITY OF LOMITA
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position
June 30, 2023
See accompanying notes to the basic financial statements. 17 Non-major Total
General Rescue Governmental Governmental
Fund Plan Act Funds Funds
Revenues:

Taxes and assessments 8,767,726 $ - 658,798 9,426,524
Intergovernmental 3,730,910 2,430,488 3,191,090 9,352,488 Licenses and permits 2,056,329 - 56,156 2,112,485
Charges for services - - 8,818 8,818
Fines and forfeitures 818,565 - - 818,565
Investment income (loss) (341,239) - 166,455 (174,784)
Rental income 242,308 - 326,863 569,171
Other revenue 393,388 - 11,573 404,961
Total revenues 15,667,987 2,430,488 4,419,753 22,518,228 Expenditures:

Current:

General government 3,961,115 - - 3,961,115
Community development 1,124,403 - - 1,124,403
Community services - - 1,681,448 1,681,448
Public works 569,643 - 738,079 1,307,722
Public safety 4,642,386 - - 4,642,386
Culture and recreation 1,795,502 - 53,203 1,848,705
Capital outlay 182,735 - 592,396 775,131
Principal 41,500 - - 41,500
Total expenditures 12,317,284 - 3,065,126 15,382,410
Excess (deficiency) of revenues
over (under) expenditures 3,350,703 2,430,488 1,354,627 7,135,818 Other financing sources (uses):

Transfers in (note 4) 332,860 - 1,050,000 1,382,860
Transfers out (note 4) (1,758,480) (2,063,348) - (3,821,828) Proceeds from subscription leases 182,735 - - 182,735
Total other financing sources (uses) (1,242,885) (2,063,348) 1,050,000 (2,256,233) Net change in fund balances 2,107,818 367,140 2,404,627 4,879,585 Fund balances, beginning of year 8,554,232 969,836 7,694,589 17,218,657 Fund balances (deficit), end of year 10,662,050 $ 1,336,976 10,099,216 22,098,242 Statement of Revenues, Expenditures, and Changes in Fund Balances

CITY OF LOMITA
Governmental Funds
For the Year Ended June 30, 2023
American
See accompanying notes to the basic financial statements. 18 Changes in fund balances of governmental funds 4,879,585 $ Amounts reported for governmental activities in the statement of activities are different because:

Governmental funds report capital outlay as expenditures. However, in the government- wide statement of activities, the cost of those assets are allocated over their estimated useful lives as depreciation expense. This is the amount by which depreciation expense exceeded capital outlays in the current year, net of disposals and internal service fund activity.

Capital outlay 948,800
Depreciation expense (657,181)
To record as an expense the net change in compensated absences in the statement of activities. (90,693)
To record as an expense the net change in lease payable in the statement of activities. (137,568) To record as an expense the net change in other post employment benefits liability in the statement of activities. 19,214
Pension obligation expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds. 909,951
Internal service funds were used by management to charge the costs of certain activities, such as insurance and fleet management, to individual funds. The net revenue (expense) of the internal service funds are reported with governmental activities. 689,043 Change in net position of governmental activities 6,561,151 $ 19 CITY OF LOMITA
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balance to the Governmental-Wide Statement of Activities For the Year Ended June 30, 2023
See accompanying notes to financial statements.

PROPRIETARY FUND FINANCIAL STATEMENTS
Water Enterprise Fund - This fund is used to account for operations that are financed and operated in a manner similar to private business enterprises, where the intent of the governing body is that costs of providing water utility services to the general public on a continuing basis be financed or recovered primarily through user charges.

Internal Service Funds - This fund is used to account for the City's cost of maintenance replacing the City's capital assets. City departments are the primary users of these services and are charged a fee on a cost reimbursement basis.

Business-Type Governmental
Activities Activities
Water Enterprise Internal
Fund Service Fund
ASSETS
Current assets:

Cash and investments (note 2) 6,347,363 $ 2,831,483
Receivables:

Accounts 1,641,237 19,094
Taxes - 68,002
Inventories 10,840 -
Total current assets 8,067,442 2,850,577
Noncurrent assets:

Capital assets (note 5):

Land - 70,675
Construction in progress 4,497,964 -
Equipment and furniture 290,217 478,570
Vehicles 195,634 -
Infrastructure 32,756,543 -
Less accumulated depreciation (10,730,300) (135,460)
Total capital assets, net 27,080,733 343,110
Total noncurrent assets 27,080,733 343,110
Total assets 35,148,175 3,193,687

DEFERRED OUTFLOWS OF RESOURCES
Pensions (note 8) 1,217,336 -
Total deferred outflows of resources 1,217,336 -

LIABILITIES
Current liabilities:

Accounts payable 643,095 16,818
Accrued liabilities 48,698 -
Interest payable 10,922 -
Deposits payable 1,000 -
Bonds payable - due within one year (note 6) 338,370 -
Compensated absences - due within one year (note 6) 62,180 - Total current liabilities 1,104,265 16,818
Noncurrent liabilities:

Bonds payable - due in more than one year (note 6) 5,182,809 - Pension Liability (note 8) 2,125,000 -
Compensated absences - due in more than one year (note 6) 248,72 - 1 Total noncurrent liabilities 7,556,530 -
Total liabilities 8,660,795 16,818

DEFERRED INFLOWS OF RESOURCES
Pensions (note 8) 298,330 -
Total deferred inflows of resources 298,330 -

NET POSITION
Net investment in capital assets 21,559,554 343,110
Unrestricted 5,846,832 2,833,759
Total net position 27,406,386 $ 3,176,869

CITY OF LOMITA
Statement of Fund Net Position
Proprietary Funds
June 30, 2023
See accompanying notes to the basic financial statements. 20 Business-Type Governmental
Activities Activities
Water Enterprise Internal
Fund Service Fund
Operating revenues:

Charges for services 6,108,357 $ -
Other revenues 1,126,540 -
Total operating revenues 7,234,897 -
Operating expenses:

Cost of water purchased 2,936,699 -
Salaries, wages and benefits 545,863 -
Materials and supplies 126,786 -
Contractual services 322,520 7,500
Repairs and maintenance 217,571 20,807
Rents and leases 116,816 -
Depreciation (note 5) 771,904 20,744
Total operating expenses 5,038,159 49,051
Operating income (loss) 2,196,738 (49,051)
Non-operating revenues (expenses):

Investment income 90,970 24,874
Interest expense and fees (129,977) -
Gain (loss) on disposal of capital assets - 4,740
Total non-operating revenues (expenses) (39,007) 29,614 Income (loss) before transfers 2,157,731 (19,437)
Transfers in (note 4) 1,730,488 708,480
Change in net position 3,888,219 689,043
Net position, beginning of year 23,518,167 2,487,826
Net position, end of year 27,406,386 $ 3,176,869

CITY OF LOMITA
Statement of Revenues, Expenses, and Changes in Fund Net Position Proprietary Funds
For the year ended June 30, 2023
See accompanying notes to the basic financial statements. 21 Business-Type Governmental
Activities Activities
Water Enterprise Internal
Fund Service Fund
Cash flows from operating activities:

Cash received from customers and other governments 7,213,498 $ - Cash paid to suppliers for goods or services (3,889,347) (30,583) Cash paid to employees for services (1,923,609) -
Net cash provided (used by) operating activities 1,400,542 (30,583) Cash flows from capital and related financing activities:

Purchase, acquisition and construction of capital assets (1,152, (248,456) 858) Principal paid on capital debt (334,370) -
Proceeds on the sale of capital assets - 4,740
Interest paid on capital-related debt (130,639) -
Net cash provided (used by) capital and related financing activities (1,617,867) (243,716) Cash flows from investing activities:

Investment income 90,970 24,874
Net cash provided (used by) investing activities 90,970 24,874 Cash flows from non-capital activities - cash received
(paid) from/to other funds 1,730,488 708,480
Net increase (decrease) in cash and cash equivalents 1,604,133 459,055 Cash and equivalents, beginning of year 4,743,230 2,372,428 Cash and equivalents, end of year 6,347,363 $ 2,831,483 Reconciliation of operating income to net cash provided by operating activities:

Operating income (loss) 2,196,738 $ (49,051)
Adjustments to reconcile operating income (loss)
to net cash provided (used) by operating activities:

Depreciation 771,904 20,744
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable 34,716 (19,094) (Increase) decrease in taxes receivable (56,115) -
(Increase) decrease in inventories 8,824 -
Increase (decrease) in accounts payable (177,733) 16,818 Increase (decrease) in accrued liabilities (13,353) -
Increase (decrease) in compensated absences 29,163 -
Increase (decrease) in net pension liability, net of
deferred inflows and outflows (1,393,602) -
Total adjustments (796,196) 18,468
Net cash provided (used) by operating activities 1,400,542 $ (30,583)

CITY OF LOMITA
Statement of Cash Flows
Proprietary Funds
For the year ended June 30, 2023
See accompanying notes to the basic financial statements. 22 FIDUCIARY FUND FINANCIAL STATEMENTS
Trust Funds - Trust funds are used to report a trust arrangement. All resources of these funds including any earnings on invested resources, must be used for specific purposes as set forth in the trust agreement. The City's trust funds are for a railroad foundation and donations for a memorial.

Trust
Funds
ASSETS
Current assets:

Cash and investments (note 2) 22,052 $
Receivables:

Accounts 83
Total assets 22,135

LIABILITIES
Current liabilities:

Accounts payable 1,332
Accrued liabilities 108
Total liabilities 1,440

NET POSITION
Restricted for foundation 20,695
Total net position 20,695 $

CITY OF LOMITA
Statement of Fiduciary Net Position
Private Purpose Trust Funds
June 30, 2023
See accompanying notes to the basic financial statements. 23 Private
Purpose
Trust
Funds
Additions:

Other revenues 8,900 $
Total additions 8,900
Deductions:

Miscellaneous 10,476
Total deductions 10,476
Change in net position (1,576)
Net position, beginning of year 22,271
Net position, end of year 20,695 $

CITY OF LOMITA
Statement of Changes in Fiduciary Net Position
Private Purpose Trust Funds
For the year ended June 30, 2023
See accompanying notes to the basic financial statements. 24 25

CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
Year ended June 30, 2023
(1) Reporting Entity and Summary of Significant Accounting Policies (a) Summary of Significant Accounting Policies
The basic financial statements of the City have been prepared in conformity with generally accepted accounting principles as applicable to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.

The Financial Reporting Entity
The City of Lomita was incorporated June 30, 1964, under the general laws of the State of California. The City operates under a Council-Administrator form of government and provides the following services: public safety (police and fire through the County of Los Angeles), community services, engineering services, planning services, public works, general administrative services, and capital improvements.

This report includes governmental activities and business-type activities of the City of Lomita (the “primary government”), as well as, the Lomita Railroad Foundation, Inc. (Foundation), the Lomita Manor Housing Authority (the Authority), and the Lomita Public Financing Authority (PFA). The Foundation, the Authority, and the PFA all meet the definition of a component unit, and are presented on a “blended” basis as if they were part of the primary government. The PFA is not currently active. Although they are legally separate entities, the City Council serves as their governing board. The City may impose its will on the Foundation and the Authority, including the ability to appoint, hire, reassign or dismiss management. There is also a financial benefit/burden relationship between the City and the other entities.

The Lomita Railroad Museum Foundation, Inc. was formed September 17, 1990, as a non-profit organization under the laws of the State of California. The corporation was formed to assist in maintaining, enhancing, and promoting the Lomita Railroad Museum.

Separate financial statements are not prepared for the Foundation.

The Lomita Manor Housing Authority was formed in 1985 as a non-profit organization to administer the local U.S. Department of Housing and Urban Development (HUD) conventional housing program. The City of Lomita contracts with an outside management company to administer this program. Separate financial statements are not prepared for the Authority.

The PFA was established to simplify the issuance of tax-exempt bonds that are issued by the City for the purpose of making lower-cost financing available for certain projects that provide a public benefit, contribute to social and economic growth, and improve the overall quality of life in the City.
26 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting Entity and Summary of Significant Accounting Policies, (Continued) (b) Basis of Accounting and Measurement Focus
The basic financial statements of the City are composed of the following:
 Government-wide financial statements
 Fund financial statements
 Notes to the basic financial statements
Financial reporting is based upon all GASB pronouncements, including the GASB Codification of Accounting and Financial Reporting Guidelines.

Government-wide Financial Statements
Government-wide financial statements display information about the reporting government as a whole, except for its fiduciary activities. These statements include separate columns for the governmental and business-type activities of the primary government (including its blended component units). Eliminations have been made in the Statement of Activities so that certain allocated expenses are recorded only once (by the function to which they were allocated). However, general government expenses have not been allocated as indirect expenses to the various functions of the City.

Government-wide financial statements are presented using the economic resources measurement focus and the accrual basis of accounting. Under the economic resources measurement focus, all (both current and long-term) economic resources and obligations of the reporting government are reported in the government-wide financial statements.

Basis of accounting refers to when revenues and expenses are recognized in the accounts and reported in the financial statements. Under the accrual basis of accounting, revenues, expenses, gains, losses, assets, and liabilities resulting from exchange and exchange-like transactions are recognized when the exchange takes place. Revenues, expenses, gains, losses, assets and liabilities resulting from non-exchange transactions are recognized in accordance with GASB Statement No. 33 government-wide activity requirements. 27 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting Entity and Summary of Significant Accounting Policies, (Continued) (b) Basis of Accounting and Measurement Focus, (Continued) Program revenues include charges for services, special assessments, and payments made by parties outside of the reporting government’s citizenry if that money is restricted to a particular program. Program revenues are netted with program expenses in the statement of activities to present the net cost of each program.

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

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

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

Governmental Funds
In the fund financial statements, governmental funds are presented using the modifiedaccrual basis of accounting. Their revenues are recognized when they become measurable and available as net current assets. Measurable means that the amounts can be estimated, or otherwise determined. Available means that the amounts were collected during the reporting period or soon enough thereafter to be available to finance the expenditures accrued for the reporting period. The City uses an availability period of 60 days.
28 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting Entity and Summary of Significant Accounting Policies, (Continued) (b) Basis of Accounting and Measurement Focus, (Continued) Sales taxes, property taxes, franchise taxes, gas taxes, motor vehicle in lieu fees, transient occupancy taxes, grants and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period to the extent normally collected within the availability period. Other revenue items are considered to be measurable and available when cash is received by the government.

Revenue recognition is subject to the measurable and available criteria for the governmental funds in the fund financial statements. Exchange transactions are recognized as revenues in the period in which they are earned (i.e., the related goods or services are provided). Locally imposed derived tax revenues are recognized as revenues in the period in which the underlying exchange transaction upon which they are based takes place. Imposed nonexchange transactions are recognized as revenues in the period for which they were imposed. If the period of use is not specified, they are recognized as revenues when an enforceable legal claim to the revenues arises or when they are received, whichever occurs first. Government-mandated and voluntary nonexchange transactions are recognized as revenues when all applicable eligibility requirements have been met.

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

Accordingly, they are said to present a summary of sources and uses of “available spendable resources” during a period.

Non-current portions of long-term receivables due to governmental funds are reported on their balance sheets in spite of their spending measurement focus. Special reporting treatments are used to indicate; however, that they should not be considered “available spendable resources” since they do not represent net current assets. 29 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting Entity and Summary of Significant Accounting Policies, (Continued) (b) Basis of Accounting and Measurement Focus, (Continued) Revenues, expenditures, assets, and liabilities resulting from nonexchange transactions are recognized in accordance with the requirements of GASB Statement Nos. 33 and 65 which require that local governments defer grant revenue that is not received within the City’s adopted policy of 60 days after the fiscal year ends to meet the “available” criteria of revenue recognition. Therefore recognition of governmental fund type revenue represented by non-current receivables are deferred inflow until they become current receivables. Non-current portions of other long-term receivables are offset by fund balance reserve accounts.

Due to the nature of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by noncurrent liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities.

Amounts expended to acquire capital assets are recorded as expenditures in the year that resources were expended, rather than as fund assets. The proceeds of long-term debt are recorded as other financing sources rather than as a fund liability. Amounts paid to reduce long-term indebtedness are reported as fund expenditures.

When both restricted and unrestricted resources are combined in a fund, expenses are considered to be paid first from restricted resources, and then from unrestricted resources.

Proprietary and Fiduciary Funds
The City’s enterprise and internal service funds are proprietary funds. In the fund financial statements, proprietary funds are presented using the accrual basis of accounting. Revenues are recognized when they are earned and expenses are recognized when the related goods or services are delivered. In the fund financial statements, the proprietary fund is presented using the economic resources measurement focus. This means that all assets and all liabilities (whether current or noncurrent) associated with their activity are included on their balance sheets. Proprietary fund type operating statements present increases (revenues) and decreases (expenses) in total net position. 30 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting Entity and Summary of Significant Accounting Policies, (Continued) (b) Basis of Accounting and Measurement Focus, (Continued) Proprietary and Fiduciary Funds, (Continued)
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, taxes, and investment earnings result from nonexchange transactions or ancillary activities. Operating expenses include the cost of sales and services, administrative expenses, and depreciation on capital assets. All expenses not meeting this definition are treated as non-operating expenses. Amounts paid to acquire capital assets are capitalized as assets in the enterprise fund financial statements, rather than reported as an expenditure. Proceeds of long-term debt are recorded as a liability in the enterprise fund financial statements, rather than as an other financing source.

Amounts paid to reduce long-term indebtedness of the enterprise fund are reported as a reduction of the related liability, rather than as an expenditure. Private-purpose trust funds are used to report a trust arrangement. All resources of these funds, including any earnings on invested resources, must be used for specific purposes. (c) Fund Classifications
The City reports the following major funds:

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

American Rescue Plan Act Special Revenue Fund – Used to account for the City’s use of emergency and rescue plan activities using ARPA COVID-19 funds received from the Department of Treasury.

Water Enterprise Fund – This fund is used to account for operations that are financed and operated in a manner similar to private business enterprises, where the intent of the governing body is that costs of providing water utility services to the general public on a continuing basis be financed or recovered primarily through user charges.

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

Internal Service Fund – Internal service fund is used to account for the City’s cost of maintaining and replacing the City’s capital assets. City departments are the primary users of these services and are charged a fee on a cost reimbursement basis.

Fiduciary Funds – Fiduciary funds are used to report a trust arrangement for the Railroad Foundation and Tom Rico Memorial. All resources of these funds, including any earnings on invested resources, must be used for specific purposes as set forth in trust agreement.
31 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting City and Summary of Significant Accounting Policies, (Continued) (d) Fund Balances and Spending Policy
In the Governmental Fund Financial Statements, fund balances are classified in the following categories:

Nonspendable – Items that cannot be spent because they are not in a spendable form, such as prepaids and inventories, items that are legally or contractually required to be maintained intact, such as principal of an endowment or revolving loan fund.

Restricted – Restricted fund balances encompass the portion of net fund resources subject to externally enforceable legal restrictions. This includes externally imposed restrictions by creditors, such as through debt covenants, grantors, contributions, laws or regulations of other governments, as well as restrictions imposed by law through constitutional provisions or enabling legislation.

Committed – Committed fund balances encompass the portion of net fund resources, the use of which is constrained by limitations that the government imposes upon itself at its highest level of decision making, the City Council is considered the highest authority for the City and approves such commitments through council resolutions. These committed amounts cannot be used for any other purposes unless the City Council removes or changes the specified use through council resolution.

Assigned – Assigned fund balances encompass the portion of net fund resources reflecting the government’s intended use of resources that are neither restricted or committed. Assignment of resources can be done by the highest level of decision making (City Council Resolution) or by a committee or official designated for that purpose. The City Council has authorized the Director of Finance for the purpose to assign fund balance for specific departmental projects.

Unassigned – The General Fund is the only fund that reports a positive unassigned fund balance amount. In other governmental funds it is not appropriate to report a positive unassigned fund balance amount. However, in governmental funds other than the General Funds, if expenditures incurred for specific purposes exceed the amounts that are restricted, committed, or assigned to those purposes, it may be necessary to report a negative unassigned fund balance in that fund.

When both restricted and unrestricted resources are available for use when an expenditure is incurred, it is the City’s policy to use restricted resources first, then unrestricted resources as they are needed. It is the City’s policy to consider committed amounts as being reduced first, followed by assigned amounts, and then unassigned amounts when expenditures are incurred for purposes for which amounts in any of those unrestricted fund balance classifications could be used.
32 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting City and Summary of Significant Accounting Policies, (Continued) (e) Cash and Investments
Investments are reported in the accompanying balance sheet at fair value. These investments are not transferable and they have terms that are not affected by changes in market interest rates. Changes in fair value that occur during a fiscal year are recognized as investment income reported for that fiscal year. Investment income reports interest earnings, changes in fair value, and any gains or losses realized upon the liquidation, maturity, or sale of investments. The City’s practice is to hold investments until maturity.

As of July 1, 2015, the City adopted Governmental Accounting Standards Board ("GASB") Statement No. 72, Fair Value Measurements and Application. GASB Statement No. 72 provides guidance for determining a fair value measurement for reporting purposes, applying fair value to investments, and disclosures related to all fair value measurements. The City categorized the fair value measurements for its investments based on the hierarchy established by generally accepted accounting principles. The fair value hierarchy, which has three levels, is based on the valuation inputs used to measure fair value: Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs.

The City follows the practice of pooling cash and investments of all funds except for funds required to be held by the outside fiscal agent under provisions of the loan payable agreement. Interest income earned on pooled cash and investments is allocated quarterly to the funds based on average monthly cash and investment balances. Interest income with cash with fiscal agent is credited directly to the related fund. (f) Statement of Cash Flows
For purposes of the statement of cash flows the City considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. In addition, cash invested in the City's cash management pool is considered to be cash equivalents. (g) Capital Assets
Capital assets (including additions to infrastructure) are recorded at cost (except for intangible right-to-use lease assets which the measurement is discussed thereafter) where historical records are available and at an estimated original cost where no historical records exist. Donated capital assets, works of art and similar items, and capital assets received in service concession arrangements are valued at acquisition value at the date of donation.

