Menifee City Council
January 21, 2026

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IMAGE 1 – PROJECT LOCATION – AERIAL

GENERAL PLAN/ZONE
The General Plan land use and zoning designation(s) for the Project site are EDC-SG which is intended to provide economic vitality and flexibility in land use options to promote economic development along the City’s major corridors. For all EDC designated areas across the City, the intent is to identify areas where a mixture of residential, commercial, office, civic, industrial, entertainment, educational, and/or recreational uses or other uses are planned. The EDC areas citywide are envisioned to develop primarily as nonresidential uses, with residential uses playing a supporting role. The unique site layout and mix of building sizes provides opportunities for a range of business park uses, including manufacturing uses, as well as service commercial uses along the Zeiders Road frontage.

Immediate surrounding General Plan Land Use designations within the City of Menifee are also EDC-SG to the north, south and east. Properties to the west of the Project site have a designation of Rural Residential (RR2). Properties in the area have historically been used for dry farming operations. The proposed Project is consistent with surrounding land use designations and the intent of the EDC designation.

Item Title: 11.1
Appeal of the Planning Commission Decision for the Menifee (Pemcor) Business Park Project Item Page Number: 477

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January 21, 2026
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November 12, 2025

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IMAGE 2 – GENERAL PLAN/ZONING MAP
The approval of a plot plan application is required for a business park use in the EDC-SG zone.

The proposed Project/use is consistent with the underlying zoning and allowable use table. The surrounding land use designations and existing uses can be found in table form below.

TABLE 1 – LAND USE DESIGNATIONS
Location Existing Land Use General Plan Land Use Zoning Classification North Residential/Agriculture EDC-SG EDC-SG
East Industrial EDC-SG EDC-SG
South Residential/Agriculture EDC-SG EDC-SG
West Residential Rural Residential (RR2) Rural Residential (RR2) Item Title: 11.1
Appeal of the Planning Commission Decision for the Menifee (Pemcor) Business Park Project Item Page Number: 478

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DISCUSSION
The Project Applicant submitted for a Pre-Application Review (PAR) on March 8, 2023, to solicit feedback from the City on the proposed Project. The initial application consisted of six buildings with a maximum building size of 80,000 square feet. After collaborating with City staff, the Applicant revised the Project and submitted an official application on December 21, 2023. The revised site plan consisted of 11 buildings (opposed to six with the PAR) with a maximum building size of 37,840 square feet.

IMAGE 3 – PAR SITE PLAN
The proposed business park project involves the development of 337,770 square feet of building area, which would be spread across 11 buildings. The entire 20.03-acre site would be graded and the portions of the site not developed with buildings would either be landscaped or hardscaped (e.g., parking or sidewalks). Two buildings will front on to Zeiders Road and three buildings will face Howard Way; the remaining six buildings will be centrally located, with three buildings facing the north and south project boundary, creating an internal truck court. The buildings range in size from 23,100 square feet to 37,840 square feet and feature two truck dock bays each, that would be oriented toward the center of the site (a total of 22 truck docks at the site). The truck courts will not be visible from adjoining streets or neighboring properties.

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Appeal of the Planning Commission Decision for the Menifee (Pemcor) Business Park Project Item Page Number: 479

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IMAGE 4 – PROPOSED SITE PLAN
Circulation and Parking
Regional Project access would be from I-215 via Scott Road Interchange, and eventually Zeiders Road. Local access to the site would be provided via two driveways on Zeiders Road. The southern driveway would provide truck and passenger car access to the site and would be a shared driveway with the southern property owner; while the northern/central driveway would only provide access to passenger vehicles. Due to site layout, trucks would travel from the southern driveway, through the drive aisle that runs through the middle of the site, to their building destination. The Project does not include vehicular access from Howard Way.

The City of Menifee Development Code outlines the parking requirements for the Project, as demonstrated in the table below. The Project meets and exceeds the City’s minimum parking requirements.

TABLE 2 – PARKING
Parking Summary
Industrial Uses Building SF Parking Spaces
Office: 1:250 SF 84,443 SF 338
Fabrication Area: 1:500 SF 50,666 SF 102
Storage Area: 1:1,000 SF 202,662 SF 203
Minimum Required 643
Total Provided 677
Using the City’s Parking and Loading Standards, the Project requires 643 parking spaces. The Project includes a total of 677 proposed off-site parking spaces, evenly distributed throughout the site. The Project does not include designated truck trailer parking stalls.

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Appeal of the Planning Commission Decision for the Menifee (Pemcor) Business Park Project Item Page Number: 480

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Infrastructure Improvements
Onsite and Frontage Improvements
The Project Applicant would be responsible for the construction of public infrastructure improvements. Zeiders Road would be improved along the Project frontage to a Major Divided Roadway per the City’s Circulation Element. The required improvements shall include the construction of appropriate pavement transitions from the new improvements to existing improvements beyond the Project frontage.

The southern driveway will be a full access driveway, with a modified traffic signal and shared access with the parcel to the south. The northern driveway shall be restricted to right-in, right-out movements only. Truck circulation also should not utilize this driveway. Driveways shall be constructed to City Standard No. 208.

Howard Road is classified as a Rural Collector Roadway along the Project’s western frontage.

Given that Howard Road is not proposed to be utilized by the Project for circulation, the Public Works Director / City Engineer may opt to accept payment in-lieu of physical construction.

Road and Bridge Benefit District (RBBD), Fair Share Contributions, and Other Improvements The Project has also been conditioned to pay RBBD fees based on the designated land use and areas prior to the issuance of occupancy.

Fair share cost participation would be required for off-site intersections including Zeiders/Haun Road at Scott Road intersection and Menifee Road and Scott Road intersection. Utility improvements would be constructed, which includes new water lines, recycled water lines, sewer, and storm drain lines.

Landscaping
Landscape standards for the Project are outlined in the City’s Development Code. A minimum of ten percent of the Project site must be landscaped per the EDEC requirements. Irrigated onsite landscaped areas for the Project site would total approximately 115,976 square feet (13 percent of the site) and would be comprised of drought-tolerant shrubs and groundcover and evergreen and deciduous trees. The conceptual landscape plan includes trees at the perimeter, street frontages, parking areas, and adjacent to the building to soften the edges of the development and the proposed building.

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Appeal of the Planning Commission Decision for the Menifee (Pemcor) Business Park Project Item Page Number: 481

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IMAGE 5 – CONCEPTUAL LANDSCAPE PLAN
The landscape and architectural plans feature site amenities that coordinate and complement the proposed Project. The buildings are separated by no less than 26-feet and include outdoor break areas with decorative paving, benches, tables, bike racks, and trash receptacles for employees and guests/customers. The primary driveway entrance has been enhanced with a wide driveway approach (30-feet) and an increase in entryway landscaping.

IMAGE 6 – ENHANCED LANDSCAPE VIEW – BETWEEN BUILDINGS
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IMAGE 7 – ENHANCED LANDSCAPE VIEW – ENTRY
Screening
The Project includes a six-foot-tall decorative block wall along the western boundary to assist in screening the proposed business park project from the adjacent residential properties. The wall will reduce visual impacts of the proposed Project, as well as possible noise impacts. The proposed block wall will run the entire 662-foot span from north to south and will match the color scheme of the business park project. Vines will be planted along the screen wall to soften the long-term appearance.

IMAGE 8 – SECTION, BLOCK WALL
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Appeal of the Planning Commission Decision for the Menifee (Pemcor) Business Park Project Item Page Number: 483

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The Project includes dense perimeter landscaping to assist in screening the Project site and the parking stalls from adjacent land uses. Dense landscape hedges are provided between the parking stalls and the property line in the northwest corner of the Project site to to help screen headlights from the existing residential use to the north, in the EDC-SG Zone.

As shown in the conceptual landscape plan, the intent is to provide landscape coverage with a variety of trees, shrubs and ground cover to soften the wall and to provide a more aesthetically pleasing street scene on the project frontages.

IMAGE 9 – ENHANCED VIEW, NORTHWEST CORNER
Elevations
The proposed buildings have unique design features as well as shared architectural elements with approved developments within the City to provide for compatible development. There are complementing roof forms, colors, and materials. The various colors include white, multiple variations of gray and porcelain tile with a wooden appearance. The buildings will include significant glazing as well as tube steel canopies over the building entrances and a concrete “eyebrow” highlighting the prominent elevations along Zeiders Road. Visual interest is maintained throughout the Project by enhancing architectural detailing and façade articulation along all building elevations to reduce any large blank sections of walls. As previously mentioned, each building contains two truck bay doors, which are strategically cut into the buildings to assist in hiding from adjacent properties. The building heights are 38 to 40 feet above ground level.

IMAGE 10 – ARCHITECTURE
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IMAGE 11 – BUILDINGS J & K – ZEIDERS ROAD
IMAGE 12 – BUILDINGS A, B, C – HOWARD WAY
IMAGE 13 – BUILDINGS D – I (INTERNAL)
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Industrial Good Neighbor Policies
On March 2, 2022, the City Council adopted the Industrial Good Neighbor Policies. The focus of the policies can be summarized in three sections:

1. Minimize impacts to sensitve uses (residential, schools, parks, nursing homes, hospitals)

2. Protect public health, safety and welfare by regulating design, location and operations

3. Protect neighborhood character of adjacent residential communities Although the proposed Project is not a warehouse distribution facility project, in which the Good Neighbor Policies were intended for, the Project does comply with and is consistent with the requirements. Implemented policies include added landscape buffers, screen walls, improved building design, community outreach, increased building and loading dock setbacks, on-site truck queuing, on-site signage, and environmental mitigation measures.

Menifee Innovation District Specific Plan (MIDSP)
The City has undertaken an effort to establish an Innovation District Specific Plan for the surrounding properties within the EDC-SG area. The City initiated the MIDSP effort to develop a vision for a thriving innovation district at the City’s southern gateway west of the I-215 freeway.

The approximately 375-acre area proposed for the MIDSP is bounded by Scott Road to the north, the I-215 Freeway to the east, Keller Road to the south and Howard/Nancy Road to the west.

IMAGE 14 – MIDSP BOUNDARY
The goal of the MIDSP is to serve as an economic development effort aimed at diversifying the City's local economy while addressing job creation for the region. Since the beginning of the MIDSP effort, the City has conducted community outreach consisting of community workshops, Item Title: 11.1
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Planning Commission/City Council interviews, a design charrette and a joint Planning Commission/City Council workshop to develop and proceed with a vision for the MIDSP. The MIDSP intends to advance Menifee’s future through a Health and Med Tech Innovation District and directly addresses the questions and concerns regarding jobs-housing balance, fiscal sustainability, infrastructure obligations, and the need for bold leadership to elevate Menifee beyond a bedroom community. Work efforts on the MIDSP are an on-going effort. The proposed project would be complimentary to the MIDSP project.

ENVIRONMENTAL DETERMINATION
Notice of Preparation (NOP)
On July 24, 2024, the City of Menifee publicly noticed its decision to prepare an Environmental Impact Report (EIR) and hold a public scoping meeting for the Project by noticing the California Governor’s Office of Planning and Research, now known as the Office of Land Use and Climate Innovation (LCI) (SCH/LCI No. 2024071016) and distributed the NOP to various agencies and surrounding property owners and residents in accordance with California Environmental Quality Act (CEQA) requirements. The NOP review period was from July 24, 2024 to August 22, 2024.

City staff held an environmental scoping meeting on Wednesday, July 31, 2024 at City Hall to discuss the Project and to receive comments from the public. No members of the public attended outside the Project Applicant and Mayor Estrada. The purpose of the NOP is to solicit feedback on areas of environmental concern from interested/affected parties. Written comments were received from the following:
oSouthern California Gas Company (SoCal Gas)
oRiverside Transit Agency (RTA)
oRiverside County Flood Control District (RCFC)
oEastern Municipal Water District (EMWD)
oSouth Coast Air Quality Management District (SCAQMD)
oAndrew and Sharon Johnson
EIR Impacts
Within the EIR that has been prepared for the Project, mitigation measures are provided under the categories of Air Quality, Biological Resources, Greenhouse Gas Emissions, Hazards and Hazardous Materials and Noise. The EIR determined that the Project could result in significant and unavoidable impacts in Greenhouse Gas Emissions based on the analysis and findings in the Draft EIR and requires adoption of a Statement of Overriding Considerations (SOC).

Draft EIR Public Review
The City distributed the Draft EIR for public review beginning September 2, 2025 and ending October 16, 2025. For the Draft EIR 45-day comment period and public hearings, property owners and non-owner residents within 1,000 feet of the Project boundary were mailed notices at each step of the Project (scoping meeting, Draft EIR comment period, public hearing). During the public review period, comments on the Draft EIR were received from the following agencies, organizations, or individuals:

Agencies
oAirport Land Use Commission (ALUC)
oRiverside County Department of Waste Resources
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November 12, 2025

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oSouth Coast Air Quality Management District (SCAQMD)
oRiverside County Flood Control District (RCFC)
oRiverside Transit Agency (RTA)
Organizations
oSupporters Alliance for Environmental Responsibility (SAFER) oGolden State Environmental Justice Alliance
Individuals
oAndrew and Sharon Johnson
The City prepared a Final Environmental Impact Report (FEIR), consisting of all comment letters received during the 45-day public review and comment period on the Draft EIR, written responses to those comments, and revisions and errata to the Draft EIR. The FEIR was distributed to the Draft EIR commenters 10 days prior to the Planning Commission hearing. The FEIR, and Draft EIR, including technical appendices can be accessed for review on the City website at https://www.cityofmenifee.us/325/Environmental-Notices-Documents.

Findings of Fact and SOC
Because the EIR identified unavoidable significant adverse impacts that could not be mitigated below the level of significance, Findings of Fact and a SOC are required to approve the Project.

The Findings of Fact and SOC are included within the resolution for the EIR for consideration by the Planning Commission.

FINDINGS
Findings for the FEIR and PP No. PLN24-0245 are included in the attached Resolutions.

PUBLIC NOTICE
The proposed Project was noticed on November 2, 2025, for the November 12, 2025, Planning Commission public hearing. A public notice was published in The Press Enterprise and notices were mailed to property owners and non-owner residents within a 1,000-foot radius of the Project site. The proper public notice was posted on-site, and in addition, all relevant public agencies and those requesting notification were notified of the public hearing.

ATTACHMENTS

1. Project Exhibits/Plans

2. Resolution – EIR

3. Exhibit A – FEIR

4. Exhibit B - MMRP

5. Exhibit C – Findings of Fact

6. Resolution – Plot Plan

7. Exhibit A – Conditions of Approval

8. Public Hearing Notice
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NOTICE OF PUBLIC HEARING
TIME OF HEARING:6:00 p.m. or as soon as possible thereafter.

DATE OF HEARING:January 21, 2026
PLACE OF HEARING:MENIFEE CITY COUNCIL CHAMBERS
29844 HAUN ROAD MENIFEE, CA 92586
A PUBLIC HEARING has been scheduled, pursuant to the City of Menifee Municipal Code, before the CITY OF MENIFEE CITY COUNCIL to consider the project shown below:

Project Title:

Appeal Nos. PLN25-0208 and PLN25-
0210 for the Menifee (Pemcor) Business
Park Project - Plot Plan PLN23-0245
Project Location:

The project site is located at 33521 Zeiders
Road, between Howard Way and Zeiders
Road, in the southern portion of the City of
Menifee. (Assessor’s Parcel Number {APN}
384-150-001)
General Plan Land Use and Zoning:

Economic Development Corridor Zone –
Southern Gateway (EDC-SG)
The City Council will consider the
following project at a public hearing:

On November 12, 2025, the Planning Commission held a duly noticed public hearing and voted to approve Plot Plan No. PLN23-0245 along with the related environmental analysis (Project). On November 19th and November 20 th, 2025, the City received an applications to appeal the November 12 th, 2025 Planning Commission decision to the City Council.

Plot Plan (PP) No. PLN23-0245 Menifee (Pemcor) Business Park Project proposes a commercial/industrial business park development consisting of eleven single-story buildings ranging in size from approximately 23,100 square feet to 37,840 square feet (total 337,770 square feet) on approximately 20-acres. The project site is zoned Economic Development Corridor – Southern Gateway (EDC-SG). The anticipated end users are expected to provide services ranging from industrial and manufacturing users to service commercial and office (tenants are not known at this time). Each building includes two (2) dock-high doors for a total of 22 for the entire project.

The project proposes 677 parking spaces and 121,879 square feet (15%) of irrigated landscaped area. The applicant is proposing approximately 53,300 cubic yards of grading. Furthermore, the project includes two (2) driveways along Zeiders Road with the southernmost driveway being signalized and aligning with Scott Road Commerce Center.

Environmental Information:

A Notice of Availability of the Draft Environmental Impact Report (DEIR) was published in The Press Enterprise on September 2, 2025, mailed to responsible and trustee agencies, and mailed to surrounding property owners Item Title: 11.1
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within 1,000 feet of the project site, stating that copies of the DEIR were available for public review with the Office of Land Use and Climate Innovation (LCI), on the City’s website and at the City of Menifee City Hall. The public review period was for the State-mandated 45 days, from September 2, 2025, through October 16, 2025.

Analysis presented in the Draft EIR indicated that the proposed project would have certain significant and unavoidable greenhouse gas impacts as described in detail in the DEIR. The DEIR also presented mitigation measures, which will reduce project-specific and cumulative impacts. All other environmental effects evaluated in the DEIR are considered less than significant, or can be successfully mitigated below the applicable significance thresholds.

The Final Environmental Impact Report (FEIR) responds to the comments and includes text revisions to the DEIR in response to input received on the DEIR. Unlike the DEIR, comments on the FEIR are not required to be responded to by the City. If written comments are received, they will be provided to the City Council as part of the staff report for the Project. The DEIR and FEIR will be submitted to the City Council for requested certification and action on the Project.

The DEIR and FEIR are available on the City of Menifee Community Development Department website:
https://www.cityofmenifee.us/325/Environmental-Notices-Documents. Additionally, a hard copy of the FEIR can be viewed at:
Menifee City Hall - 29844 Haun Road, Menifee, CA 92586 The Project site is not included on a list of hazardous materials sites compiled pursuant to Government Code Section 65962.5 (California Department of Toxic Substances Control list of various hazardous sites).

Any person wishing to comment on the proposed project may do so in writing between the date of this notice and the public hearing and be heard at the time and place noted above. All comments must be received prior to the time of public hearing. All such comments will be submitted to the City Council, and the City Council will consider such comments, in addition to any oral testimony, before making a decision on the proposed project.

If this project is challenged in court, the issues may be limited to those raised at the public hearing, described in this notice, or in written correspondence delivered to the City Council at, or prior to, the public hearing. Be advised that as a result of public hearings and comment, the City Council may amend, in whole or in part, the proposed project. Accordingly, the designations, development standards, design or improvements, or any properties or lands within the boundaries of the proposed project, may be changed in a way other than specifically proposed.

For further information regarding this project, please contact Russell Brown, at (951) 723-3745 or e-mail [email protected], or go to the City of Menifee’s agenda web page at http://www.cityofmenifee.us. To view the case file for the proposed project contact the Community Development Department office at (951) 672- 6777 Monday through Friday, from 8:00 A.M. to 5:00 P.M. Please send all written correspondence to:

CITY OF MENIFEE COMMUNITY DEVELOPMENT DEPARTMENT
Attn: Russell Brown, Senior Planner
29844 Haun Road
Menifee, CA 92584
Item Title: 11.1
Appeal of the Planning Commission Decision for the Menifee (Pemcor) Business Park Project Item Page Number: 534

Menifee Mayor and City Council
January 21, 2026
Page
986 of 1208

CITY OF MENIFEE
SUBJECT: First Reading and Introduction of an Ordinance for Annexation No. 40, Kaiser Medical, into Community Facility District 2017- 1, Maintenance Services
MEETING DATE: January 21, 2026
TO: Mayor and City Council
PREPARED BY: Mandy Stephens, Management Analyst
REVIEWED BY: Nick Fidler, Public Works Director
APPROVED BY: Armando G. Villa, City Manager
-------------------------------------------------------------------------------------------------------------------------------

RECOMMENDED ACTION

1. Adopt a resolution calling an election to annex territory, including Assessor’s Parcel Number (APN) 331-120-058, Kaiser Medical, located on the northeast corner of Encanto Drive and Rouse Road, into Community Facilities District (CFD) No. 2017-1 Maintenance Services and to levy a special tax on that land; and

2. Adopt a resolution declaring the results of the special landowner election; and

3. Introduce an ordinance, amending Ordinance No. 2017-231 and levying and apportioning the special tax in CFD 2017-1.

DISCUSSION
On December 17, 2025, the City Council adopted Resolution No. 25-1662, declaring its intent to annex territory to CFD No. 2017-1 and commence the annexation proceedings for the territory to be annexed, also known as Annexation No. 40. The next steps in the annexation proceedings are to hold a public hearing on January 21, 2026, to conduct an election for the landowners and to declare the results of that election. Notice of the public hearing was published in the Press Enterprise and mailed to the property owner in accordance with the Mello-Roos Act.

The area within Annexation No. 40 is included in APN 331-120-058 and is approximately four gross acres of a commercial lot within the City. The property is located on the northeast corner of Encanto Drive and Rouse Road, as shown in the attached Project Location Map. The proposed maintenance services would include items such as landscaping, lighting, streets, and drainage.

Per the request of Kaiser Foundation Health, Inc. (Owner), the City would establish a rate and method of apportionment and authorize the levy of special taxes on the taxable property within Annexation No. 40 to pay for those services.

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 1

Menifee Mayor and City Council
January 21, 2026
Page
987 of 1208

City of Menifee Staff Report
CFD 2017-1, Annex 40 – Kaiser Medical
January 21, 2026

3 1
0 6
Annexation No. 40 would have a maximum annual tax of $11,018 per acre and would be included in CFD No. 2017-1 as “Tax Zone 40.” This tax rate includes a Maximum Special Tax A of $3,844 per acre per year for maintenance services of public facilities and a Maximum Special Tax B (Contingent Tax B) of $7,174 per acre per year. The maximum annual tax rate is proposed to escalate each year at the greater of Consumer Price Index (CPI) or 2%. The attached CFD Maintenance Site Plan Exhibit illustrates which services would be maintained by the CFD.

The Owner submitted Consent and Waiver forms on file in the City Clerk’s Office to:
hold the election and declare election results; and
consent to the shortening of election time requirements; and waive analysis and arguments; and
waive all notice requirements relating to the conduct of the election immediately following the public hearing.

A copy of the boundary map entitled “Annexation Map No. 40, Community Facilities District No. 2017-1 (Maintenance Services)” was recorded on December 23, 2025, in Book 98 of Maps of Assessment and Community Facilities Districts at Page 59, in the office of Riverside County Recorder. Annexing the parcel into CDF No. 2017-1 would cover the costs of maintenance of public improvements associated with the development.

STRATEGIC PLAN OBJECTIVE
Thriving Economy

FISCAL IMPACT
The individual property owners in the CFD would be responsible for annual payments of special taxes. Upon full completion of the tract development, there would be an annual collection of Special Tax revenues of approximately $16,375, not including Contingent Tax B, to be used to pay for maintenance costs.

On June 1 of each year, every taxable unit for which a building permit has been issued within the boundaries of the CFD would be subject to the special tax for the ensuing Fiscal Year. If the anticipated costs of maintaining the facilities in any given Fiscal Year, prior to buildout of the project, exceeds the special tax revenues available from parcels for which building permits have been issued, the special tax may also be applied to property within recorded final subdivision maps, as well as other undeveloped property within the boundaries of the CFD.

All costs associated with annexation into the CFD have been borne by the Owners. By annexing into the CFD, the costs of maintaining improvements located within the development would be financed through special taxes levied on the parcels within CFD No. 2017-1 and not through the City’s General Fund.

ATTACHMENTS

1. Project Location Map
Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 2

Menifee Mayor and City Council
January 21, 2026
Page
988 of 1208

City of Menifee Staff Report
CFD 2017-1, Annex 40 – Kaiser Medical
January 21, 2026

3 1
0 6

2. Resolution Calling the Election

3. Resolution Declaring Election Results

4. Certificate of Registered Voters

5. Ordinance

6. Signed Petition, Waiver and Consent Annexation

7. CFD Maintenance Site Plan Exhibit
Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 3

Menifee Mayor and City Council
January 21, 2026
Page
989 of 1208

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COMMUNITY FACILITIES DISTRICT 2017-1
(MAINTENANCE SERVICES)
ANNEXATION NO. 40

PROJECT MAP
Item Title: 11.2
First Reading and Introduction of an Ordinance for Annexation No. 40, Kaiser Medical, into Community Facility District 2017-1, Maintenance Services Item Page Number: 4

Menifee Mayor and City Council
January 21, 2026
Page
990 of 1208

1 RESOLUTION NO. 26-____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MENIFEE, CALIFORNIA ,

CALLING AN ELECTION TO SUBMIT TO THE QUALIFIED ELECTORS THE

QUESTION OF LEVYING A SPECIAL TAX WITHIN THE AREA PROPOSED TO BE ANNEXED TO COMMUNITY FACILITIES DISTRICT NO. 201 7-1 (MAINTENANCE SERVICES) (ANNEXATION NO. 40), ASSESSOR’S PARCEL NUMBER 331-120-058 WHEREAS, pursuant to the Mello-Roos Community Facilities Act of 1982 ( “Act”), on December 6, 2017, the City Council ( “City Council”) of the City of Menifee (the “City”) approved Resolution No. 17- 658 establishing Community Facilities District No. 2017-1 (Maintenance Services) of the City of Menifee, County of Riverside, State of California ( “CFD No. 2017-1”) for the purpose of levying special taxes on parcels of taxable property therein for the purpose of providing certain services ( “Services”) which are necessary to meet increas ed demands placed upon the City as a result of the development of said parcels; and
WHEREAS, the City Council called a special election for December 6, 2017, at which the questions of levying a special tax and establishing an appropriations limit with respect to CFD No. 2017- 1 were submitted to the qualified electors within CFD No. 2017-1; and WHEREAS, at a special election held on December 6, 2017, more than two-thirds (⅔) of all votes cast were cast in favor of the levy of a special tax and the establishment of an appropriations limit, as determined by the City Council in Resolution No. 17-658, which was duly adopted on December 6, 2017; and
. WHEREAS, the City Council is authorized by Article 3.5 (commencing with Section 53339) of Chapter 2.5 of Part 1 of Division 2 of Title 5 of the Government Code to annex territory into an existing community facilities district by complying with the procedures set forth in said Article 3.5; and WHEREAS, the City Council on December 17 , 2025, duly adopted Resolut ion No. 2 5-1662 (“Resolution of Intention”) declaring its intention to annex certain territory to the CFD No. 2017 -1 and to levy a special tax within that territory to pay for certain services and setting a time and place for the public hearing on the proposed annexation for January 21, 2026; and WHEREAS, the territory proposed to be annexed is identified in a map entitled “Annexation Map No. 40, Community Facilities District No. 2017-1 (Maintenance Services)” a copy of which was recorded, on December 23, 2025, in Book 98 of Maps of Assessment and Community Facilities Districts at Page 59, in the office of the Riverside County Recorder; and WHEREAS, pursuant to the Act and the Resolution of Intention, a noticed public hearing was convened by the City Council on January 21, 2026, not earlier than the hour of 6:00 p.m. at the City Hall located at 29844 Haun Road, Menifee, California 92586, at which hearing all interested persons were given the opportunity to appear and be heard on the proposed annexation of said territory to the CFD No. 2017-1 and the levy of special taxes within said territory proposed to be annexed. If and to the extent participation in the January 21, 2026 meeting must occur by teleconference, videoconference, or other electronic means authorized by the Ralph M. Brown Act or an Executive Order of the Governor of California, the means and methods for participating in the meeting were posted on the Agenda for said meeting, which was posted at least 72 hours prior to the meeting on the City of Menifee (www.cityofmenifee.us), and outside of City Hall at 29844 Haun Road, Menifee, California 92586. A copy of the Agenda was and will be made available upon request to the Menifee City Clerk's office at 951-672- 6777; and
Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 5

Menifee Mayor and City Council
January 21, 2026
Page
991 of 1208

Resolution Calling an Election Annex 40
2 WHEREAS, written protests have not been filed by fifty percent (50%) or more of the registered voters residing within the CFD No. 2017-1, or by fifty percent (50%) or more of the registered voters residing within the territory proposed to be annexed, or by the owners of one-half (½) or more of the area within the CFD No. 2017- 1, or by the owners of one -half (½) or more of the territory proposed to be annexed; and
WHEREAS, the City Council has determined that there are fewer than twelve (12) registered voters residing in the territory proposed to be annexed to the CFD No. 2017- 1 and that the qualified electors in such territory are the landowners; and
WHEREAS, on the basis of all of the foregoing, the City Council has determined at this time to call an election to authorize the annexation of territory to the CFD No. 2017-1 and the levying of a special tax as described in Exhibit A attached hereto; and
WHEREAS, the City Council has received a written instrument from each landowner in the territory proposed to be annexed to the CFD No. 2017- 1 consenting to the shortening of election time requirements, waiving analysis and arguments, waiving all notice requirements , and waiving word limit requirements for the ballot relating to the conduct of the election; and WHEREAS, the City Clerk has concurred with the election date set forth herein.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Menifee, California acting as the legislative body of Community Facilities District No. 2017-1 (Maintenance Services) of the City of Menifee, determine and order as follows:

Section 1. Recitals. The foregoing recitals are true and correct.

Section 2. Confirmation of Finding in Resolution of Intention. The City Council reconfirms all of its findings and determinations as set forth in the Resolution of Intention.

Section 3. Findings Regarding Protests. The City Council finds and determines that written protests to the proposed annexation of territory to the CFD No. 2017-1 and the levy of the special tax within such territory are insufficient in number and in amount under the Act, and the City Council hereby further orders and determines that all such protests are hereby overruled.

Section 4. Findings Regarding Prior Proceedings . The City Council finds and determines that all prior proceedings had and taken by the City Council with respect to the annexation of territory to the CFD No. 2017-1 are valid and in conformity with the requirements of the Act.

Section 5. Levy of Special Tax . As stated in the Resolution of Intention, except where funds are otherwise available, subject to the approval of the qualified electors of territory proposed to be annexed to the CFD No. 2017- 1, a special tax sufficient to pay the costs of the Services (including incidental expenses as described in the Resolution of Intention), secured by recordation of a continuing lien against all nonexempt real property in CFD No. 2017-1, will be levied annually in CFD No. 2017-1. The rate and method of apportionment, and manner of collection of the special tax are specified in Exhibit A hereto.

Section 6. Apportionment of Tax. The special tax as apportioned to each parcel is based on the cost of making the Services available to each parcel, or other reasonable basis, and is not based on or upon the ownership of real property.

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 6

Menifee Mayor and City Council
January 21, 2026
Page
992 of 1208

Resolution Calling an Election Annex 40
3 Section 7. Tax Roll Preparation. The office of the Public Works Director, 29844 Haun Road, Menifee, California 92586, is hereby designated as the office that will be responsible for annually preparing a current roll of special tax levy obligations by assessor’s parcel number and that will be responsible for estimating future special tax lev ies pursuant to Government Code section 53340.2. The Public Works Director may cause these functions to be performed by his or her deputies, assistants, or other designated agents.

Section 8. Accountability Measures. Pursuant to Government Code section 50075.1, the City shall create a separate account into which special tax proceeds will be deposited; and the Public Works Director annually shall prepare and file a report with the City Council that will state (a) the amount of funds collected and expended and (b) the status of the Services financed in the CFD No. 2017-1.