Generally, capital asset purchases in excess of $5,000 (including infrastructure) are capitalized if they have an expected useful life of one year or more. Capital assets include additions to public domain (infrastructure) general capital assets consisting of certain improvements including roads and streets, curbs, gutters and sidewalks, street lights, signs and signals, park equipment and storm drains. The City chose to value its infrastructure in its entirety (e.g., prior to 1980). Capital assets used in operations are depreciated over their 33 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting City and Summary of Significant Accounting Policies, (Continued) (g) Capital Assets, (Continued)
estimated useful lives using the straight-line method in the government – wide financial statements and in the fund financial statements of the enterprise fund. Depreciation is charged as an expense against operations and accumulated depreciation is reported on the respective balance sheet. The ranges of lives used for depreciation purposes for each capital asset class are as follows:

Buildings and improvements 50 years
Leasehold improvements 10 years
Right of Use Leased Equipment/Subscriptions 3-5 years
Furniture, equipment and vehicles 3-25 years
Infrastructure - Sewer lines 25-50 years
Infrastructure – Storm drain system 20-100 years
Infrastructure - Roadways 30-100 years
Infrastructure – Waterlines 25-50 years
Infrastructure - Other 20-60 years
(h) Inventories and Prepaids
Inventories of water meters and fittings are recorded in the Water Department Enterprise Fund. Inventories in the General Fund consist of street signs. Inventories are stated at cost using the average cost method. Payments made to vendors for services that will benefit periods beyond the current fiscal year are recorded as prepaids. The City uses the consumption method when reporting prepaid items.
(i) Property Taxes
Property taxes attach as an enforceable lien on property as of the date the tax is levied.

Taxes are levied annually in August, and are payable annually in two installments in November and March. The County bills and collects the property taxes and remits them to the City in installments during the year. City property tax revenues are recognized when levied to the extent that they result in current receivables in accordance with GASB Code Section P70.

The County is permitted by State Law (Proposition 13) to levy taxes at 1% of full market value (at time of purchase) and can increase the assessed value at no more than two percent per year. The City receives a share of this basic levy. (j) Compensated Absences
The City accounts for compensated absences in accordance with GASB Statement No. 16.

In governmental funds, compensated absences are recorded as expenditures in the year paid, as it is the City’s policy to liquidate any unpaid vacation or sick leave at June 30 from future resources rather than currently available expendable resources. Accordingly, the entire unpaid liability for the governmental funds is recorded in the government-wide financial statements as these amounts will be liquidated from future resources. 34 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting City and Summary of Significant Accounting Policies, (Continued) (k) Deferred Outflows/ Inflows of Resources
In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represent a consumption of net assets that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The City has two items that qualify for reporting in this category. Deferred outflows relating to the OPEB and net pension obligation reported in the government-wide statement of net position. These outflows are the results of contributions made after the measurement period, which are expensed in the following year, and of adjustment due to difference in proportions and the difference between actual contributions made and the proportionate share of the risk pool’s total contributions.

These amounts are deferred and amortized over the expected average remaining service life time. Deferred outflows relating to the reacquisition loss on refunding bonds reported in the government-wide statement of net position and statement of fund position for proprietary funds. These outflows are the results of difference between the reacquisition price and the net carrying amount of the refunded bonds, which are recognized as a component of interest expense over the remaining life of the bonds. 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, represents an acquisition of net assets that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City has three items that qualifies for reporting in this category which are deferred inflows relating to leases, OPEB, and the net pension obligation reported in the government-wide statement of net position. These inflows are the result of the net difference between present value of future lease revenues, as well as, projected and actual earnings on OPEB and pension plan investments, respectively. The OPEB and pension amounts are deferred and amortized straight-line over a five-year period. (l) Long-Term Debt and Interest Payable
In the Government-Wide Financial Statements, long-term debt and other long-term obligations are reported as liabilities in the appropriate activities. Bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are immediately expensed in the GovernmentWide Financial Statements in addition to the Proprietary and Fiduciary Fund Statements in accordance with GASBs No. 65 and 86. In the Fund Financial Statements, with the exception of advances from other funds, long-term liabilities are not presented.

Consequently, long term debt is shown as a reconciling item in the Reconciliation of the Governmental Funds Balance Sheet to the Government-Wide Statement of Net Position. 35 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting City and Summary of Significant Accounting Policies, (Continued) (l) Long-Term Debt and Interest Payable, (Continued)
In the Government-Wide Financial Statements, interest payable on long-term debt is recognized as the liability is incurred for governmental activities and business-type activities. In the Fund Financial Statements, only propriety fund types recognize the interest payable when the liability is incurred.
(m) Net Position Flow Assumption
Sometimes the government will fund outlays for a particular purpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted – net position and unrestricted – net position in the government-wide and proprietary fund financial statements, a flow assumption must be made about the order in which the resources are considered to be applied. It is the government’s policy to consider restricted – net position to have been depleted before unrestricted – net position is applied.

In the Government-Wide Financial Statements, net position are classified in the following categories: Net Investment in Capital Assets consists of capital assets net of accumulated depreciation and reduced by outstanding debt that attributed to the acquisition, construction, or improvement of the assets.

Restricted Net Position are restricted by external creditors, grantors, contributors, laws or regulations of other governments. Unrestricted Net position is all net position that do not meet the definition of “invested in capital assets, net of related debt” or “restricted net position.”
(n) Use of Estimates
The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. In addition, estimates affect the reported amount of expenses. Actual results could differ from these estimates and assumptions.
(o) Pensions
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the City of Lomita’s California Public Employees’ Retirement System (CalPERS) plan (Plan) and additions to/deductions from the Plans’ fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.
(p) New Accounting Pronouncements
The City adopted Statement on Governmental Accounting Standards (GASB Statements) No. 91-Conduit Debt Obligations and No. 96-Subscription Based Information Technology Software. The adoption of the GASB No. 91 did not significantly impact the City.
36 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting City and Summary of Significant Accounting Policies, (Continued) (p) New Accounting Pronouncements, (Continued)
For the year ended June 30, 2023, the financial statements include the adoption of GASB Statement No. 96, Subscription-Based Information Technology Arrangements. The primary objective of this statement is to enhance the relevance and consistency of information about governments' subscription activities. This statement establishes a single model for subscription accounting based on the principle that subscriptions are financings of the right to use an underlying asset. Under this Statement, an organization is required to recognize a subscription liability and an intangible right-to-use subscription asset as described in note 1(q) below.
(q) Leases and Subscription Agreements
Lessee: The City is a lessee for a noncancellable lease of equipment and software subscriptions. The City recognizes a lease or subscription agreement liability and an intangible right-to-use lease or subscription agreement asset (lease asset) in the government-wide financial statements. The City recognizes lease liabilities with an initial, individual value of $5,000 or more.

At the commencement of a lease or subscription agreement, the City initially measures the lease liability at the present value of payments expected to be made during the lease or subscription agreement term. Subsequently, the liability is reduced by the principal portion of payments made. The lease or subscription agreement asset is initially measured as the initial amount of the liability, adjusted for payments made at or before the commencement date, plus certain initial direct costs. Subsequently, the asset is amortized on a straight-line basis over its useful life.

Key estimates and judgments related to leases include how the City determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) payments. The City uses the interest rate charged by the lessor as the discount rate. When the interest rate charged by the lessor is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for leases.

The term includes the noncancellable period of the lease. Lease payments included in the measurement of the liability are composed of fixed payments and purchase option price that the City is reasonably certain to exercise.

The City monitors changes in circumstances that would require a remeasurement of its lease and will remeasure the lease asset and liability if certain changes occur that are expected to significantly affect the amount of the lease liability.

Lease or subscription agreement assets are reported with other capital assets and lease or subscription agreement liabilities are reported with long-term debt on the Statement of Net Position.
37 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(1) Reporting City and Summary of Significant Accounting Policies, (Continued) (q) Leases, (Continued)
Lessor: The City is a lessor for a noncancellable leases of a portion of real property, as well as, building and roof space. The City recognizes a lease receivable and a deferred inflow of resources in the government-wide and governmental fund financial statements.

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

The deferred inflow of resources is initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date. Subsequently, the deferred inflow of resources is recognized as revenue over the life of the lease term.

Key elements and judgement include how the City determines (1) the discount rate it uses to discount the expected lease receipts to present value, (2) lease term, and (3) lease receipts. The City uses it estimated incremental borrowing rate as the discount rate for leases. The lease term includes the noncancellable period of the lease. Lease receipts included In the measurement of the lease receivable is composed of fixed payments from the lessee.

The City monitors changes that would require a remeasurement of its lease and will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable. (2) Cash and Investments
Cash and investments at June 30, 2023 are reported as follows in the financial statements:

Statement of net position:

Cash and investments $31,257,792
Statement of fiduciary net position:

Cash and investments 22,052
$31,279,844
38 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(2) Cash and Investments, (Continued)
Cash and investments at June 30, 2023 consisted of the following:

Petty cash $ 1,550
Demand deposits held by City 2,641,734
Investments:

Negotiable certificates of deposits 13,611,762
US Treasury Notes 996,960
US Government Bonds 4,953,280
Corporate Bonds 1,736,410
Local Agency Investment Fund 7,338,148
Total cash and investments $31,279,844
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 and the City’s investment policy. The table also identifies certain provisions of the California Government Code (or the City’s investment policy, if more restrictive) that address interest rate risk and concentration of credit risk.

Authorized *Maximum *Maximum
Investment Types By Investment *Maximum Percentage Investment Authorized by State Law Policy Maturity Of Portfolio in One Issuer

Local Agency Bonds No 5 years None None
U.S. Treasury Bills Yes None 60% None
U.S. Treasury Notes Yes 5 years 40% None
U.S. Agency Securities Yes 5 years 20% None
Banker's Acceptances Yes 180 days 10% None
Commercial Paper Yes 180 days 10% 10%
Negotiable Certificates of Deposit Yes 5 years 50% None Repurchase Agreements No 1 year None None
Passbook savings demand deposits Yes 5 years None None
Reverse Repurchase Agreements No 92 days 20% of base value None Medium-Term Notes Yes 5 years 30% None
Mutual Funds that invest only in State of
California authorized investments Yes 5 years 20% combined None
SEC registered Money Market Mutual Funds Yes 5 years None Local Agency Investment Fund (LAIF) Yes 5 years $40,000,000 None * Based on state law requirements or investment policy requirements, whichever is more restrictive. 39 CITY OF LOMITA

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

Information about the sensitivity of the fair values of the City’s to market interest rate fluctuations is provided by the following table that shows the distribution of the City’s investments by maturity:

Remaining Maturity (in Years)
1 Year 1 to 2 2 to 3 3 to 5
Investment Type Or less Years Years Years
Negotiable Certificates
of Deposit $ 13,611,762 1,226,538 3,578,171 2,975,589 5,831,464 US Treasury Notes 996,960 996,960 - - -
US Government Bonds 4,953,280 - 940,670 1,131,365 2,881,245 Corporate Bonds 1,736,410 - - 1,315,550 420,860
LAIF 7,338,148 7,338,148 - - -

Total $ 28,636,560 9,561,646 4,518,841 5,422,504 9,133,569 Fair Value Classifications
Fair value measurements are categorized based on the valuation inputs used to measure fair value: Level 1 inputs are quoted prices in active markets for identical asset assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs.

Investments categorized as Level 2 are valued using the valuation multiple approach which uses prices in observed transactions (i.e. comparable market prices) at the end of the fiscal year. 40 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(2) Cash and Investments, (Continued)
Investments' fair value measurements are as follows as of June 30, 2023:

Investment Type Fair Value Level 1 Level 2 Level 3
Negotiable Certificates
of Deposit $13,611,762 - 13,611,762 -
US Treasury Notes 996,960 - 996,960 -
US Government Bonds 4,953,280 - 4,953,280 -
Corporate Bonds 1,736,410 - 1,736,410 -
Subtotal 21,298,412 - 21,298,412 -
LAIF 7,338,148
Total Leveled Investments $28,636,560
Investments in LAIF are uncategorized as deposit and withdrawals are made on the basis of $1 and not fair value.

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

Ratings as of Year End
Minimum
Legal Not rated
Exempt from
Investment Type Rating AA+ A- BBB+ Disclosure

Negotiable Certificates
of Deposit $13,611,762 N/A - - - 13,611,762
US Treasury Notes 996,960 N/A 996,960 - - -
US Government Bonds 4,953,280 N/A 4,953,280 - - -
Corporate Bonds 1,736,410 N/A - 1,295,800 440,610 -
LAIF 7,338,148 N/A - - - 7,338,148

Total $28,636,560 5,950,240 1,295,800 440,610 20,949,910

Concentration of Credit Risk
The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. The city had no investments in any one issuer (other than U.S. Treasury securities, mutual funds, and external investment pools) that represent 5% or more of total City investments. 41 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(2) Cash and Investments, (Continued)
Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., brokerdealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the City’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits: The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The market value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits. In the current fiscal year, none of the City’s deposits with financial institutions in excess of federal depository insurance limits were held in collateralized accounts.

The City may waive collateral requirements for cash deposits, which are fully insured up to $250,000 by the Federal Deposit Insurance Corporation. The City has not agreed to such a waiver.

Investments in State Investment Pool
The City is a participant in LAIF which is regulated by California Government Code Section 16429 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.

LAIF had the following limitations:
 Agencies are limited to a deposit amount of $75 million.  Please provide LAIF one day prior notice for deposits and withdrawals of $10 million or more.
 Minimum $5,000 transaction amount in increments of $1,000.  Maximum 15 transactions (combination of deposits and withdrawals) per month. 42 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(3) Interfund Balances
Interfund balances at June 30, 2023 consisted of the following:

Due To Other Funds:

Non-major
Governmental
Funds Total
Due From Other Funds:

General Fund $121,453 $121,453
The interfund balances were to eliminate negative cash balances in non-major special revenue funds.
(4) Interfund Transfers
Interfund transfers at June 30, 2023 consisted of the following:

Transfers In:

General
Fund
Non-major
Governmental
Funds
Water
Enterprise
Fund
Internal
Service
Fund Total
Transfers Out:

General Fund $ - 1,050,000 - 708,480 1,758,480
American Rescue
Plan Act Fund 332,860 - 1,730,488 - 2,063,348
Total $332,860 1,050,000 1,730,488 708,480 3,821,828
Transfers from the General Fund to the Internal Service fund in the amount of $708,480 were for internal charges on equipment. Transfers of $332,860 and $1,730,488 from the American Rescue Plan Act Fund were to reimburse the General Fund and Water Enterprise Funds for emergency activities, respectively. The transfers were made to fund various capital related projects in the City.
43 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(5) Capital Assets
Capital asset activity for the year ended June 30, 2023 was as follows:

Governmental Activities:

Beginning Ending
Description Balance Additions Deletions Balance
Non-depreciable:

Land $ 4,993,906 - - 4,993,906
Construction in process 2,598,005 188,478 2,491,157 295,326 Street trees 1,650,378 - - 1,650,378
Total non-depreciable 9,242,289 188,478 2,491,157 6,939,610 Depreciable:

Buildings 4,523,989 - - 4,523,989
Equipment and furniture 920,306 422,924 16,000 1,327,230 Right-to-use –
Leased Equipment 19,117 - - 19,117
Right-to-use – Subscription - 182,735 - 182,735
Vehicles 442,600 255,995 119,699 578,896
Infrastructure 24,698,073 2,631,891 654,608 26,675,356
Total depreciable
capital assets 30,604,085 3,493,545 790,307 33,307,323
Less accumulated depreciation for:

Buildings 3,448,994 90,478 - 3,539,472
Equipment and furniture 610,231 37,255 16,000 631,486
Right-to-use –
Leased Equipment 3,823 3,823 - 7,646
Right-to-use – Subscription - 41,500 - 41,500
Vehicles 328,208 19,077 105,345 241,940
Infrastructure 13,256,290 465,048 654,608 13,066,730

Total accumulated
depreciation 17,647,546 657,181 775,953 17,528,774
Total depreciable
capital assets, net 12,956,539 2,836,364 14,354 15,778,549 Total capital assets, net $22,198,828 3,024,842 2,505,511 22,718,159 44 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(5) Capital Assets, (Continued)
Business-type Activities:

Beginning Ending
Description Balance Additions Deletions Balance
Non-depreciable:

Land $ 70,675 - - 70,675
Construction in process 3,548,783 1,108,261 159,080 4,497,964 Total non-depreciable 3,619,458 1,108,261 159,080 4,568,639 Depreciable:

Equipment and furniture 290,217 - - 290,217
Vehicles 164,091 31,543 - 195,634
Infrastructure 32,584,410 172,133 - 32,756,543
Total depreciable
capital assets 33,038,718 203,676 - 33,242,394
Less accumulated depreciation for:

Equipment and furniture 204,761 10,582 - 215,343
Vehicles 109,673 8,000 - 117,673
Infrastructure 9,643,962 753,322 - 10,397,284
Total accumulated
depreciation 9,958,396 771,904 - 10,730,300
Total depreciable
capital assets, net 23,080,322 (568,228) - 22,512,094
Total capital assets, net $26,699,780 540,033 159,080 27,080,733 Expenditures Remaining
Spent-to-date Commitment
Construction commitments:

Governmental activities- street projects:

Street Reconstruction – Zone G $ 108,453 $1,091,547
Lomita/Narbonne Intersection 115,076 767,924
Business-type activities-water capital improvements:

Narbonne South Pipe Replacement 51,326 1,933,674
Cypress Water Production Upgrade 4,618,829 831,171
246th-247th Pl - Western 135,389 1,364,527
45 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(5) Capital Assets, (Continued)
Depreciation expense was charged in the following functions in the Statement of Activities:

Governmental Business-Type
Activities Activities
General Government $ 65,531 -
Community Development 1,111 -
Community Services 8,754 -
Public Works 559,964 -
Culture and Recreation 21,821 -
Water - 771,904
Total $657,181 771,904
(6) Long-term Liabilities
Long-term liability activity for the year ended June 30, 2023 was as follows:

Amounts
Beginning Ending Due within
Balance Additions Deletions Balance One Year
Governmental Activities:

Lease payable $ 14,901 - 3,667 11,234 3,705
Subscription Lease payable - 182,735 41,500 141,235 36,525 Compensated absences (1) 534,823 298,287 207,614 625,496 125,099 Total governmental activities $ 549,724 481,022 252,781 777,965 165,329 Business-type Activities:

Bonds payable:

Bonds, series 2021 5,744,000 - 328,000 5,416,000 332,000 Bond premium 111,549 - 6,370 105,179 6,370
Compensated absences (2) 281,738 157,514 128,350 310,901 62,180 Total business-type activities 6,137,287 157,514 462,720 5,832,080 400,550 Total $ 6,686,991 638,536 715,501 6,610,045 565,879
(1) Compensated absences for government activities have typically been liquidated by the General Fund. (2) Compensated absences for business-type activities have typically been liquidated by the Water Fund. 46 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(6) Long-term Liabilities, (Continued)
2021 Water Revenue Refunding Bonds:

On July 15, 2021, the City issued the 2021 Water Revenue Refunding Bonds in the amount of $6,081,000 to refinance the 2016 Water Revenue Refunding Bonds in the amount of $5,995,000.

The purpose of the original 2008 bond issue was for capital improvements to the City’s water system (2008 Project). Principal payments are due in annual installments ranging from $337,000 to $450,000, commencing June 1, 2022 through June 1, 2037. The bonds accrue interest at a rate of 2.42%. Interest on the bonds is payable semiannually on June 1 and December 1, commencing on December 1, 2021. The bonds are payable solely from the net revenues of the water system of the city. Principal and interest paid for the current year, and net revenues were $465,008and $1,238,100, respectively. At June 30, 2023, the ratio of the debt service payments due to the net revenues during fiscal year 2023 was .38 (38%). Upon default by the City as defined in the bonds’ installment purchase agreement, the Authority will declare the unpaid principal and accrued interest due and payable immediately.

The bond agreement for the Water Revenue Refunding Bonds requires the city to pledge its annual net revenues (defined as total revenues (including interest and gains) for the fiscal year less operation and maintenance costs (excluding depreciation and amortization)) in an amount equal to at least 125% of the annual debt service requirement for each fiscal year through final maturity of the bonds on June 1, 2037 or early retirement of the bonds, which ever first occurs.

The amount of annual net revenues equaled 221% of the annual debt service requirement in fiscal year 2023. As of June 30, 2023, the amount of the bonds outstanding was $5,416,000 and the City’s legal debt margin was $109,932,708.

Fiscal Year Principal Interest Total

2024 $ 332,000 129,034 461,034
2025 341,000 120,952 461,952
2026 350,000 112,663 462,663
2027 359,000 104,133 463,133
2028 367,000 95,396 462,396
2029-2033 1,989,000 337,602 2,326,602
2034-2037 1,678,000 89,226 1,767,226

Total $5,416,000 989,006 6,405,006
47 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(7) Leases
Leases Payable

In January 2022, the City entered into a five-year lease agreement as lessee for the acquisition and use of equipment. An initial lease liability was recorded in the amount of $18,724 during the current fiscal year. As of June 30, 2023, the value of the lease liability was $11,234. The City is required to make monthly principal and interest payments of $319 for the equipment. The lease has an interest rate of 1.05%. The equipment has a five-year estimated useful life. The value of the right-to-use asset as of June 30, 2023 was $19,117 less accumulated amortization of $7,646.

Subscription Agreements Payable
In September 2022, the City entered into a 60 month subscription for the use of budgeting software. An initial subscription liability was recorded in the amount of $90,910. As of June 30, 2023, the value of the subscription liability is $74,410. The City is required to make annual fixed payments ranging from $20,000 to $23,000. The subscription has an interest rate of 6.0%.

The value of the right to use asset as of June 30, 2023 was $90,910 with accumulated amortization of $16,500.

In May 2022, the City entered into a 60 month subscription for the use of license and permit software. An initial subscription liability was recorded in the amount of $91,825. As of June 30, 2023, the value of the subscription liability is $66,825. The City is required to make annual fixed payments of $25,000. The subscription has an interest rate of 6.0%. The value of the right to use asset as of June 30, 2023 was $91,825 with accumulated amortization of $25,000.

The following future principal and interest payments on the leases payable and subscription agreements payable for June 30 are as follows:

Fiscal Year Principal Interest Total

2024 $ 40,348 8,593 48,941
2025 43,540 6,362 49,902
2026 46,974 3,939 50,913
2027 21,607 1,311 22,918
Total $152,469 20,205 172,674
48 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(7) Leases, (Continued)
Leases Receivable
Prior to fiscal year ended June 30, 2022, the City leased several real property to a third party which was recognized in fiscal year June 30, 2022 as a result of implementing GASB 87. The lease term is for 5 years and the City will receive monthly payments ranging from approximately $41,615 to $46,140. During the year ended June 30, 2023, the City recognized $42,182 in lease revenue and $890 in interest revenue during the current fiscal year related to the lease. As of June 30, 2023, the City’s receivable for lease payments was $85,410. Also, the City has a deferred inflow of resources associated with the lease that will be recognized as revenue over the lease term. As of June 30, 2023, the balance of the deferred inflow of resources was $128,116.

Prior to fiscal year ended June 30, 2022, the City leased a portion of building roof top space to a third party which was recognized in fiscal year June 30, 2022 as a result of implementing GASB

87. The lease term is for 5 years and the City will receive monthly payments of $29,170. During the year ended June 30, 2023, the City recognized $28,567 in lease revenue and $603 in interest revenue during the current fiscal year related to the lease. As of June 30, 2023, the City’s receivable for lease payments was $57,770. Also, the City has a deferred inflow of resources associated with the lease that will be recognized as revenue over the lease term. As of June 30, 2023, the balance of the deferred inflow of resources was $85,115. (8) Defined Benefit Pension Plans
Plan Description: All qualified permanent and probationary employees are eligible to participate in the City of Lomita’s Miscellaneous Employee Pension Plans, cost-sharing multiple employer defined benefit pension plans administered by the California Public Employees’ Retirement System (CalPERS). Benefit provisions under the Plans are established by State statute and City of Lomita resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.

Benefits Provided: CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied as specified by the Public Employees’ Retirement Law.

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

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(8) Defined Benefit Pension Plans, (Continued)
The Plans’ provisions and benefits in effect at June 30, 2023, are summarized as follows:

Miscellaneous
Prior to February 28, 2012 to On or after
Hire Date February 28, 2012 January 31, 2013 January 31, 2013 Benefit formula 2.5% @ 55 2% @ 60 2% @ 62
Benefit vesting schedule 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life Retirement age 50-55 50-63 52 - 67
Monthly benefits, as a % of
compensation 2.0% to 2.5% 1.092% to 2.418% 1.0% to 2.5% Required employee contribution rates 8.00% 7.00% 6.75%
Required contribution rates:

Normal cost rate 12.20% 8.65% 7.59%
Payment of unfunded liability $845,955 $7,265 $6,601
Contributions: Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in 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 of Lomita is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Contributions to the pension plan were $1,073,677 for the year ended June 30, 2023.

Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions - As of June 30, 2023, the City of Lomita reported net pension liabilities for its proportionate shares of the net pension liability of $10,033,856.

The City’s net pension liability for the Miscellaneous Plan is measured as the proportionate share of the net pension liability of the collective cost-sharing plan. The City’s net pension liability of the Plan is measured as of June 30, 2022, and the total pension liability for the Miscellaneous Plan used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2021, rolled forward to June 30, 2022, 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 the Miscellaneous Plan as of the June 30, 2021 and 2022 measurement dates was as follows:

Proportion – June 30, 2021 0.28718%
Proportion – June 30, 2022 0.21443%

Change – Increase/(Decrease) (0.07275)%
50 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(8) Defined Benefit Pension Plans, (Continued)
For the year ended June 30, 2023, the City of Lomita recognized pension credit of $966,340. At June 30, 2023, the City of Lomita reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred Outflows
of Resources
Deferred Inflows
of Resources
Pension contributions subsequent to
measurement date $ 1,073,677 $ -
Difference between expected and actual
experience 201,499 (134,956)
Changes in proportions 20,188 (538,604)
Difference between actual and projected
contributions - (346,285)
Difference between actual and projected
Investment earnings 1,837,936 -
Changes in assumptions 1,028,179 -
Total $4,161,479 $ (1,019,845)
$1,028,178 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, 2024. 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

2024 $ 394,078
2025 355,900
2026 193,834
2027 1,124,145
Total $ 2,067,957
51 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(8) Defined Benefit Pension Plans, (Continued)
Actuarial Assumptions – The total pension liabilities in the June 30, 2022 actuarial valuations were determined using the following actuarial assumptions:

Miscellaneous
Valuation Date June 30, 2021
Measurement Date June 30, 2022
Actuarial Cost Method Entry-Age Normal
Cost Method
Actuarial Assumptions:

Discount Rate 6.90%
Inflation 2.75%
Payroll Growth 3.0%
Projected Salary Increase Varies by Entry Age
and Service
Investment Rate of Return 7.375% (1)
Mortality (2)
(1) Net of pension plan investment expenses, including inflation. (2) The mortality table used was developed based on CalPERS’ specific data. The table includes 20 years of mortality improvements using Society of Actuaries Scale AA.

The underlying mortality assumptions and all other actuarial assumptions used in the June 30, 2016 valuation were based on the results of a actuarial experience study for the period 1997 to 2011. Further details of the Experience Study can be found on the CalPERS website.

Discount Rate – The discount rate used to measure the total pension liability was 6.90 percent.

The projection of cash flows used to determine the discount rate assumed that employee contributions will be made at the current contribution rate and that the City’s contributions will be made at rates equal to the difference between actuarially determined contributions rates and the employee rate. Based on those assumptions, each pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current active and inactive employees. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

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

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(8) Defined Benefit Pension Plans, (Continued)
Asset Class
Assumed
Asset
Allocation
Real
Return
1-10 (a)(b)

Global equity-Cap-weighted 30.0% 4.54%
Global equity-Non-Cap-weighted 12.0% 3.84%
Private Equity 13.0% 7.28%
Treasury 5.0% 0.27%
Mortgage-backed Securities 5.0% 0.50%
Investment Grade Corporates 10.0% 1.56%
High Yield 5.0% 2.27%
Emerging Market Debt 5.0% 2.48%
Private Debt 5.0% 3.57%
Real Assets 15.0% 3.21%
Leverage (5.0%) (0.59)%
Total 100%
(a) An expected inflation of 2.30% used for this period. (b) Figures are based on the 2021 Asset Liability Management study.

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, calculated using the discount rate of 6.90 percent, as well as what the City’s proportionate share of net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (5.90 percent), or 1-percentage point higher (7.90 percent), than the current rate:

Miscellaneous
1% Decrease 5.90%
Net Pension Liability $14,659,636
Current Discount Rate 6.90%
Net Pension Liability $10,033,856
1% Increase 7.90%
Net Pension Liability $6,227,986
53 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(9) Other Post Employment Benefits (OPEB)
Plan Description - In addition to the pension benefits described above, the City provides retiree health insurance benefits. The City contracts with the Public Employee’s Retirement System to provide benefits to retirees under the Employees’ Hospital and Medical Care Act. Employees who retire from the City may elect to continue their medical insurance through the available PERS plans. When retirees reach 65, they must enroll on Medicare and then may select a Medicare supplemental plan through the PERS insurance plans. This is a defined, single employer benefit plan with the City paying the minimum allowed contribution and the employees paying the balance of the selected plan premium. Changes to the plan require a resolution approved by the City Council and submitted to PERS.

Employee Covered – As of June 30, 2023 actuarial valuation, the following current and former employees were covered by the benefit terms under the plan:

Active employees 48
Inactive employees or beneficiaries currently
receiving benefits 28
Inactive employees entitled to, but not yet
receiving benefits -
Total 76
Contributions - Currently, the City funds retiree healthcare benefits on a pay-as-you-go basis.

The City recognizes expenditure for its share of the annual premiums as these benefits become due. For fiscal year 2022-2023, the City paid $207,859 for benefits of 28 retired employees.

Net OPEB Liability - The City of Lomita net OPEB liability was measured as of June 30, 2023 and the total OPEB liability used to calculate the net OEPB liability was determined by an actuarial valuation date June 30, 2023 that was rolled forward to determine the June 30, 2023 total OPEB liability, based on the following actuarial methods and assumptions:

Actuarial Assumptions:

Discount Rate 4.13%
Projected Salary Increase 2.75%
General Inflation 2.75%
Mortality Varies (1)
(1) The underlying mortality assumptions and all other actuarial assumptions used in the June 30, 2017 valuation were based on the results of a actuarial experience study for the period 1997 to 2011. Further details of the Experience Study can be found on the CalPERS website. 54 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(9) Other Post Employment Benefits (OPEB), (Continued)
Discount Rate – The discount rate used to measure the OPEB liability was 4.13 percent, which was based on the published change in return for the applicable municipal bond index.

The Changes in the net OPEB liability for the plan are as follows:

Increase (Decrease)
Total
OPEB
Liability
(a)
Plan
Fiduciary
Net Position
(b)
Net OPEB
Liability/
(Asset)
(c)=(a)-(b)
Balance at Fiscal Year Ending 6/30/22
Measurement Date 6/30/22 $4,773,098 $ - $4,773,098
Changes During the Period: -
Service Cost 144,587 - 144,587
Interest Cost 196,925 - 196,925
Expected Investment Income - - -
Employer Contributions - 207,859 (207,859)
Changes of Benefit Terms - - -
Benefit Payments (207,859) (207,859) -
Assumption Changes (1,339) - (1,339)
Plan Experience 4,944 - 4,944
Investment Experience - - -
Recognized Deferred Resources - - -
Employer Contributions Subsequent
to Measurement Date - - -
Net Changes in Fiscal Year 2022-23 137,258 - 137,258
Balance at Fiscal Year Ending 6/30/23
Measurement Date 6/30/23 $4,910,356 $ - $4,910,356
Sensitivity of the Proportionate Share of the OPEB Liability to Changes in the Discount Rate – The following presents the City of Lomita’s’ OPEB liability, calculated using the discount rate, as well as what the City’s 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 3.13%
OPEB Liability $5,601,153

Current Discount Rate 4.13%
OPEB Liability $4,910,356

1% Increase 5.13%
OPEB Liability $4,345,754
55 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(9) Other Post Employment Benefits (OPEB), (Continued)
Sensitivity of the Net OPEB Liability to Changes in the Health Care Cost Trends – The following presents the net OPEB liability of the City of Lomita if it were calculated using health care cost trend rates that are one percentage point lower or one percentage point higher than the current rate, for the measurement period June 30, 2023:
1% Decrease 5.5% decreasing to 2.83%
OPEB Liability $4,300,769
Current Healthcare Rate 6.5% decreasing to 3.83%
OPEB Liability $4,910,356
1% Increase 7.5% decreasing to 4.83%
OPEB Liability $5,665,798
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB – For the fiscal year ended June 30, 2023, the City of Lomita recognized OPEB expense of $182,845. As of the fiscal year ended June 30, 2023, the City of Lomita reported deferred outflows and inflows of resources related to OPEB from the following sources:

Deferred Outflows
of Resources
Deferred Inflows
of Resources
Change in assumptions $ 323,064 (1,171,485)
Differences between expected and
actuarial experience in measurement
of the Total OPEB Liability

4,238 (838,080)
Total $ 327,302 (2,009,565)
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

2024 $ (227,401)
2025 (227,401)
2026 (227,401)
2027 (227,401)
2028 (227,395)
Thereafter (545,264)
$(1,682,263)
(10) Risk Management
A. Description of Self-Insurance Pool Pursuant to Joint Powers Agreement: The City of Lomita is a member of the CALIFORNIA JOINT POWERS INSURANCE AUTHORITY (Authority). The Authority is composed of 124 California public entities and is organized under a joint powers agreement pursuant to California Government Code §6500 et seq. The purpose of the Authority is to arrange and administer programs for the pooling of self-insured losses, to purchase excess insurance or reinsurance, and to arrange for group purchased insurance for property and other lines of coverage. The California JPIA 56 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(10) Risk Management, (Continued)
began covering claims of its members in 1978. Each member government has an elected official as its representative on the Board of Directors. The Board operates through a nine-member Executive Committee.

B. Primary Self-Insurance Programs of the Authority: Each member pays an annual contribution at the beginning of the coverage period. A retrospective adjustment is then conducted annually thereafter, for coverage years 2012-13 and prior. Coverage years 2013-14 and forward are not subject to routine annual retrospective adjustment. The total funding requirement for primary self insurance programs is based on an actuarial analysis. Costs are allocated to individual agencies based on payroll and claims history, relative to other members of the risk-sharing pool.

Primary Liability Program: Claims are pooled separately between police and general government exposures. (1) The payroll of each member is evaluated relative to the payroll of other members. A variable credibility factor is determined for each member, which establishes the weight applied to payroll and the weight applied to losses within the formula. (2) The first layer of losses includes incurred costs up to $100,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the first layer. (3) The second layer of losses includes incurred costs from $100,000 to $500,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the second layer. (4) Incurred costs from $500,000 to $50 million, are distributed based on the outcome of cost allocation within the first and second loss layers. The overall coverage limit for each member, including all layers of coverage, is $50 million per occurrence. Subsidence losses also have a $50 million per occurrence limit. The coverage structure is composed of a combination of pooled self-insurance, reinsurance, and excess insurance. Additional information concerning the coverage structure is available on the Authority’s website: https://cjpia.org/coverage/risk-sharing-pools/.

Primary Workers’ Compensation Program: Claims are pooled separately between public safety (police and fire) and general government exposures. (1) The payroll of each member is evaluated relative to the payroll of other members. A variable credibility factor is determined for each member, which establishes the weight applied to payroll and the weight applied to losses within the formula. (2) The first layer of losses includes incurred costs up to $75,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the first layer. (3) The second layer of losses includes incurred costs from $75,000 to $200,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs within the second layer. (4) Incurred costs from $200,000 to statutory limits are distributed based on the outcome of cost allocation within the first and second loss layers. For 2022-23 the Authority’s pooled retention is $1 million per occurrence, with reinsurance to statutory limits under California Workers’ Compensation Law. Employer’s Liability losses are pooled among members to $1 million. Coverage from $1 million to $5 million is purchased as part of a reinsurance policy, and Employer’s Liability losses from $5 million to $10 million are pooled among members.

C. Purchased Insurance: Pollution Legal Liability Insurance The City of Lomita participates in the pollution legal liability insurance program which is available through the Authority. The policy covers sudden and gradual pollution of scheduled property, streets, and storm drains owned by the City of Lomita. Coverage is on a claims-made basis. There is a $250,000 deductible. The Authority has an aggregate limit of $20 million.

Property Insurance: The City of Lomita participates in the all-risk property protection program of the Authority. This insurance protection is underwritten by several insurance companies. City of Lomita 57 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(10) Risk Management, (Continued)
property is currently insured according to a schedule of covered property submitted by the City of Lomita to the Authority. City of Lomita property currently has all-risk property insurance protection in the amount of $37,590,882. There is a $10,000 deductible per occurrence except for non-emergency vehicle insurance which has a $2,500 deductible.

Earthquake and Flood Insurance: The City of Lomita purchases earthquake and flood insurance on a portion of its property. The earthquake insurance is part of the property protection insurance program of the Authority. City of Lomita property currently has earthquake protection in the amount of $7,205,100.

There is a deductible of 5% per unit of value with a minimum deductible of $100,000.

Crime Insurance: The City of Lomita purchases crime insurance coverage in the amount of $1,000,000 with a $2,500 deductible. The fidelity coverage is provided through the Authority.

Special Event Tenant User Liability Insurance: The City of Lomita further protects against liability damages by requiring tenant users of certain property to purchase low-cost tenant user liability insurance for certain activities on agency property. The insurance premium is paid by the tenant user and is paid to the City of Lomita according to a schedule. The City of Lomita then pays for the insurance. The insurance is facilitated by the Authority.

D. Adequacy of Protection: During the past three fiscal years, none of the above programs of protection experienced settlements or judgments that exceeded pooled or insured coverage. There were also no significant reductions in pooled or insured liability coverage in 2022-23. (11) Commitments and Contingencies
A. Lawsuits in the Normal Course of Business: The City is presently involved in certain matters of litigation that have arisen in the normal course of conducting City business. City management believes, based upon consultation with the City Attorney, that these cases, in the aggregate, are not expected to result in a material adverse financial impact on the City. Additionally, City management believes that the City's insurance programs are sufficient to cover any potential losses should an unfavorable outcome materialize.

B. Federal and State Grant Programs: The City participates in several federal and state grant programs.

These programs have been audited by the City's independent auditors in accordance with the provisions of the federal Single Audit Act, as amended and applicable state requirements. No cost disallowances were proposed as a result of these audits. However, these programs are still subject to further examination by the grantors and the amount, if any, of expenditures which may be disallowed by the granting agencies cannot be determined at this time.

C. Ongoing Operations: The City’s operations may be affected by the recent and ongoing outbreak of COVID-19, which was declared a pandemic by the World Health Organization in March 2020. The ultimate disruption which may be caused by the outbreak is uncertain; however, possible effects may include, but are not limited to, a reduction in certain tax revenues and a decline in the value of investments, which could have an impact on the City’s financial position and operating results. There is significant uncertainty as to the severity and longevity of the outbreak and City management is in the process of evaluating the impact on the City and its financial statements. 58 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(12) Classification of Fund Balances
The City follows the provisions of GASB Statement No. 54, “Fund Balance and Governmental Fund Type Definitions. GASB 54 established fund balance classification based largely upon the extent to which a government is bound to observe constraints imposed upon the use of the resources reported in governmental funds. The governmental fund statements conform to the new classification and are summarized as follows as of June 30, 2023:

General
Fund
ARPA
Special
Revenue
Fund

Non-major
Governmental
Funds Totals
Nonspendable
Prepaids $ - - 4,030 4,030
Inventory 22,805 - - 22,805
Total Nonspendable 22,805 - 4,030 26,835
Restricted
Street Maintenance - - 1,232,871 1,232,871
Public Transportation - - 598,536 598,536
Clean Air Act Programs - - 61,412 61,412
Safe Clean Water Program - - 505,112 505,112
Landscape Maintenance - - 10,567 10,567
Park Improvement - - 618,547 618,547
Park Athletic Program - - 95,031 95,031
Low Mod Housing & CDBG - - 942,453 942,453
Law Enforcement, CLEEP - - 6,351 6.351
Total Restricted - - 4,070,880 4,070,880
Committed
Street Improvement - - 3,834,124 3,834,124
Stephenson Center 85,744 - - 85,744
Total Committed 85,744 - 3,834,124 3,919,868
Assigned
Facilities Improvement 367,744 - - 367,744
Capital Improvement - - 188,430 188,430
Street Improvement - - 2,108,289 2,108,289
Reserve Appropriations 5,000,000 - - 5,000,000
Economic Stabilization 500,000 - - 500,000
OPEB Trust 256,548 - - 256,548
Economic Development 746,507 - - 746,507
General Plan Update 804,754 - - 804,754
Pension Stabilization 1,346,646 - - 1,346,646
Total Assigned 9,022,199 - 2,296,719 11,318,918
Unassigned 1,531,302 1,336,976 (106,537) 2,761,741
Totals $10,662,050 1,336,976 10,099,216 22,098,242

59 CITY OF LOMITA

NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
(13) Other Required Disclosures
Deficit Fund Balances
The following funds had deficit fund balances as of June 30, 2023: Non-major Special Revenue Funds:

Measure R Highway $106,537 (a)
(a) The deficit fund balance was due to actual expenses exceeding the reimbursable revenues. (14) Subsequent Events
Management has evaluated subsequent events through _______ __, 2023, which is the date the financial statements were available to be issued, and has determined that there are no transactions that will have a significant impact on the City.

REQUIRED SUPPLEMENTARY INFORMATION
Combined Combined Combined Combined
June 30, 2022 1 June 30, 2021 1 June 30, 2020 1 June 30, 2019 1 Fiscal Year Fiscal Year Fiscal Year Fiscal Year
2022-23 2021-22 2020-21 2019-20
Proportion of the net
pension liability (asset) 0.08687% 0.28718% 0.20399% 0.20145% Proportionate share of the net
pension liability (asset) 10,033,856 $ 5,453,063 $ 8,604,362 $ 8,067,243 $ Covered payroll 2 $ 3,250,441 3,406,756 $ 3,280,589 $ 3,254,459 $ Proportionate Share of the net pension
liability (asset) as percentage
of covered payroll 294.53% 167.76% 262.28% 247.88%
Plan's fiduciary net position 16,770,671,339 $ 18,065,791,524 $ 14,702,361,183 $ 13,979,687,268 $ Plan's total pension liability 21,449,898,398 $ 19,964,594,105 $ 18,920,437,526 $ 17,984,188,264 $ Plan fiduciary net position as a
percentage of the total
pension liability 70.43% 83.07% 72.81% 73.65%
1 Historical information is required only for measurement periods for which GASB 68 is applicable. 2 Covered Payroll represented above is based on pensionable earnings provided by the employer. However, GASB 68 defines covered payroll as the total of employees that are provided pensions through the pension plan. Accordingly, if pensionable earnings are different than total earnings for covered-employees, total earnings for covered-employees, the employer should display in the disclosure footnotes the payroll based on total earnings for the covered group and recalculate the required payroll-related ratios.

Notes to Schedule:

Benefit Changes: The figures above do not include any liability impact that may have resulted from plan changes which occurred after June 30, 2015. This applies for voluntary benefit changes as well as any offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) The City's defined benefit pension plan is held in a trust. There are no assets accumulated in a trust that meets the criteria of GASB codification P22.101 or P%@.101 to pay related benefits for the Pension plan. * - Fiscal year 2015 was the 1st year of implementation, therefore only nine years are shown.

CITY OF LOMITA
Schedule of Proportionate Share of the Net Pension Liability and Related Ratios June 30, 2023
Cost Sharing Defined Benefit Pension Plan
Last 10 Fiscal Years *
60 Combined Combined Combined Combined Combined
June 30, 2018 1 June 30, 2017 1 June 30, 2016 1 June 30, 2015 1 June 30, 2014 1 Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year 2018-19 2017-18 2016-17 2015-16 2014-15

0.21502% 0.22854% 0.23230% 0.18033% 0.22994%
$ 9,009,203 8,103,476 $ 8,069,774 $ 6,841,270 $ 5,682,932 $ $ 3,090,957 3,191,154 $ 2,926,047 $ 2,938,496 $ 2,954,990 $ 253.94% 291.47% 275.79% 232.82% 192.32%
$ 12,074,499,781 13,122,440,092 $ 10,923,476,287 $ 10,896,036,068 $ 10,639,461,174 $ $ 16,016,547,402 16,891,153,209 $ 14,397,353,530 $ 13,639,503,084 $ 13,110,948,452 $

72.20% 67.95% 68.65% 72.19% 76.35%
61 Combined Combined Combined Combined
Fiscal Year Fiscal Year Fiscal Year Fiscal Year
2022-23 1 2021-22 1 2020-21 1 2019-20 1
Actuarially determined contribution 2 $ 862,587 955,758 $ 782,589 $ 808,631 $ Contributions in relation to the
actuarially determined contributions 2
$ (862,587) (955,758) $ (782,589) $ (1,282,850) $
Contribution deficiency (excess) - $ - $ - $ (474,219) $ Covered payroll 3 $ 3,250,441 3,406,756 $ 3,280,589 $ 3,254,459 $ Contributions as a percentage of
covered payroll 3 28.05% 26.54% 23.86% 39.42%
1 Historical information is required only for measurement periods for which GASB 68 is applicable. 2 Employee are assumed to make contributions equal to the actuarially determined contributions. However, some employers may choose to make additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially determined contributions. CalPERS has determined that employer obligations referred to as "side funds" do not conform to the circumstances described in paragraph 120 of GASB 68, therefore are not considered separately financed specific liabilities. 3 Covered Payroll represented above is based on pensionable earnings provided by the employer. However, GASB 68 defines covered-employee payroll as the total of employees that are provided pensions through the pension plan. Accordingly, if pensionable earnings are different than total earnings for covered-employees, total earnings for covered-employees, the employer should display in the disclosure footnotes the payroll based on total earnings for the covered group and recalculate the required payroll-related ratios.