Section 9. Special Election; Voting Procedures . The City Council hereby submits the question of levying the special tax within the territory proposed to be annexed to the qualified electors of the territory proposed to be annexed, in accordance with and pursuant to the Act. The special election shall be held on January 21, 2026, and shall be conducted as follows:
(A). Qualified Electors . The City Council hereby determines that the Services are necessary to meet increased demands placed upon the City as a result of development occurring within the boundaries of the territory proposed to be annexed into CFD No. 2017-

1. Because fewer than twelve registered voters reside within the territory proposed to be annexed to the CFD No. 2017- 1 on December 10, 2025 (a date within the 90 days preceding the close of the public hearing on the territory proposed to be annexed to the CFD No. 2017- 1), the qualified electors shall be the landowners within the territory proposed to be annexed to the CFD No. 2017-1, and each landowner who was the owner of record at the close of the hearing shall have one vote for each acre or portion of an acre of land that such landowner owns within the territory proposed to be annexed to the CFD No. 2017-1.
(B). Consolidation of Elections; Combination of Propositions on Ballot. The election on the question of levying the special tax and establishing an appropriations limit for the CFD No. 2017-1 shall be consolidated, and the two propositions shall be combined into a single ballot proposition for submission to the voters, as authorized by Government Code Section 53353.5.
(C). Mail Ballot Election. Pursuant to Government Code section 53327.5, the election shall be conducted as a mail ballot election. The City Council hereby ratifies the City Clerk’s delivery of a ballot to each landowner within the territory proposed to be annexed to the CFD No. 2017-1. The City Council hereby ratifies the form of the ballot, which is attached hereto as Exhibit B. The full text of the ballot for said elections shall be set forth in Exhibit C and shall be included in the ballot pamphlet mailed to each qualified elector. (D). Return of Ballots. The City Clerk shall accept the ballots of the landowners up to 6:00 p.m. on January 21, 2026. The City Clerk shall have available ballots that may be marked at the City Clerk’s office on the election day by voters. Once all qualified electors have voted, the City Clerk may close the election.
(E). Canvass of Election. The City Clerk shall commence the canvass of the returns of the special election as soon as the election is closed (on January 21, 2026, or when all qualified electors have voted) at the City Clerk’s office. At the conclusion of the canvass, the City Clerk shall declare the results of the election.

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 7

Menifee Mayor and City Council
January 21, 2026
Page
993 of 1208

Resolution Calling an Election Annex 40
4 (F). Declaration of Results . The City Council shall declare the results of the special election following the completion of the canvass of the returns and shall cause to be inserted into its minutes a statement of the results of the special election as ascertained by the canvass of the returns.

Section 10. General Authorization with Respect to the Election. The officers, employees, and agents of the City are hereby authorized and directed to take all actions and do all things which they, or any of them, may deem necessary or desirable to accomplish the purposes of this Resolution and not inconsistent with the provisions hereof. All actions heretofore taken by the officers, employees, and agents of the City that are in conformity with the purposes and intent of this Resolution are hereby ratified, confirmed, and approved in all respects.

Section 11. Filing of Resolution and Map with City Clerk . The City Council hereby directs the Cit y Clerk to file a copy of this R esolution and the annexation map of the boundaries of CFD No. 2017-1 in his/her office.

Section 12. Effective Date. This Resolution shall take effect immediately upon its adoption.

PASSED, APPROVED AND ADOPTED this 21st day of January 2026

___________________________
Bob Karwin, Mayor Pro Tem

Attest:

___________________________
Stephanie Roseen, City Clerk
Approved as to form:

___________________________
Jeffrey T. Melching, City Attorney
Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 8

Menifee Mayor and City Council
January 21, 2026
Page
994 of 1208

RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX FOR
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES)

OF THE CITY OF MENIFEE
A Special Tax (the “Special Tax”) shall be levied on and collected from each Assessor’s Parcel (defined below) in Community Facilities District No. 2017-1 (Maintenance Services) (the “CFD No. 2017-1” or “CFD”; defined below), in each Fiscal Year, (defined below), commencing in the Fiscal Year beginning July 1, 201 8, in an amount determined by the City Council of the City of Menifee, acting in its capacity as the legislative body of CFD No. 2017-1, by applying the rate and method of apportionment set forth below. All of the real property in CFD No. 2017-1, unless exempted by law or by the provisions herein, shall be taxed to the extent and in the manner provided herein.

A. DEFINITIONS
“Acre” or “Acreage” means the land area of an Assessor’s Parcel as shown on any Assessor’s Parcel Map, or if the land area is not shown on the Assessor’s Parcel Map, the land area as shown on the applicable Final Map, or if the area is not shown on the applicable Final Map, the land area shall be calculated by the Administrator.
“Administrative Expenses” means the actual or reasonably estimated costs directly related to the formation, annexation, and administration of CFD No. 2017 -1 including, but not limited to: the costs of computing the Special Taxes and preparing the annual Special Tax collection schedules (whether by the City or designee thereof or both); the costs to the City, CFD No. 2017 -1, or any designee thereof associated with fulfilling the CFD No. 2017-1 disclosure requirements; the costs associated with responding to public inquiries regarding the Special Taxes; the costs of the City, CFD No. 2017-1 or any designee thereof related to an appeal of the Special Tax; and the City's annual administration fees including payment of a proportional share of City overhead and salaries and benefits of any City employees whose duties are related to the administration of CFD No. 2017-1 and third party expenses related to CFD No. 2017-1. Administrative Expenses shall also include amounts estimated or advanced by the City or CFD No. 2017 -1 for any other admin istrative purposes of CFD No. 2017-1 , including attorney's fees and other costs related to commencing and pursuing to completion any foreclosure of delinquent Special Taxes.
“Administrator” means the City Manager of the City of Menifee, or his or her designee. “Approved Property” means all Assessor’s Parcels of Taxable Property that are included in a Final Map that was recorded prior to the March 1 preceding the Fiscal Year in which the Special Tax is being levied, and that have not been issued a building permit on or prior to the June 1 preceding the Fiscal year in which the special tax is being levied.
“Assessor’s Parcel” means a lot or parcel of land that is identifiable by an Assessor’s Parcel Number by the County Assessor of the County of Riverside.
“Assessor’s Parcel Map” means an official map of the Assessor of the County designating parcels by Assessor’s Parcel Number.
“Assessor’s Parcel Number” means that identification number assigned to a parcel by the County Assessor of the County.
“Building Square Footage” or “BSF” means the floor area square footage reflected on the original Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 9

Menifee Mayor and City Council
January 21, 2026
Page
995 of 1208

construction building permit issued for construction of a building of Non -Residential Property and any Building Square Footage subsequently added to a building of such Non -Residential Property after issuance of a building permit for expansion or renovation of such building. “
Calendar Year” means the period commencing January 1 of any year and ending the following December 31.
“C
FD” or “CFD No. 2017 -1” means the City of Menifee Community Facilities District No. 2017 -1 (Maintenance Services).
“
City” means the City of Menifee.
“
Contingent Services” means services permitted under the Mello-Roos Community Facilities Act of 1982 including, without limitation, those services authorized to be funded by CFD No. 2017-1 as set forth in the documents adopted by the City Council at the time the CFD was formed to be provided by the City in the event the Administrator makes a determination pursuant to Section C(2) that a Property Owners’ Association fails to adequately provide such services.
“
County” means the County of Riverside.
“
Developed Property” means all Assessor’s Parcels of Taxable Property for which a building permit for new construction has been issued on or prior to June 1 preceding the Fiscal Year in which the Special Tax is being levied.
“
Exempt Property” means all Assessors’ Parcels designated as being exempt from the Special Tax as provided for in Section G.
“
Final Map” means a subdivision of property by recordation of a final map, parcel map, or lot line adjustment, pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) or recordation of a condominium plan pursuant to California Civil Code 1352 that creates individual lots for which building permits may be issued without further subdivision. “
Fiscal Year” means the period from and including July 1st of any year to and including the following June 30th.
“
Land Use Category” or “LUC” means any of the categories contained in Section B hereof to which an Assessor’s Parcel is assigned consistent with the land use approvals that have been received or proposed for the Assessor’s Parcel as of June 1 preceding the Fiscal Year in which the Special Tax is being levied. “
Maximum Special Tax” means either Maximum Special Tax A and/or Maximum Special Tax B (Contingent), as applicable.
“
Maximum Special Tax A” means for each Assessor’s Parcel and each Fiscal Year, the maximum Special Tax A, as determined in accordance with Section C below that can be levied on such Assessor’s Parcel in such Fiscal Year.
“
Maximum Special Tax B (Contingent) ” means for each Assessor’s Parcel and each Fiscal Year, the maximum Special Tax B (Contingent) , as determin ed in accordance with Section C below that can be levied on such Assessor’s Parcel in such Fiscal Year.

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 10

Menifee Mayor and City Council
January 21, 2026
Page
996 of 1208

City of Menifee
Community Facilities District No. 2017-1 (Maintenance Services) 3 “
Multi-Family Residential Property” or “MFR” means any Assessor’s Parcel of Residential Property upon which a building or buildings comprised of attached Residential Units sharing at least one common wall with another unit are constructed or are intended to be constructed. “
Non-Residential Property” or “NR” means all Assessor's Parcels of Taxable Property for which a building permit(s) was issued for a non -residential use. The Administrator shall make the determination if an Assessor’s Parcel is Non-Residential Property.
“
Property Owner’s Association” or “POA” means the property owner’s association or homeowner’s association established to maintain certain landscaping within a Tax Zone. “
Proportionately” means for Taxable Property that is: (i) Developed Property, that the ratio of the actual Special Tax levy to the Maximum Special Tax is the same for all Parcels of Developed Property, (ii) Approved Property, that the ratio of the actual Special Tax levy to the Maximum Special Tax is the same for all Parcels of Approved Property, and (iii) Undeveloped Property that the ratio of the actual Special Tax levy per acre to the Maximum Special Tax per acre is the same for all Parcels of Undevelope d Property.
“
Residential Unit” or "RU" means a residential unit that is used or intended to be used as a domicile by one or more persons, as determined by the Administrator. “
Residential Property” means all Assessor’s Parcels of Taxable Property upon which Residential Units have been constructed or are intended to be constructed or for which building permits have been or may be issued for purposes of constructing one or more Residential Units. “
Service(s)” means services permitted under the Mello-Roos Community Facilities Act of 1982 including, without limitation, those services authorized to be funded by CFD No. 2017 -1 as set forth in the documents adopted by the City Council at the time the CFD was formed as identified in Appendix B. “
Single Family Residential Property” or “SFR” means any Residential Property other than Multi-Family Residential Property on an Assessor’s Parcel.
“
Special Tax(es)” means the Special Tax A or Special Tax B (Contingent) to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property.
“
Special Tax A” means the annual special tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Special Tax A Requirement. "
Special Tax A Requirement" means for each Tax Zone that amount to be collected in any Fiscal Year to pay for certain costs as required to meet the needs of such Tax Zone within CFD No. 2017-1 in both the current Fiscal Year and the next Fiscal Year. The costs to be covered shall be the direct costs for maintenance services including but not limited to (i) maintenance and lighting of parks, parkways, streets, roads and open space, (ii) maintenance and operation of water quality improvements, (iii) public street sweeping, (iv) fund an operating reserve for the costs of Services as determined by the Administrator, and (v) Administrative Expenses. Under no circumstances shall the Special Tax A Requirement include funds for Bonds.
“Special Tax B (Contingent)” means the annual special tax to be levied in each Fiscal Year on each Assessor’s Parcel of Taxable Property to fund the Special Tax B (Contingent) Requirement, if required.

Item Title: 11.2
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Maintenance Services
Item Page Number: 11

Menifee Mayor and City Council
January 21, 2026
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“
Special Tax B (Contingent) Requirement” means that amount required in any Fiscal Year, if the POA is unable to maintain the Contingent Service(s) to: (i) pay the costs of Contingent Services incurred or otherwise payable in the Calendar Year commencing in such Fiscal Year; (ii) fund an operating reserve for the costs of Contingent Services as determined by the Administrator; less a credit for funds available to reduce the annual Special Tax B (Contingent) levy as determined by the Administrator. "
Taxable Property" means all Assessor’s Parcels within CFD No. 2017-1, which are not Exempt Property. “
Taxable Unit” means a Residential Unit, Building Square Footage, or an Acre. "Tax Zone" means a mutually exclusive geographic area, within which particular Special Tax rates may be levied pursuant to this Rate and Method of Apportionment of Special Tax. Appendix C identifies the Tax Zone in CFD No. 2017-1 at formation; additional Tax Zones may be created when property is annexed into the CFD.
"
Tax Zone 1" means the specific geographic area identified on the CFD Boundary Map as Tax Zone 1. "
Tract(s)" means an area of land; i) within a subdivision identified by a particular tract number on a Final Map, ii) identified within a Parcel Map; or iii) identified within lot line adjustment approved for subdivision.
“
Undeveloped Property” means, for each Fiscal Year, all Taxable Property not classified as Developed Property or Approved Property.

B
. ASSIGNMENT TO LAND USE CATEGORIES
For each Fiscal Year, all Assessor’s Parcels of Taxable Property within CFD No. 2017 -1 shall be classified as Developed Property, Approved Property, or Undeveloped Property, and shall be subject to the levy of Special Taxes as determined pursuant to Sections C and D below. Assessor’s Parcels of Developed Property and Approved Property shall be classified as either Residential Property or Non -Residential Property. Residential Property shall be further classified as Single Family Residential Property or Mult i- Family Residential Property and the number of Residential Units shall be determined by the Administrator.

C
. MAXIMUM SPECIAL TAX RATES
For purposes of determining the applicable Maximum Special Tax for Assessor’s Parcels of Developed Property and Approved Property which are classified as Residential Property, all such Assessor’s Parcels shall be assigned the number of Residential Unit(s) constructed or to be constructed thereon as specified in or sh own on the building permit(s) issued or Final Map as determined by the Administrator. Once a single family attached or multi-family building or buildings have been built on an Assessor's Parcel , the Administrator shall determine the actual number of Residential Units contained within the building or buildings, and the Special Tax A levied against the Assessor’s Parcel in the next Fiscal Year shall be calculated by multiplying the actual number of Residential Un its by the Maximum Special Tax per Residential Unit for the Tax Zone below or as included in Appendix A as each annexation occurs.

For purposes of determining the applicable Maximum Special Tax for Assessor’s Parcels of Developed Property and Approved Property which are classified as Non-Residential Property, all such Assessor’s Parcels shall be assigned the number of Building Square Footage or Acres as shown on the Final Map Item Title: 11.2
First

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Maintenance Services
Item Page Number: 12

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January 21, 2026
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City of Menifee
Community Facilities District No. 2017-1 (Maintenance Services) 5 as determined by the Administrator. Once the Administrator determines the actual number of Building Square Footage or Acres for the Assessor’s Parcels, the Special Tax A levied against the Assessor’s Parcel in the next Fiscal Year shall be calculated by multiplying the number of Building Square Footage or Acres by the Maximum Special Tax per Taxable Unit identified for the applicable Tax Zone below or as included in Appendix A as each annexation occurs.

1. Special Tax A
a. Developed Property
(i) Maximum Special Tax A
T he Maximum Special Tax A for each Assessor’s Parcel of Developed Property shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017-1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax A for the Tax Zones annexed and included in Appendix A. The Maximum Special Tax A for Developed Property for Fiscal Year 2018-19 within Tax Zone 1 is identified in Table 1 below:

TABLE 1

MAXIMUM SPECIAL TAX A RATES

DEVELOPED PROPERTY
Tax
Zone Tract Land Use Category
Taxable
Unit
Maximum
Special Tax A
1 TR 36299-1
& PM 9504
Single Family Residential Property RU $158
Multi-Family Residential Property RU $158
Non-Residential Property Acre $1,714
(
ii) Increase in the Maximum Special Tax A
O n each July 1, commencing on July 1, 201 9 the Maximum Special Tax A for Developed Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles - Riverside - Orange County (1982-84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater. (
iii) Multiple Land Use Categories
I n some instances, an Assessor's Parcel of Developed Property may contain more than one Land Use Category. The Maximum Special Tax A that can be levied on an Assessor's Parcel shall be the sum of the Maximum Special Tax A that can be levied for each Land Use Category located on that Assessor's Parcel. For an Assessor's Parcel that contains more than one land use, the Acreage of such Assessor's Parcel shall be allocated to each type of property based on the amount of Acreage designated for each land use a s determined by reference to the site plan approved for such Assessor's Parcel. The Administrator's allocation to each type of property shall be final.
b
. Approved Property
The Maximum Special Tax A for each Assessor’s Parcel of Approved Property shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017 -1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax A for the Tax Zone annexed and included in Appendix A. The Maximum Special Tax A for Approved Property for Fiscal Year 2018-19 within Tax Zone 1 is identified in Table 2 below:

Item Title: 11.2
First

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Item Page Number: 13

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January 21, 2026
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TABLE 2

MAXIMUM SPECIAL TAX A RATES

APPROVED PROPERTY
Tax
Zone Tract Land Use Category
Taxable
Unit
Maximum
Special Tax A
1 TR 36299-1
& PM 9504
Single Family Residential Property RU $158
Multi-Family Residential Property RU $158
Non-Residential Property Acre $1,714
On each July 1, commencing on July 1, 2019 the Maximum Special Tax A for Approved Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles - Riverside - Orange County (1982-84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.
c
. Undeveloped Property
The Maximum Special Tax A for each Assessor’s Parcel of Undeveloped Property shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017 -1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax A for the Tax Zone annexed and included in Appendix A. The Maximum Special Tax A for Undeveloped Property for Fiscal Year 2018-19 within Tax Zone 1 is identified in Table 3 below:

TABLE 3

MAXIMUM SPECIAL TAX A RATES

UNDEVELOPED PROPERTY
Tax Zone Tracts Taxable Unit Maximum Special Tax A
1 TR 36299-1
& PM 9504 Acre $1,515
O
n each July 1, commencing on July 1, 201 9 the Maximum Special Tax A for Undeveloped Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles - Riverside - Orange County (1982-84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.

2. Sp
ecial Tax B (Contingent)
The City Council shall levy Special Tax B (Contingent) only in the event the POA defaults in its obligation to maintain the Contingent Services, which default shall be deemed to have occurred, as determined by the Administrator, in each of the following circumstances:
(a) The POA files for bankruptcy;
(b) The POA is dissolved;
(c) The POA ceases to levy annual assessments for the Contingent Services; or (d) The POA fails to provide the Contingent Services at the same level as the City provides similar services and maintains similar improvements throughout the City and within ninety (90) days after written notice from the City, or such longer period permitted by the City Manager, fails to remedy the deficiency to the reasonable satisfaction of the City Council. a. D
eveloped Property
Item Title: 11.2
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Item Page Number: 14

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January 21, 2026
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City of Menifee
Community Facilities District No. 2017-1 (Maintenance Services) 7 (i) Maximum Special Tax B (Contingent)
The Maximum Special Tax B (Contingent) for each Assessor’s Parcel of Taxable Property is shown in Table 4 and shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017 -1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax B (Contingent) for the Tax Zones annexed and included in Appendix A. The Maximum Special Tax B (Contingent) for Fiscal Year 2018-19 within Tax Zone 1 is identified in Table 4 below:

TABLE 4

MAXIMUM SPECIAL TAX B (CONTINGENT) RATES

DEVELOPED PROPERTY

Tax
Zone Tract Land Use Category
Taxable
Unit
Maximum
Special Tax B
(Contingent)
1 TR 36299-1
& PM 9504
Single Family Residential Property RU $0
Multi-Family Residential Property RU $0
Non-Residential Property Acre $0

(ii) Increase in the Maximum Special Tax B (Contingent) On each July 1, commencing on July 1, 201 9 the Maximum Special Tax B (Contingent) for Developed Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles - Riverside - Orange County (1982-84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.

(iii) Multiple Land Use Categories
In some instances, an Assessor's Parcel of Developed Property may contain more than one Land Use Cate gory. The Maximum Special Tax B (Contingent) that can be levied on an Assessor's Parcel shall be the sum of the Maximum Special Tax B (Contingent) that can be levied for each Land Use Category located on that Assessor's Parcel. For an Assessor's Parcel that contains more than one land use, the Acreage of such Assessor's Parcel shall be allocated to each type of property based on the amount of Acrea ge desi gnated for each land use as determined by reference to the site plan approved for such Assessor's Parcel. The Administrator's allocation to each type of property shall be final.

b. Approved Property
The Maximum Special Tax B (Contingent) for each Assessor’s Parcel of Approved Property shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017 - 1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax B (Contingent) for the Tax Zone annexed and included in Appendix A. The Maximum Special Tax B (Contingent) for Fiscal Year 2018-19 within Tax Zone 1 is identified in Table 5 below:

Item Title: 11.2
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Maintenance Services
Item Page Number: 15

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January 21, 2026
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TABLE 5

MAXIMUM SPECIAL TAX B (CONTINGENT) RATES

APPROVED PROPERTY

Tax
Zone Tract Land Use Category
Taxable
Unit
Maximum
Special Tax B
(Contingent)
1 TR 36299-1
& PM 9504
Single Family Residential Property RU $0
Multi-Family Residential Property RU $0
Non-Residential Property Acre $0

On each July 1, commencing on July 1, 2019 the Maximum Special Tax B (Contingent) for Approved Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles - Riverside - Orange County (1982-84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.

c. Undeveloped Property
The Maximum Special Tax B (Contingent) for each Assessor’s Parcel of Undeveloped Property shall be specific to each Tax Zone within the CFD. When additional property is annexed into CFD No. 2017- 1, the rate and method adopted for the annexed property shall reflect the Maximum Special Tax B (Contingent) for the Tax Zone annexed and included in Appendix A. The Maximum Special Tax B (Contingent) for Fiscal Year 2018-19 within Tax Zone 1 is identified in Table 6 below:

TABLE 6

MAXIMUM SPECIAL TAX B (CONTINGENT) RATES

UNDEVELOPED PROPERTY

Tax Zone Tracts Taxable Unit
Maximum Special
Tax B (Contingent)
1 TR 36299-1
& PM 9504 Acre $0

On each July 1, commencing on July 1, 201 9 the Maximum Special Tax B (Contingent) for Undeveloped Property shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles - Riverside - Orange County (1982-84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.

D. METHOD OF APPORTIONMENT OF ANNUAL SPECIAL TAX

1. Special Tax A
Commencing with Fiscal Year 2018-19 and for each following Fiscal Year, the City Council shall determine the Special Tax A Requirement for each Tax Zone and shall levy the Special Tax A on all Assessor’s Parcels of Taxable Property within such Tax Zone until the aggregate amount of Special Tax A equals the Special Tax A Requirement for such Tax Zone. The Special Tax A shall be levied for each Fiscal Year as follows:

First: The S pecial Tax A shall be levied Proportionately on all Assessor’s Parcels of Developed Property up to 100% of the applicable Maximum Special Tax A to satisfy the Special Tax A Requirement;

Second: If additional moneys are needed to satisfy the Special Tax A Requirement after the first step has been completed, the Special Tax A shall be levied Proportionately on each Parcel of Approved Item Title: 11.2
First

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Maintenance Services
Item Page Number: 16

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January 21, 2026
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City of Menifee
Community Facilities District No. 2017-1 (Maintenance Services) 9 Property at up to 100% of the Maximum Special Tax A for Approved Property;

Third: If additional monies are needed to satisfy the Special Tax A Requirement after the first two steps has been completed, the Special Tax A shall be levied Proportionately on all Assessor’s Parcels of Undeveloped Property up to 100% of the Maximum Special Tax A for Undeveloped Property.

2. Special Tax B (Contingent)
Commencing with the first Fiscal Year in which Special Tax B (Contingent) is authorized to be levied and for each following Fiscal Year, the City Council s hall determine the Special Tax B (Contingent) Requirement for each Tax Zone, if any, and shall levy the Special Tax on all Assessor’s Parcels of Taxable Property within such Tax Zone until the a ggregate amount of Special Tax B (Contingent) equals the Special Tax B (Contingent) Requirement for such Tax Zone. The Special Tax B (Contingent) shall be levied for each Fiscal Year as follows:

First: The S pecial Tax shall be levied Proportionately on all Assessor’s Parcels of Developed Property up to 100% of the applicable Maximum Special Tax B (Contingent) to satisfy the Special Tax B (Contingent) Requirement;

Second: If additional moneys are needed to satisfy the Special Tax B (Contingent) Requirement after the first step has been completed, the Special Tax B (Contingent) shall be levied Proportionately on each Parcel of Approved Property at up to 100% of the Maximum Special Tax B (Contingent) for Approved Property;

Third: If additional monies are needed to satisfy the Special Tax B (Contingent) Requirement after the first two steps has been completed, the Special Tax B (Contingent) shall be levied Proportionately on all Assessor’s Parcels of Undeveloped Property up to 100% of the Maximum Special Tax B (Contingent) for Undeveloped Property.

E. FUTURE ANNEXATIONS
It is anticipated that additional properties will be annexed to CFD No. 2017-1 from time to time. As each annexation is proposed, an analysis will be prepared to determine the annual cost for providing Services to such properties . Based on this analysis, any properties to be annexed, pursuant to California Government Code section 53339 et seq. will be assigned the appropriate Maximum Special Tax rates for the Tax Zone when annexed and included in Appendix A.

F. DURATION OF SPECIAL TAX
For each Fiscal Year, the Special Tax A shall be levied as long as the Services are being provided.

For each Fiscal Year, the Special Tax B (Contingent) shall be levied as long as the Contingent Services are being provided.

G. EXEMPTIONS
The City shall classify as Exempt Property within CFD No. 2017-1, all Assessor’s; (i) which are owned by, irrevocably offered for dedication, encumbered by or restricted in use by any public entity; (ii) with public or utility easements making impractical their utilization for other than the purposes set forth in the easement; (iii) which are privately owned but are encumbered by or restricted solely for public uses; or (iv) which are in use in the performance of a public function as determined by the Administrator.

Item Title: 11.2
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January 21, 2026
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H. APPEALS
Any property owner claiming that the amount or application of the Special Taxes are not correct may file a written notice of appeal with the City not later than twelve months after having paid the first installment of the Special Tax that is disputed. The Administrator of CFD No. 2017- 1 shall promptly review the appeal, and if necessary, meet with the property owner, consider written and oral evidence regarding the amount of the Special Tax, and rule on the appeal. If the Administrator’s decision requires that the Special Tax for an Assessor’s Parcel be modified or changed in favor of the property owner, a cash refund shall not be made, but an adjustment shall be made to the Special Tax on that Assessor’s Parcel in the subsequent Fiscal Year(s).

I. MANNER OF COLLECTION
The Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem property taxes, provided, however, that CFD No. 2017 -1 may collect the Special Tax at a different time or in a different manner if necessary to meet its financial obligations.

Item Title: 11.2
First

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Annexation

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2017-1,
Maintenance Services
Item Page Number: 18

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January 21, 2026
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City of Menifee
Community Facilities District No. 2017-1 (Maintenance Services) 11 APPENDIX A

CITY OF MENIFEE
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES)

COST ESTIMATE
Special Tax A Services - The estimate breaks down the costs of providing one year's maintenance services for Fiscal Year 2025-26. These services are being funded by the levy of Special Tax A for Community Facilities District No. 2017-1 Tax Zone 40.

TAX ZONE 40 (SERVICES)
APN 331-120-058
Item Description Estimated Cost
1 Landscaping $3,319
2 Lighting $2,353
3 Streets $4,426
4 Drainage $3,154
5 Reserves $1,988
6 Administration $1,135
Total $16,375

TAX ZONE 40 (CONTINGENT SERVICES)
APN 331-120-058
Special Tax B Contingent Services – The estimate breaks down the costs of providing one year’s contingent maintenance services for Fiscal Year 2025-26. If necessary, these services will be funded by the levy of Special Tax B (Contingent) for Community Facilities District No. 2017-1 Tax Zone 40.

Item Description Estimated Cost
1 Drainage $25,352
2 Reserves $3,807
3 Administration $1,403
Total $30,561
TAX ZONE 40
FY 2025-26 MAXIMUM SPECIAL TAX RATES
Land Use
Category
Taxable
Unit
Maximum
Special Tax A
Maximum
Special Tax B
Developed Acre $3,844 $7,174
Approved Acre $3,844 $7,174
Undeveloped Acre $3,844 $7,174

Item Title: 11.2
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Maintenance Services
Item Page Number: 19

Menifee Mayor and City Council
January 21, 2026
Page
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MAXIMUM SPECIAL TAXES ASSIGNED TO EACH TAX ZONE
Tax
Zone
Fiscal
Year
Included
Tract/
APN
No. of
Taxabl
e Units
Land Use
Category
Taxable
Unit
Maximum
Special Tax
A
Maximum
Special Tax B
(Contingent) Subdivider
1 2018-19 36299-1 & PM
9504
426 SFR RU $158 $0 Stark Menifee Land, LLC
548 MFR RU $158 $0 Stark Menifee Land, LLC &
Menifee Multifamily, LLC

27.68 NR Acre $1,714 $0 Several
2 2020-21 TR 37576 65 SFR RU $539 $43 Meritage Homes
3 2020-21 TR 28859 161 SFR RU $727 $0 Woodside O5S
4 2020-21 TTM 31098 258 SFR RU $878 $0 Lennar Homes of
California, Inc.
5 2020-21 TTM 36852 68 SFR RU $755 $151 Strata Holland, LLC 6 2021-22 TTM 37668 175 SFR RU $765 $295 Meritage Homes of California, Inc.
7 2022-23 TTM 31456 176 SFR RU $996 $0 RCFC Investments, LLC 8 2021-22 TR 32102 & TR
32102-1 256 SFR RU $674 $0
Diamond Brother Five
Partnership, LP and Pulte
Home Company, LLC
9 2021-22 TTM 37400 174 SFR RU $703 $0 D.R. Horton Los Angeles Holding Company, Inc.
10 2022-23 TPM 37380 3.62 NR Acre $3,588 $1,646 Briggs & 74, LLC 11 2024-25 TR 31194 552 SFR RU $913 $0 Golden Meadowland, LLC & Golden Hill Country, LLC
12 2022-23 TR 37408 & TR
37409 1,022 SFR RU $963 $5 BLC Fleming LLC
13 2022-23 TR 36803 80 SFR RU $556 $171 FPG Sun Menifee 80 LLC 14 2022-23 TR 32628 303 SFR RU $281 $45 FPG Tricon Menifee Property LLC
15 2022-23 PLN 20-0167 9.92 MFR/NR Acre $3,865 $2,375 Boulders Menifee LLC 16 2022-23 LLA 17-007 12.48 MFR Acre $3,273 $2,119 Jefferson Menifee, LLC 17 2023-24 PM 37145 4.82 NR Acre $3,137 $0 VSK Investments, LLC 18 2023-24 TR 37131 305 SFR RU $533 $38 AG EHC II (LEN) CA 1, LP 19 2023-24 PLN 22-0199 0.96 NR Acre $2,995 $0 DSMD Cajun Properties 20 To Be Determined
21 2024-25 TR 38219 198 SFR RU $315 $71 Richmond American Homes of Maryland Inc.
22A 2023-24 TR 36658-1, -
3, -4, & -7 393 SFR RU $1,086 $100 Pulte Home Company, LLC 22B 2023-24 TR 36658-2 116 SFR RU $879 $100 Pulte Home Company, LLC 22C 2023-24 TR 36658-5
& 36658-6 247 SFR RU $879 $100 Pulte Home Company, LLC
23 2024-25 TR 37671 182 SFR RU $1,293 $0 Pulte Home Company, LLC 24 CANCELED
25 To Be Determined
26 2024-25 TTM 38126 96 SFR RU $1,239 $0
Richmond American
Homes of Maryland, Inc.,
a Maryland corporation
Item Title: 11.2
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Item Page Number: 20

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January 21, 2026
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City of Menifee
Community Facilities District No. 2017-1 (Maintenance Services) 13 Tax
Zone
Fiscal
Year
Included
Tract/
APN
No. of
Taxabl
e Units
Land Use
Category
Taxable
Unit
Maximum
Special Tax
A
Maximum
Special Tax B
(Contingent) Subdivider
27 2024-25 333-040-043,
333-040-044 1.89 NR Acre $5,016 $1,002
KA Menifee, LLC, Capital
Financial Group, Inc.