Notes to Schedule:

The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal 2018-19 were from the June 30, 2018 public agency valuations.

Actuarial cost method Entry-age
Amortization method/period For detail, see June 30, 2018 Funding Valuation Report Asset valuation method Actuarial Value of Assets. For details see June 30, 2018 Funding Valuation Report.

Inflation 2.75%
Salary increases Varies by Entry Age and Service
Payroll growth 3.00%
Investment rate of return 7.5% Net of Pension Plan Investment and Administrative expenses, includes inflation
Retirement age The probabilities of Retirement are based on the 2010 CalPERS Experience Study for the period from 1997 to 2007.

Mortality The probabilities of mortality are based on the 2010 CalPERS Experience Study for the period from 1997 to 2007. Pre-retirement and Post-Retirement mortality rates included 5 years of projected mortality improvement using Scale AA published by the Society of Actuaries.

The City's defined benefit pension plan is held in a trust. There are no assets accumulated in a trust that meets the criteria of GASB codification P22.101 or P%@.101 to pay related benefits for the Pension plan. * - Fiscal year 2015 was the 1st year of implementation, therefore only nine years are shown. 62 CITY OF LOMITA
Schedule of Plan Contributions 1
June 30, 2023
Cost Sharing Defined Benefit Pension Plan
Last 10 Fiscal Years *
Combined Combined Combined Combined Combined
Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year 2018-19 1 2017-18 1 2016-17 1 2015-16 1 2014-15 1
$ 781,413 837,192 $ 730,301 $ 562,071 $ 550,065 $
$ (781,413) (1,420,192) $ (730,301) $ (562,071) $ (550,065) $ $ - (583,000) $ - $ - $ - $
$ 3,090,957 3,191,154 $ 2,926,047 $ 2,938,496 $ 3,112,108 $

44.50% 25.28% 24.96% 19.13% 17.67%
63 2023 2022 2021 2020 2019
Total OPEB Liability
Service cost 144,587 $ 228,517 $ 198,117 $ 204,755 $ 181,090 $ Interest on the total OPEB Liability 196,925 156,877 174,777 189,858 190,222 Actual and expected
experience difference 4,944 (951,276) (157,118) (208,583) - Changes in assumptions (1,339) (1,504,719) 516,900 506,719 321,438 Changes in benefit terms - - - - -
Benefit payments (207,859) (181,233) (159,321) (127,296) (120,887) Net change in total OPEB liability 137,258 (2,251,834) 573,355 565,453 571,863 Total OPEB liability - beginning 4,773,098 7,024,932 6,451,577 5,886,124 5,314,261 Total OPEB liability - ending (a) 4,910,356 $ 4,773,098 $ 7,024,932 $ 6,451,577 $ 5,886,124 $ Plan Fiduciary Net Position
Contribution - employer 207,859 $ 181,233 $ 159,321 $ 127,296 $ 120,887 $ Net investment income - - - - -
Benefit payments (207,859) (181,233) (159,321) (127,296) (120,887) Administrative expense - - - - -
Net change in plan fiduciary
net postion - - - - -
Plan fiduciary net position -
beginning - - - - -
Plan fiduciary net position -
ending (b) - $ - $ - $ - $ - $
Net OPEB liability - ending (a)-(b) 4,910,356 $ 4,773,098 $ 7,024,932 $ 6,451,577 $ 5,886,124 $ Covered employee payroll 4,104,780 3,513,344 3,455,483 3,363,000 3,105,000 Net OPEB liability as a percentage
of covered employee payroll 119.6% 135.9% 203.3% 191.8% 189.6% Notes to Schedule
Historical information is required only for mesurement periods for which GASB 75 is applicable. Future years' information will be displayed up to 10 years as information becomes available.

The City's OPEB plan is held in a trust. There are no assets accumulated in a trust that meets the criteria of GASB codification P22.101 or P52.101 to pay related benefits for the OPEB plan.

CITY OF LOMITA
Schedule of Changes in the Net OPEB Liability and Related Ratios for the Measurement Periods Ended June 30
64 Measurement Period
2018
Total OPEB Liability
Service cost 179,837 $
Interest on the total OPEB Liability 179,461
Actual and expected
experience difference -
Changes in assumptions (86,699)
Changes in benefit terms -
Benefit payments (113,517)
Net change in total OPEB liability 159,082
Total OPEB liability - beginning 5,155,179
Total OPEB liability - ending (a) 5,314,261 $
Plan Fiduciary Net Position
Contribution - employer 113,517 $
Net investment income -
Benefit payments (113,517)
Administrative expense -
Net change in plan fiduciary
net postion -
Plan fiduciary net position -
beginning -
Plan fiduciary net position -
ending (b) - $
Net OPEB liability - ending (a)-(b) 5,314,261 $
Covered employee payroll 3,191,154
Net OPEB liability as a percentage
of covered employee payroll 166.5%
Measurement Period
65 Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Taxes and assessments 8,314,211 $ 8,557,420 8,767,726 210,306 Intergovernmental 2,990,500 3,690,500 3,730,910 40,410
Licenses and permits 1,201,000 1,209,000 2,056,329 847,329 Fines and forfeitures 490,892 517,892 818,565 300,673
Investment income (loss) 101,000 203,000 (341,239) (544,239) Rental income 250,000 250,000 242,308 (7,692)
Other revenue 102,500 379,500 393,388 13,888
Total revenues 13,450,103 14,807,312 15,667,987 860,675 Expenditures:

Current:

General government 4,225,213 4,452,946 3,961,115 491,831 Community development 889,751 1,150,955 1,124,403 26,552 Public works 655,462 664,733 569,643 95,090
Public safety 4,730,921 4,745,921 4,642,386 103,535
Culture and recreation 1,850,255 1,914,955 1,795,502 119,453 Capital outlay - - 182,735 (182,735)
Principal - - 41,500 (41,500)
Total expenditures 12,351,602 12,929,510 12,317,284 612,226 Excess (deficiency) of revenues
over (under) expenditures 1,098,501 1,877,802 3,350,703 1,472,901 Other financing sources (uses):

Transfers in 704,500 1,116,483 332,860 (783,623)
Transfers out (1,500,000) (2,492,103) (1,758,480) 733,623 Proceeds from subscription leases - - 182,735 182,735
Total other financing sources (uses) (795,500) (1,375,620) (1,242,885) 132,735 Net change in fund balances 303,001 502,182 2,107,818 1,605,636 Fund balance, beginning of year 8,554,232 8,554,232 8,554,232 - Fund balance, end of year 8,857,233 $ 9,056,414 10,662,050 1,605,636

CITY OF LOMITA
General Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
Budget Amounts
66 Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Revenues:

Intergovernmental $ 2,430,488 2,430,488 2,430,488 -
Excess (deficiency) of revenues
over (under) expenditures 2,430,488 2,430,488 2,430,488 - Other financing sources (uses):

Transfers out (2,132,988) (2,063,348) (2,063,348) -
Total other financing sources (uses) (2,132,988) (2,063,348) (2,063,348) - Net change in fund balances 297,500 367,140 367,140 -
Fund balance, beginning of year 969,836 969,836 969,836 - Fund balance (deficit), end of year 1,267,336 $ 1,336,976 1,336,976 -

CITY OF LOMITA
American Rescue Plan Act Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
Budget Amounts
67 68

CITY OF LOMITA

NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
June 30, 2023
(1) Budgets and Budgetary Accounting
The City prepares its budgets on the modified accrual basis and, accordingly, the budget amounts included in the accompanying financial statements are presented in accordance with generally accepted accounting principles.

Each year, the City Administrator submits a proposed budget to the City Council during early May. The City Council holds budget hearings during May and early June. The final budget is adopted by the City Council during late June. Funds that have irregular activity are not budgeted, hence, not budget is adopted for the Measure R Highway Special Revenue Fund. The legal level of control of which expenditures cannot exceed appropriations is at the functional level. The City Council is informed of expenditures over appropriations and such amounts are informally approved as a part of the bi-monthly review of the demand warrants.

The City holds a mid-year budget review meeting. During the meeting, all budget expenditures are reviewed and projections for the whole year are made.

Unexpended and unencumbered appropriations of the governmental funds automatically lapse at the end of the year.

SUPPLEMENTARY INFORMATION

SPECIAL REVENUE FUNDS:

CAPITAL PROJECTS FUNDS:

NON-MAJOR GOVERNMENTAL FUNDS
The following funds have been classified as non-major funds in the accompanying financial statements.

State Gas Tax Fund - Used to account for monies received from the State and County for gas sales.

CLEEP Fund - Used to account for the purchase of specialized equipment and software to enhance public safety.

Capital Improvement Fund - Used to account for the acquisition, construction and improvement of capital facilities and infrastructure. The projects are funded by transfers from the General Fund.

Measure M Fund - Used to account for street improvement projects on a cost reimbursement basis.

Measure W Fund - Used to fund projects dedicated to increase local water supply, improve water quality, and protect public health.

Community Development Block Grant Fund - Used to account for federal grants for programs benefiting low-income persons and/or families.

Measure R Fund - Used to account for street improvement projects.

Transportation Development Act Fund - Used to account for funds received from the State for improvements of local streets and roads.

Measure R Highway Fund - Used to account for street improvement projects on a cost reimbursement basis.

Proposition A Fund - Used to account for the City's share of Proposition A Local Return Funds from County sales tax dollars.

Park Grant Fund - Used to account for the grant funds received for park development and improvements.

Landscape Maintenance Fund - Used to account for assessment funds collected on property tax bills for Landscape Maintenance District #1.

Park Facilities Fund - Used to account for Park Development Tax and QUIMBY Act funds.

Proposition C Fund - Used to account for Proposition C local return revenues received from County sales tax dollars.

Air Quality Plan AB 2766 Fund - Used to account for funds received from the South Coast AQMD that were derived from clean air fees.

Park Athletic Fund - Used to account for user charges for park athletic programs.

Street Improvement Fund - Used to account for the acquisition, construction and improvement of street improvements and infrastructure. The projects are funded by transfers from the General Fund.

Lomita Manor Development Fund - Used to account for the local U.S. HUD conventional housing programs of the City-owned senior housing complex, Lomita Manor.

Transportation Community
State Development Development
Gas Tax Measure M Measure R Act Block Grant
ASSETS
Cash and investments 1,177,658 $ 724,962 678,408 - -
Receivables:

Accounts - - - - -
Taxes - - - - -
Due from other governments 158,952 - - 20,621 3,240
Prepaid items - - - - -
Total assets 1,336,610 $ 724,962 678,408 20,621 3,240

LIABILITIES
Accounts payable 63,969 $ - - 7,083 1,860
Accrued liabilities 39,770 5,193 - - -
Deposits payable - - - - -
Due to other funds - - - 13,538 1,378
Total liabilities 103,739 5,193 - 20,621 3,238

DEFERRED IN FLOWS OF RESOURCES
Unavailable revenue - - - - -
Total deferred in flows
of resources - - - - -

FUND BALANCES
Nonspendable - - - - -
Restricted 1,232,871 - - - 2
Committed - 719,769 678,408 - -
Assigned - - - - -
Unassigned - - - - -
Total fund balances 1,232,871 719,769 678,408 - 2
Total liabilities, deferred inflows
and fund balances 1,336,610 $ 724,962 678,408 20,621 3,240 69 Special Revenue Funds

CITY OF LOMITA
Non-major Governmental Funds
Combining Balance Sheet
June 30, 2023
Air Quality
Measure R Plan Park Landscape Parks
Highway Proposition A AB 2766 Grant Maintenance Facilities 630,820 - 64,531 50,000 9,882 578,347
- - - - - -
- - - - 685 -
- 191,559 6,881 - - -
- - - - - -
630,820 191,559 71,412 50,000 10,567 578,347
31,223 - 10,000 9,800 - -
1,061 - - - - -
- - - - - -
- 106,537 - - - -
32,284 106,537 10,000 9,800 - -
- 191,559 - - - -
- 191,559 - - - -
- - - - - -
598,536 - 61,412 40,200 10,567 578,347
- - - - - -
- - - - - -
- (106,537) - - - -
598,536 (106,537) 61,412 40,200 10,567 578,347
630,820 191,559 71,412 50,000 10,567 578,347
Special Revenue Funds
70 Lomita
Park Manor
Athletic Proposition C Development CLEEP Measure W
ASSETS
Cash and investments 102,978 $ 2,435,947 1,022,723 6,351 515,978 Receivables:

Accounts - - - - -
Taxes - - - - -
Due from other governments - - - - -
Prepaid items - - 4,030 - -
Total assets 102,978 $ 2,435,947 1,026,753 6,351 515,978

LIABILITIES
Accounts payable 7,947 $ - 53,962 - 10,866
Accrued liabilities - - - - -
Deposits payable - - 26,310 - -
Due to other funds - - - - -
Total liabilities 7,947 - 80,272 - 10,866

DEFERRED IN FLOWS OF RESOURCES
Unavailable revenue - - - - -
Total deferred in flows
of resources - - - - -

FUND BALANCES
Nonspendable - - 4,030 - -
Restricted 95,031 - 942,451 6,351 505,112
Committed - 2,435,947 - - -
Assigned - - - - -
Unassigned - - - - -
Total fund balances 95,031 2,435,947 946,481 6,351 505,112 Total liabilities, deferred inflows
and fund balances 102,978 $ 2,435,947 1,026,753 6,351 515,978 71 Special Revenue Funds
June 30, 2023
Combining Balance Sheet
Non-major Governmental Funds, Continued

CITY OF LOMITA
Total
Non-major
Capital Street Governmental
Improvement Improvement Funds
2,151,690 188,430 10,338,705
- - -
- - 685
- - 381,253
- - 4,030
2,151,690 188,430 10,724,673
43,401 - 240,111
- - 46,024
- - 26,310
- - 121,453
43,401 - 433,898
- - 191,559
- - 191,559
- - 4,030
- - 4,070,880
- - 3,834,124
2,108,289 188,430 2,296,719
- - (106,537)
2,108,289 188,430 10,099,216
2,151,690 188,430 10,724,673
72 Capital Projects Funds
Transportation Community
State Development Development
Gas Tax Measure M Measure R Act Block Grant
Revenues:

Taxes and assessments 530,463 $ - - - -
Intergovernmental 467,262 377,811 333,987 20,621 50,809 Licenses and permits - - - - -
Charges for services - - - - -
Investment income 20,150 12,590 12,003 - -
Rental income - - - - -
Other revenue 10,985 - - - -
Total revenues 1,028,860 390,401 345,990 20,621 50,809
Expenditures:

Current:

Community services - - - - -
Public works 504,393 - 5,680 14,643 50,808
Culture and recreation - - - - -
Capital outlay 78,474 114,335 104,479 - -
Total expenditures 582,867 114,335 110,159 14,643 50,808 Excess (deficiency) of
revenues over
(under) expenditures 445,993 276,066 235,831 5,978 1
Other financing sources (uses):

Transfers in - - - - -
Total other financing
sources (uses) - - - - -
Net change in fund balances 445,993 276,066 235,831 5,978 1 Fund balances (deficit), beginning
of year 786,878 443,703 442,577 (5,978) 1
Fund balances (deficit),
end of year 1,232,871 $ 719,769 678,408 - 2
73 Special Revenue Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances For the Year Ended June 30, 2023
Non-major Governmental Funds

CITY OF LOMITA
Air Quality
Measure R Plan Park Landscape Parks
Highway Proposition A AB 2766 Grant Maintenance Facilities - - - - 11,651 116,684
537,023 - 27,237 - - -
- - - - - -
8,818 - - - - -
13,351 - 1,126 - 128 9,870
- - - - - -
- - - - - -
559,192 - 28,363 - 11,779 126,554
1,121,844 - - - - -
- - 20,000 - 6,212 -
- - - 9,800 - -
- - - - - -
1,121,844 - 20,000 9,800 6,212 -
(562,652) - 8,363 (9,800) 5,567 126,554
- - - 50,000 - -
- - - 50,000 - -
(562,652) - 8,363 40,200 5,567 126,554
1,161,188 (106,537) 53,049 - 5,000 451,793
598,536 (106,537) 61,412 40,200 10,567 578,347
Special Revenue Funds
74 Lomita
Park Manor
Athletic Proposition C Development CLEEP Measure W
Revenues:

Taxes and assessments - $ - - - -
Intergovernmental - 445,445 403,986 - 526,909
Licenses and permits 56,156 - - - -
Charges for services - - - - -
Investment income 1,900 45,818 13,292 130 3,668
Rental income - - 326,863 - -
Other revenue 180 - 408 - -
Total revenues 58,236 491,263 744,549 130 530,577
Expenditures:

Current:

Community services - - 559,604 - -
Public works - - - - 132,343
Culture and recreation 43,403 - - - -
Capital outlay - 10,560 - - -
Total expenditures 43,403 10,560 559,604 - 132,343
Excess (deficiency) of
revenues over
(under) expenditures 14,833 480,703 184,945 130 398,234 Other financing sources (uses):

Transfers in - - - - -
Total other financing
sources (uses) - - - - -
Net change in fund balances 14,833 480,703 184,945 130 398,234 Fund balances (deficit), beginning
of year 80,198 1,955,244 761,536 6,221 106,878
Fund balances (deficit),
end of year 95,031 $ 2,435,947 946,481 6,351 505,112
75 Special Revenue Funds

CITY OF LOMITA
Non-major Governmental Funds
Combining Statement of Revenues, Expenditures and Changes in Fund Balances, Continued For the Year ended June 30, 2023
Total
Non-major
Capital Street Governmental
Improvement Improvement Funds
- - 658,798
- - 3,191,090
- - 56,156
- - 8,818
28,572 3,857 166,455
- - 326,863
- - 11,573
28,572 3,857 4,419,753
- - 1,681,448
4,000 - 738,079
- - 53,203
284,548 - 592,396
288,548 - 3,065,126
(259,976) 3,857 1,354,627
1,000,000 - 1,050,000
1,000,000 - 1,050,000
740,024 3,857 2,404,627
1,368,265 184,573 7,694,589
2,108,289 188,430 10,099,216
Capital Projects Funds
76 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Taxes and assessments $ 530,463 538,709 (8,246)
Intergovernmental 467,262 454,087 13,175
Investment income 20,150 2,000 18,150
Other revenue - 10,985 10,985
Total revenues 994,796 1,028,860 34,064
Expenditures:

Current:

Public works 504,393 528,306 23,913
Capital outlay 78,474 111,257 32,783
Total expenditures 639,563 582,867 56,696
Net change in fund balances 355,233 445,993 90,760
Fund balance, beginning of year 786,878 786,878 -
Fund balance, end of year 1,142,111 $ 1,232,871 90,760

CITY OF LOMITA
State Gas Tax Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
77 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Intergovernmental $ 377,811 351,434 26,377
Investment income 12,590 1,000 11,590
Total revenues 352,434 390,401 37,967
Expenditures:

Capital outlay 114,335 159,949 45,614
Total expenditures 159,949 114,335 45,614
Net change in fund balances 192,485 276,066 83,581
Fund balance, beginning of year 443,703 443,703 -
Fund balance, end of year 636,188 $ 719,769 83,581

CITY OF LOMITA
Measure M Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
78 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Intergovernmental $ 333,987 310,089 23,898
Investment income 12,003 3,000 9,003
Total revenues 313,089 345,990 32,901
Expenditures:

Current:

Public works 5,680 55,680 50,000
Capital outlay 104,479 112,018 7,539
Total expenditures 167,698 110,159 57,539
Net change in fund balances 145,391 235,831 90,440
Fund balance, beginning of year 442,577 442,577 -
Fund balance, end of year 587,968 $ 678,408 90,440

CITY OF LOMITA
Measure R Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
79 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Intergovernmental 19,204 $ 20,621 1,417
Total revenues 19,204 20,621 1,417
Expenditures:

Current:

Public works 14,643 13,226 (1,417)
Total expenditures 13,226 14,643 (1,417)
Net change in fund balances 5,978 5,978 -
Fund balance (deficit), beginning of year (5,978) (5,978) - Fund balance, end of year - $ - -

CITY OF LOMITA
Transportation Development Act Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
80 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Intergovernmental $ 50,809 148,379 (97,570)
Total revenues 148,379 50,809 (97,570)
Expenditures:

Current:

Public works 50,808 148,379 97,571
Total expenditures 148,379 50,808 97,571
Net change in fund balances - 1 1
Fund balance, beginning of year 1 1 -
Fund balance, end of year 1 $ 2 1

CITY OF LOMITA
Community Development Block Grant Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
81 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Intergovernmental $ 537,023 498,451 38,572
Charges for services 8,818 25,000 (16,182)
Investment income 13,351 3,000 10,351
Total revenues 526,451 559,192 32,741
Expenditures:

Current:

Community services 1,121,844 1,123,600 1,756
Total expenditures 1,123,600 1,121,844 1,756
Net change in fund balances (597,149) (562,652) 34,497
Fund balance, beginning of year 1,161,188 1,161,188 -
Fund balance, end of year 564,039 $ 598,536 34,497

CITY OF LOMITA
Proposition A Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
82 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Intergovernmental $ 27,237 26,000 1,237
Investment income 1,126 300 826
Total revenues 26,300 28,363 2,063
Expenditures:

Current:

Public works 20,000 35,000 15,000
Total expenditures 35,000 20,000 15,000
Net change in fund balances (8,700) 8,363 17,063
Fund balance, beginning of year 53,049 53,049 -
Fund balance, end of year 44,349 $ 61,412 17,063

CITY OF LOMITA
Air Quality Plan AB 2766 Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
83 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Intergovernmental $ - 222,000 (222,000)
Total revenues 222,000 - (222,000)
Expenditures:

Current:

Cultural and recreation 9,800 250,000 240,200
Total expenditures 250,000 9,800 240,200
Excess (deficiency) of revenues
over (under) expenditures (28,000) (9,800) 18,200
Other financing sources (uses):

Transfers in 50,000 50,000 -
Total other financing sources (uses) 50,000 50,000 -
Net change in fund balances 22,000 40,200 18,200
Fund balance, beginning of year - - -
Fund balance, end of year 22,000 $ 40,200 18,200

CITY OF LOMITA
Park Grant Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actua For the Year Ended June 30, 2023
84 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Taxes and assessments $ 11,651 11,738 (87)
Investment income - 128 128
Total revenues 11,738 11,779 41
Expenditures:

Current:

Public works 6,212 16,738 10,526
Total expenditures 16,738 6,212 10,526
Net change in fund balances (5,000) 5,567 10,567
Fund balance, beginning of year 5,000 5,000 -
Fund balance (deficit), end of year - $ 10,567 10,567

CITY OF LOMITA
Landscape Maintenance Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
85 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Taxes and assessments $ 116,684 5,000 111,684
Investment income 9,870 500 9,370
Total revenues 5,500 126,554 121,054
Expenditures:

Current:

Cultural and recreation - - -
Total expenditures - - -
Net change in fund balances 5,500 126,554 121,054
Fund balance, beginning of year 451,793 451,793 -
Fund balance, end of year 457,293 $ 578,347 121,054

CITY OF LOMITA
Parks Facilities Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
86 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Licenses and permits $ 56,156 54,000 2,156
Investment income 1,900 500 1,400
Other revenue - 180 180
Total revenues 54,500 58,236 3,736
Expenditures:

Current:

Cultural and recreation 43,403 51,193 7,790
Total expenditures 51,193 43,403 7,790
Net change in fund balances 3,307 14,833 11,526
Fund balance, beginning of year 80,198 80,198 -
Fund balance, end of year 83,505 $ 95,031 11,526

CITY OF LOMITA
Park Athletic Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
87 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Intergovernmental $ 445,445 413,452 31,993
Investment income 45,818 5,000 40,818
Total revenues 418,452 491,263 72,811
Expenditures:

Capital outlay 10,560 9,880 (680)
Total expenditures 9,880 10,560 (680)
Net change in fund balances 408,572 480,703 72,131
Fund balance, beginning of year 1,955,244 1,955,244 -
Fund balance, end of year 2,363,816 $ 2,435,947 72,131

CITY OF LOMITA
Proposition C Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
88 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Intergovernmental $ 403,986 176,000 227,986
Investment income 13,292 - 13,292
Rental income 326,863 288,582 38,281
Other revenue 408 3,960 (3,552)
Total revenues 468,542 744,549 276,007
Expenditures:

Current:

Community services 559,604 468,542 (91,062)
Total expenditures 468,542 559,604 (91,062)
Net change in fund balances - 184,945 184,945
Fund balance, beginning of year 761,536 761,536 -
Fund balance, end of year 761,536 $ 946,481 184,945

CITY OF LOMITA
Lomita Manor Development Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
89 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Investment income $ 130 100 30
Total revenues 100 130 30
Expenditures:

Current:

Public safety - - -
Total expenditures - - -
Net change in fund balances 100 130 30
Fund balance, beginning of year 6,221 6,221 -
Fund balance, end of year 6,321 $ 6,351 30

CITY OF LOMITA
CLEEP Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
90 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Intergovernmental $ 526,909 225,000 301,909
Investment income - 3,668 3,668
Total revenues 225,000 530,577 305,577
Expenditures:

Current:

Public works 132,343 163,076 30,733
Total expenditures 163,076 132,343 30,733
Net change in fund balances 61,924 398,234 336,310
Fund balance, beginning of year 106,878 106,878 -
Fund balance, end of year 168,802 $ 505,112 336,310

CITY OF LOMITA
Measure W Special Revenue Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
91 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Investment income $ 3,857 1,000 2,857
Total revenues 1,000 3,857 2,857
Expenditures:

Capital outlay - 5,000 5,000
Total expenditures 5,000 - 5,000
Net change in fund balances (4,000) 3,857 7,857
Fund balance, beginning of year 184,573 184,573 -
Fund balance, end of year 180,573 $ 188,430 7,857

CITY OF LOMITA
Capital Improvement Capital Projects Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
92 Variance with
Final Budget
Budget Actual Positive
Final Amounts (Negative)
Revenues:

Investment income $ 28,572 3,000 25,572
Total revenues 3,000 28,572 25,572
Expenditures:

Current:

Public works 4,000 25,000 21,000
Capital outlay 284,548 1,413,455 1,128,907
Total expenditures 1,438,455 288,548 1,149,907
Excess (deficiency) of revenues
over (under) expenditures (1,435,455) (259,976) 1,175,479 Other financing sources (uses):

Transfers in 1,000,000 1,000,000 -
Total other financing sources (uses) 1,000,000 1,000,000 - Net change in fund balances (435,455) 740,024 1,175,479 Fund balance, beginning of year 1,368,265 1,368,265 -
Fund balance, end of year 932,810 $ 2,108,289 1,175,479

CITY OF LOMITA
Street Improvement Capital Projects Fund
Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
93 FIDUCIARY FUNDS
Railroad Tom Rico
Foundation Memorial Total
ASSETS
Current assets:

Cash and investments 22,052 $ - 22,052
Receivables:

Accounts 83 - 83
Total assets 22,135 - 22,135

LIABILITIES
Current liabilities:

Accounts payable 1,332 - 1,332
Accrued liabilities 108 - 108
Total liabilities 1,440 - 1,440

NET POSITION
Restricted for foundation 20,695 - 20,695
Restricted for memorial - - -
Total net position 20,695 $ - 20,695

CITY OF LOMITA
Combining Statement of Fiduciary Net Position
Private Purpose Trust Funds
June 30, 2023
94 Railroad Tom Rico
Foundation Memorial Total
Additions:

Other revenues 8,900 $ - 8,900
Total additions 8,900 - 8,900
Deductions:

Miscellaneous 8,886 1,590 10,476
Total deductions 8,886 1,590 10,476
Change in net position 14 (1,590) (1,576)
Net position, beginning of year 20,681 1,590 22,271
Net position, end of year 20,695 $ - 20,695

CITY OF LOMITA
Combining Statement of Changes in Fiduciary Net Position Private Purpose Trust Funds
For the Year Ended June 30, 2023
95 Statistical Section
This part of the City of Lomita annual comprehensive financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the government’s overall financial health.

Contents
Financial Trends
These schedules contain trend information to help the reader understand how the government’s financial performance and well-being have changed over time.

Revenue Capacity
These schedules contain information to help the reader asses the government’s most significant local revenue source, the property tax.

Debt Capacity
These schedules present information to help the reader assess the affordability of the government’s current levels of outstanding debt and the government’s ability to issue additional debt in the future.

Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the environment with in which the government’s financial activities take place.

Operating Information
These schedules contain service and infrastructure data to help the reader understand how the information in the government’s financial report relates to the services that the government provides and the activities it performs.

Sources: Unless otherwise noted, the information in these schedules is derived from the annual comprehensive financial reports for the relevant year.

City of Lomita
Net Position by Component
Last Ten Fiscal Years
(accrual basis of accounting)
2023 2022 2021 2020 2019
Governmental activities:

Net investment in capital assets 22,718,159 $ 22,183,927 $ 20,121,459 $ 20,331,203 $ 20,579,331 $ Restricted 9,594,104 7,593,689 7,018,655 5,139,262 4,002,512 Unrestricted 2,472,644 (1,553,860) (3,058,698) (4,982,190) (4,384,212) Total governmental activities net position 34,784,907 $ 28,223,756 $ 24,081,416 $ 20,488,275 $ 20,197,631 $ Business-type activities:

Net investment in capital assets 21,559,554 $ 20,844,231 $ 18,200,296 $ 18,452,593 $ 17,995,090 $ Restricted - - - - -
Unrestricted 5,846,832 2,673,936 3,602,880 1,882,888 1,675,608 Total business-type activities net position 27,406,386 $ 23,518,167 $ 21,803,176 $ 20,335,481 $ 19,670,698 $ Primary government:

Net investment in capital assets 44,277,713 $ 43,028,158 $ 38,321,755 $ 38,783,796 $ 38,574,421 $ Restricted 9,594,104 7,593,689 7,018,655 5,139,262 4,002,512 Unrestricted (1)
1,120,076 8,319,476 544,182 (3,099,302) (2,708,604)
Total primary government net position 62,191,293 $ 51,741,923 $ 45,884,592 $ 40,823,756 $ 39,868,329 $

(1) GASB 75 was implemented June 30, 2018. The recording of the City's net OPEB liability resulted in a negative unrestricted net asset balance.

Fiscal Year
96 2018 2017 2016 2015 2014
$ 17,033,665 19,933,570 $ 18,274,572 $ 18,192,046 $ 17,423,028 $ 2,641,909 2,952,055 3,676,616 3,354,468 3,516,178
(969,590) (4,506,553) (726,465) (621,965) 3,431,164
$ 18,705,984 18,379,072 $ 21,224,723 $ 20,924,549 $ 24,370,370 $ $ 15,480,584 16,255,533 $ 16,158,075 $ 15,498,223 $ 15,313,322 $ - - 175,847 678,501 678,500
3,088,795 2,822,396 2,553,377 2,472,870 3,675,085
$ 18,569,379 19,077,929 $ 18,887,299 $ 18,649,594 $ 19,666,907 $ $ 32,514,249 36,189,103 $ 34,432,647 $ 33,690,269 $ 32,736,350 $ 2,641,909 2,952,055 3,852,463 4,032,969 4,194,678
2,119,205 (1,684,157) 1,826,912 1,850,905 7,106,249
$ 37,275,363 37,457,001 $ 40,112,022 $ 39,574,143 $ 44,037,277 $

Fiscal Year
97 City of Lomita
Changes in Net Position
Last Ten Fiscal Years
(accrual basis of accounting)
2023 2022 2021 2020 2019
Expenses:

Governmental activities:

General government 3,651,972 $ 4,615,742 $ 3,516,508 $ 3,097,344 $ 4,488,587 $ Public safety 4,624,434 4,385,150 4,122,368 3,843,357 3,633,645 Public works 1,584,797 1,557,665 2,345,393 1,830,924 1,496,818 Community development 1,022,436 985,098 720,677 691,477 683,449 Community services 1,684,425 701,673 713,824 861,971 920,398 Culture and Recreation 1,688,139 1,731,965 1,127,697 1,124,928 1,365,464 Total governmental activities expenses 14,256,203 13,977,293 12,546,467 12,347,825 11,690,537 Business-type activities:

Water Enterprise Operating Expenses 5,168,136 7,011,399 6,746,049 7,196,441 6,025,969 Total business-type activities expenses 5,168,136 7,011,399 6,746,049 6,025,969 7,196,441 Total primary government expenses 19,424,339 20,988,692 19,292,516 18,373,794 18,886,978 Program revenues:

Governmental activities:

Charges for services:

General government 60,000 160,000 60,000 60,000 60,000
Public safety 727,215 600,451 392,639 473,892 441,691
Public works 203,713 201,162 210,123 233,172 228,755
Community development 2,053,254 1,375,786 2,418,941 811,739 1,612,396 Community services 335,681 313,479 310,261 330,030 324,675 Cultural and Recreation 408,955 381,421 197,198 197,254 340,053 Operating grants and contributions 5,790,820 5,347,576 3,100,247 2,320,210 2,910,425 Capital grants and contributions 723,342 621,557 526,724 516,581 531,777 Total governmental activities
program revenues 9,001,432 10,302,980 7,216,133 6,434,576 4,958,074 Business-type activities:

Charges for services:

Water 6,108,357 6,344,367 6,433,700 6,023,257 5,629,363 Operating grants and contributions - - - - -
Capital grants and contributions - - - - -
Total business-type activities
program revenues 6,344,367 6,108,357 6,433,700 5,629,363 6,023,257 Total primary government
program revenues 15,345,799 16,411,337 13,649,833 12,063,939 10,981,331 Net revenues (expenses):

Governmental activities (3,953,223) (4,975,861) (5,330,334) (6,732,463) (5,913,249) Business-type activities 940,221 (667,032) (312,349) (396,606) (1,173,184) Total net revenues (expenses) (3,013,002) (5,642,893) (5,642,683) (6,309,855) (7,905,647)

Fiscal Year
98 2018 2017 2016 2015 2014
$ 3,507,091 4,078,593 $ 3,123,342 $ 2,899,057 $ 3,098,164 $ 3,309,683 3,549,113 3,108,606 3,016,259 3,110,281
2,028,211 1,850,296 1,440,942 868,679 1,154,889
763,932 878,350 816,396 732,230 870,304
1,480,018 926,762 861,319 1,177,247 911,817
1,199,067 1,388,433 1,196,613 1,205,707 1,162,065
12,288,002 12,671,547 10,547,218 9,899,179 10,307,520
5,221,613 5,816,026 4,938,566 4,982,663 5,064,405
5,221,613 5,816,026 4,938,566 4,982,663 5,064,405
17,509,615 18,487,573 15,485,784 14,881,842 15,371,925

60,000 60,000 60,000 60,000 61,281
373,933 386,780 364,735 377,159 297,550
193,363 224,714 211,337 189,668 402,407
846,262 992,241 1,075,688 1,413,611 1,159,824
314,290 299,478 306,110 267,026 267,952
368,800 430,563 334,994 261,195 236,828
2,194,576 2,221,458 1,516,695 1,831,908 1,481,169
779,612 713,374 328,664 417,909 982,808
5,130,836 5,328,608 4,198,223 4,818,476 4,889,819
4,789,815 5,330,322 4,435,449 4,594,551 4,566,793
- - - - -
- - - - -
4,789,815 5,330,322 4,435,449 4,594,551 4,566,793
9,920,651 10,658,930 8,633,672 9,413,027 9,456,612
(7,157,166) (7,342,939) (6,348,995) (5,080,703) (5,417,701) (431,798) (485,704) (503,117) (388,112) (497,612)
(7,588,964) (7,828,643) (6,852,112) (5,468,815) (5,915,313)

Fiscal Year
99 City of Lomita
Changes in Net Position, Continued
Last Ten Fiscal Years
(accrual basis of accounting)
2023 2022 2021 2020 2019
General revenues and other changes in net position:

Governmental activities:

Taxes:

Property taxes 2,112,200 1,990,207 1,893,942 1,776,468 1,639,059 Sales tax 4,944,221 5,040,048 2,637,134 1,884,061 2,011,963 Transient occupancy taxes 230,035 133,484 198,839 148,228 185,632 Refuse Tax 346,598 327,045 303,799 285,240 267,502
Business Licence Tax 678,225 688,309 630,812 650,737 652,617 Franchise Taxes 410,506 384,293 368,062 350,249 347,479 Other taxes 45,942 75,521 283,986 50,165 54,910
Motor vehicle in lieu, unrestricted 2,789,586 2,633,390 2,520,716 2,390,550 2,263,193 Investment income (loss) (316,365) (915,599) 13,242 202,981 167,410 Other general revenues 1,003,914 31,015 72,943 84,428 143,293 Gain on sales of property - - - - -
Transfers (1,730,488) (1,269,512) - (800,000) -
Total governmental activities 10,514,374 9,118,201 8,923,475 7,023,107 7,733,058 Business-type activities:

Investment income 90,970 10,472 7,720 73,877 78,302
Other 1,126,540 1,102,039 1,772,324 964,090 911,073
Transfers 1,730,488 1,269,512 - 800,000 -
Total business-type activities 2,947,998 2,382,023 1,780,044 1,837,967 989,375 Total primary government 13,462,372 11,500,224 10,703,519 8,861,074 8,722,433 Changes in net position
Governmental activities 6,561,151 4,142,340 3,593,141 290,644 1,819,809 Business-type activities 3,888,219 1,714,991 1,467,695 664,783 592,769 Total primary government 10,449,370 $ 5,857,331 $ 5,060,836 $ 955,427 $ 2,412,578 $ Fiscal Year
100
2018 2017 2016 2015 2014

1,523,888 1,657,387 1,748,361 1,807,043 1,840,685
1,625,596 1,769,925 1,474,499 1,289,649 1,336,438
178,239 180,278 150,091 133,642 122,510
253,270 258,776 243,783 242,841 235,523
544,333 617,755 550,167 584,131 505,590
335,077 345,511 400,033 357,134 360,228
16,000 51,760 4,000 20,550 7,000
2,038,861 2,142,009 1,939,675 1,842,511 1,762,032
7,322 (40,487) 138,154 67,806 60,760
341,477 33,113 406 11,226 10,310
- - - - -
2,733 - - - -
6,866,796 7,016,027 6,649,169 6,356,533 6,241,076

9,563 10,737 7,447 4,128 5,035
827,067 983,517 733,375 871,796 750,446
(2,733) - - - -
833,897 994,254 740,822 875,924 755,481
7,700,693 8,010,281 7,389,991 7,232,457 6,996,557
(290,370) (326,912) 300,174 1,275,830 823,375
402,099 508,550 237,705 487,812 257,869
$ 111,729 181,638 $ 537,879 $ 1,763,642 $ 1,081,244 $

Fiscal Year
101
City of Lomita
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)

2023 2022 2021 2020 2019
General fund:

Nonspendable 22,805 $ 28,777 $ 25,095 $ 24,561 $ 22,444 $ Committed 85,744 85,744 85,744 85,744 85,744
Assigned 9,022,199 7,334,625 6,304,510 5,591,510 5,853,930 Unassigned 1,531,302 1,105,086 1,098,165 980,273 980,422 Total general fund 10,662,050 8,554,232 7,513,514 6,682,088 6,942,540 All other governmental funds:

Nonspendable 4,030 3,670 3,332 4,095 5,016
Restricted 4,070,880 3,409,072 2,767,734 1,879,238 1,382,246 Committed 3,834,124 2,841,524 2,850,143 2,400,803 1,777,503 Assigned 2,296,719 1,552,838 1,505,677 855,145 837,747
Unassigned 1,230,439 857,321 (106,537) (266,125) (10,268) Total all other governmental funds 11,436,192 8,664,425 7,020,349 4,873,156 3,992,244 Grand Total 22,098,242 17,218,657 14,533,863 11,555,244 10,934,784 Fiscal Year
102
2018 2017 2016 2015 2014
$ 18,896 20,384 $ 499,516 $ 281,510 $ 354,869 $
89,343 89,343 104,132 22,500 -
5,180,075 5,274,835 4,986,341 4,111,396 3,885,436
1,544,373 1,002,484 789,516 1,516,969 832,656
6,832,687 6,387,046 6,379,505 5,932,375 5,072,961
6,185 3,053 1,130 1,227 1,376
602,516 987,480 1,151,250 1,137,673 1,727,257
1,192,592 1,229,487 1,318,552 1,548,912 -
877,480 746,778 1,210,815 843,681 1,908,056
(375,303) (505,587) (2,785) (177,025) (120,511)
2,303,470 2,461,211 3,678,962 3,354,468 3,516,178
9,136,157 8,848,257 10,058,467 9,286,843 8,589,139
Fiscal Year
103
City of Lomita
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
2023 2022 2021 2020 2019
Revenues:

Taxes and assessments 9,426,524 $ 9,293,309 $ 6,922,990 $ 5,619,851 $ 5,578,097 $ Intergovernmental 9,352,488 8,392,801 5,788,221 4,784,452 5,808,278 Licenses and permits 2,112,485 1,315,005 2,428,326 886,378 1,768,927 Charges for services 8,818 9,466 7,824 20,390 26,937
Fines and forfeitures 818,565 619,001 394,939 496,842 463,291 Investment income (loss) (174,784) (899,406) 23,839 321,521 247,567 Rental income 569,171 537,171 493,144 521,382 527,172
Other 404,961 120,377 76,341 233,783 126,436
Total revenues 22,518,228 19,387,724 16,135,624 14,654,052 12,777,252 Expenditures
Current:

General government 3,961,115 3,654,560 2,909,752 2,738,871 3,803,130 Community development 1,124,403 914,687 685,949 663,348 656,309 Community services 1,681,448 686,419 691,979 840,928 901,046 Public works 1,307,722 1,371,232 1,345,083 1,194,563 1,058,516 Public safety 4,642,386 4,371,832 4,119,547 3,842,231 3,632,226 Cultural and recreation 1,848,705 1,551,436 1,096,712 1,353,101 1,109,354 Capital outlay 775,131 2,285,223 907,943 532,191 1,205,694 Debt service:

Principal retirement 41,500 3,823 - - -
Interest and fiscal charges - - - - -
Total expenditures 15,382,410 14,839,212 11,756,965 12,366,275 11,165,233 Excess (deficiency) of
revenues over (under)
expenditures 7,135,818 4,548,512 4,378,659 2,287,777 1,612,019 Other financing sources (uses):

Transfers in 1,382,860 980,164 923,260 12,000 338,343
Transfers out (3,821,828) (2,862,606) (2,323,260) (812,000) (538,343) Proceeds from leases 182,735 18,724 - - -
Issuance of bonds - - - - -
Payment to bond escrow agent - - - - -
Total other financing
sources (uses) (2,256,233) (1,863,718) (1,400,000) (800,000) (200,000) Net change in fund balances 4,879,585 2,684,794 2,978,659 2,087,777 812,019

0.28% 0.03% n/a n/a n/a
Fiscal Year
Ratio of total debt service
expenditures to total noncapital
expenditures.
104
2018 2017 2016 2015 2014
$ 4,929,177 5,390,929 $ 5,036,023 $ 5,100,944 $ 5,050,191 $ 3,713,536 4,604,060 3,715,286 3,485,555 3,914,285
1,054,795 1,150,494 1,250,947 1,558,515 1,356,968
20,210 25,384 19,571 20,628 20,051
376,733 444,580 372,735 387,659 297,550
20,354 (31,440) 147,297 72,312 67,288
489,831 511,890 514,200 444,488 430,481
756,655 95,697 62,772 59,673 62,136
11,361,291 12,191,594 11,118,831 11,129,774 11,198,950
2,687,690 3,047,279 2,735,363 2,553,174 2,694,870
745,442 857,609 799,282 722,548 849,720
1,464,068 908,870 846,556 1,168,895 894,060
1,072,359 1,047,337 925,359 783,041 747,972
3,309,683 3,549,113 3,108,606 3,016,259 3,110,281
1,199,067 1,388,433 1,196,613 1,205,707 1,162,065
1,768,025 1,608,353 710,564 927,446 1,820,774
- - - - -
- - - - -
12,246,334 12,406,994 10,322,343 10,377,070 11,279,742
(215,400) (885,043) 796,488 752,704 (80,792)
135,490 357,616 339,569 317,553 467,221
(172,757) (430,116) (439,569) (372,553) (492,221)
- - - - -
- - - - -
- - - - -
(72,500) (37,267) (100,000) (55,000) (25,000)
(287,900) (922,310) 696,488 697,704 (105,792)
n/a n/a n/a n/a n/a
Fiscal Year
105
City of Lomita
Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years
Fiscal Year Taxable Percent Total
Ended Less: Assessed Change Direct Tax
June 30 Secured Unsecured Exemptions 1 Value Residential Income Industrial Total Rate 2013/14 1,835,389,728 30,658,161 1,866,047,889 3.62% 4,581 475 16 5,072 0.10263% 2014/15 1,909,903,891 32,194,065 1,942,097,956 4.08% 4,583 473 16 5,072 0.10263% 2015/16 2,014,069,980 31,249,739 2,045,319,719 5.31% 4,579 477 16 5,072 0.10263% 2016/17 2,117,244,522 32,349,456 2,149,593,978 5.10% 4,580 477 15 5,072 0.10263% 2017/18 2,225,454,844 31,629,569 2,257,084,413 5.00% 4,580 475 15 5,070 0.10263% 2018/19 2,351,141,143 35,125,603 2,386,266,746 5.72% 4,598 475 14 5,087 0.10263% 2019/20 2,520,927,188 35,884,762 2,556,811,950 7.15% 4,602 470 14 5,086 0.10263% 2020/21 2,665,742,123 36,097,437 2,701,839,560 5.67% 4,613 473 14 5,100 0.10263% 2021/22 2,729,191,737 34,661,192 2,763,852,929 2.30% 4,632 473 14 5,119 0.10263% 2022/23 2,893,245,881 38,292,998 2,931,538,879 6.07% 4,631 472 14 5,117 0.10263%