Defined Benefit Pension
Plan, Kaassi International,
Inc. Defined Benefit
Pension Plan, KZA Inc.

Defined Benefit Pension
Plan.
28 2025-26 PLN 22-0154 43.14 NR Acre $820 $0 Nova Power, LLC 29 2024-25 TR 38346 162 MFR RU $274 $65 Lennar Homes of California, LLC
30 2025-26 TPM 38156 71.78 NR Acre $1,312 $374 Menifee Commerce Center
31 To Be Determined
32 To Be Determined
33 2025-26 CUP 2019-013 4.07 NR Acre $1,048 $1,902 CG Menifee 1, LLC, & CG Menifee 2, LLC
34 2025-26 TTM 31229 233 SFR RU $1,033 $121
KB Home Cal
Management Services,
LLC
35 2025-26 335-481-017 30 MFR RU $525 $327 Navarro Trust DTD 05/01/2007
36 To Be Determined
37 To Be Determined
38 To Be Determined
39 To Be Determined
40 2025-26 331-120-058 4.44 NR Acre $3,844 $7,174 Kaiser Foundation Health, Inc.

ESCALATION OF MAXIMUM SPECIAL TAXES
On each July 1, commencing on July 1, 20 19 the Maximum Special Tax shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Los Angeles - Riverside - Orange County (1982-84 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater.

Item Title: 11.2
First

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Item Page Number: 21

Menifee Mayor and City Council
January 21, 2026
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APPENDIX B

CITY OF MENIFEE
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES)

DESCRIPTION OF AUTHORIZED SERVICES

The services which may be funded with proceeds of the special tax of CFD No. 2017-1, as provided by Section 53313 of the Act, will include all costs attributable to maintaining, servicing, cleaning, repairing and/or replacing landscaped areas (may include reserves for replacement) in public street right -of-way, public landscaping, public open spaces and other similar landscaped areas officially dedicated for public use. These services including the following:
(a) maintenance and lighting of parks, parkways, streets, roads and open space, which maintenance and lighting services may include, without limitation, furnishing of electrical power to street lights and traffic signals ; repair and replacement of damaged or inoperative light bulbs, fixtures and standards; maintenance (including irrigation and replacement) of landscaping vegetation situated on or adjacent to parks, parkways, streets, roads and open space; maintenance and repair of irrigation facilities; maintenance of public signage; graffiti removal from and maintenance and repair of public structures situated on parks, parkways, streets, roads and open space; maintenance and repair of playground or recreation program equipment or facilities situated on any park; and

(b) maintenance and operation of water quality improvements which include storm drainage and flood protection facilities, including, without limitation, drainage inlets, catch basin inserts, infiltration basins, flood control channels, fossil fuel filters, and similar facilities. Maintenance services may include but is not limited to the repair, removal or replacement of all or part of any of the water quality improvements, fossil fuel filters within the public right-of-way including the removal of petroleum hydrocarbons and other pollutants from water runoff, or appurtenant facilities, clearing of inlets and outlets; erosion repairs; and cleanup to improvements, and other items necessary for the maintenance and servicing of the water quality basin improvements within flood control channel improvements; and

(c) public street sweeping, on the segments of the arterials within the boundaries of CFD No. 2017-1; as well as local roads within residential subdivisions located within CFD No. 2017-1; and any portions adjacent to the properties within CFD No. 2017-1; and

In addition to payment of the cost and expense of the forgoing services, proceeds of the special tax may be expended to pay “Administrative Expenses,” as said term is defined in the Rate and Method of Apportionment.

The above services may be financed by proceeds of the special tax of CFD No. 2017-1 only to the extent that they are in addition to those provided in the territory of CFD No. 2017-1 before CFD No. 2017-1 was created or those provided in the territory annexed to CFD No. 2017-1 before the territory was annexed, as applicable.

Item Title: 11.2
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Item Page Number: 22

Menifee Mayor and City Council
January 21, 2026
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City of Menifee
Community Facilities District No. 2017-1 (Maintenance Services) 15 APPENDIX C

CITY OF MENIFEE
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES)

PROPOSED BOUNDARIES
Item Title: 11.2
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Menifee Mayor and City Council
January 21, 2026
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Item Title: 11.2
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Menifee Mayor and City Council
January 21, 2026
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Item Title: 11.2
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Menifee Mayor and City Council
January 21, 2026
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EXHIBIT B
BALLOT

CITY OF MENIFEE

COUNTY OF RIVERSIDE, STATE OF CALIFORNIA
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES) ANNEXATION NO. 40
(January 21, 2026)
This ballot is for the use of the authorized representative of the following owner of land within Community Facilities District No. 2017-1 (Maintenance Services) (“CFD No. 2017-1”) of the City of Menifee:

Name of Landowner Number of Acres Owned Total Votes
Kaiser Foundation Health, Inc. 4.44 5
According to the provisions of the Mello-Roos Community Facilities Act of 1982, and resolutions of the City Council (the “Council”) of the City of Menifee (the “City”), the above-named landowner is entitled to cast the number of votes shown above under the heading “Total Votes,” representing the total votes for the property owned by said landowner. The City has sent the enclosed ballot to you so that you may vote on whether or not to approve the special tax.

Thi
s special tax ballot is for the use of the property owner of the parcels identified below, which parcels are located within the territory proposed to be annexed to the CFD No. 2017-1, City of Menifee, County of Riverside, State of California. Please advise the City Clerk, at (951) 672-6777 if the name set forth below is incorrect or if you are no longer one of the owners of these parcels.

This special tax ballot may be used to express either support for or opposition to the proposed special tax. To be counted, this special tax ballot must be signed below by the owner or, if the owner is not an individual, by an authorized representative of the owner. The ballot must then be delivered to the City Clerk, either by mail or in person, as follows:

M
ail
Delivery: If by mail, place ballot in the return envelope provided, and mail no later than January 7, 2026, two calendar weeks prior to the date set for the election. Mailing later than this deadline creates the risk that the special tax ballot may not be received in time to be counted.

Personal
Delivery: If in person, deliver to the City Clerk at any time up to 5:00 p.m. on January 21 , 2026, at the Clerk’s office at 29844 Haun Road, City of Menifee, CA 92586.

H
owever delivered, this ballot must be received by the Clerk prior to the close of the public meeting on January 21, 2026.

V
ery truly yours,
S
tephanie Roseen
City Clerk
City of Menifee
Item Title: 11.2
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Menifee Mayor and City Council
January 21, 2026
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TO CAST THIS BALLOT, PLEASE RETURN THIS ENTIRE PAGE.

OFFICIAL SPECIAL TAX BALLOT
Name & Address of Property Owner: Assessor’s Parcel Number(s):

Kaiser Foundation Health, Inc.

Attn: Mark Itzigsohn
74 N. Pasadena Ave 8th Floor
Pasadena, CA 91103
331-120-058

CITY OF MENIFEE

COUNTY OF RIVERSIDE, STATE OF CALIFORNIA
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES) AN “X” OR OTHER MARK WILL CAST ALL VOTES ASSIGNED TO THIS BALLOT SPECIAL TAX BALLOT MEASURE MARK “YES” OR
“NO” WITH AN “X”:

Shall the City Council of the City of Menifee be authorized to levy a special tax on an annual basis at the rates set forth in the following table:

Land Use
Category
Maximum
Special Tax A
Maximum
Special Tax B
Non-Residential $3,844 $7,174
plus an annual increase on each July 1, commencing on July 1, 2026 the Maximum Special Tax shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Riverside – San Bernardino - Ontario (December 2017 = 100) since the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater, to finance certain services within the territory identified on the map entitled “Annexation Map No. 40 of Community Facilities District No. 2017 -1 (Maintenance Services) City of Menifee” including landscaping, lighting, streets, and drainage for Special Tax A, and drainage for Special Tax B, as provided in the Rate and Method of Apportionment which is attached as Exhibit C to Resolution No. 25- 1662 adopted by the City Council of the City of Menifee on December 17, 2025 (including incidental expenses), and shall an appropriation limit be established for the Community Facilities District No. 2017-1 (Maintenance Services) in the amount of special taxes collected? YES _________

NO _________
Certification for Special Election Ballot
The undersigned is an authorized representative of the above- named landowner and is the person legally authorized and entitled to cast this ballot on behalf of the above-named landowner.

I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct, and that this declaration is executed on ____________, 20__.

Mark Itzigsohn
Vice President
Signature
Print Name
Item Title: 11.2
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Item Page Number: 27

Menifee Mayor and City Council
January 21, 2026
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EXHIBIT C

FULL TEXT OF PROPOSITION

SPECIAL ELECTION TO SUBMIT TO THE QUALIFIED ELECTORS THE QUESTION OF

LEVYING A SPECIAL TAX WITHIN THE AREA PROPOSED TO BE ANNEXED TO COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES) (ANNEXATION NO. 40)
January 21, 2026
SPECIAL TAX BALLOT MEASURE: Shall the City Council of the City of Menifee be authorized to levy a special tax on an annual basis at the rates set forth in the following table:

Land Use
Category
Maximum
Special Tax A
Maximum
Special Tax B
Non-Residential $3,844 $7,174
plus an annual increase on each July 1, commencing on July 1, 2026 the Maximum Special Tax A and the Maximum Special Tax B shall increase by i) the percentage increase in the Consumer Price Index (All Items) for Riverside – San Bernardino – Ontario (December 2017 = 100) s
ince the beginning of the preceding Fiscal Year, or ii) by two percent (2.0%), whichever is greater, to finance certain services within the territory identified on the map entitl ed “
Annexation Map No. 40 of Community Facilities District No. 2017 -1 (Maintenance Services) City of Menifee” including landscaping, lighting, streets, and drainage for Special Tax A, and drainage for Special Tax B (Contingent) as provided in the Rate and Method of Apportionment which is attached as Exhibit C to Resolution No. 25- 1662 adopted by the City Council of the City of Menifee on December 17, 2025 (including incidental expenses), and shall an appropriation limit be established for the Community Facilities District No. 2017-1 (Maintenance Services) in the amount of special taxes collected?
Item Title: 11.2
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Item Page Number: 28

Menifee Mayor and City Council
January 21, 2026
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1 RESOLUTION NO. 26-____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MENIFEE, CALIFORNIA ,

DECLARING ELECTION RESULTS OF THE SPECIAL ELECTION HELD ON JANUARY 21, 2026 , AND ORDERING THE ANNEXATION OF TERRITORY TO COMMUNITY FACILITIES DISTRICT NO. 2017 -1 (MAINTENANCE SERVICES) (ANNEXATION NO. 40), ASSESSOR’S PARCEL NUMBER 331-120-058 WHEREAS, the City Council (the “City Council”) of the City of Menifee (the “City”) has heretofore conducted proceedings, pursuant to the Mello-Roos Community Facilities Act of 1982 (the “Act”), for the area proposed to be annexed to Community Facilities District No. 2017-1 (Maintenance Services) of the City of Menifee, County of Riverside, State of California (the “CFD No. 2017 -1”), including conducting a public hearing pursuant to the Act; and
WHEREAS, at the conclusion of said public hearing, the City Council adopted a resolution calling a special election for January 21, 2026, and submitting to the qualified electors of the territory proposed to be annexed to the CFD No. 2017-1 the question of levying special taxes on parcels of taxable property therein for the purpose of providing certain services which are necessary to meet i ncreased demands placed upon the City as a result of the development of said real property, as provided in the form of the special election ballot attached thereto as Exhibit B; and WHEREAS, the special election was held on January 21, 2026 , and the City Clerk (or, in the absence of the City Clerk, the Assistant City Clerk – in either case, the “Clerk”) has duly canvassed the returns of the special election and has filed with the City Council a Certificate of Election Results, dated January 21, 2026, executed by the Clerk, certifying that a completed ballot has been returned to the Clerk for each landowner-voter(s) eligible to cast a ballot in said special election, with all votes ca st as “Yes” votes in favor of the ballot measure, and further certifying on said basis that the special mailed -ballot election was closed.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Menifee, California:

Section 1. Recitals. The City Council finds and determines that the foregoing recitals are true and correct.

Section 2. Approval of Canvass. The City Council has received, reviewed, and hereby accepts the Clerk’s Certificate of Election Results, a copy of which is attached hereto as Exhibit A, and hereby ratifies, confirms, and approves said Certificate of Election Results.

Section 3. Ballot Measure. The City Council hereby finds, determines, and declares that more than two-thirds (⅔) of all the votes cast at the special election on the ballot measure were in favor of the ballot measure, the ballot measure passed, and the ballot measure was approved by the qualified electors in accordance with the Act.

Section 4. Validity of Procedures . The City Council hereby finds and determines that all prior proceedings and actions taken by the City Council pursuant to the Act were and are valid and in conformity with the Act.

Section 5. Annexation. The City Council hereby finds, determines, and declares that pursuant to Government Code section 53339.8, the territory proposed to be annexed is added to and part of the CFD No. 2017 -1 with full legal effect, and the City Council is also authorized, pursuant to said Section 53339.8, to annually levy special taxes within the annexed territory to pay the costs of the services to be provided by the CFD No. 2017-1 as specified in Resolution No. 25-1662 adopted by the City Council on December 17 , 202 5. The Item Title: 11.2
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January 21, 2026
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Resolution Declaring Election Results Annex 40
2 boundaries of the annexed territory are shown on the map entitled, “Annexation Map No. 40 Community Facilities District No. 2017-1 (Maintenance Services)” a copy of which was recorded, on December 23, 2025, in Book 98 of Maps of Assessment and Community Facilities Districts at Page 59, in the office of the Riverside County Recorder.

Section 6. Notice of Special Tax Lien. Pursuant to Government Code section 53339.8 and Streets and Highways Code sections 3114.5 and 3117.5, within fifteen (15) days of the adoption of this Resolution, the City Clerk shall cause to be filed with the County Recorder of the County of Riverside an amendment to the notice of special tax lien and a map of the amended boundaries of the CFD No. 2017-1 including the annexed territory.

Section 7. Effective Date. This Resolution shall take effect immediately upon its adoption.

PASSED, APPROVED AND ADOPTED this 21st day of January 2026

___________________________
Bob Karwin, Mayor Pro Tem
Attest:

___________________________
Stephanie Roseen, City Clerk
Approved as to form:

___________________________
Jeffrey T. Melching, City Attorney

Item Title: 11.2
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Item Page Number: 30

Menifee Mayor and City Council
January 21, 2026
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EXHIBIT A

CITY OF MENIFEE
COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES) ANNEXATION NO. 40

CERTIFICATE OF ELECTION RESULTS

I, the undersigned, being the City Clerk or the Acting City Clerk, as the case may be, hereby certify:

In connection with the special mailed-ballot election called by the City Council (the “City Council”) of the City of Menifee (the “City”) on this same date in the proceedings of the City Council for the above -entitled community facilities district, I personally received (a) signed and dated waiver and consent form s and (b) signed, dated and marked election ballot s on behalf of the property owners, the entities named as the sole landowners of the lands within the boundary of the above-entitled community facilities district in the Certificate Regarding Registered Voters and Landowners, dated December 10, 2025 and on file in the office of the City Clerk of the City in connection with the City Council actions on that date. Copies of the completed waiver and consent form and the completed ballot received by me and on file in my office are attached hereto.

Following such receipt, I have personally, and in the presence of all persons present, reviewed the ballot to confirm that it is properly marked and signed, and I hereby certify the result of that count to be that the ballot was cast in favor of the measure.

Based upon the foregoing, all votes that were cast having been cast “Yes”, in favor of the ballot measure, the measure has therefore passed.

Tax Zone
Qualified
Landowner Votes Votes Cast YES NO
40 4.44 5

I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct and that this declaration is executed on January 21, 2026.

Stephanie Roseen
City Clerk
City of Menifee

By:

(Attach completed copies of Waiver/Consent and Ballot)
Item Title: 11.2
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Item Page Number: 31

Menifee Mayor and City Council
January 21, 2026
Page
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..
0 Your Voice Every Vote. Our Future
RivCo><VOTE

ART TINOCO

REGISTRAR OF VOTERS

MATTHEW CEBALLOS

ASSISTANT REGISTRAR OF VOTERS
2724 GATEWAY DRIVE
RIVERSIDE, CA92507-0918
MAIN (951) 486-7200
FAX (951) 486-7335
CA RELAY SERVICE (DIAL 7ll)
VOTEINFQ.NET
Registrar of Voters
State of California )
) ss
County of Riverside )
I, Art Tinoco, Registrar of Voters of said County, hereby certify that:
(A)I have been furnished a map describing the proposed boundary of Annexation #40 for Community Facilities District No. 2017-1 (Maintenance Services), to the City of Menifee, of the County of Riverside, State of California. (B) On December 10, 2025, I conducted, or caused to be conducted, a review of the voter registration records of the County of Riverside for the purpose of determining the number of voters registered to vote within the proposed boundary of Annexation #40 for Community Facilities District No. 2017-1 (Maintenance Services), to the City of Menifee, of the County of Riverside.
(C) There are O registered voters residing within the proposed boundary of Annexation #40 for Community Facilities District No. 2017-1 (Maintenance Services), to the City of Menifee, of the County of Riverside.

IN WITNESS WHEREOF, I have executed this Certificate on this December 10, 2025
Art Tinoco
Registrar of V
By:_..J..L---�'--1------
Alice Kim
Chief Deputy Registrar of Voters
Item Title: 11.2
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Item Page Number: 32

Menifee Mayor and City Council
January 21, 2026
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ORDINANCE NO. 2026-

AN ORDINANCE OF THE CITY OF MENIFEE, CALIFORNIA, AMENDING ORDINANCE NO. 2017 -231 AND LEVYING SPECIAL TAXES TO BE COLLECTED DURING FISCAL YEAR 202 5/2026 TO PAY THE ANNUAL

COSTS OF THE MAINTENANCE AND SERVICING OF STREET LIGHTS,

PARKS, PARKWAYS, STREETS, ROADS , AND OPEN SPACE, THE

OPERATION AND MAINTENANCE OF STORM DRAINAGE SYSTEMS, A

RESERVE FUND FOR CAPITAL REPLACEMENT, AND ADMINISTRATIVE

EXPENSES WITH RESPECT TO CITY OF MENIFEE COMMUNITY FACILITIES DISTRICT NO. 2017-1, ANNEXATION NO. 40 , FOR MAINTENANCE SERVICES WHEREAS, pursuant to the Mello-Roos Community Facilities Act of 1982 (the “Act”), on December 6, 2017, the City Council (the “City Council”) of the City of Menifee (the “City”) adopted Resolution No. 17- 658 establishing Community Facilities District No. 2017- 1 (Mai ntenance Services) of the City of Menifee, County of Riverside, State of California (the "CFD No. 2017-1") for the purpose of levying special taxes on parcels of taxable property therein for the purpose of providing certain services (the “Services”), which are necessary to meet increased demands placed upon the City and are described in Exhibit A attached hereto; and WHEREAS, on December 20, 2017, the City Council adopted Ordinance No. 2017- 231 entitled, “An Ordinance Levying Special Taxes to be Collected During Fiscal Year 2018-19 to Pay the Annual Costs of the Maintenance and Servicing of Street Lights, Parks, Parkways, Streets, Roads, and Open Space, the Operation and Maintenance of Storm Drainage Systems, a Reserve Fund for Capital Replacement, and Administrative Expenses with Respect to City of Menifee Community Facilities District No. 2017 -1 (Maintenance Services) ” (“Ordinance No. 2017 -231”), pursuant to which the City Council levied special taxes with the CFD No. 2017-1; and WHEREAS, on December 17, 2025, the City Council adopted Resolution No. 25-1662 entitled “A Resolution of the City Council of the City of Menifee Declaring Its Intention to Annex Territory to Community Facilities District No. 2017 -1 (Maintenance Services) of the City of Menifee, Adopting a Map of the Area to be Proposed to be Annexed (Annexation No. 40) and Authorizing the Levy of a Special Taxes Therein” (the “Resolution of Intention”) declaring its intention to annex certain territory to the CFD No. 2017 -1 and to levy special taxes within that territory to provide the Services as described in the Resolution of Intention and setting a special public hearing on the proposed annexation for January 21, 2026; and WHEREAS, notice was published as required by the Act relative to the intention of the City Council to annex certain territory to the CFD No. 2017- 1, to levy special taxes therein to provide the Services, and to set the time and place of said public hearing; and WHEREAS, on January 21, 2026, at the time and place specified in said published notice, the City Council opened and held a public hearing as required by the Act relative to the annexation of territory in to the CFD No. 2017-1, the levy of the special taxes therein, and the provision of Services by the CFD No. 2017-1; and
WHEREAS, at said public hearing all persons desiring to be heard on all matters pertaining to the annexation of territory to the CFD No. 2017-1, the levy of the special taxes therein, and the provision of Services therein were heard, and a full and fair hearing was held; and
Item Title: 11.2
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WHEREAS, subsequent to said public hearing, the City Council adopted Resolution No. 26-___ entitled “A Resolution of the City Council of the City of Menifee Calling an Election to Submit to the Qualified Electors the Question of Levying a Special Tax Within the Area Proposed to be Annexed to Community Facilities District No. 2017- 1 (Maintenance Services) (Annexation No. 40)” (the “Resolution Calling the Election”) on January 21, 2026 , wherein the City Council submitted the question of levying a special tax in territory proposed to be annexed to the CFD No. 2017-1 at the rate and according to the method of apportionment described therein; and WHEREAS, at said special election on January 21, 2026, the qualified electors of the territory proposed to be annexed to the CFD No. 2017-1 approved said propositions as described in the Resolution Calling the Special Election by more than the two- thirds vote required by the Act; and
WHEREAS, subsequent to said special election, the City Council adopted Resolution No. 26-___ entitled “A Resolution of the City Council of the City of Menifee Declaring the Results of the Special Election Held on January 21, 2026 , and Ordering the Annexation of Territory to Community Facilities District No. 2017 -1 (Maintenance Services) (Annexation No. 40)” wherein the City Council determined that the territory proposed to be annexed was added to the CFD No. 2017-1 (such territory being referred to herein as “Annexation No. 40”).

NOW, THEREFORE, the City Council of the City of Menifee, California does ordain as follows:

Section 1. Recitals. The foregoing recitals are true and correct.

Section 2. Amendment to Exhibit B of Ordinance No. 2017- 231. Exhibit B of Ordinance No. 2017 -231 is hereby amended by deleting it in its entirety and replacing it with Revised Exhibit B attached hereto.

Section 3. Amendment to Section 2 of Ordinance No. 2017- 231. Section 2 of Ordinance No. 2017-231 is hereby amended by deleting it in its entirety and replacing it with the following:

Section 2. Levy of Special Taxes . Special taxes
shall be and are hereby levied for the Fiscal Year 2025 - 26, and each Fiscal Year thereafter, on all parcels of real property within the Community Facilities District which are subject to taxation, which are identified in Revised Exhibit B attached hereto, and in the amount set forth for each such parcel in said R evised Exhibit B. Pursuant to said Section 53340, such special taxes shall be collected in the same manner as ordinary ad valorem property taxes
are collected and shall be subject to the same penalties and the same procedure, sale, and lien priority in case of delinquency as is provided for ad valorem taxes.

Section 4. Severability. If any section, subsection, sentence, clause, or phrase of this ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this ordinance, and each and every section, subsection, sentence, clause, or phrase not declared Item Title: 11.2
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invalid or unconstitutional, without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional.

Section 5. Effective Date. This ordinance shall take effect thirty (30) days from the date of its adoption.

Section 6. Notice of Adoption. The City Clerk shall certify to the passage and adoption of this Ordinance, and shall cause to be published within fifteen (15) days after its passage in a newspaper of general circulation and circulated within the City in accordance with Government Code Section 36933(a) or, cause this Ordinance to be published in a manner requi red by law using the alternative summary and posting procedure authorized under Government Code Section 36933 (c).

This Ordinance was introduced and read on the 21st day of January 2026 and APPROVED AND ADOPTED this 4th day of February 2026.

___________________________
Bob Karwin, Mayor Pro Tem
Attest:

___________________________
Stephanie Roseen, City Clerk
Approved as to form:

___________________________
Jeffrey T. Melching, City Attorney

Item Title: 11.2
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Item Page Number: 35

Menifee Mayor and City Council
January 21, 2026
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EXHIBIT A

DESCRIPTION OF SERVICES
The services which may be funded with proceeds of the special tax of CFD No. 2017 -1, as provided by Section 53313 of the Act, will include all costs attributable to maintaining, servicing, cleaning, repairing and/or replacing landscaped areas ( and may include reserves for replacement) in public street right -of- ways, public landscaping, public open spaces and other similar landscaped areas officially dedicated for public use. These services include the following:
(a) maintenance and lighting of parks, parkways, streets, roads and open space, which maintenance and lighting services may include, without limitation, furnishing of electrical power to street lights and traffic signals ; repair and replacement of damaged or inoperative light bulbs, fixtures and standards; maintenance (including irrigation and replacement) of landscaping vegetation situated on or adjacent to parks, parkways, streets, roads and open space; maintenance and repair of irrigation facilities; m aintenance of public signage; graffiti removal from and maintenance and repair of public structures situated on parks, parkways, streets, roads and open space; maintenance and repair of playground or recreation program equipment or facilities situated on any park; and

(b) maintenance and operation of water quality improvements which include storm drainage and flood protection facilities, including, without limitation, drainage inlets, catch basin inserts, infiltration basins, flood control channels, fossil fuel filters, and similar facilities.

Maintenance services may include, but are not limited to, the repair, removal or replacement of all or part of any of the water quality improvements ; fossil fuel filters within the public right -of-way including the removal of petr oleum hydrocarbons and other pollutants from water runoff or appurtenant facilities; clearing of inlets and outlets; erosion repairs; and cleanup to improvements, and other items necessary for the maintenance, servicing, or both of the water quality basin improvements within flood control channel improvements; and

(c) public street sweeping, on the segments of the arterials within the boundaries of CFD No. 2017-1; as well as local roads within residential subdivisions located within CFD No. 2017- 1; and any portions adjacent to the properties within CFD No. 2017-1.

In addition to payment of the cost and expense of the foregoing services, proceeds of the special tax may be expended to pay “Administrative Expenses,” as said term is defined in Exhibit B to the Resolution of Intention (Resolution No. 23-1273).

The above services shall be limited to those provided within the boundaries of CFD No. 201 7-1 or for the benefit of the properties within the boundaries of CFD No. 201 7-1, as the boundary is expanded from time to time by annexations, and said services may be financed by proceeds of the special tax of CFD No. 2017-1 only to the extent that they are in addition to those provided in the territory of CFD No. 2017 -1 before CFD No. 2017-1 was created.

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 36

Menifee Mayor and City Council
January 21, 2026
Page
1022 of 1208

5 REVISED EXHIBIT B
(Amending and Replacing Exhibit B of Ordinance No. 2017-231) COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES) SPECIAL TAX FISCAL YEAR 2025-26

(Effective as of January 21, 2026)

ASSESSOR'S PARCEL NUMBERS
Annexation Owner Assessor's Parcel Numbers
Original
Formation
Stark Menifee Land, LLC
See Next Page Stark Menifee Land, LLC & Menifee
Multifamily, LLC
Several
1 MLC Holdings 360-210-001
2 Woodside O5S See Next Page
3 To Be Determined
4 Lennar Homes of California, Inc. See Next Page
5 Forester Real Estate Group Inc. 372-040-043,
372-040-044
6 Meritage Homes of California, Inc. 372-160-006, -007, -008, -013 and 372-190-003
7 RCFC Investments, LLC 339-020-004, -005, -006, -007, -008, -040, -041, -042, -043 and 339-030-022
8 Pulte Home Company, LLC and
Diamond Brother Five Partnership, LP
340-050-034,
340-050-032
9 D.R. Horton Los Angeles Holding
Company, Inc. See Next Page
10 Briggs & 74, LLC 327-320-028
11 Golden Meadowland, LLC & Golden Hill
Country, LLC
360-300-011, 360-300-012,
360-300-013, 360-300-014
12 BLC Fleming, LLC 333-020-011,
333-020-019
13 FPG Sun Menifee 80 LLC 360-150-019
14 FPG Tricon Menifee Property LLC 372-050-037, -038, -039, -040, -041, -042
15 Boulders Menifee LLC 339-200-080
16 Jefferson Menifee LLC 364-070-051
17 VSK Investments, LLC 329-020-009,
329-020-022
18 AH EHC CA 1 364-190-004,
364-190-005
19 DSMD Cajun Properties 360-020-029
20 To Be Determined
21 Richmond American Homes of
Maryland, Inc., a Maryland corporation
338-150-046,
338-150-031
Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 37

Menifee Mayor and City Council
January 21, 2026
Page
1023 of 1208

Ordinance Annex 40

6 Annexation Owner Assessor's Parcel Numbers
22A Pulte Home Company, LLC See Next Page
22B Pulte Home Company, LLC 335-070-055,
335-430-027
22C Pulte Home Company, LLC 330-220-016, -017 and
330-230-043
23 Pulte Home Company, LLC See Next Page
24 Canceled
25 To Be Determined
26 Richmond American Homes of
Maryland, Inc., a Maryland corporation 330-230-023
27 KA Menifee, LLC, Capital Financial
Group, Inc Defined Benefit Pension
Plan, Kaassi International, Inc. Defined
Benefit Pension Plan, KZA Inc. Defined
Benefit Pension Plan
333-040-045,
333-040-046
28 Nova Power, LLC, a Delaware Limited
Liability Company
331-180-025 (Formerly APN 331-180-
022)
29 Lennar Homes of California, LLC 331-250-028, 331-250-029, 331-250-030
30 Menifee Commerce Center I, LLC
331-110-027, 331-110-
035, 331-110-041, 331-140-010, 331-
140-018, 331-140-021, and 331-140-
025
31 To Be Determined
32 To Be Determined
33 CG Menifee 1, LLC, and CG Menifee 2,
LLC 384-180-020, 384-180-036
34 KB Home Cal Management Services,
LLC 335-481-017
35 Navarro Trust DTD 05/01/2007 335-481-017
36 To Be Determined
37 To Be Determined
38 To Be Determined
39 To Be Determined
40 Kaiser Foundation Health, Inc. 331-120-058
Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 38

Menifee Mayor and City Council
January 21, 2026
Page
1024 of 1208

Ordinance Annex 40

7 REVISED EXHIBIT B (cont.)
(Amending and Replacing Exhibit B of Ordinance No. 2017-231)

COMMUNITY FACILITIES DISTRICT NO. 2017-1 (MAINTENANCE SERVICES)

ORIGINAL FORMATION

ASSESSOR'S PARCEL NUMBERS
Assessor’s Parcel Numbers
360850024 360861031 360862008 360862050 360870030
360850029 360861032 360862009 360862051 360870031
360850030 360861033 360862010 360862052 360870032
360850031 360861034 360862011 360862053 360870033
360850032 360861035 360862012 360862054 360870034
360860001 360861036 360862013 360862055 360870035
360860017 360861038 360862014 360862056 360870036
360860026 360861039 360862016 360862057 360870037
360860027 360861040 360862017 360862058 360870038
360860028 360861041 360862018 360862059 360870039
360860041 360861042 360862019 360870001 360870040
360861001 360861043 360862020 360870002 360870041
360861002 360861044 360862021 360870003 360870042
360861003 360861045 360862022 360870004 360870043
360861004 360861046 360862023 360870005 360870044
360861005 360861047 360862024 360870006 360870045
360861006 360861048 360862025 360870007 360870046
360861007 360861049 360862026 360870008 360870047
360861008 360861050 360862027 360870009 360870048
360861009 360861051 360862028 360870010 360870049
360861010 360861053 360862029 360870011 360870050
360861012 360861054 360862031 360870012 360870051
360861013 360861055 360862032 360870013 360870052
360861014 360861056 360862033 360870014 360870053
360861015 360861057 360862034 360870015 360870054
360861016 360861058 360862035 360870016 360870055
360861017 360861059 360862036 360870017 360870056
360861018 360861060 360862037 360870018 360870057
360861019 360861061 360862038 360870019 360870058
360861020 360861062 360862039 360870020 360870059
Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 39