Source: HdL, Coren & Cone
County of Los Angeles, Auditor-Controller Office/Tax Division City Parcel Counts
In 1978 the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rate of 1% based upon the assessed value of the property being taxed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only re-assessed at the time that it is sold to a new owner. At that point, the new assessed value is reassessed at the purchase price of the property sold. The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above. 106
City of Lomita
Direct and Overlapping Property Tax Rates
(Rate per $100 of assessed value)
Last Ten Fiscal Years
2023 2022 2021 2020 2019 2018 2017 2016 (2) 2015 2014
City Direct Rates:

City Lomita Tax District 1 0.066600 0.066600 0.066600 0.066600 0.066600 0.066600 0.066550 0.066550 0.066550 0.066550 Lomita Waterworks 0.036100 0.036100 0.036100 0.036100 0.036100 0.036100 0.036080 0.036080 0.036080 0.036080 Total City Direct Rate 0.102700 0.102700 0.102700 0.102700 0.102700 0.102700 0.102630 0.102630 0.102630 0.102630 LA County General 0.214700 0.214700 0.214700 0.214700 0.214700 0.214700 0.214700 0.214700 0.214700 0.214700 LA County Other 0.209050 0.209050 0.209050 0.209050 0.209050 0.209050 0.209110 0.209110 0.209110 0.209110 Water Replenishment S.C. 0.000160 0.000160 0.000160 0.000160 0.000160 0.000160 0.000160 0.000160 0.000160 0.000160 LA Sanitary District 0.011090 0.011090 0.011090 0.011090 0.011090 0.011090 0.011090 0.011090 0.011090 0.011090 LA Unified School
District 0.207800 0.207800 0.207800 0.207800 0.207800 0.207800 0.207830 0.207830 0.207830 0.207830 Educational Revenue
Augmentation Fund 0.204800 0.204800 0.204800 0.204800 0.204800 0.204800 0.204800 0.204800 0.204800 0.204800 LA Community College 0.028200 0.028200 0.028200 0.028200 0.028200 0.028200 0.028200 0.028200 0.028200 0.028200 LA County Library 0.021500 0.021500 0.021500 0.021500 0.021500 0.021500 0.021480 0.021480 0.021480 0.021480 Total Prop 13 Rate 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000 1.000000 Overlapping Rates:

LA County Bonds 0.024880 0.043760 0.040160 0.027170 0.046210 0.045990 0.035960 0.035750 0.040170 0.044540 LA County Storm Drain - - - - - - - - - -
LA Unified School Bonds 0.121070 0.113230 0.139930 0.125520 0.123230 0.122190 0.131100 0.129710 0.146880 0.146440 Palos Verdes Penninsula - - - - - - - - 0.023290 0.023110 West Basin MWD 0.003500 0.003500 0.003500 0.003500 0.003500 0.003500 0.003500 0.003500 0.003500 0.003500 Voter Approved Rate 0.160490 0.149450 0.183590 0.156190 0.172940 0.171680 0.170560 0.168960 0.213840 0.217590 Total Tax Rate 1.160490 1.149450 1.183590 1.156190 1.172940 1.171680 1.170560 1.168960 1.213840 1.217590

Source: L.A. County Assessor 2012/13-2021/22 Tax Rate Table, HdL, Coren & Cone Fiscal Year
In 1978, California voters passed Proposition 13 which sets the property tax rate at a 1.00% fixed amount. This 1.00% is shared by all taxing agencies for which the subject property resides within. In addition to the 1.00% fixed amount, property owners are charged taxes as a percentage of assessed property values for the payment of the Los Angeles Unified School District bonds. 107
City of Lomita
Principal Property Owners
Current Year and Prior Year
Top Ten
Percent of Percent of
Total City Total City
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayer Value Value Value Value
Weiss Investment Properties LP 2 r 18,581,095 0.63% 18,216,909 0.62% Sabra Lomita LP 1 i 18,559,817 0.63% 18,195,900 0.62%
Spectrum Pacific West LLC 4 u 15,759,014 0.54% 14,905,555 0.51% Vista Verde Center LLC 1 c 11,773,198 0.40% 11,542,352 0.39% Lomita & Crenshaw Acquistion 5 c 11,681,632 0.40% 11,452,584 0.39% BRFI Lomita LLC 3 c 11,165,263 0.38% 12,922,711 0.44%
Mittal Legacy LP 8 r 10,758,895 0.37% - 0.00%
JCM Homes LLC 21 r 10,610,254 0.36% 10,610,254 0.36%
William B Ghadimi 1 r 9,843,489 0.34% - 0.00%
Spencer Plaza LLC 10 r 9,569,909 0.33% 9,382,272 0.32%

Top Ten Totals 128,302,566 4.38% 107,228,537 3.66%
City Totals 2,931,538,879 $ 2,514,269,367 $
USE:

Commercial c
Institutional i
Residentail r
Unsecured u
Vacant v
Source: L.A. County Assessor 2022/23 Combined Tax Rolls and the SBE Non Unitary Tax Roll, HdL, Coren & Cone Parcels Use 2022/23 2021/22
108
City of Lomita
Property Tax Levies and Collections
Last Ten Fiscal Years
Fiscal Taxes Levied Collections in
Year Ended for the Percent Subsequent Percent
June 30 Fiscal Year Amount of Levy Years Amount of Levy 2014 1,815,291 51,992 2.86% 138,221 190,213 10.48%
2015 1,945,923 61,109 3.14% 136,902 198,011 10.18%
2016 2,056,573 69,970 3.40% 136,059 206,028 10.02%
2017 2,158,376 89,443 4.14% 85,746 175,188 8.12%
2018 2,279,687 110,520 4.85% 86,460 196,980 8.64%
2019 2,361,888 81,748 3.46% 89,503 171,251 7.25%
2020 2,550,889 (1) 4.18% 88,844 106,504 195,348 7.66%
2021 2,702,917 113,995 4.22% 98,421 212,416 7.86%
2022 2,803,540 181,539 6.48% 105,687 287,226 10.25%
2023 2,961,666 114,457 3.86% 111,787 226,244 7.64%
NOTE: The amounts presented include City property taxes and Redevelopment Agency tax increment. This schedule also includes amounts collected by the City and Redevelopment Agency that were passed-through to other agencies. (1) Correction for fiscal year 2020
Source: Los Angeles County Auditor Controller's Office
Collected within the
Fiscal Year of Levy Total Collections to Date
109
City of Lomita
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
Fiscal Year Tax Pension Certificates Total
Ended Allocation Revenue Obligation of Governmental
June 30 Bonds Bonds Ref Bonds Participation Other Activities 2014 n/a n/a n/a n/a n/a -
2015 n/a n/a n/a n/a n/a -
2016 n/a n/a n/a n/a n/a -
2017 n/a n/a n/a n/a n/a -
2018 n/a n/a n/a n/a n/a -
2019 n/a n/a n/a n/a n/a -
2020 n/a n/a n/a n/a n/a -
2021 n/a n/a n/a n/a n/a -
2022 n/a n/a n/a n/a n/a -
2023 n/a n/a n/a n/a n/a -
Notes: Details regarding the City's outstanding debt can be found in the notes to the financial statements.

In July 2021, the City refunded the 2016 Water Revenue Refunding Bonds with a Private Placement Loan in the amount of $6,081,000
(1) Net of discount
Governmental Activities
110
Certificates Total Total Percentage Debt
of Business-type Primary of Personal per
Participation (1) Other Activities Government Income Capita n/a 6,757,536 6,757,536 6,757,536 8.83% 331
n/a 6,600,347 6,600,347 6,600,347 9.01% 323
n/a 7,200,000 7,200,000 7,200,000 8.16% 355
n/a 6,985,000 6,985,000 6,985,000 8.82% 342
n/a 6,750,000 6,750,000 6,750,000 9.90% 326
n/a 6,505,000 6,505,000 6,505,000 10.62% 314
n/a 6,255,000 6,255,000 6,255,000 12.34% 304
n/a 5,995,000 5,995,000 5,995,000 13.05% 293
n/a 5,744,000 5,744,000 5,744,000 13.54% 291
n/a 5,416,000 5,416,000 5,416,000 16.25% 270
Business-type Activities
111
City of Lomita
Legal Debt Margin Information
Last Ten Fiscal Years (in thousands of dollars)
2023 2022 2021 2020 2019
Assessed valuation 2,931,538,879 $ 2,763,852,929 $ 2,653,562,437 $ 2,514,269,367 $ 2,386,266,746 $ Conversion percentage 25.00% 25.00% 25.00% 25.00% 25.00% Adjusted assessed valuation 732,884,720 690,963,232 663,390,609 628,567,342 596,566,687 Debt limit percentage 15.00% 15.00% 15.00% 15.00% 15.00% Debt limit 109,932,708 103,644,485 99,508,591 94,285,101 89,485,003 Total net dept applicable to limit:

General obligation bonds - - - - -
Legal debt margin 109,932,708 $ 103,644,485 $ 99,508,591 $ 94,285,101 $ 89,485,003 $ Total net debt applicable to the limit
as a percent of debt limit 0% 0% 0% 0% 0%
Lomita Long Term Debt outstanding: 5,416,000 5,744,000 5,995,000 6,255,000 6,505,000 Debt per capita: 269.56 278.39 293.43 304.44 313.71
Debt as a percentage of personal income: 16.25% 13.54% 13.05% 12.34% 10.62% Section 43605 of the Government Code of the State of California provides for a legal debt limit of 15% of gross assessed valuation. However, this provision was enacted when assessed valuation was based upon 25% OF MARKET VALUE. Effective with 1981-82 fiscal year, each parcel is now assessed at 100% of market value (as of the most recent change in ownership for that parcel). The Computations shown above reflect a conversion of assessed valuation data for each fiscal year from current full valuation perspective to the 25% level that was in effect at the time the legal debt margin was enacted by the State of California for local governments located within the State.

In July 2021, the City refunded the 2016 Water Revenue Refunding Bonds with a Private Placement Loan in the amount of $6,081,000
112
2018 2017 2016 2015 2014
$ 2,149,593,978 2,257,084,413 $ 2,045,319,719 $ 1,942,097,956 $ 1,866,047,889 $

25.00% 25.00% 25.00% 25.00% 25.00%
537,398,495 564,271,103 511,329,930 485,524,489 466,511,972

15.00% 15.00% 15.00% 15.00% 15.00%
80,609,774 84,640,665 76,699,489 72,828,673 69,976,796
- - - - -
$ 80,609,774 84,640,665 $ 76,699,489 $ 72,828,673 $ 69,976,796 $ 0% 0% 0% 0% 0%
6,985,000 6,750,000 7,200,000 6,665,000 6,825,000
342.35 325.85 354.85 322.92 330.83

9.90% 8.82% 8.16% 9.01% 8.83%
113
City of Lomita
Pledged Revenue Coverage
Last Ten Years
Fiscal Year Less Net
Ended Water Operating Available
June 30 Revenue* Expenses** Revenue Principal Interest Total Coverage 2014 5,317,239 $ 4,254,309 $ 1,062,930 $ 155,000 $ 344,713 $ 499,713 $ 2.13 2015 5,466,347 $ 4,080,838 $ 1,385,509 $ 160,000 $ 338,513 $ 498,513 $ 2.78 2016 5,168,824 $ 4,032,400 $ 1,136,424 $ 170,000 $ 332,113 $ 502,113 $ 2.26 2017 5,616,882 $ 4,321,380 $ 1,295,502 $ 215,000 $ 251,550 $ 466,550 $ 2.78 2018 6,313,840 $ 4,858,095 $ 1,455,744 $ (1) $ 227,013 235,000 $ 462,013 $ 3.15 2019 6,540,437 $ 5,063,714 $ 1,476,723 $ 245,000 $ 219,375 $ 464,375 $ 3.18 2020 6,921,842 $ 5,486,250 $ 1,435,593 $ (2) $ 211,413 250,000 $ 461,413 $ 3.11 2021 8,206,024 $ 5,764,712 $ 2,441,312 $ 260,000 $ 203,288 $ 463,288 $ 5.27 2022 7,446,407 $ 6,421,035 $ 1,025,372 $ 337,000 $ 127,129 $ 464,129 $ 2.21 2023 7,234,936 $ 4,950,569 $ 2,284,367 $ 328,000 $ 137,008 $ 465,008 $ 4.91 * Excludes interest income
** Excludes depreciation and interest income
Notes: Details regarding the City's Water Fund outstanding debt can be found in the notes to the financial statements.

In July 2021, the City refunded the 2016 Water Revenue Refunding Bonds with a Private Placement Loan in the amount of $6,081,000
(1) Correction for fiscal year 2018
(2) Correction for fiscal year 2020
Source: City of Lomita, Administrative Services Department - Finance Certificates of Participation
Debt Service
114
City of Lomita
Direct and Overlapping Debt
City Assessed Valuation $ 2,931,538,879
Redevelopment Agency Incremental Valuation -
Total Assessed Valuation $ 2,931,538,879
Estimated
Share of
Percentage Outstanding Overlapping
Applicable 1 Debt 6/30/23 Debt
Overlapping Debt Repaid with Property Taxes:

LA Unified School District General Obligation Bonds 0.000% - $ - LA Community College District 0.000% - -
LA Unified School District Lease Tax Obligations 0.000% - - LA County Water District, I.D. No. 54 0.000% - -
LA County Water District, I.D. No. 55 0.000% - -
Total overlapping debt repaid with property taxes - -
Overlapping Other Debt:

Palos Verdes Pen USD $ -
LA County Board of Education Certificates of Participation 0.274% 4,500,730,000 12,332,000 LA Unified School District Certificates of Participation 0.334% 10,704,725,000 35,753,782 West Basin County Water District Certificates of Participation 0.081% 19,215,000 15,564

Total overlapping other debt 48,101,346 15,224,670,000
Total overlapping debt $ 48,101,346 15,224,670,000
City direct debt -
Total direct and overlapping debt 1 $ 48,101,346
Notes:
1 For debt repaid with property taxes, the percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable percentages were estimated by determining the portion of another governmental unit's taxable assessed value that is within the city's boundaries and dividing it by each unit's total taxable assessed value.

Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City. This process recognizes that, when considering the City's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government.

Source: HdL Coren & Cone, Los Angeles County Assessor's Office June 30, 2023
115
Business Type Tax Payers Business Type
1 7 Eleven Convenience Stores/Liquor 99 Cents Only Variety Stores 2 99 Cents Only Variety Stores Albertsons Grocery Stores 3 ARCO AM/PM Service Stations Arco AM/PM Service Stations 4 ARCO AM/PM Service Stations Arco AM/PM Service Stations 5 Auto Zone Automotive Supply Stores AutoZone Automotive Supply Stores 6 Battaglia's Title Building Materials Big Lots Variety Stores 7 Big Lots Variety Stores California Pro Sports Sporting Goods/Bike Stores 8 Bites & Bashes Casual Dining CVS Pharmacy Drug Stores 9 California Pro Sporrts Sporting Goods/Bike Stores Cycle Gear Boats/Motorcycles 10 CVS Pharmacy Drug Stores Discount Pool & Spa Supply Specialty Stores 11 Discount Pool & Spa Supply Specialty Stores Enterprise Rent A Car Transportation/Rentals 12 Enterprise Rent A Car Transportation/Rentals Harbor Freight Tools Building Materials 13 Harbor Freight Tools Building Materials Hertz Rent A Car Transportation/Rentals 14 Hot N Tot Casual Dining Hot N Tot Casual Dining
15 I D Systems & Supplies Light Industrial/Printers Jims Auto Sales Used Automotive Dealers 16 Jims Auto Sales Used Automotive Dealers KFC Quick-Service Restaurants 17 Lomita Feed Store Gardening/Agricultural Supplies Lees Tires Automotive Supply Stores 18 Lomita Shell Service Stations Lomita Feed Store Gardening/Agricultural Supplies 19 Pacific Coast Hobbies Specialty Stores Lomita Shell Service Stations 20 Popeyes Lousiana Kitchen Quick-Service Restaurants Pacific Coast Hobbies Specialty Stores 21 Shell Service Stations Redondo Beach Towing Transportation/Rentals 22 Sushi Delight Casual Dining Shell Service Stations
23 Szchwan Chinese Casual Dining Sprint Electronics/Appliance Stores 24 Taco Bell/Pizze Hut Quick-Service Restaurants Taco Bell/Pizze Hut Quick-Service Restaurants 25 Thompson Building Materials Building Materials Thompson Building Materials Building Materials -Account for 61.24% -Account for 63.13%
of the total sales tax collected. of the total sales tax collected. *** The names are listed in alphabetical order, not sales tax volume.

Source: HdL Companies, State Board of Equalization, California Department of Taxes and Fees Administration, State Controller's Office Period: January 2022 Thru December 2022
Tax Payers
Calendar Year 2022
City of Lomita
Top 25 Sales Tax Producers
(Miscellaneous Information)
Current Calendar Year and Nine Years Ago
Calendar Year 2013
116
City of Lomita
Demographic and Economic Statistics
Last Ten Calendar Years
Personal Per Capital Lomita
Calendar City of Lomita Median Income Personal Unemployment Year Population (1) Age (2) (in thousands) (3) Income (4) Rate (5) 2014 20,630 39.5 602,417 29,201 5.5%
2015 20,640 40.3 600,583 29,098 5.9%
2016 20,290 40.3 587,263 28,943 4.8%
2017 20,403 40.8 615,782 30,180 3.7%
2018 20,715 40.4 668,303 32,261 4.6%
2019 20,736 40.7 690,910 33,275 4.3%
2020 20,549 40.1 771,963 37,566 16.5%
2021 20,431 40.1 782,242 38,287 5.6%
2022 20,633 40.5 777,527 37,683 2.3%
2023 20,092 39.5 880,182 43,807 2.2%
Source: (1) California State Department of Finance
(2) U.S. Department of Commerce Bureau of Economic Analysis, Census Bureau (3) U.S. Department of Commerce Bureau of Economic Analysis, Census Bureau (4) U.S. Department of Commerce Bureau of Economic Analysis, Census Bureau (5) California Employment Development Department
117
City of Lomita
Principal Employers
Current Year and Nine Years Ago
Percent of Percent of
Number of Total Number of Total
Employer Business Type Employees Employment Employees Employment Lomita Post-Acute Care Center Nursing Facility 132 1.23% 80 0.76% WDC Kitchen & Bath Center Retail 100 0.93% n/a n/a
City of Lomita Government 90 0.84% 85 0.81%
Kaiser Permanente Medical 66 0.62% n/a n/a
Palos Verdes Health Care Center Nursing Facility 50 0.47% 42 0.40% Nishiyamato Acedemy of California Education 44 0.41% n/a n/a CVS Retail 47 0.44% n/a n/a
99 Cents Only Store LLC Retail 39 0.36% n/a n/a
Thompson Building Materials Building 38 0.36% 40 0.38%
Travers Tree Service Service 30 0.28% 60 n/a
Western Veterinary Group Animal Services 29 0.27% n/a n/a

Total Top Ten Employers 665 307
Total City Employment 10,700 10,500
NOTE: Non-Governmental Employers.

Several potential businesses that may qualify for Top 10 ranking. However, current employee counts were unattainable at the time of report preparation. Previous historical data is not available.

Source: City of Lomita, Economic Development Department State of California, Employment Development Department
2023 2014
118
City of Lomita
Full-time and Part-time City Employees
by Function
Last Ten Fiscal Years
Function 2023 2022 2021 2020 2019 2018 2017 2016 (2) 2015 2014 General government 20 12 14 12 12 9 12 11 12 13
Public safety (1) - - - - - - - - - -
Public works 12 16 13 10 9 10 9 7 8 6
Community Services 5 5 5 5 6 4 10 8 10 16
Water 7 6 7 7 7 7 7 6 6 5
Community Development 5 5 3 4 3 6 6 4 3 5
Parks and Recreation 37 37 34 37 42 49 46 43 42 40
Total 90 77 76 75 79 85 90 79 81 85
(1) Police and fire services are provided by Los Angeles County. (2) Correction for fiscal year 2016.

Source: City of Lomita, Administrative Services Department - Finance Full-Time and Part-time Employees as of June 30
119
City of Lomita
Operating Indicators
by Function
Last Ten Fiscal Years
2023 2022 2021 2020 2019 2018 2017 2016 2015 2014
(1) Police:

Arrests 513 477 663 815 994 865 913 n/a n/a n/a
Parking citations issued 9838 9001 7368 6001 6612 6201 5564 5380 6124 4048 (2) Fire:

Number of emergency calls 2006 1804 1016 1740 2920 1827 1816 1770 1476 n/a Inspections 804 899 0 200 1488 763 579 n/a n/a n/a
Public works:

Street resurfacing (miles) n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a Parks and recreation:

Number of recreation classes 184 186 18 331 319 278 328 295 269 193 Number of facility rentals 378 403 10 179 407 475 402 344 422 530 Water:

New connections - - - - - - - - - -
Average daily consumption
(thousands of gallons) n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a Sewer:

New connections n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a Average daily sewage treatment
(thousands of gallons) n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a (1) Deputy Sheriffs and Community Service Officers are provided through a contract with the Los Angeles County Sheriff's Department. (2) Fire Protecxtion and Fire Personnel are provided through a contract with the Los Angeles County Fire Department.

Due Covid-19 pandemic, business inspections are on hold and there no Brush inspections. n/a Data is unavailable to include in this report.