Menifee Mayor and City Council
January 21, 2026
Page
1025 of 1208

Ordinance Annex 40

8 Assessor’s Parcel Numbers
360861021 360861063 360862040 360870021 360870060
360861022 360861064 360862041 360870022 360870061
360861023 360862001 360862042 360870023 360870062
360861025 360862002 360862043 360870024 360870063
360861026 360862003 360862044 360870025 360870064
360861027 360862004 360862046 360870026 360870065
360861028 360862005 360862047 360870027 360870066
360861029 360862006 360862048 360870028 360880001
360861030 360862007 360862049 360870029 360880002
360880003 360880042 360971003 360972002 360980014
360880004 360880043 360971004 360972003 360980015
360880005 360880044 360971005 360972004 360980016
360880006 360880045 360971006 360972005 360980017
360880007 360880046 360971007 360972006 360980018
360880008 360880047 360971008 360973001 360980019
360880009 360880048 360971009 360973002 360980020
360880010 360880049 360971010 360973003 360980021
360880011 360880050 360971011 360973004 360980022
360880012 360880051 360971012 360973005 360980023
360880013 360880052 360971013 360973006 360980024
360880014 360880053 360971014 360973007 360980025
360880015 360880054 360971015 360973008 360980026
360880016 360880055 360971016 360973009 360980027
360880017 360880056 360971017 360973010 360980028
360880018 360880057 360971018 360973011 360980029
360880019 360880058 360971019 360973012 360980030
360880020 360880059 360971020 360974001 360980031
360880021 360970001 360971021 360974002 360980032
360880022 360970002 360971022 360974003 360980033
360880023 360970003 360971023 360974004 360980034
360880024 360970004 360971024 360974005 360980035
360880025 360970005 360971025 360974006 360980036
360880026 360970006 360971026 360974007 360980037
360880027 360970007 360971027 360974008 360980038
360880028 360970008 360971028 360974009 360981001
360880029 360970009 360971029 360980001 360981002
360880030 360970010 360971030 360980002 360981003
360880031 360970011 360971031 360980003 360981004
Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 40

Menifee Mayor and City Council
January 21, 2026
Page
1026 of 1208

Ordinance Annex 40

9 Assessor’s Parcel Numbers
360880032 360970012 360971032 360980004 360982001
360880033 360970013 360971033 360980005 360982002
360880034 360970014 360971034 360980006 360982003
360880035 360970015 360971035 360980007 360982004
360880036 360970016 360971036 360980008 360982005
360880037 360970017 360971037 360980009 360982006
360880038 360970018 360971038 360980010 360982007
360880039 360970019 360971039 360980011 360982008
360880040 360971001 360971040 360980012 360982009
360880041 360971002 360972001 360980013 360982010
360982011 364411001 364420019 364422018 364430013
360982012 364411002 364420020 364422019 364430014
360983001 364411003 364420021 364422020 364430015
360983002 364411004 364420022 364422021 364430016
360983003 364411005 364420023 364422022 364431001
360983004 364411006 364420024 364423001 364431002
360983005 364411007 364421001 364423002 364431003
360983006 364411008 364421002 364423003 364431004
360983007 364411009 364421003 364423004 364431005
360983008 364411010 364421004 364423005 364431006
360983009 364411011 364421005 364423006 364431007
360983010 364411012 364421006 364423007 364431008
360983011 364411013 364421007 364423008 364431009
360983012 364411014 364421008 364423009 364431010
364410001 364411015 364421009 364423010 364431011
364410002 364411016 364421010 364423011 364431012
364410003 364411017 364421011 364424001 364431013
364410004 364411018 364422001 364424002 364431014
364410005 364420003 364422002 364424003 364431015
364410006 364420004 364422003 364424004 364431016
364410007 364420005 364422004 364424005 364431017
364410008 364420006 364422005 364424006 364432001
364410009 364420007 364422006 364430001 364432002
364410010 364420008 364422007 364430002 364432003
364410011 364420009 364422008 364430003 364432004
364410012 364420010 364422009 364430004 364432005
364410013 364420011 364422010 364430005 364432006
364410014 364420012 364422011 364430006 364432007
Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 41

Menifee Mayor and City Council
January 21, 2026
Page
1027 of 1208

Ordinance Annex 40

10 Assessor’s Parcel Numbers
364410015 364420013 364422012 364430007 364432008
364410016 364420014 364422013 364430008 364433001
364410017 364420015 364422014 364430009 364433002
364410018 364420016 364422015 364430010 364433003
364410019 364420017 364422016 364430011 364433004
364410020 364420018 364422017 364430012

ANNEXATION NO. 2

ASSESSOR'S PARCEL NUMBERS
Assessor's Parcel Numbers
339020039 339362020 339362021 339362022 339362023 339362024 339362025 339362026 339362027 339500001 339500002 339500003 339500004 339500005 339500006 339500007 339500008 339500009 339500010 339500011 339500012 339500013 339500014 339500015 339500016 339500017 339500018 339500019 339500020 339500021 339500022 339500023 339500024 339500025 339500026 339500027 339500028 339501001 339501002 339501003 339501004 339501005 339502001 339502002 339502003 339502004 339502005 339502006 339510001 339510002 339510003 339510004 339510005 339510006 339510007 339510008 339510009 339510010 339510011 339510012 339511001 339511002 339511003 339511004 339511005 339511006 339511007 339511008 339511009 339511010 339511011 339511012 339511013 339511014 339511015 339511016 339511017 339511018 339511019 339511020 339511021 339511022 339511023 339511024 339511025 339511026 339511027 339511028 339511029 339511030 339511031 339512001 339512002 339512003 339512004 339512005 339512006 339512007 339512008 339512009 339512010 339512011 339512012 339512013 339512014 339520001 339520002 339520003 339520004 339520005 339520006 339520007 339520008 339520009 339520010 339520011 339520012 339520013 339520014 339520015 339520016 339520017 339520018 339520019 339521001 339521002 339521003 339521004 339521005 339521006 339521007 339521008 339521009 339521010 339521011 339521012 339522001 339522002 339522003 339522004 339522005 339522006 339522007 339522008 339522009 339522010 339522011 339522012 339522013 339522014 339522015 339522016 339522017 339522018 339522019 339522020 339522021 339522022 339522023 339522024 339522025 339522026 339522027 339522028 339522029

ANNEXATION NO. 4

ASSESSOR'S PARCEL NUMBERS
Assessor's Parcel Numbers
333070069 333070070 333070071 333070075 333070080 333070081 333070082

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 42

Menifee Mayor and City Council
January 21, 2026
Page
1028 of 1208

Ordinance Annex 40

11 ANNEXATION NO. 9

ASSESSOR'S PARCEL NUMBERS
Assessor's Parcel Numbers
331080005 331080006 331080007 331080008 331080009 331080010 331080011 331080012 331080018 331080019 331080020 331080021 331080024 331080025 331080027 331080028

ANNEXATION NO. 22A

ASSESSOR'S PARCEL NUMBERS
Assessor's Parcel Numbers
330220018 330220019 330230042 330230044 330230045 335070056 335070057 335070058 335430028 335530001 335530002 335530003 335530004 335530005 335530006 335530007 335530008 335530009 335530010 335531001 335531002 335531003 335531004 335531005 335531006 335531007 335532001 335532002 335532003 335532004 335532005 335532006 335532007 335532008 335532009 335532010 335532011 335532012 335532013 335532014 335532015 335532016 335532017 335532018 335532019 335532020 335532021 335532022 335533001 335533002 335533003 335533004 335533005 335533006 335533007 335533008 335533009 335533010 335533011 335533012 335534001 335534002 335534003 335534004 335534005 335534006 335534007 335534008 335534009 335534010 335534011 335534012 335534013 335534014 335534015 335535001 335535002 335540001 335540002 335540003 335540004 335540005 335540006 335540007 335541001 335541002 335541003 335541004 335541005 335541006 335541007 335541008 335541009 335541010 335541011 335541012 335541013 335541014 335541015 335541016 335541017 335541018 335541019 335542001 335542002 335542003 335542004 335542005 335542006 335542007 335542008 335542009 335542010 335542011 335542012 335542013 335542014 335542015 335542016 335542017 335542018 335542019 335542020 335542021 335542022 335542023 335542024 335542025 335542026 335542027 335542028 335542029 335542030 335543001 335543002 335543003 335543004 335543005 335543006 335543007 335543008 335543009 335543010 335543011 335543012 335543013 335543014 335544001 335544002 335544003 335544004 335544005 335544006 335544007 335544008 335544009 335544010 335544011 335544012 335544013 335544014

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 43

Menifee Mayor and City Council
January 21, 2026
Page
1029 of 1208

Ordinance Annex 40

12 ANNEXATION NO. 23

ASSESSOR'S PARCEL NUMBERS
Assessor's Parcel Numbers
340580001 340580035 340590017 340591018 340603012 340610003 340580002 340580036 340590018 340591019 340603013 340610004 340580003 340580037 340590019 340591020 340603014 340610005 340580004 340580038 340590020 340591021 340603015 340610006 340580005 340580039 340590021 340591022 340603016 340610007 340580006 340580040 340590022 340600001 340603017 340610008 340580007 340580041 340590023 340600002 340603018 340610009 340580008 340580042 340590024 340600003 340603019 340610010 340580009 340580043 340590025 340601001 340603020 340610011 340580010 340580044 340590026 340601002 340603021 340610012 340580011 340580045 340590027 340601003 340603022 340610013 340580012 340580046 340590028 340601004 340603023 340610014 340580013 340580047 340590029 340601005 340603024 340610015 340580014 340581001 340590030 340601006 340603025 340610016 340580015 340581002 340590031 340601007 340603026 340610017 340580016 340581003 340590032 340602001 340603027 340610018 340580017 340581004 340590033 340602002 340603028 340610019 340580018 340581005 340591001 340602003 340603029 340610020 340580019 340590001 340591002 340602004 340603030 340610021 340580020 340590002 340591003 340602005 340603031 340610022 340580021 340590003 340591004 340602006 340603032 340610023 340580022 340590004 340591005 340602007 340603033 340610024 340580023 340590005 340591006 340602008 340603034 340610025 340580024 340590006 340591007 340603001 340603035 340610026 340580025 340590007 340591008 340603002 340603036 340610027 340580026 340590008 340591009 340603003 340603037 340610028 340580027 340590009 340591010 340603004 340603038 340610029 340580028 340590010 340591011 340603005 340603039 340610030 340580029 340590011 340591012 340603006 340603040 340610031 340580030 340590012 340591013 340603007 340603041 340610032 340580031 340590013 340591014 340603008 340603042 340610033 340580032 340590014 340591015 340603009 340603043
340580033 340590015 340591016 340603010 340610001
340580034 340590016 340591017 340603011 340610002

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 44

Menifee Mayor and City Council
January 21, 2026
Page
1030 of 1208

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 45

Menifee Mayor and City Council
January 21, 2026
Page
1031 of 1208

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 46

Menifee Mayor and City Council
January 21, 2026
Page
1032 of 1208

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 47

Menifee Mayor and City Council
January 21, 2026
Page
1033 of 1208

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 48

Menifee Mayor and City Council
January 21, 2026
Page
1034 of 1208

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 49

Menifee Mayor and City Council
January 21, 2026
Page
1035 of 1208

Item Title: 11.2
First

Reading

and

Introduction

of

an

Ordinance

for

Annexation

No.

40,

Kaiser

Medical,

into

Community

Facility

District

2017-1,
Maintenance Services
Item Page Number: 50

Menifee Mayor and City Council
January 21, 2026
Page
1036 of 1208

Item Title: 11.2
First Reading and Introduction of an Ordinance for Annexation No. 40, Kaiser Medical, into Community Facility District 2017-1, Maintenance Services Item Page Number: 51

Menifee Mayor and City Council
January 21, 2026
Page
1037 of 1208

CITY OF MENIFEE
SUBJECT: Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025
MEETING DATE: January 21, 2026
TO: Mayor and City Council
PREPARED BY: Ann-Marie Etienne, Finance Manager
REVIEWED BY: Travis Hickey, Chief Financial Officer
APPROVED BY: Armando G. Villa, City Manager
-------------------------------------------------------------------------------------------------------------------------------

RECOMMENDED ACTION

1. Receive and file the Annual Comprehensive Financial Report (ACFR) and other audit reports for the fiscal year end June 30, 2025.

DISCUSSION
Following the completion and receipt of the City’s annual financial audit, the Finance Department will present to the City Council the City’s annual financial statements and financial audit. The statements are referred to, collectively, as an Annual Comprehensive Financial Report (“ACFR”).

The format and content requirements for ACFRs are set forth in guidelines developed by the Government Finance Officers Associations of the United States and Canada and the California Society of Municipal Finance Officers.

The ACFR is divided into three major sections: the introductory section, the financial section, and the statistical section. The introductory section includes the letter of transmittal, a directory of City officials in office as of the report date, and an organization chart. The financial section includes the independent auditors’ report, management discussion and analysis, and the financial statements, including notes to the financial statements. The statistical section includes financial trend information and demographic information about the City.

The financial statements were audited by the independent public accounting firm of Rogers, Anderson, Malody & Scott, LLP Certified Public Accountants, whose unmodified opinion is included within the financial section of the report. An unmodified opinion indicates that the financial statements present fairly the financial position of the City of Menifee as of June 30, 2025, and that the results of operations are in accordance with generally accepted accounting principles.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 1

Menifee Mayor and City Council
January 21, 2026
Page
1038 of 1208

City of Menifee Staff Report
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 January 21, 2026

3 1
3 5
As part of the audit, the audit firm also reviewed and performed tests of the City’s internal accounting control procedures to determine if there are any material weaknesses or instances of non-compliance. Based on the audit, no material weaknesses were noted. Two other reports are also included in the packet that support these findings: 1) the 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; and 2) the communication with those charged with governance (also referred to as the SAS 114 letter).

Financial Condition of the City on June 30, 2025
The City closed the Fiscal Year 2024/25 period in a financially sound position, with a net position of $639.2 (compared to $573 million in June 30, 2024). The largest portion of the City’s net position, $387 million or 60.54 percent, reflects its investment in capital assets (e.g. land, buildings, improvements other than buildings, equipment, infrastructure and construction in progress) as the City continues to develop.

The General Fund (represented by the main General Fund, Quality of Life Fund, Internal Service Funds (ISFs), and Trust Fund closed the year in a positive position, due to strong revenues and diligent management of the budget. In total General Fund revenues, net of transfers and SBITA (Subscription-Based Information Technology Arrangement)/Lease Acquisition, were $9 million higher than the adjusted budget primarily due to the combined impact of: one-time revenue sales tax and Quality of Life revenues receipts, increased property taxes, VLF, and franchise fee revenue.

Sales tax revenues, including both Bradley Burns and the Quality of Life revenue have slightly decreased by 1.70%, or $699k compared to the prior year. While the City still collected just over $7 million in one-time sales tax proceeds generated from the construction of the Nova Park Battery Storage Project, on-going sales tax revenue, specifically in the Quality of Life revenues has experienced a consistent leveling throughout Fiscal Year 2024/25.

General Fund expenditures, net (excluding transfers) totaled $98.9 million for the fiscal year ending June 30, 2025, compared to $90.7 million for the previous year. This increase of $8.2 million was due to various increases including continued increase costs in public safety related services, just over $1 million in fire contract services, and $144k in dispatch services.

The City’s net position, though positive, and excluding one-time revenues and operational savings, reflects some leveling of growth in several of its key revenues. As the City completes the current fiscal year and moves to its next biennial budget cycle, staff will continue to closely monitor any significant deviations from the projected budget. The City’s financial stability is attributable to the deliberate and concentrated efforts of the City Council to managing the City’s operations in a fiscally conservative approach.

The City’s ACFR for the fiscal year end June 30, 2025 is attached to this staff report and is also available for review in the City Clerk’s Office and Finance Department. In addition, the ACFR will be distributed to the City Council, various federal and state government agencies, rating agencies and financial institutions, and will be made available on the City’s website for interested citizens.

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City of Menifee Staff Report
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 January 21, 2026

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STRATEGIC PLAN OBJECTIVE
Regular City Business

FISCAL IMPACT
There is no fiscal impact associated with the recommended action.

ATTACHMENTS

1. 2025 Annual Comprehensive Financial Report

2. Management Representation Letter

3. Independent Auditor’s Report on Internal Controls

4. SAS 114 Letter
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ANNUAL COMPREHENSIVE

FINANCIAL REPORT (ACFR)

FISCAL YEAR ENDED JUNE 30, 2025

CITY OF MENIFEE

CALIFORNIA

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CITY OF MENIFEE, CALIFORNIA

ANNUAL COMPREHENSIVE FINANCIAL REPORT

FOR THE FISCAL YEAR ENDED

JUNE 30, 2025

Prepared by:

Finance Department
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CITY OF MENIFEE

ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

TABLE OF CONTENTS

Page
Number
INTRODUCTORY SECTION (unaudited)

Letter of Transmittal ................................................................................................................................ i Listing of Elected Officials .................................................................................................................... vii Organizational Chart ........................................................................................................................... viii Executive Staff ....................................................................................................................................... ix GFOA Award of Financial Reporting Achievement ................................................................................ x

FINANCIAL SECTION

INDEPENDENT AUDITOR’S REPORT ................................................................................................ 1

MANAGEMENT’S DISCUSSION AND ANALYSIS .............................................................................. 5

BASIC FINANCIAL STATEMENTS

Government - Wide Financial Statements

Statement of Net Position .......................................................................................................... 15

Statement of Activities ............................................................................................................... 16

Fund Financial Statements

Balance Sheet - Governmental Funds ...................................................................................... 17

Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position .......................................................................................................... 18

Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds ................................................................................................................. 19

Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities ................................................................................................................................ 20

Statement of Fiduciary Net Position - Fiduciary Funds ............................................................. 21

Statement of Changes in Fiduciary Net Position - Fiduciary Funds .......................................... 22

Notes to Financial Statements ......................................................................................................... 23 Item Title: 12.1
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CITY OF MENIFEE

ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

TABLE OF CONTENTS
Page
Number

REQUIRED SUPPLEMENTARY INFORMATION

Budgetary Comparison Schedule - General Fund .......................................................................... 54

Budgetary Comparison Schedule - Development Impact Fees ...................................................... 55

Budgetary Comparison Schedule - Grants Fund ............................................................................ 56

Budgetary Comparison Schedule - TUMF Fees Funds ................................................................... 57

Schedule of the City’s Proportionate Share of the Pension Plan’s Net Pension Liability and Related Ratios as of the Measurement Date .......................................................................... 58

Schedule of the Pension Plan’s Contributions ............................................................................... 59

Schedule of Changes in the Total OPEB Liability and Related Ratios .......................................... 60

Notes to the Required Supplementary Information ......................................................................... 61

COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES

Non-major Governmental Funds Descriptions ................................................................................ 62

Combining Balance Sheet - Non-major Governmental Funds ....................................................... 65

Combining Statement of Revenues, Expenditures and Changes .... in Fund Balances - Non-major Governmental Funds ................................................................ 69

Budgetary Comparison Schedules - Special Revenue Funds
Gas Tax ..................................................................................................................................... 73 SB 1 ........................................................................................................................................... 74 Measure A ................................................................................................................................. 75 Air Quality Management District ................................................................................................ 76 Landscape and Lighting Maintenance District .......................................................................... 77 Community Facilities District - Audie Murphy Ranch ................................................................ 78 Community Facilities District - Hidden Hills ............................................................................... 79 Community Facilities District - 2014-1 Town Center ................................................................. 80 Community Facilities District - 2014-2 Commerce Point ........................................................... 81 Community Facilities District - 2015-2 Citywide ........................................................................ 82 Community Facilities District - 2017-1 Maintenance Services .................................................. 83 Public Education and Governmental Access ............................................................................ 84 County Service Areas (CSA) ..................................................................................................... 85 Maintenance CFD ...................................................................................................................... 86

Budgetary Comparison Schedule - Capital Projects Fund
Bonded CFDs ............................................................................................................................. 87 Capital Projects Fund ................................................................................................................ 88

Budgetary Comparison Schedule - Debt Service Fund
Debt Service .............................................................................................................................. 89 Item Title: 12.1
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CITY OF MENIFEE

ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

TABLE OF CONTENTS

Page
Number

STATISTICAL SECTION (unaudited)

Statistical Section Descriptions ................................................................................................. 90 Net Position ............................................................................................................................... 91 Changes in Net Position ............................................................................................................ 93 Fund Balances of Governmental Funds .................................................................................... 95 Changes in Fund Balances of Governmental Funds ................................................................ 97 Major Revenues by Source - Governmental Funds .................................................................. 99 Assessed Value and Estimated Actual Value of Taxable Property ......................................... 100 Assessed Value and Estimated Actual Value of Taxable Property by Use Category ............. 101 Direct and Overlapping Property Tax Rates ........................................................................... 102 Principal Property Taxpayers .................................................................................................. 103 Property Tax Levies and Collections ....................................................................................... 104 Ratio of Outstanding Debt by Type ......................................................................................... 105 Ratio of General Bonded Debt Outstanding ............................................................................ 106 Direct and Overlapping Bonded Debt ..................................................................................... 107 Legal Debt Margin Information .................................. ..... ........................................................ 108 Demographic and Economic Statistics .................................................................................... 109 Principal Employers ................................................................................................................. 110 Full and Part-time City Employees by Program ...................................................................... 111 Capital Asset Statistics by Function/Program ......................................................................... 112 Operating Indicators by Function/Program ............................................................................. 113 Miscellaneous Statistics .......................................................................................................... 114 Taxable Sales by Category ..................................................................................................... 115 Top 25 Sales Tax Producers ................................................................................................... 116 Measure DD 1% Sales Tax - Revenues and Expenditures History ………………………….... 117

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INTRODUCTORY SECTION

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December 18, 2025

Honorable Mayor, Members of the City Council & Citizens of the City of Menifee, California

It is our pleasure to submit the Annual Comprehensive Financial Report (ACFR) for the City of Menifee (City) for the fiscal year ended June 30, 2025. The City annually issues a report on its financial position and activity, audited by an independent firm of certified public accountants. The City’s Finance Department prepared this report in accordance with generally accepted accounting principles (GAAP), as set forth by the Governmental Accounting Standards Board (GASB) and other sources. This ACFR also conforms to GASB Statement No. 34 financial report standards, providing the reader with a dual- perspective financial report. The report contains a citywide view of all governmental activities, as well as a focus on the financial position and operating results of the City’s major funds.

Responsibility for the accuracy of the data, and the completeness and fairness of the presentations including disclosures, rests with the City. To provide a reasonable basis for making these presentations, management has established a comprehensive internal control framework that is designed both to protect the City’s assets from loss, theft, or misuse and to compile sufficient reliable information for the presentation of the City’s financial statements in conformity with accounting principles generally accepted in the United States of America. Because the cost of internal controls should not outweigh their benefits, internal controls have been designed to provide reasonable rather than absolute assurance that the financial statements will be free from material misstatement. As management, we assert that, to the best of our knowledge and belief, the enclosed data is accurate in all material respects and is reported in a manner designed to present fairly the financial position and results of operations of the various funds of the City. Also, all disclosures necessary to enable the reader to gain an understanding of the City’s financial activities have been included.

Rogers, Anderson, Malody & Scott, LLP, Certified Public Accountants, have issued unmodified opinions on the City of Menifee’s financial statements for the year ended June 30, 2025. The independent auditor’s report is located at the front of the financial section of this report.

Generally accepted accounting principles require that management provide a narrative introduction overview and analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with the MD&A which can be found immediately following the report of the independent auditors.

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Profile of the City of Menifee

The City of Menifee is located approximately 80 miles southeast of Los Angeles in the southwestern portion of Riverside County. The City incorporated on October 1, 2008 as a general law City. As of 2025, the City has a population of 115,316 residents and covers an area of over 46 square miles. As a general law city, Menifee is governed by a five-member City Council operating under the Council/Manager form of government. Beginning with the November 2012 election, the Council consists of four Council Members elected by district who serve a four-year term on a staggering basis, and a Mayor elected at large who serves a four year term. The City Council is responsible for passing City ordinances, resolutions, adopting the annual budget, appointing commissions and committees, and setting policy. The City Council appoints the City Attorney and City Manager who in turn appoints the heads of the various departments and other staff.

The City provides a wide range of services including planning, building, public works, engineering, parks and recreation, police and general administrative activities. Services are also provided to the City and its citizens by contract and by the direct services of other government agencies and organizations. These services include animal control through Animal Friends of the Valley for animal field services and participation as a member of the Joint Powers Authority (JPA) for animal sheltering services. Fire protection services are provided through contract with the County of Riverside while water and sewer services are provided by the Eastern Municipal Water District (EMWD). Library services and public health services are provided by the County of Riverside.

Franchise agreements for electricity services are provided through Southern California Edison (SCE), natural gas through Sempra Utilities (SoCalGas), refuse collection through a franchise agreement with Waste Management, public transit through the Riverside Transit Agency (RTA), and cable service through state franchise agreements with Mediacom, Charter and Frontier.

Although the City is distinctively residential in character, the City has the potential for a strong economic base and staff is working diligently to enhance this opportunity. Currently the major commercial bases are anchored by the Countryside Marketplace, Center Pointe, Newport Towne Square, Menifee Plaza, Cherry Hills Plaza, and other key focal points near the I-215, Newport Road and McCall Boulevard. The City has experienced significant growth over the past fiscal year, welcoming several new businesses, including the Menifee Center for Medical Excellence, Velo Training Facility, Rasoi Indian Food, Yoshiharu Ramen, and Grey Iron Brewing Company.

Looking ahead, the City anticipates further expansion with the introduction of key establishments such as Richie's Diner, Rady Children's Health, Planet Fitness, Scripps Exploring Academy, and La Bufadora Baja Grill, and Onyx Lagree Studio. These developments are expected to enhance the local economy and provide residents with increased access to diverse services and amenities.

During April 2025, the official groundbreaking took place for the Menifee Valley Business Park, a Class A industrial park slated to bring jobs, business opportunities, and economic growth for the region. Key efforts completed or initiated by the City include, in the spring of 2025, the City acquired nearly 400 acres of land, “Menifee Hills”, for permanent open space preservation, allowing for future hiking and biking trails. Additionally, in the spring of 2025 the City embarked on the journey of proactively putting efforts into a consolidated Placemaking, Unique Identity, Tourism Master Plan, with the intent of developing a roadmap to address some of the city’s core strategic goals.

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Local Economy

Mirroring the national, state and regional economies, the City of Menifee’s local economy reflects the impacts of decelerating national historic inflation, continued international supply chain issues, and higher interest rates. Relative to the unemployment rate during the Covid-19 pandemic, the unemployment rate has significantly improved over the past few years. The unemployment rate remained around 5% for 2024, still aligned with a softening labor market experienced at the statewide level over the last year. The existing high-interest rate environment and more cautious lending from banks have impacted credit conditions that in turn have affected job growth in credit- sensitive sectors. During the FY2024-25 period the City and local region have continued to experience a markedly slower pace of permitting and planning application activity compared to the last five years. Higher interest rates continue to impact the demand for housing and make construction loans more expensive. Locally, the number of building permits issued has experienced an increase of 10.93% (from 4,015 to 4,454), while the number of planning applications saw an overall decrease of 8.12% (from 342 to 196).

Comparable to national trends, retail sales activity during the FY2024-25 period was marked by overall slower growth. Overall, gross Bradley Burns sales tax collections nominally increased from $16,994,440 in fiscal year 2023-24 to $17,012,539 in FY2024-25. $3,529,453 of the of the Bradley Burns sales tax collected in FY2024-25 is directly attributable as one time sales tax revenue resulting from the construction of the Nova Park Battery Storage project. A clause within the development agreement of the project conditioned the sales tax associated with the materials of construction for the project be reported and remitted to the City. Excluding the Nova Park associated sales tax remittances, the overall Bradley Burns sales tax change from 2023-24 to 2024-25 was an increase $536,579 or 4.14% from the prior year. Similarly, for Quality of Life (Measure DD) sales tax collections decreased from $24,088,083 in fiscal year 2023-24 to $23,370,559 in fiscal year 2024-25, a 2.98% decrease. Included within the FY2024-24 Quality of Life sales tax revenue includes $3,530,687 of one time sales tax revenue resulting from the construction of the Nova Park Battery Storage project. Excluding the Nova Park Project remittances between the two years, the change in in Quality of Life revenue from FY2023-24 to FY2024-25 was a decrease of $197,379 or 0.99%. This was the eighth full year of collection of this 1% additional sales tax that was passed by the voters in November 2016. While both Bradley Burns Sales Tax collections reflected overall increases from the prior year, the increases were:
1) principally attributed to one time sales tax revenue associated with the Nova Park Battery

10.20%8.90%9.60%7.90%7.10%5.20%4.20%4.00%10.10%7.50%4.20%5.00%5.00%2 0 1 2 2 0 1 3 2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9 2 0 2 0 2 0 2 1 2 0 2 2 2 0 2 3 2 0 2 4UNEMPLOYMENT RATE BY CALENDAR YEAR ( P E R H D L ) Item Title: 12.1
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Storage Project and 2) excluding the Nova Park revenues, modest and reflecting the overall national financial conditions signaling a potential economic slowdown in the upcoming year.

Quality of Life revenues, including one time receipts, were lower than the prior year. As the City enters the new fiscal year, projected revenues in sales tax (Bradley Burns and Quality of Life) are forecast to be modest growth from the FY2024-25 amounts.

As part of the State of California’s Fiscal Year 2011-12 Budget, the Governor signed Senate Bill 89 (SB 89), which shifted millions of Vehicle License Fee (VLF) revenues to fund state law enforcement grants. This legislation particularly impacted newly incorporated cities such as Menifee, which received a special allocation from VLF revenues. The impact due to SB 89 for the City of Menifee in Fiscal Year 2016-17 was estimated to be a loss of approximately $4.3 million, which the City addressed through budgetary measures. In the State of California budget for fiscal year 2017-18 SB 130 was introduced, signed and made into law. With SB 130 the City of Menifee’s annual VLF revenues were restored. In fiscal year 2023-24 the City received $10,726,737, in fiscal year 2024-25 the City received $11,840,008 an increase of 10.38%.

Budget Process

Beginning with Fiscal Year 2023-24, the City has transitioned from an annual budget cycle to a biennial budget process, developing and adopting two consecutive and discrete 12 month budgets in a consolidated process. FY 2024-25 represents year 2 of the first biennial budget cycle.

In doing so, the City’s main objectives were to streamline the budget development process as well as align this with long-term financial planning. With a biennial budget process the City is able to examine budgetary decisions with a longer-term view. Additionally, incorporated as part its biennial budget process is the update of its 10-year financial forecast for its principal funds. As was included in the regular one year budget process, staff present two mid-year reviews (Year 1 and Year 2) examining progress and adjustments of revenues and expenses for the current year underway, and one mid-cycle process, examining any significant budgetary adjustments needed for the second year.

The City’s operating budget and five-year capital improvement plan is adopted in the biennial budget cycle by the City Council no later than the close of the prior fiscal year and serves as the foundation for planning and controlling the City’s finances. The budget process begins early in winter and encompasses budget workshops with the public and City Council in order to promote transparency and to develop goals and objectives with the community’s best interest at heart. As the City of Menifee is still relatively new and growing, the primary goal for the City continues to be maintaining a good balance between augmenting City staff and services and utilizing existing resources efficiently as well as minimizing costs as much as possible.

During the year, supplemental appropriations are made to the adopted budget and approved by City Council as necessary. The City Manager is authorized to approve operating transfers between departments within a fund without limits and may reduce expenditure appropriations within a fund as a method of fiscal control. The Chief Financial Officer may decrease revenue estimates to reflect changes in the economy within the fiscal year. Annually, staff prepare and present mid-year budget adjustments to City Council for their approval. This process incorporates updating beginning fund balances per the annual audit report and adjusting the budget as dictated by changes in the City’s goals and objectives or due to economic or legislative changes. All appropriations lapse at year-end, except those approved for carryover through encumbrances or by City Council resolution.

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Long-term Financial Planning

The City has adopted a fund balance policy, most recently updated June 2024, in compliance with GASB Statement No. 54, which sets the goal of maintaining the General Fund unrestricted balance in an amount equal to forty percent (40%) of General Fund expenditures. 15% of these reserves are committed or set aside for use specifically in the case of the declaration of a state or federal emergency, or a local emergency as defined in Menifee Municipal Code 1.10.010. The City’s Finance Committee, made up of two City Councilmembers and Finance staff, has made it a priority to work with staff to develop necessary and appropriate fiscal policies to guide the City’s future operations. Additionally, as the City reviewed and updated its existing fund balance policy in June of 2024, it also identified and established reserves for future larger capital and/or operating expenses, such as insurance premiums/claims, fleet replacement, fire equipment, unfunded pension liability, and larger public facilities projects. This additional level of reserves provides the City with a strategy and opportunity to establish reserves as savings for anticipated larger expenditures, which cannot readily be funded in one single year.

During the City’s budget process, the City’s engineering staff takes a five-year capital project budget to City Council for adoption. For FY2024-25 within the five-year capital project budget there were a total of 27 projects identified with requested funding totaling $15,577,212, from various sources. These 27 projects consist of four transportation projects, two traffic signal projects, three street improvement projects, three pavement management projects, three drainage projects, two technology infrastructure, six facility projects and four parks, trails and recreation projects. As a fast-growing community, Menifee continues to prioritize funding resources and efforts into capital projects. During FY2024-25 a total of 13 capital improvement projects were completed including facilities, park, trails, recreation, street improvements, and transportation projects. The City’s largest transportation project to date, the Holland Road Overpass Project, a $35 million infrastructure investment to support much needed traffic mitigation efforts was substantially completed and operationally functional during FY2024-25. In May 2025, the City formally awarded a construction contract for the Bradley Bridge over Salt Creek project, initiating construction on another one of the City’s key transportation projects.

These projects are vital to alleviate traffic congestion and improve safety, and the City continues to aggressively seek various methods of funding and is also looking into local, regional and state collaborations. Some notable projects completed during the FY2024-25 period include various improvements to the Kay Ceniceros Senior Center (parking lot, display sign etc), the Quail Valley Streetlights which installed solar powered streetlights along the Quail Valley grid area to complement existing streetlight corridors to illuminate mailbox clusters and to improve poorly lit intersections which do not have existing or adequate streetlighting, the Romoland/3rd Street Improvements Project, identified as part of the existing Active Transportation Plan (ATP), and the Bradley Rd Widening at Paloma Valley High School project which significantly improved safety for students.

User fees and development impact fees are collected under the updated fee schedules effective January 1, 2023 and July 1, 2023, respectively. The City conducted a comprehensive citywide user fee study and development impact fee (DIF) study update during FY2021-22 and formally updated a new fee schedule on October 5, 2022, with an effective date of January 1, 2023. The user fee study examined all existing fees for service and provided an updated fee schedule reflecting the costs to provide each service. The DIF study update was conducted to review the existing impact fees to ensure that these are compatible to today’s construction costs and meet the future needs of the City. These fees are imposed on new construction and bring much needed financial relief to the City by expanding current and future roadways and constructing new public facilities. The implementation date of any new fees related to the 2022 DIF Study Update were presented for City Council consideration and adopted on November 16, 2022. The updated DIF Item Title: 12.1
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fees schedule was effective July 1, 2023, with a five-year phase-in for commercial/retail and office development.

In April 2015 the City adopted its first city-wide Community Facility District (CFD) for facility maintenance. This city-wide CFD provides maintenance services such as street lighting, street sweeping, landscape maintenance and storm drainage maintenance to those residential and commercial projects that annex into the maintenance CFD. This maintenance CFD will assess only new construction to help minimize the fiscal impact that expanding development imposes on the City. The formation of the new CFDs will allow the City to continue to provide quality services that our residents and community expect, and the level of services that make the City of Menifee one of the premier cities in Riverside County.

Lastly, during FY2024-25 the City continued its efforts on a new enterprise resource planning system (ERP) to replace the existing system. The overarching goals of this system conversion are to streamline business processes, improve data accuracy, enhance operational efficiency, and gain a unified view of all critical business functions across departments by centralizing data in a single system. In the implementation of the project, the City has established an executive steering committee, core team, and included other departments in the phased-in implementation of the new ERP. The City successfully went live with the financials component of the new ERP in July 2024, including closing of FY2024-25 as its second year using the new system. Efforts for the human resources and payroll components of the ERP project will continue through FY2025- 26, with a target go live date in the first half of calendar year 2026.

Awards and Acknowledgements
The Government Finance Officers Association (GFOA) of the United States and Canada awarded the City its Certificate of Achievement for Excellence in Financial Reporting for the Annual Comprehensive Financial Report (ACFR) for the fiscal year ending June 30, 2024. Since incorporation, the City has been bestowed this prestigious award every year that has been submitted. To be awarded the Certificate of Achievement, a government must publish an easily readable and efficiently organized ACFR. This report must satisfy both generally accepted accounting principles and applicable legal requirements.

A Certificate of Achievement is valid for a period of one year. The City believes the current ACFR continues to meet the high standards associated with the Certificate of Achievement Program and we are submitting it to GFOA to determine its eligibility for another certificate.

The City's ACFR was prepared through the combined efforts of City staff. Special recognition is due to the Finance Department. With their support and coordination, the entire department assisted in closing the books for the year and ensuring timely and accurate reporting. Credit must also be given to the Mayor and City Council for their unfailing support for maintaining the highest standards of professionalism in the management of the City's finances.

Respectfully submitted,

Armando G. Villa Travis Hickey
City Manager Chief Financial Officer
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CITY OF MENIFEE

Elected Officials

Ricky Estrada – Mayor
Bob Karwin – Councilmember
Ben Diederich – Councilmember
Dan Temple – Councilmember
Dean Deines – Councilmember
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Citizens of MenifeeCity CouncilCity AttorneyCity ManagerDeputy City ManagerCommunity ServicesCity ClerkInformation TechnologyCity Executive Office (CEO)Human ResourcesFinancePolice DepartmentAssistant City ManagerEconomic DevelopmentCommunity DevelopmentPublic Works / EngineeringFire(Contract) Commissions & Committees

CITY OF MENIFEE
Organizational Chart
Fiscal Year 2024/25

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City of Menifee Executive Staff

City of Menifee ACFR Team
Travis Hickey, Chief Financial Officer (CFO) Lauri Lockwood, Financial Analyst Margarita Cornejo, Deputy Finance Director Melissa Cortes, Principal Accountant Ann-Marie Etienne, Finance Manager Dominic Tartaglia, Principal Accountant Colin O’Connell, Accountant
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FINANCIAL SECTION

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Tel. 909-889-0871 | www.ramscpa.net | 735 E. Carnegie Dr. Suite 100, San Bernardino, CA 92408

CERTIFIED PUBLIC ACCOUNTANTS

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Independent Auditor’s Report

To the Honorable City Council
City of Menifee, California

Report on the Audit of the Financial Statements

Opinions

We have audited the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the City of Menifee (the City), as of and for the year ended June 30, 2025, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.

In our opinion, the accompanying financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2025, and the respective changes in financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinions

We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States ( Government Auditing Standards ). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of entity and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Emphasis of a Matter

As described in Note 1 to the financial statements during the year ended June 30, 2025, the entity adopted new accounting guidance under Governmental Accounting Standards Board (GASB) Statement No. 101, Compensated Absences and No. 102, Certain Risk Disclosures. Our opinions are not modified with respect to this matter.

Responsibilities of Management for the Financial Statements

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

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

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Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS and Government Auditing Standards, we:

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

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

Required Supplementary Information

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

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Supplementary Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining and individual nonmajor fund financial statements are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with GAAS. In our opinion, the accompanying supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Information

Management is responsible for the other information included in the annual comprehensive financial report.

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 18, 2025 on our consideration of City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering City’s internal control over financial reporting and compliance.

San Bernardino, California
December 18, 2025

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CITY OF MENIFEE
MANAGEMENT’S DISCUSSION AND ANALYSIS

As management of the City of Menifee, California, we offer readers of the City’s financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2025.

We encourage readers to consider the information presented here in conjunction with additional information beyond what we have furnished in our letter of transmittal, which can be found in the introductory section of this report, and with the City’s financial statements, which follow this discussion.

Financial Highlights

• The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows or resources at June 30, 2025, by $639.21 million (net position). Of this amount, $146.8 million is restricted for public works, future capital projects and debt service.

• As of June 30, 2025, the City’s governmental funds reported combined ending fund balances of $250.4 million.

• At June 30, 2025, the Unassigned Fund Balance for the General Fund was $45.8 million, an additional $14.1 million was Committed for use in the event of an emergency, $5.5 million for the McCall Blvd project improvements, as well as an additional $4.8 million for the construction of a future City Hall, $2 million for future public facilities, $14.1 million was Assigned for economic uncertainty, and $19.5 million for various assignments of fund balance. Council action in 2024 set fund balance requirements at Committed of 15%, Assigned of 15% and Unassigned Fund Balance of 10% for a total required Fund Balance of 40% of budgeted operating expenditures. The ending General Fund balance as of June 30, 2025 was $106.3 million compared to the ending Fund balance of $109.6 on June 30, 2024. The decrease in fund balance from one year to the next represents the deliberate transfer of fund balance, for the purpose of consolidating previously approved appropriations associated with capital projects into the Capital Projects Fund. Excluding this deliberate transfer for future capital program expenditures, the net change in fund balance represents an increase of $16.7 million, principally driven from one time sales tax revenues and operational savings. The fund balance amounts are reviewed each year as part of the budget process.

Overview of the Financial Statements

This discussion and analysis is intended to serve as an introduction to the City’s Basic Financial Statements. The City’s Basic Financial Statements consist of three components: 1) Government-wide Financial Statements, 2) Fund Financial Statements, and 3) Notes to the Basic Financial Statements. This report also contains other supplementary information in addition to the basic financial statements themselves.

Government-wide Financial Statements

The government wide financial statements are designed to provide readers with a broad overview of the City’s finances, in a manner similar to a private-sector business.

The statement of net position presents information on all of the City’s assets, deferred outflows of resources, liabilities, and deferred inflows of resources with the difference between them reported as net position. Over time increases in the net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating.

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

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The government-wide financial statements present information about the functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities). The governmental activities of the City include general government, engineering and public works, public safety, community development and recreation services.

The Government-wide Financial Statements can be found in the Table of Contents under the heading Basic Financial Statements.

Fund Financial Statements

A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The fund financial statements provide detailed information about the individual funds—not the City as a whole. Some funds are required to be established by State law. However, the City Council establishes many other funds to help it control and manage money for particular purposes or to show that it is meeting legal responsibilities for using certain taxes, grants, and other money. The City of Menifee uses primarily governmental funds and one fiduciary fund for accounting and reporting purposes.

Governmental Funds

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

Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. Both the governmental funds Balance Sheet and the governmental funds Statement of Revenues, Expenditures, and Changes in Fund Balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.

The City maintains various individual governmental funds. Information is presented separately in the Governmental Funds Balance Sheet, and in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances. The General Fund, the Development Impact Fees Fund, the Grants Fund, the TUMF Fees Fund, and the Bonded CFD Fund are considered to be major funds, and are presented in individual columns in the fund statements. Data from other non-major governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non-major governmental funds is provided in the form of combining statements elsewhere in this report. The Governmental Fund Financial Statements can be found in the Table of Contents under the heading Basic Financial Statements.

Proprietary Funds

Proprietary funds are generally used to account for services for which the City charges customers (either outside customers, or internal units or departments of the City). Proprietary Funds provide the same type of information as shown in the Government-Wide Financial Statements: albeit in more detail. Proprietary Funds utilize the same method used by the private sector businesses: the accrual basis of accounting. The City currently does not maintain any separate proprietary funds.

Fiduciary Funds

Fiduciary funds are used to account for resources held for the benefit of parties outside the government.

Fiduciary funds are not reflected in the government-wide financial statement because the resources of those funds are not available to support the City of Menifee’s own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. The City has one fiduciary fund – the Custodial Item Title: 12.1
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Fund, which is used to hold deposits that the City holds on behalf of outside parties. The Fiduciary Funds Financial Statements can be found in the Table of Contents under the heading Basic Financial Statements.

Notes to the Basic Financial Statements

The Notes to the Basic Financial Statements provide additional information that is essential for a full understanding of the data provided in the government-wide and fund financial statements. The Notes to the Basic Financial Statements can be found in the Table of Contents under the heading Notes to Financial Statements.

Government-wide Financial Analysis

The government-wide financial statements provide long-term and short-term information about the City’s overall financial condition. This analysis addresses the financial statements of the City as a whole.

For fiscal year ending June 30, 2025, the City of Menifee’s total net position increased 11.55% percent from $573.0 million for fiscal year ending 2024, to $639.2 million for fiscal year ending 2025. The largest portion of the City’s net position, $387.0 million or 60.54% percent, reflects its investment in capital assets (e.g. land, buildings, improvements other than buildings, equipment, infrastructure and construction in progress); less any related debt used to acquire those assets, which is still outstanding. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending.

Although the city’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources since the capital assets themselves cannot be used to liquidate these liabilities. Of the remaining total, $146.8 million is restricted to specifically stipulated spending agreements originated by law, contract or other agreements with external parties.

Summary of Net Position
June 30, 2025 and 2024

2024 2025Assets:Current and other assets 234,078,170$ 279,022,907$ Restricted assets 15,499,177 32,254,089 Net pension asset - 1,109,928 Capital and intangible assets 391,954,095 417,812,155 Total assets 641,531,442 730,199,079 Deferred Outflows of Resources:OPEB related 1,282,640 1,209,695 Pension related 10,176,204 9,891,164 Deferred charges on refunding 813,951 768,732 Total deferred outflows of resources 12,272,795 11,869,591 Liabilities:Other liabilities 46,069,315 61,007,480 Long-term liabilities 33,907,137 40,205,300 Total liabilities 79,976,452 101,212,780 Deferred Inflows of Resources:OPEB related 690,003 860,014 Pension related 105,619 788,194 Total deferred inflows of resources 795,622 1,648,208 Net Position:Net investment in capital assets 366,417,603 387,004,052 Restricted 94,559,622 146,775,442 Unrestricted 112,054,938 105,428,188 Total net position573,032,163$ 639,207,682$ ActivitiesGovernmental

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As shown above, the City’s assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $639.2 million at June 30, 2025. Deferred outflows is defined as “a consumption of net assets by the government that is applicable to a future reporting period” and deferred inflows is defined as “an acquisition of net assets by the government that is applicable to a future reporting period”. For further information on the deferred outflows and inflows, see Notes 7 and 8 in the Basic Financial Statements section of this report.

Overall, Citywide governmental fund revenues for the fiscal year ending June 30, 2025, totaled $199.7 million. This figure compares with the prior year total of $186.6 million, a (6.99%) increase.

 Total program revenues of $106.8 million were 53.48 percent of total revenues.  Total general revenues of $92.9 million were 46.52 percent of total revenues.

Total related current year expenses accumulated to $133.6 million, compared with prior year expenses of $95.9 million. Public Safety expenses accounted for 38.29% of total current expenses. Engineering and Public Works expenses, which account for 19.86% of the total expenses, were used primarily for street maintenance costs and design costs. The overall largest category, General Government, includes expenses related to the management and administration of the City, such as finances, management, and legal expense services, accounting for 26.56% of total expenses.

Summary of Changes in Net Position
For the Years Ended June 30, 2025 and 2024

2024 2025RevenuesProgram revenues:Charges for services 44,218,494$ 51,158,222$ Operating grants and contributions 12,041,584 16,476,836 Capital grants and contributions 40,366,619 39,181,538 General revenues:Property taxes 33,849,512 35,297,340 Sales taxes 41,064,793 40,206,315 Other taxes 6,144,757 6,309,767 Motor vehicle in-lieu (unrestricted) 135,915 346,458 Use of money & property 8,327,212 10,318,496 Other revenues 535,387 431,604 Total revenues 186,684,273 199,726,576 ExpensesGeneral government 27,374,493 35,476,891 Public safety 44,266,879 51,131,903 Community development 8,906,681 8,916,422 Recreation services 8,634,157 9,852,490 Engineering and public works 6,075,482 26,527,280 Interest expense 622,071 1,646,071 Total expenses 95,879,763 133,551,057 Change in Net Position90,804,510 66,175,519 Net position, beginning of year, as previously reported 488,770,974 573,032,163 Restatement - correction of an error (6,543,321) - Net position, beginning of year, restated 482,227,653 573,032,163 Net position, end of year573,032,163$ 639,207,682$ ActivitiesGovernmental

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Financial Analysis of the Government’s Funds

As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.

Governmental Funds

The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information may be useful in assessing the City’s financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year.

Below, the Statement of Revenues, Expenditures, and Changes in Fund Balances shows the governmental activities fund balances for the two fiscal years ending June 30, 2025 and 2024. Governmental funds are divided into two categories consisting of major and non-major funds. During the year ending June 30, 2025, six funds were classified as major governmental funds, consisting of the General Fund, Capital Projects fund, the Development Impact Fees Fund, the Grants Fund, the TUMF Fund, and the Bonded CFD Fund.

All other funds were classified as non-major funds. A major fund is any individual fund that meets the criteria of the following combined two tests: 1) a fund is classified as a major fund if the corresponding total revenues, expenses or (expenditures), assets or liability for that fund are at least 10 percent of the total of the aggregate for all funds and; 2) at least 5 percent of the total aggregate for all funds combined. The General Fund is always classified as a major fund while all other funds must meet the qualifications to be a major fund.

Summary of Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds
For the Years Ended June 30, 2025 and 2024

Other Total
Development Grants TUMF Capital Projects Bonded CFD's Governmental Governmental General Impact Fees Fund Fund Fund Fund Funds Funds
Total revenues: 106,478,150 $ 15,883,053$ 4,751,231$ 11,208,327$ 2,553,163$ 25,292,460$ 20,145,231$ 186,311,615$ Total expenditures: 90,659,586 12,417,702 2,880,646 10,988,369 2,736,675 20,497,137 14,254,826 154,434,941 Revenues over (under)
expenditures 15,818,564 3,465,351 1,870,585 219,958 (183,512) 4,795,323 5,890,405 31,876,674 Total other financing
sources (uses) 3,573,984 219,088 (1,150,000) - 1,000,000 - (1,440,364) 2,202,708 Net change in fund balances 19,392,548 3,684,439 720,585 219,958 816,488 4,795,323 4,450,041 34,079,382 Fund balances, beginning, as restated 90,190,765 41,253,764 1,575,170 (1,158,298) 4,213,574 10,652,089 22,437,984 169,165,048 Fund balances, ending 109,583,313$ 44,938,203$ 2,295,755$ (938,340)$ 5,030,062$ 15,447,412$ 26,888,025$ 203,244,430$ Other Total
Development Grants TUMF Capital Projects Bonded CFD's Governmental Governmental General Impact Fees Fund Fund Fund Fund Funds Funds
Total revenues: 115,571,950 $ 17,922,179$ 4,298,013$ 524,316 $ 1,224,715$ 31,481,381$ 20,449,969$ 191,472,523$ Total expenditures: 98,850,540 270,922 1,602,758 - 27,855,832 14,565,371 10,072,503 153,217,926 Revenues over (under)
expenditures 16,721,410 17,651,257 2,695,255 524,316 (26,631,117) 16,916,010 10,377,466 38,254,597 Total other financing
sources (uses) (20,020,012) (3,989,585) (2,792,899) (1,155,549) 40,328,379 - (3,488,709) 8,881,625 Net change in fund balances (3,298,602) 13,661,672 (97,644) (631,233) 13,697,262 16,916,010 6,888,757 47,136,222 Fund balances, beginning, as restated 109,583,313 44,938,203 2,295,755 (938,340) 5,030,062 15,447,412 26,888,025 203,244,430 Fund balances, ending 106,284,711$ 58,599,875$ 2,198,111$ (1,569,573)$ 18,727,324$ 32,363,422$ 33,776,782$ 250,380,652$ Fiscal Year 2024-2025
Fiscal Year 2023-2024
As of fiscal year ending 2025, the City’s total governmental funds reported a combined ending fund balance of $250.4 million, an increase of $47,136,222 from the prior fiscal year. The General Fund, which is the chief operating fund of the City, had a fund balance of $106,284,711 as of June 30, 2025. This technically represents a decrease of $3,296,602 from June 30, 2024, $109,583,313. As referenced on the first page of the MD&A, the decrease in fund balance from one year to the next represents the deliberate transfer of fund balance, for the purpose of consolidating previously approved appropriations associated with capital projects into the Capital Projects Fund. Excluding this deliberate transfer for future capital program expenditures, the net change in fund balance represents an increase of $16.7 million. The increase in fund Item Title: 12.1
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balance is due primarily because of an increase in one-time sales tax revenues in Sales Tax, including Quality of Life (Measure DD) sales tax, increased property tax revenues compared to the prior year, and one-time operational savings. Lastly, investment income revenue continued to perform strongly throughout FY2024-25, as the city proactively maintained its investments efforts in a favorable interest rate environment.

As indicated in the previous table, the City’s total governmental funds ending fund balances, is $250.4 million of which $44.3 million represents unassigned fund balance, which is available for spending at the government’s discretion, less allocations as noted in Note 11. The remainder of fund balance, $206.20 million, is either non-spendable, restricted (to indicate that it be spent only for the specific purposes stipulated by constitution, enabling legislation or external providers); committed (can be used only for specific purposes determined by formal action of a government’s legislative body); or assigned (intended to be used for specific purposes but does not meet the higher criteria of restricted or committed).

General Fund Financial Highlights

As of June 30, 2025, unassigned fund balance of the General Fund is $45.8 million, with an additional $14.1 million committed by Council action for emergencies, $5.5 million for the McCall Blvd. project improvements and $4.8 million for a future City Hall; $14.1 million is assigned for economic uncertainty, $2.0 million for future public facilities, and the following assigned fund balances: $722,746 for fire safety, $1.4 for general plan update, $1.0 million for fleet replacement, $500k for insurance premiums/claims, $13.3 million for future public facilities, $764k for fire equipment, and $1.1 million for eligible technology updates (Technology surcharge).

Overall, General Fund revenues for the fiscal year ending June 30, 2025 totaled $115.6 million, compared to $106.5 million for the previous year, an increase of just over $9 million, or 8.54%. General Fund revenues can be broken down into five major categories shown below. By far, sales tax is the City’s single largest source of revenue. Sales tax revenues, including both Bradley Burns and the Quality of Life revenue have slightly decreased by 1.70%, or $699k compared to the prior year. While the City still collected just over $7 million in one-time sales tax proceeds generated from the construction of the Nova Park Battery Storage Project, on-going sales tax revenue, specifically in the Quality of Life revenues has experienced a consistent leveling throughout FY2024-25. Property tax revenue is the City’s second largest source of revenue.

Property taxes have increased 5.90% from prior year, reflecting continued appreciation in assessed values and new development. Together property tax, VLF in Lieu revenue and sales tax, including Quality of Life sales tax represented approximately 66% of the City’s total General Fund revenues in FY2024-25.

Development related fees (building, planning, fire and engineering permits and fees) increased by 3.7%, just over $500k, from the prior year as the year reflecting a mix of slight increased activity on the building permitting and engineering activities, but lower activity level on planning applications received and processed.

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General Fund Budgetary Highlights

Differences between the General Fund original budget expenditures and the final adjusted budget expenditures, excluding SBITA/Lease Acquisition and transfers, were $43.3 million. The differences between the General Fund original budget revenues and the final amended budget were approximately $10.4 million and are briefly summarized as follows:

Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 1109,583,313$ 109,583,313$ 109,583,313$ -$ Resources (Inflows):Taxes 64,376,049 62,933,062 71,147,589 8,214,527 Licenses and permits 10,626,420 11,323,725 11,315,032 (8,693) Intergovernmental 11,595,633 11,664,089 12,631,274 967,185 Charges for services 6,705,879 13,347,041 11,377,808 (1,969,233) Use of money and property 635,000 2,620,402 8,225,168 5,604,766 Fines and forfeitures 390,000 398,178 439,280 41,102 Miscellaneous 66,500 66,788 435,799 369,011 Transfers in 9,571,848 12,021,525 486,270 (11,535,255) SBITA/Lease acquisition - 8,881,625 8,881,625 - Amounts Available for Appropriation 213,550,642 232,839,748 234,523,158 1,683,410 Charges for Appropriation (Outflows):General government 22,775,851 24,631,612 22,765,017 1,866,595 Public safety 51,432,276 59,421,892 54,773,074 4,648,818 Community development 8,109,173 11,752,507 8,045,173 3,707,334 Parks and recreation 4,504,054 5,213,903 4,165,333 1,048,570 Engineering and public works 5,822,796 6,482,176 5,364,733 1,117,443 Debt service:Principal retirement - 464,735 464,735 - Interest and fiscal charges - 13,997 13,997 - Capital outlay 2,450,791 4,243,535 3,258,478 985,057 Transfers out 8,882,387 37,056,084 29,387,907 7,668,177 Total Charges to Appropriations 103,977,328 149,280,441 128,238,447 21,041,994 Budgetary Fund Balance, June 30 109,573,314$ 83,559,307$ 106,284,711$ 22,725,404$ Budgeted Amounts
Revenues:

While variances between years exist for the various revenue categories, the total net increase was approximately $9 million or 8.54%. The increase is largely attributable one time mitigation revenue from the Rockport Ranch project in the amount of $3.6 million to be used towards a future capital project, increased investment income $1.4 milion higher than the prior year due to an economic rebound that produced higher interest earnings on investments. A $1.4 million increase in property tax revenue resulting from a growth in assessed property values also contributed to the overall increase in revenues. Lastly, VLF revenue $942k higher than prior year, and Development Revenue (Engineering, Fire, Planning, Building & Safety) charges for service were just over $500k higher than last year.

Variance of final adjusted budget to actuals is principally attributed to one time sales tax revenue of just over $7 million, in Bradley Burns and Quality of Life, associated with the Nova Park Project development.

Interest earnings actual revenues compared to adjusted budget were an estimated $1.5 million higher, and property tax revenue was $1.3 million higher than the adjusted budget, with various secured property tax categories, such as RDA pass-thru revenues performing higher than budgeted.

Expenditures:

General Fund expenditures, net (excluding transfers) totaled $98.9 million for the fiscal year ending June 30, 2025, compared to $90.7 million for the previous year. This increase of $8.2 million was due to various increases including continued increase costs in public safety related services, just over $1 million in fire contract services, and $144k in dispatch services. Additionally, the City invested approximately $1.2 million for the purchase of just under 400 acres of open space (Menifee Hills) to be used for future recreation Item Title: 12.1
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opportunities. and well as increases of $2.2 million in capital program project expenditures and increases in operational costs of $1.4 million compared to FY2023-24. By the end of FY2024-25 the City had an approved workforce of 332.50 FTEs, the same as the prior year.

Previously approved capital improvement program (CIP) expenditure budgets not yet complete at year end will be rolled into the subsequent year’s budget into the Capital Projects Fund (Fund 4320), along with any operating budget carryovers within the respective funds. Budget carryovers, except for encumbrances, require City Council approval for carryover.

Capital Asset and Debt Administration

Capital Assets

The City’s investment in capital assets for its governmental activities as of June 30, 2025, totals $417.8 million, net of accumulated depreciation. This investment in capital assets includes land, buildings, system improvements, machinery and equipment, park facilities, roads, highways, and bridges.

Summary of Changes in Capital Assets
June 30, 2025

Balance BalanceJuly 1, 2024 Additions Deletions June 30, 2025Governmental activities:Capital assets, not being depreciated:Land 28,794,607$ 2,202,942$ -$ 30,997,549$ Right-of-way 850,800 - - 850,800 Construction in progress 75,953,720 27,316,085 (47,311,647) 55,958,158 Total capital assets, not being depreciated 105,599,127 29,519,027 (47,311,647) 87,806,507 Capital assets, being depreciated:Building and improvements 33,229,712 1,230,234 - 34,459,946 Equipment and furniture 5,698,908 439,332 - 6,138,240 Vehicles 9,140,083 862,003 (59,983) 9,942,103 Software and website design 772,239 - - 772,239 Infrastructure 381,752,807 54,033,095 - 435,785,902 Right-to-use 10,205,932 9,156,084 - 19,362,016 Total capital assets, being depreciated 440,799,681 65,720,748 (59,983) 506,460,446 Less accumulated depreciation (154,444,713) (22,070,068) 59,983 (176,454,798) Total capital assets, being depreciated, net 286,354,968 43,650,680 - 330,005,648 Governmental Activities Capital Assets, net391,954,095$ 73,169,707$ (47,311,647)$ 417,812,155$ Total capital assets increased 6.60% from prior year. During the current fiscal year, the City accepted $31.8 million in infrastructure improvements from development projects and had an additional $55.9 million in construction in progress.

During FY2024-25 the City also acquired 13 new city vehicles totaling $0.86 million for Police, City Hall, and Public Works departments.

Additional information on the City’s capital assets can be found within Note 4 – Capital Assets and Note 5 – Long-term Liabilities in the notes to the basic financial statements section of this report.

Long-term Liabilities

At the end of the current fiscal year, the City had total unsecured debt and/or long-term liabilities outstanding in the amount $35.4 million.

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During Fiscal Year 2011-12, the City issued $20 million in Certificates of Participation through the California Communities Total Road Improvement Program (TRIP). The proceeds from this financing were used to fund various capital road improvements and are being repaid from a combination of future Gas Tax and Measure “A” revenues. This original TRIP debt was refinanced in 2020, resulting in anticipated savings exceeding $4 million for the balance of the debt. The current outstanding balance for this project is $14,270,000.

In June of 2019 the City entered into a financing agreement with Banc of America through the support and regional efforts of the Western Riverside Council of Governments (WRCOG) with Southern California Edison (SCE) to work with the City in the purchase and retrofit of approximately 6,300 streetlights from SCE, known as the Streetlight Retrofit Project. The initial debt for the Streetlight Retrofit Project was $6,550,000 and with a financing period of fifteen years. In the fall of 2021, taking advantage of the lower interest rate market, the City refinanced the Streetlight Retrofit Project, resulting in anticipated savings of over $400k for the balance of the debt. The current outstanding balance for this project is $4,616,365.

Other debts include the City’s liabilities arising from employee’s accrued leave, or compensated absences of $3,869,007, lease liabilities of $11,244,324, represented by various vehicle, real property, equipment leases, and subscription liabilities of $1,446,146 further detailed within Note 5- Long-Term Liabilities. During FY2024-25 some larger equipment and/or subscription leases including the tasers and body worn cameras used by the police department.

Summary of Changes in Long-Term Liabilities
June 30, 2025
Balance Balance Long- Due WithinJuly 1, 2024 Increases Decreases June 30, 2025 Term One YearTransportation Revenues 14,960,000$ -$ (690,000)$ 14,270,000$ 13,570,000$ 700,000$ COP, 20205,057,262 - (440,897) 4,616,365 4,162,187 454,178 Lease liabilities 6,001,206 7,302,719 (2,059,601) 11,244,324 9,130,512 2,113,812 Subscription liabilities 331,975 1,578,906 (464,735) 1,446,146 942,000 504,146 Compensated absences 2,627,278 1,241,729 - 3,869,007 3,095,206 773,801 Long-term liabilities total 28,977,721$ 10,123,354$ (3,655,233)$ 35,445,842$ 30,899,905$ 4,545,937$ Distribution Facilities Financing Agreement Additional information on the City’s long-term liabilities can be found within Note 1 – Summary of Significant Accounting Policies, Note 5 – Long-Term Liabilities, Note 7 – Pension Plan, and Note 8 – Post Employment Benefits in the notes to the basic financial statements section of this report

Economic Factors and Next Year's Budget

The city has experienced significant and steady increase in the City's sales tax base since fiscal year 2017- 18, with the adoption of the Quality of Life measure, and as consumers changed their spending habits during the pandemic. With this additional revenue source, the city has been able to prioritize services in the areas of public safety and infrastructure. However, over the past two years inflationary pressures continue to influence the City's financial landscape going into the upcoming fiscal year, impacting both revenues and expenditures. Inflation is driving up costs in all City funds in areas such as personnel, supplies, purchased services, and capital investments. In addition to inflation, unemployment, which has increased slightly over the past year, is expected to lead to a reduction in sales tax and other City revenues as consumers cut back on discretionary spending.