Source: City of Lomita, Administrative Services Department Los Angeles County Fire Department
120
City of Lomita
Capital Asset Statistics
by Function
Last Ten Fiscal Years
2023 2022 2021 2020 2019 2018 2017 2016 2015 2014
(1) Police:

Stations 1111111111
(2) Fire:

Fire stations 1111111111
Public works:

Streets (miles)(5) 31.90 31.90 31.90 33.20 31.00 31.00 31.00 31.00 31.00 31.00 Streetlights 58 58 58 58 58 58 58 58 58 58
Traffic signals n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a Parks and recreation:

Parks 7 7 7 7 7 7 7 7 6 6
Rail Road Museum 1 1 1 1 1 1 1 1 1 1
Community centers 1 1 1 1 1 1 1 1 1 1
Water System :

Length of Pipes (LF)(3) 228,975 228,975 228,975 228,975 228,015 228,015 228,015 228,015 228,015 217,305 Number of Pump Stations 3 3 3 3 3 3 3 3 3 3
Number of Catch Basin(6) 69 69 69 72 69 69 42 42 42 42
Number of Service Connection 4,357 4,357 4,357 4,357 4,314 4,314 4,312 4,241 4,241 4,241 Sewer System:

Length of Pipes (LF)(4) 188,415 188,415 188,415 188,415 173,931 173,931 173,931 173,931 173,931 173,931 Number of manholes 883 883 883 883 882 882 882 882 882 882 Maximum daily treatment capacity
(thousands of gallons) n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a (1) Deputy Sheriffs and Community Service Officers are provided through a contract with the Los Angeles County Sheriff's Department. (2) Fire Protection and Fire Personnel are provided through a contract with the Los Angeles County Fire Department. (3) Corrected length of pipes in lateral feet to match our 2019 Water Loss Audit Report, 2015 Water Master Plan, 2004 Water Master Plan. (4) Corrected length of pipes in lateral feet to match our 2016 Sewer System Management Plan (5) Corrected miles to match our 2020 Pavement Management Plan (6) Corrected catch basins - City of Lomita Public Works performed field check; three basins either erroneous or duplicates. n/a Data is unavailable to include in this report.

Source: City of Lomita, Administrative Services Department Los Angeles County Fire Department
Los Angeles County Department of Public Works
Fiscal Year
121
City of Lomita
Water Department
Water Sold by Type of Customer
Last Ten Fiscal Years
2023 2022 2021 2020 2019 2018 2017 2016 2015 2014
Type of Customer:

Residential 4,003 (2) 3,970 (2) 4,004 (1) 3,966 (2) 3,975 (1) 3,971 (1) 3,960 (1) 3,849 (2) 3,917 (1) 3,902 Schools 21 21 21 21 25 25 21 21 (1) 17 17
Commercial 283 (1) 281 (1) 279 279 (1) 270 (1) 261 266 246 246 246 Churches 31 31 30 (2) 31 31 31 32 32 31 31
Government 72 72 72 72 (1) 17 17 14 12 10 10
City 18 18 18 18 19 19 18 15 13 13
Total 4,428 4,393 4,424 4,337 4,329 4,306 4,175 4,234 4,219 4,219

Total direct rate
per 748 gallons 5.03 4.79 4.79 4.79 4.43 4.12 3.81 3.53 3.53 3.01 (2) Vacancies (3) Type correction
Source: City of Lomita, Administrative Services Department - Finance

(1) New development
Fiscal Year
122
City of Lomita
Water Department
Water Rates
Last Ten Fiscal Years
Fiscal Bi-Monthly Rate per
Year Ended Base 748
June 30 Rate Gallons
2014 3.01 39.16
2015 (1) 3.53 36.90
2016 36.90 3.53
2017 39.73 3.81
2018 42.90 4.12
2019 46.78 4.43
2020 50.31 4.79
2021 50.31 4.79
2022 50.31 4.79
2023 (2) 5.03 53.81
NOTE:
(1) A new water rate structure went into effect March 1, 2015. (2) A new water rate structure went into effect January 1, 2023.

Rates are based on 5/8" meter, which is the standard household meter size. 123
City of Lomita
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years (dollars in thousands, except per capita) Percentage
Fiscal Year Tax Pension Certificates of Actual
Ended Revenue Allocation Obligation of Value Per
June 30 Bonds Bonds Ref Bonds Participation Total of Property (1) Capita (2) 2014 n/a n/a n/a n/a - n/a n/a
2015 n/a n/a n/a n/a - n/a n/a
2016 n/a n/a n/a n/a - n/a n/a
2017 n/a n/a n/a n/a - n/a n/a
2018 n/a n/a n/a n/a - n/a n/a
2019 n/a n/a n/a n/a - n/a n/a
2020 n/a n/a n/a n/a - n/a n/a
2021 n/a n/a n/a n/a - n/a n/a
2022 n/a n/a n/a n/a - n/a n/a
2023 n/a n/a n/a n/a - n/a n/a
(1) See Schedule 6 for property value data.
(2) Population data can be found in Schedule 16.

Ten years of data is not available.

General Bonded Debt Outstanding
124

LOMITA CITY HALL
24300 Narbonne Ave. • Lomita, CA U.S.A. 90717 • Ph: 310.325.7110 www.lomitacity.com
City of Lomita
Single Audit Report on Schedule of Expenditures of Federal Awards June 30, 2023
Attachment 3

CITY OF LOMITA
Single Audit Report on Schedule of Expenditures of Federal Award Programs June 30, 2023

TABLE OF CONTENTS
Page
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 1
Report on Compliance for Each Major
Program and on Internal Control Over Compliance
Required by the Uniform Guidance 3
Schedule of Expenditures of Federal Awards 6
Notes to Schedule of Expenditures of Federal Awards 7
Schedule of Findings and Questioned Costs 8
Summary Schedule of Prior Audit Findings 9
438 Old Newport Blvd, Newport Beach, CA 92663
Phone (949) 346-2900 –www.gruberlopezinc.com
1 Honorable Mayor and City Council
City of Lomita
Lomita, California
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
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, each major fund, and the aggregate remaining fund information of City of Lomita, California (City) as of and for the year ended June 30, 2023, and the related notes to the financial statements, which collectively comprise City of Lomita’s basic financial statements, and have issued our report thereon dated December 15, 2023.

Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered City of Lomita’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 City of Lomita’s internal control. Accordingly, we do not express an opinion on the effectiveness of City of Lomita’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. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses.

However, material weaknesses may exist that have not been identified. 2 Honorable Mayor and City Council
City of Lomita
Page Two
Compliance and Other Matters
As part of obtaining reasonable assurance about whether City of Lomita’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

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 entity’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 entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Gruber and Lopez, Inc.

Newport Beach, California
December 15, 2023
Gruber and Lopez, Inc.
438 Old Newport Blvd, Newport Beach, CA 92663
Phone (949) 346-2900 –www.gruberlopezinc.com
3 Honorable Mayor and City Council
City of Lomita
Lomita, California

INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND

ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE Report on Compliance for Each Major Federal Program
Opinion on Each Major Federal Program
We have audited City of Lomita CA’s compliance with the types of compliance requirements identified as subject to audit in the OMB Compliance Supplement that could have a direct and material effect on each of City of Lomita CA’s major federal programs for the year ended June 30, 2023. City of Lomita CA’s major federal programs are identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs.

In our opinion, City of Lomita CA complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2023.

Basis for Opinion on Each Major Federal Program
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Our responsibilities under those standards and the Uniform Guidance are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our report.

We are required to be independent of City of Lomita CA and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on compliance for each major federal program. Our audit does not provide a legal determination of City of Lomita CA’s compliance with the compliance requirements referred to above.

Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to City of Lomita CA’s federal programs.

Auditor’s Responsibilities for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion on City of Lomita CA’s compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. 4 Honorable Mayor and City Council
City of Lomita
Page Two
Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about City of Lomita CA’s compliance with the requirements of each major federal program as a whole.

In performing an audit in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance, we:
 Exercise professional judgment and maintain professional skepticism throughout the audit.  Identify and assess the risks of material noncompliance, 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 City of Lomita CA’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances.  Obtain an understanding of City of Lomita CA’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of City of Lomita CA’s internal control over compliance.

Accordingly, no such opinion is expressed.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit.

Report on Internal Control over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.

Our consideration of internal control over compliance was for the limited purpose described in the Auditor’s Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance may exist that were not identified.

Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed. 5 Honorable Mayor and City Council
City of Lomita
Page Three
Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance We have audited the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of City of Lomita CA, as of and for the year ended June 30, 2023, and the related notes to the financial statements, which collectively comprise City of Lomita CA’s basic financial statements.

We issued our report thereon dated December 15, 2023, which contained unmodified opinions on those financial statements. Our audit was performed for the purpose of forming opinions on the financial statements that collectively comprise the basic financial statements. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by the Uniform Guidance and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the 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 schedule of expenditures of federal awards is fairly stated in all material respects in relation to the basic financial statements as a whole.

The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of Uniform Guidance. Accordingly, this report is not suitable for any other purpose.

Gruber and Lopez, Inc.

Newport Beach, California
December 15, 2023
Gruber and Lopez, Inc.

Federal Program Federal Amount
Federal Grantor/ Assistance Identification Award Provided to Pass-through Grantor/Program Listing Number Expenditures Subrecipients U.S. Department of Housing and Urban Development
Passed through the Community Development Commission of the County of Los Angeles:

Community Development Block Grant 14.218 D96361-16 35,940 $ - Community Development Block Grant 14.218 D96370-16 14,868 - Community Development Block Grant 14.218 602490-21 - -
Subtotal 14.218 50,808
Direct assistance:

Low Rent Public Housing 14.850 CA139-001-01J 192,528 -
Capital Grant Fund Program 14.872 CA16-P139-501-01 211,458 - - Total U.S. Department of Housing and Urban Development 454,794 - U.S. Department of Housing and Urban Development
Passed through the State of California:

Coronavirus State and Fund Recovery Funds 21.027 FY 21-22 849,611 Coronavirus State and Fund Recovery Funds 21.027 FY 22-23 1,213,737 Total U.S. Department of Housing and Urban Development * 2,063,348 U.S. Department of Homeland Security
Passed through the State of California:

Hazard Mitigation Grant 97.039 DR4407-PJ0418 43,174 $
Total U.S. Department of Homeland Security 43,174
Total Federal Awards 2,561,316 $ -
*Denotes major federal program.

CITY OF LOMITA
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2023
6 See accompanying notes to schedule of expenditures of federal awards. 7 CITY OF LOMITA
Notes to the Schedule of Expenditures of Federal Awards June 30, 2023
(1) Summary of Significant Accounting Policies Applicable to the Schedule of Expenditures of Federal Awards
The financial reporting entity, as defined by Governmental Accounting Standard Board (GASB), consists of the primary government, which is the City of Lomita, California (City), entities for which the primary government is financially accountable, and other entities for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete.

The City Council acts as the governing body and is able to impose its will on the following entities by establishing financial accountability:
 Lomita Public Financing Authority  Lomita Manor Housing Authority  Lomita Railroad Foundation, Inc. (a) Scope of Presentation
The accompanying schedule presents only the expenditures incurred by the City of Lomita (City) that are reimbursable under federal programs of federal agencies providing financial assistance. For purposes of this schedule, financial assistance includes both federal financial assistance received directly from a federal agency and expended, as well as federal funds received indirectly by City of Lomita from a non-federal agency and expended. Only the portion of program expenditures reimbursable with such federal funds are reported in the accompanying schedule. Program expenses in excess of the maximum federal reimbursement authorized or the portion of program expenses that were funded with state, local or other non-federal funds are excluded from the accompanying schedule. (b) Basis of Accounting
Funds received under the various grant programs have been recorded within the general fund and special revenue funds of the City. The City utilizes the modified accrual basis of accounting for governmental funds. The accompanying schedule of expenditures of federal awards is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Office of Management and Budget Uniform Grant Guidance).
(c) De Minimus Indirect Cost Rate
The City elected to use the 10% de minimus indirect cost rate for the year ended June 30, 2023, however, no indirect cost rates were charged to any federal programs. (d) Subrecipients
There were no payments to subrecipients for the year ended June 30, 2023.

8 CITY OF LOMITA
Schedule of Findings and Questioned Costs
Year ended June 30, 2023
Summary of Auditors’ Results
A) Findings Related to the Financial Statements which are Required to be Reported in Accordance with GAGAS

1. An unmodified report was issued by the auditors on the financial statements of the auditee.

2. There were no material weaknesses in internal control nor were there any significant deficiencies.

3. There were no instances of noncompliance or other matters that were required to be reported under Government Auditing Standards.
(B) Findings and Questioned Costs for Federal Awards as Defined in 2 CFR 200.515(d)

4. There were no material weaknesses or significant deficiencies in internal control over federal major programs of the auditee.

5. An unmodified report was issued by the auditors on compliance for federal major programs.

6. The audit disclosed no audit findings of federal awards required by the auditors to be reported under 2 CFR 200.515(d)

7. The major federal program of the auditee was the: (1) Assistance Listing #21.027 U.S.

Department of Treasury – Corona Virus State and Local Fiscal Recovery Funds.

8. The dollar threshold used to distinguish Type A and Type B programs was $750,000 under 2 CFR 200.518 (b) (1).

9. The auditee was considered a low risk auditee as defined by 2 CFR 200.518 for the year ended June 30, 2023 for purposes of determining major programs. 9 CITY OF LOMITA
Summary Schedule of Prior Year (June 30, 2021) Audit Findings Year ended June 30, 2023
There were no findings noted for fiscal year June 30, 2022.

CITY OF LOMITA -

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

FINANCIAL STATEMENTS
June 30, 2021 and 2022
Attachment 4

CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

FINANCIAL STATEMENTS

June 30, 2022 and 2021

TABLE OF CONTENTS
Page
INDEPENDENT AUDITORS’ REPORT ON FINANCIAL STATEMENTS 1
FINANCIAL STATEMENTS:

Balance Sheet 4
Statement of Revenues, Expenditures and Changes in Fund Balance 5 Notes to Financial Statements 6
Required Supplementary Information (Unaudited):

Statement of Revenues, Expenditures and Changes in Fund Balance - Budget to Actual 10

Notes to Required Supplementary Information 12
OTHER REPORTS:

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 13
Report on Compliance with Requirement Applicable to Measure W Revenues and Expenditures in Accordance with Chapters 16 and 18 of the Los Angeles County Flood Control District and Municipal Program Agreement No. 2020MP45 15

Schedule of Findings, Questioned Costs, and Other Matters 18 Status of Prior Audit Findings 20
438 Old Newport Blvd – Newport Beach, CA 92663
Phone (949) 346-2900 – Fax (714) 901-0024 – www.gruber-inc.com -1-
Honorable Mayor and City Council
City of Lomita, California
INDEPENDENT AUDITORS’ REPORT ON FINANCIAL STATEMENTS
Opinion
We have audited the accompanying financial statements of Safe, Clean Water Program (Measure W Fund) of the City of Lomita (the City) as of and for the years ended June 30, 2022 and 2021, and the related notes to the financial statements as listed in the table of contents.

In our opinion, the financial statements present fairly, in all material respects, the Balance Sheet as of June 30, 2022 and 2021, and the Statement of Revenues, Expenditures and Changes in Fund Balance for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion
We conducted our audits 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.

Emphasis of Matter
As discussed in Note 1, the financial statements present only the Measure W fund and do not purport to, and do not, present fairly the financial position of the City of Lomita, CA , as of June 30, 2022 and 2021, the changes in its financial position, or, where applicable, its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter.

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 Authority’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. - 2 -
Honorable Mayor and City Council
City of Lomita, California
Page Two
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 generally accepted auditing standards and Government Auditing Standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.

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

Other Matters
Required Supplementary Information
Management has omitted 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.

Accounting principles generally accepted in the United States of America require that the budgetary comparison information as listed in the table of contents be presented to supplement the basic financial statements. Such 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. 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 - 3 -
Honorable Mayor and City Council
City of Lomita, California
Page Three
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.

Other Reporting Required By Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated November 15, 2023 on our consideration of the City's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on 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.

Restriction of Use
Our report is intended solely for the information and use of the management of City and the Los Angeles County Flood Control District and is not intended to be and should not be used by anyone other than these specified parties.

Gruber and Lopez, Inc.

Newport Beach, California
November 15, 2023

Gruber and Lopez, inc.
2022 2021
ASSETS
Cash $ 118,894 $ 112,317
Total assets $ 118,894 $ 112,317

LIABILITIES
Accounts payable 12,016 4,086
Total liabilities 12,016 4,086

FUND BALANCES
Restricted 106,878 108,231
Total fund balances 106,878 108,231
Total liabilities and fund balances $ 118,894 $ 112,317 City of Lomita
Balance Sheet
June 30
Safe, Clean Water Program (Measure W Fund)
See accompanying notes to the basic financial statements. 4 2022 2021
REVENUES:

Special parcel tax-Measure W $ 226,215 $ 225,151
Investment income 94 125
Total operating revenues 226,309 225,276
EXPENDITURES:

Public Works:

Professional services 675 -
Special department supplies & Expense 135 -
Infrastructure Planning 7,794 405
Stormwater Runoff Program 10,136 11,923
Stormwater Runoff Monitoring 82,267 88,229
Water Quality Program 18,335 5,583
Catch Basin 39 5,962
Outreach and communications 1,433 967
Lomita/Narbonne Intersection - ADA 106,848 3,976
Total expenditures 227,662 117,045
Net change in Fund Balance (1,353) 108,231
Fund balance, beginning of year 108,231 -
Fund balance, end of year $ 106,878 $ 108,231
City of Lomita
Safe, Clean Water Program (Measure W Fund)
Years ended June 30,
Statements of Revenues, Expenditures, and Changes in Fund Balance See accompanying notes to the basic financial statements. 5 - 6 -

CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

NOTES TO FINANCIAL STATEMENTS
Years Ended June 30, 2022 and 2021
(1) Organization and Activities
The Safe, Clean Water Program (Measure W Fund) financial statements of the City of Lomita, California (the ”City”) have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) applied to governmental agencies. The Governmental Accounting Standards Board (“GASB”) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.

Reporting Entity
On November 6, 2018, the voters of Los Angeles County approved Measure W, which is a Special Parcel Tax to fund the Safe, Clean Water Program (Program). Measure W required the Los Angeles County Flood Control District (District) Board to adopt an ordinance further establishing the implementation of the Program, which was accomplished on July 30, 2019 by passage of an ordinance that amended the District Code by amending Chapter 16, relating to the Los Angeles Region Safe, Clean Water Program, and adding Chapter 18, relating to Safe, Clean Water Program Implementation to the District Code (the SCWP Code).

The City entered into Municipal Program Agreement No. 2020MP45 (the Transfer Agreement) with the District dated June 25, 2020 and receives a proportional share of Measure W special parcel tax revenue to fund Safe, Clean Water program projects in Los Angeles County. Expenditures must comply with the provisions of Chapters 16 and 18 of the District Code, including but not limited to the provisions regarding eligible expenditures contained in Section 16.05.A.2 and the provisions regarding ineligible expenditures contained in Section 16.05.A.3.

The financial statements present only the Safe, Clean Water Program (Measure W Fund) of the City of Lomita and to not purport to and do not present the City’s financial position, changes in financial position or, where applicable, its cash flows. The City’s basic financial statements, which are available at 24300 Narbonne Ave, Lomita, CA 90717, or on the City’s website.

The following is a summary of the significant accounting policies:

Basis of Accounting
The City accounts for the Measure W Fund using a Special Revenue Fund to track and record the revenues and expenditures related to the Safe, Clean Water Program. - 7 -

CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

NOTES TO FINANCIAL STATEMENTS
(Continued)
(1) Organization and Activities (continued)
Basis of Accounting (continued)
The Measure W Fund is accounted for on a spending or “current financial resources” measurement focus and the modified accrual basis of accounting. Accordingly, only current assets and current liabilities are included on the Balance Sheet. The Statement of Revenues, Expenditures and Changes in Fund Balance present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in fund balance. Under the modified accrual basis of accounting, revenues are recognized in the accounting period in which they become both measurable and available to finance expenditures of the current period.

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

Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For these purposes, the City considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. The primary revenue sources, which have been treated as susceptible to accrual by the City, are Measure W, Special Parcel Tax, revenues, and interest revenue. Expenditures are recorded in the accounting period in which the related fund liability is incurred. Amounts expended to acquire capital assets are recorded as expenditures in the year that resources were expended, rather than as fund assets.

Classification of Fund Balance
All fund balance in the Measure W Fund is restricted.

Restricted – Restricted fund balances encompass the portion of net fund resources subject to externally enforceable legal restrictions. This includes externally imposed restrictions by creditors, such as through debt covenants, grantors, contributors, laws or regulations of other governments, as well as restrictions imposed by law through constitutional provisions or enabling legislation.

Cash and investments
The Measure W Fund’s cash balance was pooled with various other City funds for deposit and investment purposes. The share of each fund in the pooled cash account was separately maintained and interest income was apportioned to the participating funds based on the relationship of their average cash balances to the total of the pooled cash and investments.

- 8 -

CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

NOTES TO FINANCIAL STATEMENTS
(Continued)
(1) Organization and Activities (continued)
Basis of Accounting (continued)
Use of Estimates
The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. (2) Cash and Investments
The Measure W Fund's cash and investments are pooled with the City in the amount of $118,894 and $112,317 as of June 30, 2022 and 2021, respectively. Each fund's share of the pooled cash account is separately accounted for, and investment income is allocated to all participating funds based on the relationship of their month-end cash balances to the total of the pooled cash and investments. Information regarding the authorized types of deposits and investments, the type of risks (i.e. credit, interest rate, custodial, etc.) and other disclosures associated with the Measure W Fund's pooled cash and investments is included in the City’s basic financial statements, which are available at 24300 Narbonne Ave, Lomita, CA 90717, or on the City’s website. (3) Measure W
Forty percent (40%) of the revenue from the annual Special Parcel Tax (Measure W) are allocated for Municipal Programs. Each Municipality receives a proportional share of these Municipal Program funds based on the Special Parcel Tax revenues collected within each Municipality. The City uses the revenues received to fund projects dedicated to increase local water supply, improve water quality, and protect public health.

Municipalities must spend at least seventy percent (70%) of its Safe, Clean Water Program funds annually on eligible expenses related to projects or programs implemented on or after November 6, 2018, which also includes operations and maintenance of projects built to comply with the MS4 Permit, so long as the project complies with Municipal Program requirements.

Up to thirty percent thirty percent (30%) of a Municipality's Municipal Program funds may be used to pay for costs and expenses incurred on or after November 6, 2018, related to the continuation of Programs implemented or the maintenance of Projects implemented prior to November 6, 2018.

The City shall be able to carryover uncommitted SCW Program Payments for up to five (5) years from the end of the fiscal year in which those funds are transferred from the District to the Municipality.
- 9 -

CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

NOTES TO FINANCIAL STATEMENTS
(Continued)
(4) Risk Management
The Measure W Fund is covered under the City’s insurance policies. Therefore, the limitations and self-insured retentions applicable to the City also apply to the Measure W Fund. Additional information on coverage and self-insured retentions can be obtained by contacting the City.
(5) Commitments and Contingencies
The City is subject to litigation arising in the normal course of business. In the opinion of management there is no pending litigation, which is likely to have a material adverse effect on the financial position of the Measure W Fund.