As the City continues to mature and its operations and workforce expand, rising maintenance and retirement costs will play significant impact on the City’s long-term financial stability. The City has commenced some proactive efforts beginning with FY2024-25 to help mitigate significant fluctuations in year over year pension liability, as well as setting aside reserves for other larger anticipated costs, such as fleet/fire equipment purchases and future public facilities.

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On June 18, 2025, the City Council adopted the City's Fiscal Year 2025-2027 Biennial Budget. Within the adoption, next year’s budget, FY2025-26, citywide budget totaled $135 million in funding for citywide operations, including $21.1 million for capital projects. Subsequently through the Mid-Cycle budget review/adoption process, City Council adopted a revised budget in June 2024. At the Mid-Year review process tentatively scheduled for February 2026, the City Council will review the adjusted budget reflecting prior year carryovers, additional appropriations to date, and any additional recommended budget adjustments. Shortly thereafter, the City will initiate the Mid-Cycle budget review process to identify any necessary budget adjustments to the following FY2026-27 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 Travis Hickey, Chief Financial Officer, City of Menifee, 29844 Haun Road, Menifee, CA 92586 or by telephone to (951) 672-6777. The entire ACFR is also available on the City’s website: www.cityofmenifee.us.

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Basic Financial Statements

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CITY OF MENIFEE

STATEMENT OF NET POSITION
JUNE 30, 2025

The accompanying notes are an integral part of these financial statements. -15-
GovernmentalActivitiesAssets:Cash and investments 265,807,978$ Receivables:Accounts 11,056,328 Accrued interest 1,729,224 Prepaid items 424,202 Restricted assets:Cash with fiscal agent 32,254,089 Other current assets 5,175 Net pension asset 1,109,928 Capital assets, not being depreciated 87,806,507 Capital assets, depreciated, net 330,005,648 Total Assets 730,199,079 Deferred Outflows of Resources:OPEB related 1,209,695 Pension related 9,891,164 Deferred charge on refunding 768,732 Total Deferred Outflows of Resources 11,869,591 Liabilities:Accounts payable 14,430,355 Accrued liabilities 3,031,954 Accrued interest 43,433 Deposits payable 42,257,801 Unearned revenue 1,176,234 Long-term liabilities, due within one year 4,545,937 Current portion of total OPEB liability 67,703 Due beyond one year:Total OPEB liability 4,759,458 Long-term liabilities, due beyond one year 30,899,905 Total Liabilities 101,212,780 Deferred Inflows of Resources:OPEB related 860,014 Pension related 788,194 Total Deferred Inflows of Resources 1,648,208 Net Position:Net investment in capital assets 387,004,052 Restricted for:Community development projects36,451,847 Public works 108,541,142 Debt service 672,525 Net pension asset 1,109,928 Unrestricted 105,428,188 Total Net Position 639,207,682$ Item Title: 12.1
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CITY OF MENIFEE

STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

The accompanying notes are an integral part of these financial statements. -16-
Net(E xpenses)Revenues andChanges inNet PositionOperating CapitalCharges for Contributions Contributions Governmental Expenses Services and Grants and Grants ActivitiesFunctions/ProgramsGovernmental activities:General government 35,476,891$ 15,510,130$ -$ -$ (19,966,761)$ Public safety 51,131,903 17,041,967 1,027,691 - (33,062,245) Community development 8,916,422 4,711,252 1,032,604 - (3,172,566) Recreation services 9,852,490 1,017,309 158,843.00 - (8,676,338) Engineering and public w orks 26,527,280 12,877,564 14,257,698 39,181,538 39,789,520 Interest on long-term debt 1,646,071 - - - (1,646,071) Total governmental activities133,551,057$ 51,158,222$ 16,476,836$ 39,181,538$ (26,734,461) General Revenues:Taxes:Property tax, levied for general purpose 35,297,340Sales tax - Shared State revenue 40,206,315Transient occupancy tax 485,200Franchise taxes 4,838,540Other taxes 986,027Unrestricted: Vehicle license fees 346,458 Use of money and property 10,318,496 Other 431,604 Total General Revenues 92,909,980 Change in net position 66,175,519 Net PositionBeginning of year 573,032,163 End of year 639,207,682$ Program Revenues

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BALANCE SHEET – GOVERNMENTAL FUNDS
JUNE 30, 2025

The accompanying notes are an integral part of these financial statements. -17-
GeneralDevelopment Impact Fees Grants TUMF FeesCapital Projects (formerly non-major) Bonded CFDsTotal Non-Major Governmental FundsTotal Governmental FundsAssetsCash and investments 150,236,607$ 58,854,783$ 3,333,526$ -$ 20,197,374$ -$ 33,185,688$ 265,807,978$ Receivables:Accounts, grants and taxes 8,534,487 - 357,697 511,600 - - 1,652,544 11,056,328 Accrued interest 1,073,936 290,336 38,925 - 27,816 222,781 75,430 1,729,224 Prepaid items 283,029 - - - - - 141,173 424,202 Other current assets 5,175 - - - - - - 5,175 Due from other funds 2,048,366 - - - - - - 2,048,366 Restricted assets:Cash and investments with fiscal agents - - - - - 32,140,641 113,448 32,254,089 Total Assets 162,181,600$ 59,145,119$ 3,730,148$ 511,600$ 20,225,190$ 32,363,422$ 35,168,283$ 313,325,362$ Liabilities and Fund BalancesLiabilities:Accounts payable 10,618,489$ 545,244$ 355,378$ 32,807$ 1,497,866$ -$ 1,380,571$ 14,430,355$ Accrued liabilities 3,020,599 - 425 - - - 10,930 3,031,954 Deposits payable 42,257,801 - - - - - - 42,257,801 Unearned revenue- - 1,176,234 - - - - 1,176,234 Due to other funds - - - 2,048,366 - - - 2,048,366 Total Liabilities 55,896,889 545,244 1,532,037 2,081,173 1,497,866 - 1,391,501 62,944,710 Fund Balances:Nonspendable:Prepaid items 283,029 - - - - - 141,173 424,202 Restricted for:Community development projects - - - - - - 17,724,788 17,724,788 Engineering and public works - 58,599,875 2,198,111 - 18,727,324 32,363,422 15,379,734 127,268,466 Debt service - - - - - - 531,352 531,352 Committed to:Emergency contingency 14,187,139 - - - - - - 14,187,139 City hall 4,750,000 - - - - - - 4,750,000 McCall Blvd project improvement 5,540,317 - - - - - - 5,540,317 Public facilities 2,000,000 - - - - - - 2,000,000 Assigned to:Economic uncertainty 14,187,139 - - - - - - 14,187,139 Public facilities 13,271,085 - - - - - - 13,271,085 Unfunded liability 698,747 - - - - - - 698,747 Fleet replacement 1,000,000 - - - - - - 1,000,000 Fire safety 722,746 - - - - - - 722,746 PARSAC SIR 500,000 - - - - - - 500,000 General plan update 1,449,656 - - - - - - 1,449,656 Technology surcharge 1,105,399 - - - - - - 1,105,399 Fire equipment 764,000 - - - - - - 764,000 Unassigned (deficit)45,825,454 - - (1,569,573) - - (265) 44,255,616 Total Fund Balances 106,284,711 58,599,875 2,198,111 (1,569,573) 18,727,324 32,363,422 33,776,782 250,380,652 Resource and Fund Balances 162,181,600$ 59,145,119$ 3,730,148$ 511,600$ 20,225,190$ 32,363,422$ 35,168,283$ 313,325,362$ Total Liabilities, Deferred Inflows of Special Revenue Funds Capital Projects Funds

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RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS

TO THE STATEMENT OF NET POSITION
JUNE 30, 2025

The accompanying notes are an integral part of these financial statements. -18-
250,380,652$ 417,812,155 1,109,928 Certificates of Participation (14,270,000)$ Debt Agreement 2019 (4,616,365) Total OPEB liability (4,827,161) Subscriptions (1,446,146) Lease liabilities (11,244,324) Compensated absences (3,869,007) (40,273,003) (43,433) 9,891,164 1,209,695 768,732 (788,194) (860,014) 639,207,682$ Net pension asset not been included as financial resources in governmental fund activity.Deferred charge on refunding Amounts reported for governmental activities in the statement of net position are different because:Capital assets net of depreciation have not been included as financial resources in governmentalfund activity.Pension related deferred outflows of resourcesOPEB related deferred inflows of resources Fund balances of governmental funds
Net position of governmental activitiesLong-term liabilities and compensated absences that have not been included in the governmental Accrued interest payable for the current portion of interest due on bonds has not been reported inthe governmental funds.Deferredinflowsandoutflowsofresourcesnotdueandpayable,orowedandreceivable,respectively, in the current period, are not reported in the funds:OPEB related deferred outflows of resourcesPension related deferred inflows of resources

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STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES –

GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

The accompanying notes are an integral part of these financial statements. -19-
GeneralDevelopment Impact Fees Grants TUMF FeesCapital Projects (formerly non-major) Bonded CFDsTotal Non-Major Governmental FundsTotal Governmental FundsRevenues:Taxes71,147,589$ -$ -$ -$ -$ -$ -$ 71,147,589$ Licenses and permits11,315,032 - - - - - - 11,315,032 Intergovernmental12,631,274 - 4,000,748 524,316 - - 9,480,930 26,637,268 Charges for services11,377,808 - - - 128,801 - 9,567,688 21,074,297 Use of money and property8,225,168 2,577,009 297,265 - 246,089 1,383,551 1,401,351 14,130,433 Fines and forfeitures439,280 - - - - - - 439,280 Developer participation- 15,344,404 - - - - - 15,344,404 Miscellaneous435,799 766 - - - 46,125 - 482,690 Contributions from property owners - - - - 849,825 30,051,705 - 30,901,530 Total Revenues 115,571,950 17,922,179 4,298,013 524,316 1,224,715 31,481,381 20,449,969 191,472,523 Expenditures:Current:General government 22,765,017 50,000 240,160 - - 13,515,235 530,952 37,101,364 Public safety 54,773,074 220,922 259,388 - - - 161,904 55,415,288 Community development 8,045,173 - 778,280 - - - - 8,823,453 Parks and recreation 4,165,333 - 97,694 - - - 4,137,521 8,400,548 Engineering and public works 5,364,733 - - - 1,177,184 - 3,442,794 9,984,711 Capital outlay3,258,478 - 227,236 - 26,678,648 - 130,007 30,294,369 Debt service:Principal retirement 464,735 - - - - - 1,130,897 1,595,632 Interest and fiscal charges 13,997 - - - - - 538,428 552,425 Bond issuance costs - - - - - 1,050,136 - 1,050,136 Total Expenditures 98,850,540 270,922 1,602,758 - 27,855,832 14,565,371 10,072,503 153,217,926 Excess of revenues over(under) expenditures 16,721,410 17,651,257 2,695,255 524,316 (26,631,117) 16,916,010 10,377,466 38,254,597 Other Financing Sources (Uses):Transfers in 486,270 - - - 40,328,379 - 1,958,312 42,772,961 Transfers out(29,387,907) (3,989,585) (2,792,899) (1,155,549) - - (5,447,021) (42,772,961) Subscription/lease acquisition 8,881,625 - - - - - - 8,881,625 Total Other Financing Sources (Uses)(20,020,012) (3,989,585) (2,792,899) (1,155,549) 40,328,379 - (3,488,709) 8,881,625 Net Change in Fund Balances(3,298,602) 13,661,672 (97,644) (631,233) 13,697,262 16,916,010 6,888,757 47,136,222 Fund Balances (Deficit)Beginning of year 109,583,313 44,938,203 2,295,755 (938,340) - 15,447,412 31,918,087 203,244,430 Change from non-major to major - - - 5,030,062 - (5,030,062) - Beginning of year, as restated 109,583,313 44,938,203 2,295,755 (938,340) 5,030,062 15,447,412 26,888,025 203,244,430 End of year 106,284,711$ 58,599,875$ 2,198,111$ (1,569,573)$ 18,727,324$ 32,363,422$ 33,776,782$ 250,380,652$ Special Revenue Funds Capital Projects Fund

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RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND

BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED JUNE 30, 2025

The accompanying notes are an integral part of these financial statements. -20-
Net change in fund balances - total governmental funds 47,136,222$ Amounts reported for governmental activities in the statement of activities aredifferent because: Capitalized expenditures30,294,369 Additional costs capitalized 9,003,259 Contributed capital assets8,630,500 Depreciation/amortization expense(22,070,068) (8,881,625) 3,655,233$ (45,219) 3,610,014 1,709 (1,241,729) (376,447) 1,303,405 (1,234,090) Change in net position of governmental activities66,175,519$ Governmentalfundsreportcapitaloutlaysasexpenditures.However,inthestatementofactivities,thecosts of those assets is allocated over their estimated useful lives and reported as depreciation andamortization expense or allocated to the appropriate functional expense. The capital and intangible assetactivity is reconciled as follows:Repayment of bond principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position.Accrued interest for long-term liabilities. This is the change in accrued interest for the current period.Compensated absences expenses reported in the statement of activities do not require the use of currentfinancial resources and, therefore, are not reported as expenditures in governmental funds. This is thechange in compensated absences for the current period.Revenues reported as unavailable and unearned revenue in the governmental funds are recognized in thestatement of activities. These are included in the intergovernmental revenues under the modified accrualbasis of accounting in the governmental fund activity when they are measurable and available.

Cost of assets capitalized:Amortization of deferred chargesPrincipal repaymentsOPEB related net adjustmentDeferred inflows and outflows of resources not due and payable, or owed and receivable, respectively, inthe current period, are not reported in the funds:Pension related net adjustment Governmental funds report proceeds from issuance of debt and lease/SBITA acquisitions as otherfinancing sources or uses, and do not report the respective long term liabilities. For the Statement ofActivities these amounts been reclassified to long term debt in the Statement of Net Position. This is theamount for the current year:

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STATEMENT OF FIDUCIARY NET POSITION

FIDUCIARY FUNDS
JUNE 30, 2025

The accompanying notes are an integral part of these financial statements. -21-
Bonded CFD Custodial FundAssets:Cash and investments 3,380,635$ Cash and investments with fiscal agents 7,477,313 Receivables:Accounts 56,696 Accrued interest 47,979 Total Assets10,962,623 Liabilities:Accounts payable 15,063 Total Liabilities15,063 Net Position:Net position restricted for other purposes 10,947,560 Total Net Position10,947,560$

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STATEMENT OF CHANGES IN FIDUCIARY NET POSITION

FIDUCIARY FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

The accompanying notes are an integral part of these financial statements. -22-
Bonded CFD Custodial FundAdditions:Interest income 115,727$ Contributions from property owners 7,422,677 Total Additions 7,538,404 Deductions:Administrative expenses 136,005 Interest paid to bondholders 3,064,269 Total Deductions 3,200,274 Change in Net Position4,338,130 Net positionBeginning of year 6,609,430 End of year 10,947,560$

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NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

-23-
I. SIGNIFICANT ACCOUNTING POLICIES

Note 1: Summary of Significant Accounting Policies

a. Description of the Reporting Entity

The City of Menifee, California (the City), was incorporated on October 1, 2008, under the laws of the State of California and enjoys all the rights and privileges applicable to a General Law City. The City is governed by an elected five-member board. As required by generally accepted accounting principles, these financial statements present the City (the primary government) and its component units. Component units are legally separate organizations for which the elected officials of the primary government are financially accountable. In addition, component units can be other organizations for which the nature and significance of their relationship with a primary government are such that exclusion would cause the reporting entity's financial statements to be incomplete. Under this definition, it is determined that there are no component units for this reporting entity, and these financial statements present the financial reporting entity that consisted solely of the City as the primary government.

b. Government-Wide and Fund Financial Statements

The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the nonfiduciary activities of the primary government and its component units. For the most part, the effect of interfund activity has been removed from these statements. Interfund services provided and used are not eliminated in the process of consolidation. Governmental activities are normally supported by taxes and intergovernmental revenues.

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

Separate financial statements are provided for governmental funds and fiduciary funds, even though the latter are excluded from the government-wide financial statements. The fiduciary funds are reported on the accrual basis of accounting. Major individual governmental funds are reported as separate columns in the fund financial statements.

c. Measurement Focus, Basis of Accounting and Financial Statement Presentation

The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 50

Menifee Mayor and City Council
January 21, 2026
Page
1087 of 1208

CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 1: Summary of Significant Accounting Policies (continued)

c. Measurement Focus, Basis of Accounting and Financial Statement Presentation (continued)

Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose the government considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. However, grant revenues are considered available within 6 months of the end of the current fiscal year. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due.

The City’s fiduciary fund financial statements report a custodial fund. The custodial fund is reported using the economic resources measurement focus and the accrual basis of accounting.

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

Governmental funds with assets and deferred outflows, liabilities and deferred inflows, revenues, or expenditures equal to at least 10% of their fund-type total, and at least 5% of the combined total of governmental funds and enterprise fund, as applicable, are required to be reported as a major fund. A governmental fund may also be presented as a major fund in the basic financial statements, event if it does not meet the size criteria just described, if the City’s officials believe that the fund is particularly important to the financial statement users (because of public interest, reporting consistency, or otherwise). The General Fund is always reported as a major fund.

The City reports the following major governmental funds:

The General Fund is the City’s primary operating fund. All general tax receipts and fee revenue not allocated by law, Council policy, or contractual agreement to other funds are accounted for in the General Fund. General Fund expenditures include operations traditionally associated with activities, which are not required to be accounted for or paid by another fund.

The Development Impact Fees (DIF) Fund – This fund is used to account for 9 separate DIF Funds. Fees are charged to new development to pay for future infrastructure costs such as roads, fire facilities, parks and libraries.

The Grants Fund – This fund accounts for all of the various miscellaneous grants, in order to properly segregate and track grant funding. Grants are budgeted upon being awarded by a third-party agency and approved by the City Council. Only grants that are approved at the time of the adoption of this budget are listed in this budget document.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 51

Menifee Mayor and City Council
January 21, 2026
Page
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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 1: Summary of Significant Accounting Policies (continued)

c. Measurement Focus, Basis of Accounting and Financial Statement Presentation (continued)

The TUMF Fees Fund – This fund tracks revenues and expenditures associated with the regional transportation mitigation fee program. These funds are generated from impact fees assessed by Western Riverside Council of Governments (WRCOG) on all new residential and commercial development. These funds are later divided among the three (3) zones comprising of the Northern, Central and Southern zones. The City of Menifee is located within the Central zone along with the Cities of Perris, Moreno Valley and Riverside County. The City is eligible to receive TUMF funds on major road and bridge projects located within the City.

These projects must first be approved by WRCOG and the Central zone Technical Advisory Committee (TAC). The City uses these funds to supplement capital projects relating to road and bridge improvements and they are treated as grant funding.

Capital Projects Fund – This fund is used to account for the project completion of street and highways capital improvements financed through various sources including, but not limited to, developer contributions and grants.

The Bonded CFDs Fund – This fund is used to account for 6 separate Bonded CFD funds (capital projects). Proceeds received by the issuance of bonds under the Mello-Roos Community Facilities Act of 1982, are accounted for under the respective Bonded CFD fund and used to pay for the specific eligible public facilities/improvements financed by the CFD.

Additionally, the City reports the following fund types:

The custodial fund is used to account for third party contributions received by the City for which the City’s responsibility is essentially custodial. The Bonded CFD fund is used to account for contributions from property owners for payment on outstanding debt that the City is not directly liable for.

d. Assets, Liabilities and Net Position or Equity

Cash and Investments

The City’s cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition. For financial statement presentation purposes, cash and cash equivalents are shown as both restricted and unrestricted cash and investments in the governmental funds.

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

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 52

Menifee Mayor and City Council
January 21, 2026
Page
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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 1: Summary of Significant Accounting Policies (continued)

d. Assets, Liabilities and Net Position or Equity (continued)

Receivables and Payables

Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either "due to/from other funds" (i.e., the current portion of interfund loans) or "advances to/from other funds" (i.e., the non-current portion of interfund loans). All other outstanding balances between funds are reported as "due to/from other funds." Advances between funds, as reported in the fund financial statements, are offset by a fund balance reserve account in applicable governmental funds to indicate that they are not available for appropriation and are not expendable available financial resources. All trade and property tax receivables are shown net of an allowance for uncollectable.

Capital Assets

Capital assets are defined by the government as assets with an initial, individual cost of more than $5,000 ($50,000 for infrastructure) and an estimated useful life in excess of two or more years. Assets are generally capitalized as a whole unit or system and not by the individual units that comprise the system. For example, a phone system is capitalized as one entire system and not on the individual components such as the phones, phone server, installation costs, and wiring.

Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value at the date of acquisition.

Capital assets, which include property, plant, equipment, infrastructure assets (e.g., roads, bridges, sidewalks and similar items) and intangible assets, are reported in the governmental activities column in the government-wide financial statements. In accordance with generally accepted accounting principles, the City has reported all general infrastructure assets.

The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed.

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

Assets Years $ ThresholdEquipment and furniture 2-10 5,000$ Vehicles 2-10 5,000 Software 2-10 5,000 Infrastructure 20-50 50,000

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 53

Menifee Mayor and City Council
January 21, 2026
Page
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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 1: Summary of Significant Accounting Policies (continued)

d. Assets, Liabilities and Net Position or Equity (continued)

Intangible Assets

Intangible Right to Use assets are related to equipment or real property that the City has obtained the right to utilize for a specified period of time through the use of a lease or subscription agreement. The life of the right to use asset is for the same period as the lease/subscription and amortized on a straight-line basis over that period.

Compensated Absences

Vacation pay is payable to employees at the time a vacation is taken or upon termination of employment. Normally, an employee cannot accrue more than his regular annual entitlement. Payment for vacation not taken is payable at the end of the cumulative time.

Sick leave is payable when an employee is unable to work because of illness. Upon termination an employee will not be paid for any unused sick leave, with the exception for the City Manager pursuant to employment contract. All unpaid vacation and sick leave, if applicable, is recorded as a liability in the government-wide financial statements.

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, represents 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.

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 government has only one type of item, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category.

Accordingly, the item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental funds report unavailable revenues from taxes and intergovernmental revenues. These amounts are unavailable and recognized as an inflow of resources in the period that the amounts become available.

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.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 54

Menifee Mayor and City Council
January 21, 2026
Page
1091 of 1208

CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 1: Summary of Significant Accounting Policies (continued)

d. Assets, Liabilities and Net Position or Equity (continued)

Fund Balance

In the fund financial statements, government funds report the following fund balance classification:

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

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

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

Assigned include amounts that are constrained by the government’s intent to be used for specific purposes, but are neither restricted nor committed. The City Manager is authorized to assign amounts to a specific purpose, which was established by the governing body in Resolution No. 2011-226 approved on June 21, 2011.

Unassigned include the residual amounts that have not been restricted, committed, or assigned to specific purposes in the General Fund, and deficit fund balances in any other funds.

An Emergency Contingency commitment of fund balance has been established through Resolution 21-1076. This reserve is set at a minimum of 12.5% of General Fund operating expenditures The specified uses include the declaration of a state or federal emergency or a local emergency as defined in Section 1.10.010 of the Menifee Municipal Code. City Council may, by majority vote of the members, change the amount of this commitment and/or the specific uses through adoption of resolution.

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

The General Fund is the only fund that reports a positive unassigned fund balance amount. In other governmental funds it is not appropriate. However, if expenditures incurred for a specific purpose 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.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 55

Menifee Mayor and City Council
January 21, 2026
Page
1092 of 1208

CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 1: Summary of Significant Accounting Policies (continued)

d. Assets, Liabilities and Net Position or Equity (continued)

Fund Balance Flow Assumptions

Sometimes the government will fund outlays for a particular purpose from both restricted and unrestricted resources (the total of committed, assigned, and unassigned fund balance). In order to calculate the amounts to report as restricted, committed, assigned, and unassigned fund balance in the governmental fund financial statements a flow assumption must be made about the order in which the resources are considered to be applied. It is the government’s policy to consider restricted fund balance to have been depleted before using any of the components of unrestricted fund balance. Further, when the components of unrestricted fund balance can be used for the same purpose, committed fund balance is depleted first, followed by assigned fund balance. Unassigned fund balance is applied last.

Property Taxes

Property tax revenue is recognized on the modified accrual basis, that is, in the fiscal year for which the taxes have been levied providing they become available. Available means then due or past due and receivable within the current period and collected within the current period or expected to be collected soon enough thereafter to be used to pay liabilities of the current period. The County of Riverside collects property taxes for the City. Tax liens attach annually as of 12:01 A.M. on the first day in January proceeding the fiscal year for which the taxes are levied. The tax levy covers the fiscal period July 1 to June 30. All secured personal property taxes and one-half of the taxes on real property are due November 1; the second installment is due February 1. All taxes are delinquent, if unpaid, on December 10 and April 10, respectively.

Unsecured personal property taxes become due on the first of March each year and are delinquent on August 31.

Functional Classifications

Expenditures of the governmental funds are classified by function. Functional classifications are defined as follows:

 General Government includes legislative activities, City Clerk, City Attorney, City Manager as well as management or supportive services across more than one functional area.

 Public Safety includes those activities which involve police protection, fire protection and animal control services.

 Community Development includes those activities which involve planning, building and safety and code enforcement.

 Parks and Recreation includes activities which provide recreation, cultural and educational services.

 Engineering and Public Works includes all maintenance, engineering and capital improvements which relate to streets and other public facilities.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 56

Menifee Mayor and City Council
January 21, 2026
Page
1093 of 1208

CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 1: Summary of Significant Accounting Policies (continued)

e. Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

f. Pension Plans

For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Plan and additions to/deductions from the Plan’s fiduciary net position have been determined on the same basis. For this purpose, benefit payments (including refunds of employee contributions) are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value. The General Fund has been used to liquidate the liability in prior years.

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

Valuation Date (VD) June 30, 2023
Measurement Date (MD) June 30, 2024
Measurement Period (MP) July 1, 2023 to June 30, 2024

g. Other Postemployment Benefits (OPEB)

For purposes of measuring the total OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the City’s plan (OPEB Plan) and additions to/deductions from the OPEB Plan’s fiduciary net position have been determined on the same basis. For this purpose, benefit payments are reported at fair value. The General Fund has been used to liquidate the liability in prior years.

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

Valuation Date (VD) June 30, 2023
Measurement Date (MD) June 30, 2024
Measurement Period (MP) July 1, 2023 to June 30, 2024

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 57

Menifee Mayor and City Council
January 21, 2026
Page
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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 1: Summary of Significant Accounting Policies (continued)

h. Implementation of New Pronouncement

Governmental Accounting Standards Board has issued Statement No. 101, Compensated Absences. The objective of this Statement is to better meet the information needs of financial statement users by updating the recognition and measurement guidance for compensated absences. That objective is achieved by aligning the recognition and measurement guidance under a unified model and by amending certain previously required disclosures

Governmental Accounting Standards Board has issued Statement No. 102, Certain Risk Disclosures. State and local governments face a variety of risks that could negatively affect the level of service they provide or their ability to meet obligations as they come due. Although governments are required to disclose information about their exposure to some of those risks, essential information about other risks that are prevalent among state and local governments is not routinely disclosed because it is not explicitly required.

The objective of this Statement is to provide users of government financial statements with essential information about risks related to a government’s vulnerabilities due to certain concentrations or constraints.

II. STEWARDSHIP

Note 2: Stewardship, Compliance and Accountability

a. Budgetary Data

General Budget Policies

The City Council approves each year's budget prior to the beginning of the new fiscal year. Public hearings are conducted prior to its adoption by the City Council.

Supplemental appropriations, where required during the period, are approved by the City Manager. In most cases, expenditures may not exceed appropriations at the fund level. At fiscal year-end, all operating budget appropriations lapse.

Encumbrances

Encumbrances are estimations of costs related to unperformed contracts for goods and services. These commitments are recorded for budgetary control purposes in the General, Special Revenue and similar governmental funds. Encumbrances represent the estimated amount of the expenditure ultimately to result if unperformed contracts in process at year-end are completed. They do not constitute expenditures or estimated liabilities.

Budget Basis of Accounting

Budgets for all governmental funds are adopted on a basis consistent with generally accepted accounting principles (GAAP).

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 58

Menifee Mayor and City Council
January 21, 2026
Page
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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 2: Stewardship, Compliance and Accountability (continued)

b. Deficit Fund Balances

The following funds present a fund balance deficit as of the year ended June 30, 2025:

Fund Fund Balance DeficitTUMF Fees (1,569,573)$ Citywide Streetsweeping (265)

Note 3: Cash and Investments

As of June 30, 2025, cash and investments were reported in the accompanying financial statements as follows:

Governmental activitiesCash and investments 265,807,978$ Cash with fiscal agent 32,254,089 Fiduciary fundsCash and investment 3,380,635 Cash with fiscal agent 7,477,313 Total Cash and Investments 308,920,015$ Cash and investments held by the City consist of the following:

Cash on hand 12,300$ Deposits with financial institutions 50,845,972 Investments 258,061,743 Total Cash and Investments 308,920,015$ The City maintains a cash and investment pool that is available for use for all funds. Each fund type's position in the pool is reported on the combined balance sheet as cash and investments.

The City has adopted an investment policy which authorizes it to invest in various investments.

Interest income earned on pooled cash and investments is allocated quarterly to the various funds based on average daily cash balances.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 59

Menifee Mayor and City Council
January 21, 2026
Page
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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 3: Cash and Investments (continued)

Deposits with financial institutions

The California Government Code requires California banks and savings and loan associations to secure a City’s deposits by pledging government securities with a value of 110% of a City’s deposits. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of a City’s total deposits. The City Treasurer may waive the collateral requirement for deposits which are fully insured up to $250,000 by the FDIC. The collateral for deposits in federal and state-chartered banks is held in safekeeping by an authorized Agent of Depository recognized by the State of California Department of Banking. The collateral for deposits with savings and loan associations is generally held in safekeeping by the Federal Home Loan Bank in San Francisco, California as an Agent of Depository. These securities are physically held in an undivided pool for all California public agency depositors. Under Government Code Section 53655, the placement of securities by a bank or savings and loan association with an "Agent of Depository" has the effect of perfecting the security interest in the name of the local governmental agency.

Accordingly, all collateral held by California Agents of Depository are considered to be held for, and in the name of, the local governmental agency.

Investments Authorized by Debt Agreements

The above investments do not address investment of debt proceeds held by a bond trustee.

Investments of debt proceeds held by a bond trustee are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City’s investment policy.

The remainder of this page left intentionally blank
Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 60

Menifee Mayor and City Council
January 21, 2026
Page
1097 of 1208

CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 3: Cash and Investments (continued)

Investments Authorized by the California Government Code and the Entity’s Investment Policy

The table below identifies the investment types that are authorized 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, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City’s investment policy.

*Maximum*Maximum InvestmentInvestment Types *Maximum Percentage of In One Authorized by City's Investment Policy Maturity Portfolio IssuerU.S. Treasury securities 5 years None NoneFederal Agency Securities 5 years 20% NoneMunicipal securities 5 years 30% 5%Negotiable certificates of deposit 5 years 30% 5%Commercial Paper 270 days 25% 5%Bankers acceptance 180 days 40% 5%Local Agency Investment Fund N/A None $75 millionFederally insured time deposits (CDs) 5 years 20% NoneNon-negotiable certificates of deposit5 years20%NoneCertificate of deposit placement service5 years30%NoneCollateralized bank depositsN/AN/AN/ARepurchase agreements1 yearNoneNoneLocal government investment poolsN/ANoneNoneCorporate medium term notes5 years30%5%Asset/mortgage backed securities5 years20%5%Supranationals5 years30%10%Mutual funds N/A 10% None * Based on state law requirements or investment policy requirements, whichever is more restrictive

Investments in State Investment Pool

The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. LAIF is overseen by the Local Agency Investment Advisory Board, which consists of five members, in accordance with State statute. The State Treasurer’s Office audits the fund annually. The fair value of the position in the investment pool is the same as the value of the pool shares.

Fair Value

Generally Accepted Accounting Principles (GAAP), establishes fair value standards for investments in participating interest earning investment contracts, external investment pools, equity securities, option contracts, stock warrants and stock rights that have readily determinable fair values. Accordingly, the City reports its investments at fair value in the balance sheet. All investment income, including changes in the fair value of investments, is recognized as revenue in the operating statement.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 61

Menifee Mayor and City Council
January 21, 2026
Page
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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 3: Cash and Investments (continued)

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. The City’s investment policy does not limit investments in Federal Agency Securities and Treasury Obligations to ratings issued by nationally recognized statistical rating organizations. The City’s investment policy does restrict investments in Corporate Medium-Term Notes (MTN’s) to those rated A or better by a nationally recognized statistical rating organization. Presented below are the City’s investments and the actual rating as of fiscal year end for each investment type:

Investment Type AmountMinimum legal rating A-/A/A+ AA-/AA/AA+ Aaa (or similar) Not ratedState investment pool (LAIF) 35,914,141$ N/A -$ -$ -$ 35,914,141$ Money market funds 629,858 N/A - - 629,858 - U.S. Treasury obligations 63,955,262 N/A - 63,955,262 - - Federal agency securities 19,603,446 N/A - 19,603,446 - - Agency/mortgage backed securities 5,444,403 N/A - 2,188,201 3,256,202 - U.S. corporate medium term notes 32,891,016 N/A 14,679,052 6,842,713 - 11,369,251 Supranational 6,748,223 N/A - - - 6,748,223 Asset-backed securities 4,973,356 N/A - - 3,982,331 991,025 California asset management program (CAMP) 87,788,590 N/A - - 87,788,590 - Held by bond trustee and escrow agent:Cash with fiscal agents 113,448 N/A - - - 113,448 Total investments 258,061,743$ 14,679,052$ 92,589,622$ 95,656,981$ 55,136,088$ Rating at year end Custodial Credit Risk

The 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 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 to a transaction, a government will not be able to recover the value of investment or collateral securities that are in the possession of an outside party. The City’s investment in LAIF is unrated.

The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The market value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.

As of June 30, 2025, the City held deposits with financial institutions in excess of Federal Depository Insurance Corporation (FDIC) limits. These funds were held in collateralized accounts as required by the California Government Code as stated above.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 62

Menifee Mayor and City Council
January 21, 2026
Page
1099 of 1208

CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 3: Cash and Investments (continued)

Concentration of Credit Risk

The City’s investment policy imposes restrictions on percentages that the City can invest in certain types of investments and with any one issuer for certain types of investments. Generally accepted accounting principles requires a separate disclosure if any single issuer comprises more than 5% of the total investment value. At June 30, 2025, the City’s had no single issuer of more than 5%. Investments guaranteed by the U.S. government and investments in mutual funds and external investment pools are excluded from this requirement.

Interest Rate Risk

Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. The City has elected to use the segmented time distribution method of disclosure for its interest rate risk.

As of June 30, 2025, the City had the following investments and remaining maturities:

1 year 1 year 3 years Fair or less to 3 years to 5 years ValueState investment pool (LAIF) 35,914,141$ -$ -$ 35,914,141$ Money market funds629,858 - - 629,858 U.S. Treasury obligations10,342,676 18,492,489 35,120,097 63,955,262 Federal agency securities5,816,996 10,960,128 2,826,322 19,603,446 Agency/mortgage backed securities296,690 509,231 4,638,482 5,444,403 U.S. corporate medium term notes609,966 7,563,522 24,717,528 32,891,016 Supranational147,155 - 6,601,068 6,748,223 Asset-backed securities5,800 61,756 4,905,800 4,973,356 California asset management program (CAMP)87,788,590 - - 87,788,590 Held by bond trustee and escrow agent:Cash with fiscal agents 113,448 - - 113,448 Total investments 141,665,320$ 37,587,126$ 78,809,297$ 258,061,743$ Investments MaturitiesInvestment Type Fair Value Measurements

Generally accepted accounting principles, establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy consists of three broad levels: Level 1 inputs consist of quoted prices (unadjusted) for identical assets and liabilities in active markets that a government can access at the measurement date, Level 2 inputs that are observable for an asset or liability, either directly or indirectly, and Level 3 inputs have the lowest priority and consist of unobservable inputs for an asset or liability.

The valuation technique used for level 2 investments include "inputs other than quoted prices included within Level I that are observable for the asset or liability, either directly or indirectly".

Level 2 inputs include: quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; interest rates and yield curves observable at commonly quoted intervals; implied volatilities; credit spreads, and market-corroborated inputs.

Item Title: 12.1
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NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 3: Cash and Investments (continued)

Fair Value Measurements (continued)

The following table presents the balances of the assets measured at fair value on a recurring basis as of June 30, 2025:

Investments by Fair Value Hierarchy Total Level 1 Level 2 Level 3U.S. Treasury obligations 63,955,262$ -$ 63,955,262$ -$ Federal agency securities 19,603,446 - 19,603,446 - Agency/mortgage backed securities 5,444,403 - 5,444,403 - U.S. corporate medium term notes 32,891,016 - 32,891,016 - Supranational 6,748,223 - 6,748,223 - Asset-backed securities 4,973,356 - 4,973,356 - Total Investments by Fair Value Hierarchy 133,615,706 -$ 133,615,706$ -$ Investments outside the Fair Value HierarchyState investment pool (LAIF) 35,914,141 California asset management program (CAMP) 87,788,590 Money market funds 629,858 Held by bond trustee and escrow agent:Cash with fiscal agents 113,448 Total Investments 258,061,743$

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Item Title: 12.1
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January 21, 2026
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NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 4: Capital Assets

Capital asset activity for the year ended June 30, 2025, was as follows:

Beginning Deletions/ EndingBalance Additions Adjustments BalanceGovernmental activities:Capital assets, not being depreciated:Land 28,794,607$ 2,202,942$ -$ 30,997,549$ Right-of-w ay 850,800 - - 850,800 Construction in progress 75,953,720 27,316,085 (47,311,647) 55,958,158 Total capital assets, not being depreciated 105,599,127 29,519,027 (47,311,647) 87,806,507 Capital assets, being depreciated/amortized:Building and improvements 33,229,712 1,230,234 - 34,459,946 Equipment and furniture 5,698,908 439,332 - 6,138,240 Vehicles 9,140,083 862,003 (59,983) 9,942,103 Softw are and w ebsite design 772,239 - - 772,239 Infrastructure 381,752,807 54,033,095 - 435,785,902 Right-to-useLand - 534,515 - 534,515 Buildings 8,442,223 381,374 - 8,823,597 Vehicles and equipment 912,450 6,551,940 - 7,464,390 Subscriptions 851,259 1,688,255 - 2,539,514 Total capital assets, being depreciated/amortized 440,799,681 65,720,748 (59,983) 506,460,446 Less accumulated depreciation/amortization:Building and improvements (9,243,217) (1,559,472) - (10,802,689) Equipment and furniture (3,129,005) (506,107) - (3,635,112) Vehicles (5,067,744) (1,175,274) 59,983 (6,183,035) Softw are and w ebsite design (590,098) (32,622) - (622,720) Infrastructure (132,026,135) (16,364,154) - (148,390,289) Right-to-useLand - (232,818) - (232,818) Buildings (3,557,380) (1,190,126) - (4,747,506) Vehicles and equipment (381,086) (393,688) - (774,774) Subscriptions (450,048) (615,807) - (1,065,855) Total accumulated depreciation/amortization (154,444,713) (22,070,068) 59,983 (176,454,798) Total capital assets, being depreciated/amortized, net 286,354,968 43,650,680 - 330,005,648 Governmental activities capital assets, net391,954,095$ 73,169,707$ (47,311,647)$ 417,812,155$ Depreciation/amortization expense was charged to the following functions in the statement of activities:

Governmental Activities:General government 810,079$ Public safety 3,382,846 Parks and recreation 1,572,623 Engineering and public w orks 16,304,520 Total Depreciation/Amortization Expense - Governmental Activities 22,070,068$

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NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 5: Long-Term Liabilities

The following is a schedule of changes in long-term liabilities for the fiscal year ended June 30, 2025:

Beginning E nding Due WithinBalance Additions Deductions Balance One YearLong-term liabilitiesSeries 2020 (TRIP) 14,960,000$ -$ (690,000)$ 14,270,000$ 700,000$ Direct Borrow ings:Distribution FacilitiesFinancing Agreement 5,057,262 - (440,897) 4,616,365 454,178 Lease liabilities 6,001,206 7,302,719 (2,059,601) 11,244,324 2,113,812 Subscription liabilities331,975 1,578,906 (464,735) 1,446,146 504,146 Other long-term liability: Compensated absences* 2,627,278 1,241,729 - 3,869,007 773,801 Total long-term debt 28,977,721$ 10,123,354$ (3,655,233)$ 35,445,842$ 4,545,937$ *Net change is show nCertificates of Participation, Transportation Revenue Certificates of Participation Bonds, Series 2020

The 2020 Certificates of Participation Bonds were issued to refund the 2012B Certificate of Participation Bonds for $16,990,000. The bonds mature annually through 2042, in amounts ranging from $1,835,000 to $2,305,000. Interest rates vary from 0.435% to a maximum of

3.238% and are payable semiannually on December 1 and June 1. This transaction resulted in an economic gain of $1.8 million and a net savings in debt service costs of $4.3 million.

Assets irrevocably pledged as collateral for the bonded debt are all of the revenues and all money in the Pledged Tax Fund (the "Gas Tax Account" and the "Measure A Receipts Account”) and in the funds or accounts so specified and provided for in the 2020 Installment Sale Agreement.

In the event of default the Trustee may, by notice in writing to the City, declare the entire principal amount of the unpaid 2020 Installment Sale Payments and the accrued interest thereon to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable.

The annual debt service requirements on these bonds are as follows:

Year EndingJune 30 Principal Interest Total2026700,000$ 383,166$ 1,083,166$ 2027710,000 373,352 1,083,352 2028720,000 361,978 1,081,978 2029730,000 348,141 1,078,141 2030745,000 333,423 1,078,423 2031-20353,995,000 1,399,545 5,394,545 2036-20404,615,000 790,557 5,405,557 2041-20422,055,000 100,378 2,155,378 Totals 14,270,000$ 4,090,540$ 18,360,540$ Certificates of Participation, Series 2020 TRIP

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FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 5: Long-Term Liabilities (continued)

Distribution Facilities Financing Agreement – Direct borrowing:

On July 6, 2018, the City entered into a financing agreement to purchase Certain Southern California Edison Company Street Light Facilities. The agreement calls for the conveyance and sale of 6,310 LS-1 electric streetlights facilities. The term of the agreement is 15 years, expiring on 2034. Interest rate is set at 4.30% and debt payments are payable semiannually on December 1 and June 1.

The agreement was refinanced on September 10, 2021 for $6,335,581 with an interest rate of

2.99% with payments due in December and June of every year. The refinancing did not extend the life of the agreement and will therefore continue to expire in 2034. The refinancing resulted in economic gain of approximately $400,738 over the term of the agreement with an annual average cash flow savings of approximately $30,826.

In the event of default, the lessor may, by notice in writing to the City, declare the entire principal amount of the unpaid Agreement and the accrued interest thereon to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable.

The annual debt service requirements on this borrowing is as follows:

Year EndingJune 30 Principal Interest Total2026454,178$ 134,660$ 588,838$ 2027467,860 120,978 588,838 2028481,953 106,885 588,838 2029496,471 92,366 588,837 2030511,427 77,411 588,838 2031-20342,204,476 150,873 2,355,349 Totals 4,616,365$ 683,173$ 5,299,538$ Distribution Facilities Financing Agreement Lease Liabilities

The City has entered into leases (as the lessee) for various vehicles and equipment. The lease terms range from 33 to 60 months. Monthly fixed payments range from $390 to $1,195 with interest rates ranging from 0.411% to 0.736%. The leases have guaranteed residual values ranging from $3,265 to $10,372.

The City has entered into leases (as the lessee) for various buildings. The lease terms range from 33 to 86 months. Monthly fixed payments range from $1,352 to $47,760 with interest rates ranging from 0.308% to 2.287%.

Item Title: 12.1
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NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 5: Long-Term Liabilities (continued)

Future payments on the total lease liabilities are as follows.

Year EndingJune 30 Principal Interest Total20262,113,812$ 111,485$ 2,225,297$ 20272,100,064 202,503 2,302,567 20282,093,897 169,210 2,263,107 20291,212,286 138,761 1,351,047 2030614,754 118,123 732,877 2031-20353,109,511 305,654 3,415,165 Totals 11,244,324$ 1,045,736$ 12,290,060$ Leases See note 4 for the net book value of right-to-use assets acquired through leases.

Subscription Liabilities

The City has entered into subscriptions for the use of various software packages. The terms range from 18 to 58 months. Annual fixed payments range from $7,020 to $136,207 with interest rates ranging from 2.0237% to 2.3657%.

Future payments on the total lease liabilities are as follows.

Year EndingJune 30 Principal Interest Total2026504,146$ 36,675$ 540,821$ 2027505,811 23,790 529,601 2028215,816 11,576 227,392 2029220,373 5,869 226,242 Totals 1,446,146$ 77,910$ 1,524,056$ Subscriptions See note 4 for the net book value of right-to-use assets acquired through leases.

Compensated Absences

The City’s liability for vested and unpaid compensated absences (accrued vacation and sick pay) in the governmental activities has been accrued and amounts to $3,869,007 as of June 30, 2025. These liabilities have been described in Note 1.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 68

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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 6: Interfund Receivable, Payable and Transfers

Due to/from other funds balances as of June 30, 2025 were as follows:

Funds TotalDue From Other Funds:Due to General FundTUMF Fund 2,048,366$ Total 2,048,366$ These represent borrowings from other governmental funds to cover temporary cash deficit.

Transfers in and out for the year ended June 30, 2025 were as follows:

Transfers in Transfers out AmountGeneral Fund Grants Fund (a) 150,000$ Nonmajor Governmental Funds (b) 336,270 Nonmajor Governmental Funds General Fund(e)29,387,907 Development Impact Fees(c)3,989,585 Grants Fund (c) 2,642,899 Nonmajor Governmental Funds (d) 5,110,751 TUMF Fees Fund (c) 1,155,549 Total transfers 42,772,961$ (a) To fund police salaries and benefits(b) To repay the fund for Fleet Services(c) To fund various CIP projects(d) To fund the debt service payments, Citywide CFD transfers and CIP projects(e) To fund CIP projects, the purchase of ROW land, and to cover utility costs for LLMD funds

Note 7: Defined Benefit Pension Plan

General Information about the Pension Plan

Plan Description

All qualified permanent and probationary employees are eligible to participate in the Public Agency Cost-Sharing Multiple-Employer Defined Benefit Pension Plan (Plan or PERF C) administered by the California Public Employees’ Retirement System (CalPERS.) The Plan consists of a miscellaneous pool and a safety pool (also referred to as “risk pools”), which are comprised of individual employer miscellaneous and safety rate plans, respectively. Plan assets may be used to pay benefits for any employer rate plan of the safety and miscellaneous pools. Accordingly, rate plans within the safety or miscellaneous pools are not separate plans under generally accepted accounting principles. Individual employers may sponsor more than one rate plan in the miscellaneous or safety risk pools. The City participates in three rate plans (two miscellaneous and one safety). Benefit provisions under the Plan are established by State statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plan regarding benefit provisions, assumptions and membership information that can be found on the CalPERS’ website, at www.calpers.ca.gov.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 69

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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 7: Pension Plan (continued)

General Information about the Pension Plan (continued)

Benefits provided

CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits.

All members are eligible for non-duty disability benefits after 5 years of service. The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost-of-living adjustments for each plan are applied as specified by the Public Employees’ Retirement Law.

The Plan operates under the provisions of the California Public Employees’ Retirement Law (PERL), the California Public Employees’ Pension Reform Act of 2013 (PEPRA), and the regulations, procedures and policies adopted by the CalPERS Board of Administration. The Plan’s authority to establish and amend the benefit terms are set by the PERL and PEPRA, and may be amended by the California state legislature and in some cases require approval by the CalPERS Board.

The Plans’ provisions and benefits in effect as of June 30, 2025 are summarized as follows:

SafetyHire datePrior to January 1, 2013On or after January 1, 2013On or after January 1, 2013Benefit formula 2.7% @ 55 2% @ 62 2.7% @ 57Benefit vesting schedule 5 years service 5 years service 5 years serviceBenefit payments monthly for life monthly for life monthly for lifeRetirement age 50 - 67 52 - 67 50 - 57Monthly benefits, as a % of eligible compensations 2.0% to 2.7% 1.0% to 2.5% 2.0% to 2.7%Required employee contribution rates 8.00% 8.25% 14.50%Required employer contribution rates 16.94% 8.18% 14.72%Miscellaneous

Contributions

Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process.

The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The employer is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contribution requirements are classified as plan member contributions. Employer Contributions to the Plan for the fiscal year ended June 30, 2025 were $4,604,663.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 70

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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 7: Pension Plan (continued)

Net Pension Liability

The City’s net pension liability for the Plan is measured as the total pension liability, less the pension plan’s fiduciary net position. The net pension liability of the Plan is measured as of June 30, 2024, using an annual actuarial valuation as of June 30, 2023 rolled forward to June 30, 2024 using standard update procedures. A summary of principal assumptions and methods used to determine the net pension liability is as follows.

Actuarial Methods and Assumptions Used to Determine Total Pension Liability

The collective total pension liability for the June 30, 2024 measurement period was determined by an actuarial valuation as of June 30, 2023, with update procedures used to roll forward the total pension liability to June 30, 2024. The collective total pension liability was based on the following assumptions:

Valuation Date June 30, 2023Measurement Date June 30, 2024Actuarial Cost MethodEntry Age Actuarial Cost MethodAsset Valuation Method Fair value of assetsActuarial Assumptions: Discount Rate 6.90%Inflation 2.30%Salary Increase Varies by Entry Age and ServiceMortality Rate Table (1)Derived using CalPERS' membership data for all fundsPost Retirement Benefit Increase The lesser of contract COLA up to 2.30% until purchasing power protection allowance floor on purchasing power applies, 2.30% thereafter(1) The mortality table used w as developed based on CalPERS-specific data. The rates incorporateGenerational Mortality to capture ongoing mortality improvement using 80% of Scale MP-2020 published bythe Society of Actuaries. For more details, please refer to the 2021 experience study report fromNovember 2021 that can be found on the CalPERS w ebsite.

Long-term Expected Rate of Return

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

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

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Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 71

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NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 7: Pension Plan (continued)

Net Pension Liability (continued)

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

Asset ClassAssumed Asset Allocation Real Return 1,2Global 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 (5.00%) (0.59%)Total 100.0%1 An expected inflation of 2.30% used for this period.2 Figures are based on the 2021-22 Asset Liability Management study.

Discount Rate

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

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NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 7: Pension Plan (continued)

Net Pension Liability (continued)

Subsequent Events

There were no subsequent events that would materially affect the results presented in this disclosure.

Pension Plan Fiduciary Net Position

Information about the pension plan’s assets, deferred outflows of resources, liabilities, deferred inflows of resources, and fiduciary net position are presented in CalPERS’ audited financial statements, which are publicly available reports that can be obtained at CalPERS’ website, at www.calpers.ca.gov. The plan’s fiduciary net position and additions to/deductions from the plan’s fiduciary net position have been determined on the same basis used by the pension plan, which is the economic resources measurement focus and the accrual basis of accounting.

Benefits and refunds are recognized when due and payable in accordance with the terms of the plan. Investments are reported at fair value.

Proportionate Share of Net Pension Liability

The following table shows the City’s proportionate share of the Plan’s net pension liability (asset) over the measurement period.

Plan Total Pension Liability(a)Plan Fiduciary Net Position(b)Plan Net Pension Liability (Asset)(c) = (a) - (b)Balance at: 6/30/2023 (VD) 26,716,025$ 25,554,933$ 1,161,092$ Balance at: 6/30/2024 (MD) 35,478,083 36,588,011 (1,109,928) Net changes during 2023-24 8,762,058$ 11,033,078$ (2,271,020)$ Increase (Decrease) Valuation Date (VD), Measurement Date (MD).

The City’s proportion of the net pension liability was determined by CalPERS using the output from the Actuarial Valuation System and the fiduciary net position, as provided in the CalPERS Public Agency Cost-Sharing Allocation Methodology Report, which is a publicly available report that can be obtained at CalPERS’ website, at www.calpers.ca.gov. The City’s proportionate share of the net pension liability for the Plan as of the June 30, 2023 and 2024 measurement dates was as follows:

Proportion - June 30, 2023 0.00931%Proportion - June 30, 2024 0.00915%Change - Increase (Decrease) (0.00016%) Item Title: 12.1
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FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 7: Pension Plan (continued)

Proportionate Share of Net Pension Liability (continued)

Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate

The following presents the City’s proportionate share of the net pension liability (asset) of the Plan as of the measurement date, calculated using the discount rate of 6.9%, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage- point lower (5.9%) or 1 percentage-point higher (7.9%) than the current rate:

Discount Rate - 1% (5.90%)Current Discount Rate (6.90%)Discount Rate + 1% (7.90%)Miscellaneous Plan's Net Pension Liability (Asset) 2,865,387$ (825,891)$ (3,864,357)$ Safety Plan's Net Pension Liability (Asset) 825,584 (284,037) (1,191,551) Amortization of Deferred Outflows and Deferred Inflows of Resources

Gains and losses related to changes in total pension liability and fiduciary net position are recognized in pension expense systematically over time.

The first amortized amounts are recognized in pension expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to pensions and are to be recognized in future pension expense.

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

Difference between projected and actual earnings5 year straight-line amortizationAll other amounts Straight-line amortization over the average expectedremaining services lives of all members that areprovided with benefits (active, inactive and retired) asof the beginning of the measurement period Item Title: 12.1
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NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 7: Pension Plan (continued)

Pension Expense and Deferred Outflows and Deferred Inflows of Resources Related to Pensions

As of the start of the measurement period (July 1, 2023), the City’s net pension liability/(asset) was $1,161,092. For the measurement period ending June 30, 2024 (the measurement date), the City incurred a pension expense of $3,301,258.

As of June 30, 2025, the City has deferred outflows and deferred inflows of resources related to pensions as follows:

Deferred Outflows of ResourcesDeferred Inflows of ResourcesChanges of Assumptions -$ 28,225$ Differences between expected and actual experience 3,540 94,586 Differences between Projected and Actual Investment Earnings - 61,275 Differences between Employer's Contributionsand Proportionate Share of Contributions 4,762,442 - Change in Employer's Proportion 520,519 604,108 Pension Contributions Made Subsequent toMeasurement Date - Total 9,891,164$ 788,194$ 4,604,663 The amounts above are net of outflows and inflows recognized in the 2023-24 measurement period expense. Contributions subsequent to the measurement date of $4,604,663 reported with deferred outflows of resources will be recognized as a reduction of the net pension liability in the upcoming fiscal year. Other amounts reported as deferred outflows and deferred inflows of resources related to pensions will be recognized in future pension expense as follows:

Fiscal Year Ended June 30:Deferred Outflows/(Inflows) of Resources, Net2026 2,233,014$ 2027 1,459,788 2028 784,515 2029 20,991 2030 - Thereafter - Payable to the Pension Plan

At June 30, 2025, the City reported a payable of $801,019 for the outstanding amount of contributions to the pension plan required for the year then ended.

Item Title: 12.1
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NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 8: Other Post-Employment Benefits

Plan Description

The City has established a single-employer Retiree Healthcare Plan (HC Plan). This coverage is available for employees who satisfy the requirements for retirement under the California Public Employees Retirement System (PERS), which is age 50 or older with at least five years of State or public agency service. The healthcare coverage provided by PERS meets the definition of an Other Post Employment Benefit (OPEB) as described in GASB Statement No.

75. Medical plan benefits are provided through PERS, as permitted by the Public Employees’ Medical and Hospital and Care Act (PEMHCA). A separate financial report is not prepared for the HC Plan.

Employees Covered

As of the June 30, 2024 measurement date, the following current and former employees were covered by the benefit terms under the HC Plan:

Active employees 280 Inactive employees or beneficiaries currently receiving benefits 4 Total 284 Contributions

The HC Plan and its contribution requirements are established by Memoranda of Understanding with the applicable employee bargaining units and may be amended by agreements between the City and the bargaining units. For the fiscal year ended June 30, 2025, the City’s cash contributions were $9,766 in payments for benefits.

Total OPEB Liability

The City’s total OPEB liability was measured as of June 30, 2024 and was calculated based on the following actuarial methods and assumptions from the valuation dated June 30, 2023:

Discount Rate 3.93%Inflation 2.50%Salary Increases 2.75% per yearInvestment Rate of Return 3.93%Mortality Rate 2021 CalPERS Mortality for Miscellaneous and Schools Employees, and Safety Employees, respectivelyPre-Retirement Turnover Healthcare Trend Rate 4.0% per yearActuarial Assumptions:

Discount Rate

The discount rate used to measure the total OPEB liability was 3.93% percent.

Change of Assumptions

The discount rate changed from 3.65% to 3.93% for the measurement date June 30, 2024.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 76

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January 21, 2026
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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 8: Other Post-Employment Benefits (continued)

Changes in Total OPEB Liability

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

Total OPEB LiabilityBalance at June 30, 2024(Measurement Date June 30, 2023) 3,836,027$ Changes recognized for the measurement period:Service Cost 1,110,072 Interest 159,256 Changes of assumptions (222,443) Experience (gains)/losses 4,021 Benefit payments (59,772) Net Changes991,134 Balance at June 30, 2025(Measurement Date June 30, 2024) 4,827,161$ Sensitivity of the Total OPEB Liability to Changes in the Discount Rate

The following presents the total OPEB liability of the City if it were calculated using a discount rate that is one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2024:

1% Decrease (2.93%)Current Discount Rate (3.93%)1% Increase (4.93%)Total OPEB Liability 5,672,637$ 4,827,161$ 4,149,895$ Sensitivity of the Total OPEB Liability to Changes in the Health Care Cost Trend Rates

The following presents the total OPEB liability of the Authority if it were calculated using health care cost trend rates that are one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2024:

1% DecreaseCurrent Healthcare Cost Trend Rates 1% IncreaseTotal OPEB Liability 3,832,688$ 4,827,161$ 6,142,133$ OPEB Plan Fiduciary Net Position

The City is not prefunding with an OPEB trust. Plan Fiduciary Net Position was $0 at June 30, 2025. The City does not have assets accumulated in a trust that meets the criteria of GASB 75 to pay related benefits.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 77

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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 8: Other Post-Employment Benefits (continued)

Recognition of Deferred Outflows and Deferred Inflows of Resources

Gains and losses related to changes in total OPEB liability and fiduciary net position are recognized in OPEB expense systematically over time.

Amounts are first recognized in OPEB expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to OPEB and are to be recognized in future OPEB expense. The City determined that it was not reasonable to rerun prior valuations under GASB 75. Therefore, the transition approach was used as provided in GASB 75, Paragraph 244. This means that there are no deferred inflows/outflows in the first year of implementation of GASB 75 with the exception of employer contributions after the measurement date.

OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB

For the fiscal year ended June 30, 2025, the City recognized OPEB expense of $1,294,243.

The City reported deferred outflows and inflows of resources related to OPEB from the following sources:

Deferred DeferredOutflows Inflowsof Resources of ResourcesOPEB contributions subsequent to measurement date 9,766$ -$ Changes of assumptions 659,545 859,067 Differences between expectedand actual experience 540,384 947 Total 1,209,695$ 860,014$ The $9,766 reported as deferred outflows of resources related to contributions subsequent to the June 30, 2024 measurement date will be recognized as a reduction of the total OPEB liability during the fiscal year ending June 30, 2025. Other amounts reported as deferred outflows and deferred inflows of resources related to OPEB will be recognized in future OPEB expense as follows:

Fiscal Year Ended June 30:Deferred Outflows/(Inflows) of Resources2026 24,915$ 2027 24,915 2028 24,915 2029 24,915 2030 24,915 Thereafter: 215,340

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 78

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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 9: Risk Management

The City of Menifee (“City”) is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; and natural disasters for which the Member Entity obtains insurance coverage.

Beginning July 1, 2021, The City is a member of the California Intergovernmental Risk Authority (CIRA) (Authority), a joint powers authority, which provides joint protection programs for public entities covering automobile, general liability, errors and omission losses, workers’ compensation, and property claims. Under the General Liability program, the «Type» has a «Liability_Retention» retention limit similar to a deductible, with the Authority being responsible for losses above that amount up to $1 million. The Authority has additional coverage of $39 million in excess of its $1 million retention limit through affiliated risk management authorities.

The Authority also provides $600 million aggregate property coverage to its members with such coverage provided by purchased insurance.

Liabilities of the member entity are reported when it is probable that a loss has occurred, and the amount of the loss can be reasonably estimated. Liabilities include an amount for claims that have been incurred but not reported (IBNRs). The result of the process to estimate the claims liability is not an exact amount as it depends on many complex factors, such as inflation, changes in legal doctrines, and damage awards. Accordingly, claims are reevaluated periodically to consider the effects of economic and social factors. The estimate of the claims liability also includes amounts for incremental claim adjustment expenses related to specific claims and other claim adjustment expenses regardless of whether allocated to specific claims.

Estimated recoveries, for example, from salvage or subrogation, are another component of the claims liability estimate.

The Authority covers workers’ compensation claims up to its self-insurance limit of $500,000.

The Local Agency Workers Compensation Excess Pool provides excess coverage to statutory limits. Financial statements of CIRA may be obtained from its administrative office located at 2330 E. Bidwell Street, Suite 150, Folsom, CA 95630; www.cira-jpa.org or by calling (916) 927- 7727.

Note 10: Tax Abatements

The City periodically enters into tax abatement agreements with local businesses for the purpose of attracting or retaining businesses within their its jurisdiction. The abatements may be granted to any business located within or promising to relocate to the City.

The City has agreed to abate 50% of taxes collected for a period of ten years with a not-to- exceed amount of $1,000,000. For the fiscal year ended June 30, 2025, the City abated certain taxes totaling $176,783 under this program. The developer has covenanted to operating the business within the City continuously over the period of the agreement.

Note 11: Commitments and Contingencies

Litigation

The City is involved as a defendant in various legal proceedings. While it is not feasible to predict or determine the outcome in these cases, it is the opinion of the City that the outcome will have no material adverse effect on the financial position of the City.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 79

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CITY OF MENIFEE

NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Note 11: Commitments and Contingencies (continued)

Grants

The City has received State and Federal funds for specific purposes that are subject to audit by the grantor agencies. Although such audits could generate expenditure disallowances under the terms of the grants, it is believed that any required reimbursements will not be material.

Construction Commitments

No material construction commitments existed as of June 30, 2025.

Additional Allocations of Fund Balance

The City has various other allocations for the General Fund unassigned fund balance, which is further detailed below to show the total funds available as of June 30, 2025.