The Safe, Clean Water Program has been audited by the City's independent auditors in accordance with the provisions SCWP Code and a Transfer Agreement. A potential cost disallowances were proposed as a result of these audits. However, this program is still subject to further examination by the District and the amount, if any, of expenditures, which may be disallowed by the District, cannot be determined at this time. (6) Subsequent Events
The City has evaluated subsequent events for recognition or disclosure through November 15, 2023, the date on which the financial statements were available to be issued. There were no material subsequent events that required recognition or additional disclosures in the financial statements.
.
- 14 -

REQUIRED SUPPLEMENTARY INFORMATION
Variance
with
Final Budget Actual Final Budget
REVENUES:

Special parcel tax-Measure W $ 225,000 $ 226,215 $ 1,215 Investment income - 94 94
Total operating revenues 225,000 226,309 1,309
EXPENDITURES:

Public Works:

Professional services - 675 (675)
Special department supplies & Expense - 135 (135)
Infrastructure Planning - 7,794 (7,794)
Stormw dsiN 2,662 10,136 (7,474)
Stormwater Runoff Monitoring 97,100 82,267 14,833
Water Quality Program - 18,335 (18,335)
Catch Basin - 39 (39)
Outreach and communications - 1,433 (1,433)
Lomita/Narbonne Intersection - ADA 127,900 106,848 21,052 Total expenditures 227,662 227,662 -
Net change in Fund Balance (2,662) (1,353) 1,309
Fund balance, beginning of year 108,231 108,231 -
Fund balance, end of year $ 105,569 $ 106,878 $ 1,309
City of Lomita
Safe, Clean Water Program (Measure W Fund)
Statements of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2022
10 Variance
with
Final Budget Actual Final Budget
REVENUES:

Special parcel tax-Measure W $ 225,000 $ 225,151 $ 151
Investment income - 125 125
-
Total operating revenues 225,000 225,276 276
EXPENDITURES:

Public Works:

Infrastructure Planning 38,700 405 38,295
Stormwater Runoff Program 25,400 11,923 13,477
Stormwater Runoff Monitoring 88,000 88,229 (229)
Water Quality Program 24,700 5,583 19,117
Catch Basin 15,900 5,962 9,938
Outreach and communications 2,800 967 1,833
Lomita/Narbonne Intersection - ADA 29,500 3,976 25,524
Total expenditures 225,000 117,045 107,955
Net change in Fund Balance - 108,231 (107,679)
Fund balance, beginning of year - - -
Fund balance, end of year $ - $ 108,231 $ (107,679)
City of Lomita
Safe, Clean Water Program (Measure W Fund)
Statements of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2021
11 - 12 -

CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
Years Ended June 30, 2022 and 2021
(1) Budgets and Budgetary Accounting
The City prepares its budgets on the modified accrual basis and, accordingly, the budget amounts included in the accompanying financial statements are presented in accordance with generally accepted accounting principles.

Each year, the City Administrator submits a proposed budget to the City Council during early May. The City Council holds budget hearings during May and early June. The final budget is adopted by the City Council during late June. Funds that have irregular activity are not budgeted. The legal level of control of which expenditures cannot exceed appropriations is at the functional level. The City Council is informed of expenditures over appropriations and such amounts are informally approved as a part of the bimonthly review of the demand warrants.

The City holds a mid-year budget review meeting. During the meeting, all budget expenditures are reviewed and projections for the whole year are made.

Unexpended and unencumbered appropriations of the governmental funds automatically lapse at the end of the year.

13 438 Old Newport Blvd. – Newport Beach, CA 92663
Phone (949) 346-2900 – Fax (714) 901-0024 – www.gruber-inc.com Honorable Mayor and City Council
City of Lomita, California

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
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 Safe, Clean Water Program (Measure W Fund), operated by City of Lomita (City), as of and for the years ended June 30, 2022 and 2021, and the related notes to the financial statements, which collectively comprise the Measure W Fund basic financial statements, and have issued our report thereon dated November 15, 2023.

Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered 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 City’s internal control. Accordingly, we do not express an opinion on the effectiveness of City’s internal control.

However, material weaknesses may exist that have not been identified. 14 Honorable Mayor and City Council
City of Lomita, California
Page Two
Compliance and Other Matters
As part of obtaining reasonable assurance about whether City's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Restriction of Use
Our report is intended solely for the information and use of the management of City and the District and is not intended to be and should not be used by anyone other than these specified parties.

Gruber and Lopez, Inc.

Newport Beach, California
November 15, 2023

Gruber and Lopez, inc.
15 Honorable Mayor and City Council
City of Lomita, California

REPORT ON COMPLIANCE with REQUIREMENT APPLICABLE TO SAFE, CLEAN WATER

PROGRAM REVENUES AND EXPENDATURES IN ACCORDANCE WITH
CHAPTERS 16 AND 18 OF THE LOS ANGELES COUNTY FLOOD DISTRICT CODE AND MUNICIPAL PROGRAM AGREEMENT NO. 2020MP45
Opinion
We have audited the City of Lomita’s (City) compliance with Chapters 16 and 18 of the Los Angeles County Flood Control District (District) Code and the Transfer Agreement [Municipal Program Agreement No. 2020MP45] applicable to Safe, Clean Water Program (Program) revenues and expenditures for the fiscal years ended June 30, 2022 and 2021.

In our opinion, the City complied, in all material respects, with the compliance requirements referred to above that are applicable to the Program revenues and expenditures for the fiscal years ended June 30, 2022 and 2021.

Basis for Opinion
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United State of America (GAAS); the standards applicable to financial audit 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 Compliance section of our report.

We are required to be independent of the City and to meet our ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our audit does not provide a legal determination of the City’s compliance with compliance requirements referred to above.

Responsibilities of Management for the Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to the Program revenues and expenditures.

Auditor’s Responsibilities for the Audit of the Compliance Our objectives are to obtain reasonable assurance about whether material compliance with the compliance requirement referred to above occurred, whether due to fraud or error, and express an opinion of the City’s compliance with Program revenues and expenditures based on our audit.

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 material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about the City’s compliance with the requirements of the Program revenues and expenditures as a whole. 16 Honorable Mayor and City Council
City of Lomita, California
Page Two
In performing an audit in accordance with generally accepted auditing standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material noncompliance, 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 City’s compliance with the compliance requirements referred to above and performing other procedures as necessary in the circumstances.
• Obtain an understanding of the City’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with Program revenues and expenditures, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control over compliance. Accordingly, no such opinion is expressed.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant deficiencies, and material weakness in internal control over compliance that we identified during the audit.

Other Matters
The results of our auditing procedures disclosed an instance of noncompliance which is required to be reported in accordance with the District Code and which is described in the accompanying schedule of findings and questioned costs as item 2021-01 Our opinion on each major federal program is not modified with respect to these matters.

Government Auditing Standards requires the auditor to perform limited procedures on the City’s response to the noncompliance findings identified in our audit described in the accompanying schedule of findings and questioned costs. The City’s response was not subjected to the other auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the response.

Internal Control Over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a compliance requirement will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a compliance requirement that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
17 Honorable Mayor and City Council
City of Lomita, California
Page Three
Our consideration of internal control over compliance was for the limited purpose described in the Auditor’s Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance may exist that were not identified.

Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.

Purpose of this Report
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the compliance requirements of the Program revenues and expenditures. Our audit was not designed for the purpose of expressing an opinion on effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.

Gruber and Lopez, Inc.

Newport Beach, California
November 15, 2023
Gruber and Lopez, inc.
18 CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

SCHEDULE OF FINDINGS, QUESTIONED COSTS, AND OTHER MATTERS June 30, 2022 and June 2021
2021-01 Pre- Nov 6, 2018 Program / Project in Excess of 30% of Program Revenues Condition:

During the testing of cash disbursements, we noted that two program expenses were for a continuation of programs and/or maintenance of projects implemented prior to November 6, 2018. The amounts claimed exceeded 30% of program funds received for each year under audit. The expenses incurred were in accordance with a Memorandum of Agreement (MOA). The MOA was submitted and conditionally approved on or about December 11, 2015.

The MOA is to cooperatively fund the monitoring services needed to comply with the monitoring requirement of the MS4 permit. Because MS4 compliance is the purpose of the MOA, and that is one of the functions of the City [Municipal] Program, it seems reasonable that MOA expenditures would qualify under 18.06.C.2 of LAC FCDC since the MOA started back in 2015.

Criteria:

Section 18.06 C.2 of LACFCD says “Up to thirty percent (30%) of a Municipality's [City] Municipal Program funds may be used to pay for costs and expenses incurred on or after November 6, 2018, related to the continuation of Programs implemented or the maintenance of Projects implemented prior to November 6, 2018.”
Questioned Cost:

FY 2020/21 FY 2021/22

SCWP revenue received $225,151.00 $226,215.00
30% permitted for PreNovember 6,2018 $67,545.30 $67,864.50

18.06.C.2 Project /
Program Expenditures $87,999.00 $80,613.00
Amounts Under (Over)
30% of program
revenue $(20,453.70) $(12,748.50)
19 CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)
SCHEDULE OF FINDINGS, QUESTIONED COSTS, AND OTHER MATTERS (contined) June 30, 2022 and June 2021
2021-01 Pre- Nov 6, 2018 Program / Project in Excess of 30% of Program Revenues

Effect:

Section 18.14.B of LAC FCDC says “If the District determines that a Municipality, Infrastructure Program Project Developer, or any other recipient of SCW Program funds has violated any provision of this Chapter or an applicable Transfer Agreement, the District is authorized to issue a notice of violation to the Municipality, Infrastructure Program Project Developer or other recipient of SCW Program revenues. The notice shall be in writing and shall describe the violation, the remedial actions the recipient must take to correct the violation, and the date by which the violation must be corrected.”
Recommendation:

Action by the City would be required upon a notice of violation issued by the District in accordance with Section 18.14.B of LAC FCDC. At that time, the City, could appeal not later than twenty (20) business days form the date of the written notice from the District or comply with the remedial actions to correct the violation by the date specified in the notice from the District.

Management’s Response:

We agree with the auditor’s comments, and the City understands that, per Section 18.06 C.2 of LACFCD, the two program expenses claimed exceeded 30% of program funds received for each year under audit. It is understood that action from the City may be required if the District determines to issue a notice of violation.
20 CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

STATUS OF PRIOR AUDIT FINDINGS
June 30, 2022 and June 30, 2021
There were no prior year findings.

CITY OF LOMITA -

SAFE, CLEAN, WATER PROGRAM
(MEASURE W FUND - MUNICIPAL PROGRAM)

FINANCIAL STATEMENTS
June 30, 2023
Attachment 5

CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM
(MEASURE W FUND - MUNICIPAL PROGRAM)

FINANCIAL STATEMENTS
June 30, 2023

TABLE OF CONTENTS
Page
INDEPENDENT AUDITORS’ REPORT ON FINANCIAL STATEMENTS 1
FINANCIAL STATEMENTS:

Balance Sheet 4
Statement of Revenues, Expenditures and Changes in Fund Balance 5 Notes to Financial Statements 6
Required Supplementary Information (Unaudited):

Statement of Revenues, Expenditures and Changes in Fund Balance - Budget to Actual 10

Notes to Required Supplementary Information 11
OTHER REPORTS:

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 12
Report on Compliance with Requirement Applicable to Measure W Revenues and Expenditures in Accordance with Chapters 16 and 18 of the Los Angeles County Flood Control District and Municipal Program Agreement No. 2020MP45 14

Schedule of Findings, Questioned Costs, and Other Matters 17 Status of Prior Audit Findings 19
438 Old Newport Blvd – Newport Beach, CA 92663
Phone (949) 346-2900– www.gruberlopezinc.com
-1-
Honorable Mayor and City Council
City of Lomita, California
INDEPENDENT AUDITORS’ REPORT ON FINANCIAL STATEMENTS
Opinion
We have audited the accompanying financial statements of Safe, Clean Water Program (Measure W Fund - Municipal Program) of the City of Lomita (the City) as of and for the year ended June 30, 2023, and the related notes to the financial statements as listed in the table of contents.

In our opinion, the financial statements present fairly, in all material respects, the Balance Sheet as of June 30, 2023, and the Statement of Revenues, Expenditures and Changes in Fund Balance for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Emphasis of Matter
As discussed in Note 1, the financial statements present only the Measure W fund (Municipal Program) and do not purport to, and do not, present fairly the financial position of the City of Lomita, CA , as of June 30, 2023, the changes in its financial position, or, where applicable, its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter.

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 Authority’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. 2 Honorable Mayor and City Council
City of Lomita, California
Page Two
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.

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.

Accounting principles generally accepted in the United States of America require that the budgetary comparison information as listed in the table of contents be presented to supplement the basic financial statements. Such 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. 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 3 Honorable Mayor and City Council
City of Lomita, California
Page Three
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.

Other Reporting Required By Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 06, 2023 on our consideration of the City's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on 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.

Gruber and Lopez, Inc.

Newport Beach, California
December 06, 2023
Gruber and Lopez, Inc.

See accompanying notes to the basic financial statements. 4 ASSETS
Cash $ 215,786
Total assets $ 215,786

LIABILITIES
Accounts payable 10,866
Total liabilities 10,866

FUND BALANCES
Restricted 204,920
Total fund balances 204,920
Total liabilities and fund balances $ 215,786
City of Lomita
Balance Sheet
Safe, Clean Water Program (Measure W Fund - Municipal Program) June 30, 2023
See accompanying notes to the basic financial statements. 5 REVENUES:

Special parcel tax-Measure W Municipal Program $ 226,909 Investment income 3,476
Total operating revenues 230,385
EXPENDITURES:

Public Works:

Professional services 27,931
Infrastructure Planning 1,403
Stormwater Runoff 99,076
Catch Basin 3,528
Downtown Lomita Multi-Benefit Stormwater Project 405
Total expenditures 132,343
Net change in Fund Balance 98,042
Fund balance, beginning of year 106,878
Fund balance, end of year $ 204,920
City of Lomita
Safe, Clean Water Program (Measure W Fund - Municipal Program) Statement of Revenues, Expenditures, and Changes in Fund Balance For the Year Ended June 30, 2023
6 CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM
(MEASURE W FUND - MUNICIPAL PROGRAM)

NOTES TO FINANCIAL STATEMENTS
Year Ended June 30, 2023
(1) Organization and Activities
The Safe, Clean Water Program (Measure W Fund - Municipal Program) financial statements of the City of Lomita, California (the ”City”) have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S.

GAAP”) applied to governmental agencies. The Governmental Accounting Standards Board (“GASB”) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.

The financial statements present only municipal program funding of the Safe, Clean Water Program (Measure W Fund) of the City of Lomita and to not purport to and do not present the City’s financial position, changes in financial position or, where applicable, its cash flows. All other funding sources of the Safe, Clean Water Program have been excluded. The City’s basic financial statements, which are available at 24300 Narbonne Ave, Lomita, CA 90717, or on the City’s website.

The following is a summary of the significant accounting policies:

Basis of Accounting
The City accounts for the Measure W Fund using a Special Revenue Fund to track and record the revenues and expenditures related to the Safe, Clean Water Program. 7 CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

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

Classification of Fund Balance
All fund balance in the Measure W Fund is restricted.

Restricted – Restricted fund balances encompass the portion of net fund resources subject to externally enforceable legal restrictions. This includes externally imposed restrictions by creditors, such as through debt covenants, grantors, contributors, laws or regulations of other governments, as well as restrictions imposed by law through constitutional provisions or enabling legislation.

8 CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

NOTES TO FINANCIAL STATEMENTS
(Continued)
(1) Organization and Activities (continued)
Basis of Accounting (continued)
Use of Estimates
The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. (2) Cash and Investments
The Measure W [Municipal Program] Fund's cash and investments are pooled with the City in the amount of $226,978 as of June 30, 2023. Each fund's share of the pooled cash account is separately accounted for, and investment income is allocated to all participating funds based on the relationship of their month-end cash balances to the total of the pooled cash and investments. Information regarding the authorized types of deposits and investments, the type of risks (i.e. credit, interest rate, custodial, etc.) and other disclosures associated with the Measure W Fund's pooled cash and investments is included in the City’s basic financial statements, which are available at 24300 Narbonne Ave, Lomita, CA 90717, or on the City’s website.
(3) Measure W
Forty percent (40%) of the revenue from the annual Special Parcel Tax (Measure W) are allocated for Municipal Programs. Each Municipality receives a proportional share of these Municipal Program funds based on the Special Parcel Tax revenues collected within each Municipality. The City uses the revenues received to fund projects dedicated to increase local water supply, improve water quality, and protect public health.

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

The Safe, Clean Water Program has been audited by the City's independent auditors in accordance with the provisions SCWP Code and a Transfer Agreement. A potential cost disallowances were proposed as a result of these audits. However, this program is still subject to further examination by the District and the amount, if any, of expenditures, which may be disallowed by the District, cannot be determined at this time. (6) Subsequent Events
The City has evaluated subseque nt events for recognition or disclosure through December 06, 2023, the date on which the financial statements were available to be issued. There were no material subsequent events that required recognition or additional disclosures in the financial statements. .

REQUIRED SUPPLEMENTARY INFORMATION
10 Variance
with
Final Budget Actual Final Budget
REVENUES:

Special parcel tax-Measure W Municipal Program $ 225,000 226,909$ $ 1,909 Investment income - 3,476 3,476
Total operating revenues 225,000 230,385 5,385
EXPENDITURES:

Public Works:

Professional services 29,500 27,931 1,569
Infrastructure Planning 1,000 1,403 (403)
Stormwater Runoff 99,076 99,076 -
Catch Basin 10,000 3,528 6,472
Downtown Lomita Multi-Benefit Stormwater Project 23,500 405 23,095 Total expenditures 163,076 132,343 30,733
Net change in Fund Balance 61,924 98,042 (25,348)
Fund balance, beginning of year 106,878 106,878 -
Fund balance, end of year $ 168,802 204,920$ $ (25,348) City of Lomita
Safe, Clean Water Program (Measure W Fund - Municipal Program) Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual For the Year Ended June 30, 2023
11 CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
Year Ended June 30, 2023
(1) Budgets and Budgetary Accounting
The City prepares its budgets on the modified accrual basis and, accordingly, the budget amounts included in the accompanying financial statements are presented in accordance with generally accepted accounting principles.

Each year, the City Administrator submits a proposed budget to the City Council during early May. The City Council holds budget hearings during May and early June. The final budget is adopted by the City Council during late June. Funds that have irregular activity are not budgeted. The legal level of control of which expenditures cannot exceed appropriations is at the functional level. The City Council is informed of expenditures over appropriations and such amounts are informally approved as a part of the bimonthly review of the demand warrants.

The City holds a mid-year budget review meeting. During the meeting, all budget expenditures are reviewed and projections for the whole year are made.

Unexpended and unencumbered appropriations of the governmental funds automatically lapse at the end of the year.
12 438 Old Newport Blvd. – Newport Beach, CA 92663
Phone (949) 346-2900 – www.gruberlopezinc.com
Honorable Mayor and City Council
City of Lomita, California

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
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 Safe, Clean Water Program (Measure W Fund), operated by City of Lomita (City), as of and for the year ended June 30, 2023, and the related notes to the financial statements, which collectively comprise the Measure W Fund basic financial statements, and have issued our report thereon dated December 06, 2023.

However, material weaknesses may exist that have not been identified. 13 Honorable Mayor and City Council
City of Lomita, California
Page Two
Compliance and Other Matters
As part of obtaining reasonable assurance about whether City's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Gruber and Lopez, Inc.

Newport Beach, California
December 06, 2023
Gruber and Lopez, Inc.
14 Honorable Mayor and City Council
City of Lomita, California
REPORT ON COMPLIANCE with REQUIREMENT APPLICABLE TO SAFE, CLEAN WATER

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 material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about the City’s compliance with the requirements of the Program revenues and expenditures as a whole. 15 Honorable Mayor and City Council
City of Lomita, California
Page Two
In performing an audit in accordance with generally accepted auditing standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material noncompliance, 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 City’s compliance with the compliance requirements referred to above and performing other procedures as necessary in the circumstances.
• Obtain an understanding of the City’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with Program revenues and expenditures, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control over compliance. Accordingly, no such opinion is expressed.

Other Matters
The results of our auditing procedures disclosed an instance of noncompliance which is required to be reported in accordance with the District Code and which is described in the accompanying schedule of findings and questioned costs as item 2023-01. Our opinion on each major federal program is not modified with respect to these matters.

Internal Control Over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a compliance requirement will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a compliance requirement that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
16 Honorable Mayor and City Council
City of Lomita, California
Page Three
Our consideration of internal control over compliance was for the limited purpose described in the Auditor’s Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance may exist that were not identified.

Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.

Gruber and Lopez, Inc.

Newport Beach, California
December 06, 2023
Gruber and Lopez, Inc.
17 CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

SCHEDULE OF FINDINGS, QUESTIONED COSTS, AND OTHER MATTERS June 30, 2023
2023-01 Pre- Nov 6, 2018 Program / Project in Excess of 30% of Program Revenues Condition: During the testing of cash disbursements, we noted that one program expense was for a continuation of programs and/or maintenance of projects implemented prior to November 6, 2018. The amounts claimed exceeded 30% of program funds received for each year under audit. The expenses incurred were in accordance with a Memorandum of Agreement (MOA). The MOA was submitted and conditionally approved on or about December 11, 2015.

Criteria: Section 18.06 C.2 of LACFCD says “Up to thirty percent (30%) of a Municipality's [City] Municipal Program funds may be used to pay for costs and expenses incurred on or after November 6, 2018, related to the continuation of Programs implemented or the maintenance of Projects implemented prior to November 6, 2018.”
Questioned Cost:

FY 2022/23
SCWP revenue received $226,909.00
30% permitted for PreNovember 6,2018 $68,072.70

18.06.C.2 Project /
Program Expenditures $88,474.00
Amounts Under (Over)
30% of program
revenue $(20,401.30)
18 CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)
SCHEDULE OF FINDINGS, QUESTIONED COSTS, AND OTHER MATTERS (contined) June 30, 2023
2023-01 Pre- Nov 6, 2018 Program / Project in Excess of 30% of Program Revenues Effect:

Management’s Response:

We agree with the auditor’s comments, and the City understands that, per Section 18.06 C.2 of LACFCD, the program expense claimed exceeded 30% of program funds received for each year under audit. It is understood that action from the City may be required if the District determines to issue a notice of violation.
19 CITY OF LOMITA

SAFE, CLEAN, WATER PROGRAM (MEASURE W FUND)

STATUS OF PRIOR AUDIT FINDINGS
June 30, 2023
2021-01 Pre- Nov 6, 2018 Program / Project in Excess of 30% of Program Revenues Condition: During the testing of cash disbursements, we noted that two program expenses were for a continuation of programs and/or maintenance of projects implemented prior to November 6, 2018. The amounts claimed exceeded 30% of program funds received for each year under audit. The expenses incurred were in accordance with a Memorandum of Agreement (MOA). The MOA was submitted and conditionally approved on or about December 11, 2015.

Results: Matter was not resolved and was repeated in finding 2023-01 in the current year schedule of findings, questioned costs, and other matters.

Lomita City CouncilDecember 19, 2023

Lomita City Council
December 19, 2023