Purpose AmountInternal Service Operations 6,453,594$ Encumbered Items 3,417,281 Cash flow - 10% minimum 9,458,093 Unallocated 26,496,486 Total Unassigned Fund Balance 45,825,454$

Note 12: Commitments and Contingencies (continued)

Per GASB 100, the City is required to restate its June 30, 2024 governmental funds’ fund balance. The Capital Projects fund was previously reported as non-major fund, and qualified as major for the year ending June 30, 2025. This qualifies as a change to or within the financial reporting entity, under the guidance of GASB 100.

Capital ProjectsTotal Non-Major Governmental FundsFund balance, as previously reported $ 5,030,062 $ 31,918,087 Change from non-major to major (5,030,062) (5,030,062)Fund balance, as restated $ - $ 26,888,025

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 80

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REQUIRED SUPPLEMENTARY INFORMATION

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 81

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January 21, 2026
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CITY OF MENIFEE

REQUIRED SUPPLEMENTARY INFORMATION

BUDGETARY COMPARISON SCHEDULE

GENERAL FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 1109,583,313$ 109,583,313$ 109,583,313$ -$ Resources (Inflows):Taxes 64,376,049 62,933,062 71,147,589 8,214,527 Licenses and permits 10,626,420 11,323,725 11,315,032 (8,693) Intergovernmental 11,595,633 11,664,089 12,631,274 967,185 Charges for services 6,705,879 13,347,041 11,377,808 (1,969,233) Use of money and property 635,000 2,620,402 8,225,168 5,604,766 Fines and forfeitures 390,000 398,178 439,280 41,102 Miscellaneous 66,500 66,788 435,799 369,011 Transfers in 9,571,848 12,021,525 486,270 (11,535,255) SBITA/Lease acquisition - 8,881,625 8,881,625 - Amounts Available for Appropriation 213,550,642 232,839,748 234,523,158 1,683,410 Charges for Appropriation (Outflows):General government 22,775,851 24,631,612 22,765,017 1,866,595 Public safety 51,432,276 59,421,892 54,773,074 4,648,818 Community development 8,109,173 11,752,507 8,045,173 3,707,334 Parks and recreation 4,504,054 5,213,903 4,165,333 1,048,570 Engineering and public works 5,822,796 6,482,176 5,364,733 1,117,443 Debt service:Principal retirement - 464,735 464,735 - Interest and fiscal charges - 13,997 13,997 - Capital outlay 2,450,791 4,243,535 3,258,478 985,057 Transfers out 8,882,387 37,056,084 29,387,907 7,668,177 Total Charges to Appropriations 103,977,328 149,280,441 128,238,447 21,041,994 Budgetary Fund Balance, June 30 109,573,314$ 83,559,307$ 106,284,711$ 22,725,404$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 82

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CITY OF MENIFEE

REQUIRED SUPPLEMENTARY INFORMATION

BUDGETARY COMPARISON SCHEDULE
DEVELOPMENT IMPACT FEES – SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 144,938,203$ 44,938,203$ 44,938,203$ -$ Resources (Inflows):Use of money and property 208,400 488,041 2,577,009 2,088,968 Developer participation 7,494,045 7,643,717 15,344,404 7,700,687 Miscellaneous - - 766 766 Amounts Available for Appropriation 52,640,648 53,069,961 62,860,382 9,790,421 Charges for Appropriation (Outflows):General government 50,000 50,000 50,000 - Public safety 204,930 204,930 220,922 (15,992) Capital outlay 5,816,731 218,528 - 218,528 Transfer out - 21,325,358 3,989,585 17,335,773 Total Charges to Appropriations 6,071,661 21,798,816 4,260,507 17,538,309 Budgetary Fund Balance, June 30 46,568,987$ 31,271,145$ 58,599,875$ 27,328,730$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 83

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CITY OF MENIFEE

REQUIRED SUPPLEMENTARY INFORMATION

BUDGETARY COMPARISON SCHEDULE
GRANT FUNDS – SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 12,295,755$ 2,295,755$ 2,295,755$ -$ Resources (Inflows):Intergovernmental 677,847 23,964,286 4,000,748 (19,963,538) Use of money and property - 38,287 297,265 258,978 Amounts Available for Appropriation2,973,602 26,298,328 6,593,768 (19,704,560) Charges for Appropriation (Outflows):General government - 336,488 240,160 96,328 Public safety - 387,715 259,388 128,327 Community development 304,784 1,060,112 778,280 281,832 Parks and recreation - 549,194 97,694 451,500 Capital outlay 223,063 1,200,584 227,236 973,348 Transfers out 150,000 2,960,307 2,792,899 167,408 Total Charges to Appropriations 677,847 6,494,400 4,395,657 2,098,743 Budgetary Fund Balance, June 30 2,295,755$ 19,803,928$ 2,198,111$ (17,605,817)$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 84

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CITY OF MENIFEE

REQUIRED SUPPLEMENTARY INFORMATION

BUDGETARY COMPARISON SCHEDULE
TUMF FEES FUND – SPECIAL REVENUE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance (Deficit), July 1(938,340)$ (938,340)$ (938,340)$ -$ Resources (Inflows):Intergovernmental - 10,213,818 524,316 (9,689,502) Amounts Available for Appropriation(938,340) 9,275,478 (414,024) (9,689,502) Charges for Appropriation (Outflows)Transfers out - 6,321,254 1,155,549 5,165,705 Total Charges to Appropriations - 6,321,254 1,155,549 5,165,705 Budgetary Fund Balance (Deficit), June 30 (938,340)$ 2,954,224$ (1,569,573)$ (4,523,797)$ Budgeted Amounts Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 85

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CITY OF MENIFEE

REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF THE CITY’S PROPORTIONATE SHARE OF THE PENSION PLAN’S NET PENSION

LIABILITY AND RELATED RATIOS AS OF THE MEASUREMENT DATE

LAST TEN YEARS

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Measurement DateEmployer's Proportion of the Collective Net Pension Liability1Employer's Proportionate Share of the Collective Net Pension Liability/(Asset)Employer's Covered PayrollEmployer's Proportionate Share of the Collective Net Pension Liability as a Percentage of the Employer's Covered PayrollPension's Plans Fiduciary Net Position as a Percentage of the Total Pension Liability6/30/2015 0.00368% 252,740$ 3,376,969$ 7.48% 78.40%6/30/2016 0.00420% 363,319 4,222,698 8.60% 74.06%6/30/2017 0.00556% 551,431 4,350,553 12.67% 73.31%6/30/2018 0.00519% 499,769 5,130,794 9.74% 75.26%6/30/2019 0.00023% 23,598 6,773,265 0.35% 75.26%6/30/2020 0.00236% 256,708 10,202,569 2.52% 75.10%6/30/2021-0.03945%(2,133,291) 17,087,839 -12.48%88.29%6/30/20220.00122%141,043 20,641,512 0.68%76.68%6/30/20230.00931%1,161,092 25,329,014 4.58%76.21%6/30/2024-0.00915%(1,109,928) 28,066,270 -3.95%78.08%both the Miscellaneous and Safety Risk pools excluding the 1959 Survivors Risk Pool.1 Proportion of the collective net pension liability represents the plan's proportion of PERF C, which includes

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Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 86

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CITY OF MENIFEE

REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF THE PENSION PLAN’S CONTRIBUTIONS

LAST TEN YEARS

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Fiscal YearActuarially Determined ContributionsContributions in Relation to the Actuarially Determined ContributionsContribution Deficiency (Excess)Employer's Covered PayrollContributions as a Percentage of Covered Payroll6/30/2016 447,484$ (447,484)$ -$ 4,222,698$ 10.60%6/30/2017 461,164 (461,164) - 4,350,553 10.60%6/30/2018 524,088 (524,088) - 5,130,794 10.21%6/30/2019 727,566 (1,360,520) (632,954) 6,773,265 20.09%6/30/2020 1,089,277 (1,089,277) - 10,202,569 10.68%6/30/2021 1,631,504 (2,053,455) (421,951) 17,087,839 12.02%6/30/2022 2,881,799 (2,881,799) - 20,641,512 13.96%6/30/2023 3,383,586 (3,383,586) - 25,329,014 13.36%6/30/2024 3,709,952 (5,881,952) (2,172,000) 28,066,270 20.96%6/30/2025 3,836,388 (4,604,663) (768,275) 29,893,065 15.40%Notes to Schedule:Changes in Benefit Terms: There were no changes to benefit terms that applied to all members of the PublicAgency Pool. However, individual employers in the Plan may have provided a benefit improvement to theiremployees such as Golden Handshakes, service purchases, and other prior service costs. Employers thathave done so may need to report this information as a separate liability in their financial statement asCalPERS considers such amounts to be separately financed employer-specific liabilities. These employersshould consult with their auditors. Additionally, the figures above do not include any liability impact thatoccurred after the June 30, 2023, valuation date, unless the liability impact is deemed to be material to thePublic Agency Pool.Change in Assumptions: There were no assumption changes in 2023 or 2024. Effective with the June 30,2021, valuation date (June 30, 2022, measurement date), the accounting discount rate was reduced from7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-termmarket return expectations as well as the expected pension fund cash flows. In addition, demographicassumptions and the price inflation assumption were changed in accordance with the 2021 CalPERSExperience Study and Review of Actuarial Assumptions. The accounting discount rate was 7.15% formeasurement dates June 30, 2017, through June 30, 2021, and 7.65% for measurement dates June 30,2015, through June 30, 2016.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 87

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CITY OF MENIFEE

REQUIRED SUPPLEMENTARY INFORMATION

SCHEDULE OF CHANGES IN THE TOTAL OPEB LIABILITY AND RELATED RATIOS LAST TEN YEARS*

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Measurement Period 2024 2023 2022 2021 2020Total OPEB LiabilityService Cost 1,110,072$ 670,308$ 857,974$ 606,096$ 449,840$ Interest on the Total OPEB Liability 159,256 111,120 67,079 44,239 38,328 Actual and expected experience difference 4,021 245,953 - 32,710 364,149 Changes in assumptions (222,443) 28,355 (754,285) 313,441 (1,232) Changes in benefit terms - - - - - Expected Minus Actual Benefit Payments 3,926 1,591 407 - Benefit payments (59,772) (51,020) (41,422) (16,144) (12,360) Net change in Total OPEB Liability991,134 1,008,642 130,937 980,749 838,725 Total OPEB Liability, beginning3,836,027 2,827,385 2,696,448 1,715,699 876,974 Total OPEB Liability, ending4,827,161$ 3,836,027$ 2,827,385$ 2,696,448$ 1,715,699$ Plan fiduciary net position as a percentage of the total OPEB liability 0.00% 0.00% 0.00% 0.00% 0.00%Covered employee payroll 28,066,270$ 25,329,014$ 20,641,512$ 17,087,839$ 10,202,569$ Net OPEB liability as a percentage of covered employee payroll 17.20% 15.14% 13.70% 15.78% 16.82%Measurement Period 2019 2018Total OPEB LiabilityService Cost 71,218$ 74,816$ Interest on the Total OPEB Liability 10,868 8,305 Actual and expected experience difference 91,138 - Changes in assumptions 453,877 (13,488) Changes in benefit terms - - Expected Minus Actual Benefit Payments - - Benefit payments (775) (256) Net change in Total OPEB Liability626,326 69,377 Total OPEB Liability, beginning250,648 181,271 Total OPEB Liability, ending876,974$ 250,648$ Plan fiduciary net position as a percentage of the total OPEB liability 0.00% 0.00%Covered employee payroll 6,773,265$ 5,130,794$ Net OPEB liability as a percentage of covered employee payroll 12.95% 4.89%Notes to schedule:The City does not have assets accumulated in a trust that meets the criteria of GASB 75 to pay related benefitsBenefits are not based on a measure of pay, therefore covered employee payroll is used. Changes Since the Prior Valuation: Fiscal year 2017-18 was the first year of implementation.* Historical information is required only for measurement periods for which GASB 75 is applicable. Future years' information will be displayed up to 10 years as information becomes available.The discount rate of 3.93% was used in the valuation. The discount rate used in the prior valuation was 3.65%.

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CITY OF MENIFEE

REQUIRED SUPPLEMENTARY INFORMATION

NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
FOR THE FISCAL YEARA ENDED JUNE 30, 2025

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Notes to the Required Supplementary Information:

Budget Basis of Accounting

Budgets for all governmental funds are adopted on a basis consistent with generally accepted accounting principles (GAAP), with the exception of the Veteran’s Memorial and Citywide Street sweeping Fund which do not have an adopted budget.

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SUPPLEMENTAL SCHEDULES

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NON-MAJOR GOVERNMENTAL FUNDS DESCRIPTIONS

SPECIAL REVENUE FUNDS

Gas Tax

Used to account for revenue and expenditures of money apportioned under Street and Highways Code, Sections 2103, 2105, 2106, 2107 and 2107.5 of the State of California. These funds are earmarked for maintenance, rehabilitation or improvement of public streets. Section 2107.5 funds can be used for engineering and gas tax audit costs. In addition, beginning in FY 2010/11, the new excise tax on fuel, which took the place of Traffic Congestion Relief/Proposition 42 funds, is recorded in the Gas Tax Fund.

SB1

Used to account for revenue and expenditures of the Road Maintenance and Rehabilitation Account to address deferred maintenance on the State Highway System and the local streets and road system. A percentage of this new RMRA funding will be apportioned by formula to eligible cities and counties pursuant to Streets and Highways Code section 2032(h) for basic road maintenance, rehabilitation, and critical safety projects on the local streets and roads system.

Measure A

Represents funds apportioned by the Riverside County Transportation Commission (RCTC) and received by the City as a result of the voter-approved initiative that increased sales tax by 1/2 percent in Riverside County to fund transportation projects. Measure "A" funds were originally approved by voters in 1988, and an extension was approved in 2002 which will fund projects through 2039.

Air Quality Management District

This fund was established to account for the City's share of vehicle registration fees collected under Assembly Bill 2766 passed during the 1990 State Legislative session. This fee was levied to fund programs to reduce air pollution from mobile sources such as cars, trucks and buses. Allocations to agencies are made through an apportionment basis and also through a competitive process. The South Coast Air Quality Management District distributes these funds to the City.

Landscape and Lighting Maintenance

Upon incorporation, the City acquired the responsibility of a portion of one LLMD which included both street lighting and traffic signals. In January 2015, the City requested from the County of Riverside to become solely responsible for all LLMDs located exclusively within the City jurisdiction. This resulted in the City acquiring 24 individual LLMD zones. These LLMDs had originally been established by Riverside County prior to the City's incorporation, and maintained responsibility for the maintenance of these zones until January 2015.

CFD Audie Murphy Ranch

In January 2012 the Audie Murphy Ranch Community Facility District (CFD) was formed. This CFD encompasses approximately 1,059.3 gross acres and upon full build out will contain approximately 2,129 residential dwelling units. Each July 1, commencing on July 1, 2013, the maximum special tax for developed property shall be increased based on the percentage change in the Consumer Price Index, with a maximum annual increase of six percent (6%) and a minimum annual increase of two percent (2%) per fiscal year.

The assessed fees will be used towards street lighting, landscaping, street sweeping, water quality basin improvements, parks, trails and recreation improvements.

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CFD Hidden Hills

In June 2012 the Hidden Hills Community Facility District (CFD) was formed. This CFD boundary includes approximately 157 gross acres and upon full build out will contain 511 single family homes. Services provided by the CFD include landscape maintenance, park and trails maintenance, as well as incidental costs such as capital replacement and administrative costs. The maximum special tax for developed property shall be increased based on the percentage change in the Consumer Price Index, with a maximum annual increase of six percent (6%) and a minimum annual increase of two percent (2%) per fiscal year.

CFD 2014-1 Town Center

In August 2014 the Menifee Town Center Community Facility District (CFD) was formed. This CFD encompasses approximately 149 gross acres of mix use development consisting of retail, commercial and residential housing units Beginning July 1, 2015 and each year thereafter, the maximum special tax for developed property shall be increased based on the percentage change in the Consumer Price Index with a maximum annual increase of six percent (6%) and a minimum annual increase of two percent (2%) per fiscal year. The assessed fees will be used towards street lighting, landscaping, street sweeping, water quality basin improvements, parks, trails and recreation improvements.

CFD 2014-2 Commerce Point

In August 2014 the Commerce Point Community Facility District (CFD) was formed. This CFD boundary includes approximately 46 taxable acres of commercial real estate. Services provided by the CFD include landscape maintenance, street lighting, water quality improvements, graffiti removal, street sweeping, and park and trails maintenance. On July 1 of each year, and commencing July 1, 2016, the maximum special tax for developed properly shall be the greater of the increased based on the percentage change in the Consumer Price Index or two percent (2%) per fiscal year.

Veteran’s Memorial

In August 2009, the City Council instructed staff to set up the fund to receive donations along with the Riverside County’s donation of $25,000 and the City’s match of $25,000 to construct a Veteran’s Memorial.

Construction began in 2010 and the Memorial was completed in 2011. Citizens can purchase personalized bricks that are added to the Memorial.

2015-2 Citywide CFD

In April 2015 the City-Wide Community Facility District (CFD) was formed under Resolution No. 15- 430.

CFD No. 2015-2 (Maintenance Services) currently consists of one Tax Zone consisting of one residential tract that will include 359 residential units. Services provided by the CFD include landscape maintenance, street lighting, water quality improvements, graffiti removal, public street sweeping, and park and trails maintenance. On July 1 of each year, and commencing July 1, 2016, the maximum special tax for developed property shall be the greater of the increased based on the percentage change in the Consumer Price Index or two percent (2%) per fiscal year.

2017-1 Maintenance Services CFD

In December 2017 the Community Facilities District (CFD) 2017-1 was formed. This CFD boundary includes approximately 104 acres of vacant commercial and residential property within the City (TR 36299-1 and PM 9504). The improvements proposed to be maintained include items such as landscaping, lighting, storm drains, water quality improvements, graffiti, streets, streetlights, traffic signals, street sweeping, and trail maintenance. On July 1 of each year, and commencing July 1, 2019, the maximum special tax for developed property shall be the greater of the increased based on the percentage change in the Consumer Price Index or two percent (2%), whichever is greater, per fiscal year.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 93

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Public, Educational and Government Access

This fund will be used to acquire equipment for and broadcasting on a future City cable channel. Used to account for revenue and expenditures of money pursuant to section 611 of the Communications Act. Local Franchising authorities (The City) may require cable operations to remit funds and set aside channels for public, educational, or governmental use.

County Service Areas (CSA)

Upon incorporation, the City assumed responsibility for seven (7) County Service Area Districts within the City limits. These districts were established by the County of Riverside to provide a mechanism through special assessments to fund services such as street lighting, street sweeping, park maintenance, road maintenance, and law enforcement services to property owners within each district. Each CSA fund provides a unique set of services to the residents within that individual district.

Citywide Streetsweeping

This fund is used to account for expenditures related to street sweeping activities.

Maintenance CFD

On September 18, 2019, the City Council adopted Resolution No. 19-830 declaring its intent to annex territory to CFD No. 2017-1 and commence the annexation proceedings for the territory to be annexed, also known as Annexation No. 1. Subsequently, the city has continued to annex additional zones into the Maintenance CFD. Services provided by the CFD include landscape maintenance, street lighting, water quality improvements, graffiti removal, public street sweeping, and park and trails maintenance. On July 1 of each year, and commencing July 1, 2019, the maximum special tax for developed property shall be the greater of the increased based on the percentage change in the Consumer Price Index or two percent (2%) per fiscal year. Specific improvements and applicable maximum special tax rates are established and applied per the corresponding Rate and Method of Apportionment (RMA) of the respective annexed tax zone.

DEBT SERVICE FUND

Debt Service

Debt Service Funds are used to track revenues and expenditures related to repayment of principal and interest costs associated with borrowing money for long-term obligations. In May 2012 the City issued Certificates of Participation in the amount of $20.0 million under the Total Road Improvement Program (TRIP) financing. These proceeds were used for the construction of the Newport Road/I-215 interchange and will be paid back over a 30 year period. In 2020, the TRIP financing was refinanced in 2020 in a favorable low interest environment, resulting in anticipated interest savings exceeding $4 million of the balance of the debt service schedule. In June 2019, the City entered into a financing agreement for $6,550,000 with Banc of America to purchase and retrofit Certain Southern California Edison Company Street Light Facilities. In 2021, the City refinanced the Streetlight Retrofit Project in 2020 in a favorable low interest environment, resulting in anticipated interest savings exceeding $400k of the balance of the debt service schedule. Currently, the City has only the TRIP debt and Streetlight Retrofit Project outstanding debt accounted for in this fund.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 94

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CITY OF MENIFEE

COMBINING BALANCE SHEET

NON-MAJOR GOVERNMENTAL FUNDS
JUNE 30, 2025

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Gas Tax SB1 Measure AAir Quality Management DistrictAssetsCash and investments 1,539,119$ 4,060,238$ 4,757,676$ 403,860$ Receivables:Accounts, grants and taxes 400,482 536,479 552,608 - Accrued interest 1,312 4,895 12,571 - Prepaid items - - - - Restricted assets:Cash and investments with fiscal agents - - - - Total Assets 1,940,913$ 4,601,612$ 5,322,855$ 403,860$ Liabilities and Fund BalancesLiabilities:Accounts payable 327,838$ 478,137$ 4,102$ -$ Accrued liabilities 2,481 - - - Total Liabilities 330,319 478,137 4,102 - Fund Balances:Nonspendable:Prepaid items- - - - Restricted for:Community development projects - - - - Engineering and public works 1,610,594 4,123,475 5,318,753 403,860 Debt service - - - - Unassigned (deficit)- - - - Total Fund Balances 1,610,594 4,123,475 5,318,753 403,860 Total Liabilities and Fund Balances1,940,913$ 4,601,612$ 5,322,855$ 403,860$ Special Revenue Funds

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 95

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CITY OF MENIFEE

COMBINING BALANCE SHEET
NON-MAJOR GOVERNMENTAL FUNDS (continued)
JUNE 30, 2025

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Landscape and Lighting Maintenance DistrictCFD Audie Murphy Ranch CFD Hidden HillsCFD 2014-1 Town CenterCFD 2014-2 Commerce PointVeteran's Memorial3,972,667$ 5,221,497$ 964,112$ 210,998$ 91,514$ 5,043$ 28,068 19,427 303 - - - - 43,981 - 883 - - - - - - - - - - - - - - 4,000,735$ 5,284,905$ 964,415$ 211,881$ 91,514$ 5,043$ 77,040$ 206,722$ 25,807$ 6,519$ 1,254$ -$ 643 2,323 372 - 12 - 77,683 209,045 26,179 6,519 1,266 - - - - - - - - 5,075,860 938,236 205,362 90,248 5,043 3,923,052 - - - - - - - - - - - - - - - - - 3,923,052 5,075,860 938,236 205,362 90,248 5,043 4,000,735$ 5,284,905$ 964,415$ 211,881$ 91,514$ 5,043$ Special Revenue Funds

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 96

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CITY OF MENIFEE

COMBINING BALANCE SHEET
NON-MAJOR GOVERNMENTAL FUNDS (continued)
JUNE 30, 2025

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2015-2 Citywide CFD2017-1 Maintenance Services CFDPublic, Educational and Governmental AccessCounty Service AreasAssetsCash and investments 5,246,069$ 749,294$ 768,651$ 2,047,811$ Receivables:Accounts, grants and taxes 23,950 1,092 22,891 50,673 Accrued interest - - 4,529 7,259 Prepaid items - - - - Restricted assets:Cash and investments with fiscal agents - - - - Total Assets 5,270,019$ 750,386$ 796,071$ 2,105,743$ Liabilities and Fund BalancesLiabilities:Accounts payable 87,787$ 19,269$ -$ 111,318$ Accrued liabilities 2,252 39 - 1,565 Total Liabilities 90,039 19,308 - 112,883 Fund Balances:Nonspendable:Prepaid items- - - - Restricted for:Community development projects 5,179,980 731,078 796,071 1,992,860 Engineering and public works - - - - Debt service - - - - Unassigned (deficit)- - - - Total Fund Balances 5,179,980 731,078 796,071 1,992,860 Total Liabilities and Fund Balances5,270,019$ 750,386$ 796,071$ 2,105,743$ Special Revenue Funds

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 97

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CITY OF MENIFEE

COMBINING BALANCE SHEET
NON-MAJOR GOVERNMENTAL FUNDS (concluded)
JUNE 30, 2025

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Debt Service FundCitywide Streetsweeping Maintenance CFD Debt ServiceTotal Non-Major Governmental Funds-$ 2,729,235$ 417,904$ 33,185,688$ - 16,571 - 1,652,544 - - - 75,430 - - 141,173 141,173 - - 113,448 113,448 -$ 2,745,806$ 672,525$ 35,168,283$ -$ 34,778$ -$ 1,380,571$ 265 978 - 10,930 265 35,756 - 1,391,501 - - 141,173 141,173 - 2,710,050 - 17,724,788 - - - 15,379,734 - - 531,352 531,352 (265) - - (265) (265) 2,710,050 672,525 33,776,782 -$ 2,745,806$ 672,525$ 35,168,283$ Special Revenue Funds

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 98

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CITY OF MENIFEE

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES

NON-MAJOR GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Gas Tax SB1 Measure AAir Quality Management DistrictRevenuesIntergovernmental 3,137,078$ 3,044,372$ 3,189,610$ 109,870$ Charges for services - - - - Use of money and property 58,184 149,658 245,276 13,349 Total Revenues 3,195,262 3,194,030 3,434,886 123,219 ExpendituresCurrent:General government - - - - Public safety - - - - Parks and recreation - - - - Engineering and public works 2,472,886 - - - Capital outlay 56,993 - - 29,591 Debt service:Principal retirement - - - - Interest and fiscal charges - - - - Total Expenditures 2,529,879 - - 29,591 Excess (Deficiency) of Revenues Over (Under) Expenditures665,383 3,194,030 3,434,886 93,628 Other Financing Sources (Uses)Transfers in - - - - Transfers out (457,546) (1,789,841) (2,292,387) - Total Other Financing Sources (Uses) (457,546) (1,789,841) (2,292,387) - Net Change in Fund Balances 207,837 1,404,189 1,142,499 93,628 Fund Balances (Deficit)Beginning of year 1,402,757 2,719,286 4,176,254 310,232 Change from non-major to major - - - - Beginning of year, as restated 1,402,757 2,719,286 4,176,254 310,232 End of year 1,610,594$ 4,123,475$ 5,318,753$ 403,860$ Special Revenue Funds
Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 99

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January 21, 2026
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CITY OF MENIFEE

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NON-MAJOR GOVERNMENTAL FUNDS (continued)
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Landscape and Lighting Maintenance DistrictCFD Audie Murphy Ranch CFD Hidden HillsCFD 2014-1 Town CenterCFD 2014-2 Commerce Point Veteran's Memorial-$ -$ -$ -$ -$ -$ 895,746 2,466,173 297,682 17,844 30,296 1,275 146,966 279,535 41,038 11,338 1,985 (525) 1,042,712 2,745,708 338,720 29,182 32,281 750 51,538 12,019 9,129 1,479 2,365 - - - - - - - 788,667 1,533,514 259,520 19,975 5,504 - 62,663 111,702 - 70 7,938 - - 10,949 - - - - - - - - - - - - - - - - 902,868 1,668,184 268,649 21,524 15,807 - 139,844 1,077,524 70,071 7,658 16,474 750 85,000 - - - - - (10,197) (96,730) - - (412) - 74,803 (96,730) - - (412) - 214,647 980,794 70,071 7,658 16,062 750 3,708,405 4,095,066 868,165 197,704 74,186 4,293 - - - - - - 3,708,405 4,095,066 868,165 197,704 74,186 4,293 3,923,052$ 5,075,860$ 938,236$ 205,362$ 90,248$ 5,043$ Special Revenue Funds
Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 100

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CITY OF MENIFEE

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NON-MAJOR GOVERNMENTAL FUNDS (continued)
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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2015-2 Citywide CFD2017-1 Maintenance Services CFD Public, Educational and Governmental Access County Service AreasRevenuesIntergovernmental -$ -$ -$ -$ Charges for services 1,958,992 228,532 100,073 1,941,357 Use of money and property 151,733 12,339 37,418 110,080 Total Revenues 2,110,725 240,871 137,491 2,051,437 ExpendituresCurrent:General government 33,957 7,653 6,552 22,798 Public safety - - - 161,904 Parks and recreation 686,570 169,566 - 662,986 Engineering and public works 342,814 5,575 - 430,019 Capital outlay - - 32,474 - Debt service:Principal retirement - - - - Interest and fiscal charges - - - - Total Expenditures 1,063,341 182,794 39,026 1,277,707 Excess (Deficiency) of Revenues Over (Under) Expenditures1,047,384 58,077 98,465 773,730 Other Financing Sources (Uses)Transfers in 113,987 - - - Transfers out (21,329) (2,472) - (662,120) Total Other Financing Sources (Uses)92,658 (2,472) - (662,120) Net Change in Fund Balances 1,140,042 55,605 98,465 111,610 Fund Balances (Deficit)Beginning of year 4,039,938 675,473 697,606 1,881,250 Change from non-major to major - - - - Beginning of year, as restated 4,039,938 675,473 697,606 1,881,250 End of year 5,179,980$ 731,078$ 796,071$ 1,992,860$ Special Revenue Funds

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 101

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CITY OF MENIFEE

COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NON-MAJOR GOVERNMENTAL FUNDS (concluded)
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Capital Projects Fund Debt Service FundCitywide Streetsweeping Maintenance CFD Capital Projects Debt ServiceTotal Non-Major Governmental Funds-$ -$ -$ -$ 9,480,930$ - 1,629,718 - - 9,567,688 - 63,567 - 79,410 1,401,351 - 1,693,285 - 79,410 20,449,969 - 271,508 - 111,954 530,952 - - - - 161,904 - 11,219 - - 4,137,521 265 8,862 - - 3,442,794 - - - - 130,007 - - - 1,130,897 1,130,897 - - - 538,428 538,428 265 291,589 - 1,781,279 10,072,503 (265) 1,401,696 - (1,701,869) 10,377,466 - - - 1,759,325 1,958,312 - (113,987) - - (5,447,021) - (113,987) - 1,759,325 (3,488,709) (265) 1,287,709 - 57,456 6,888,757 - 1,422,341 5,030,062 615,069 31,918,087 - - (5,030,062) - (5,030,062) - 1,422,341 - 615,069 26,888,025 (265)$ 2,710,050$ -$ 672,525$ 33,776,782$ Special Revenue Funds
Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 102

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THIS PAGE INTENTIONALLY LEFT BLANK

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 103

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE

GAS TAX
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 11,402,757$ 1,402,757$ 1,402,757$ -$ Resources (Inflows):Intergovernmental 3,191,556 3,034,146 3,137,078 102,932 Use of money and property 2,000 22,064 58,184 36,120 Amounts Available for Appropriation4,596,313 4,458,967 4,598,019 139,052 Charges for Appropriation (Outflows):Engineering and public works 2,552,793 2,691,843 2,472,886 218,957 Capital outlay 207,885 149,885 56,993 92,892 Transfers out 490,876 627,764 457,546 170,218 Total Charges to Appropriations 3,251,554 3,469,492 2,987,425 482,067 Budgetary Fund Balance, June 30 1,344,759$ 989,475$ 1,610,594$ 621,119$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 104

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE
SB1
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 12,719,286$ 2,719,286$ 2,719,286$ -$ Resources (Inflows):Intergovernmental 2,752,637 2,816,029 3,044,372 228,343 Use of money and property 15,000 58,631 149,658 91,027 Amounts Available for Appropriation5,486,923 5,593,946 5,913,316 319,370 Charges for Appropriation (Outflows):Capital outlay 2,774,000 - - - Transfers out - 5,135,607 1,789,841 3,345,766 Total Charges to Appropriations 2,774,000 5,135,607 1,789,841 3,345,766 Budgetary Fund Balance, June 30 2,712,923$ 458,339$ 4,123,475$ 3,665,136$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 105

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE

MEASURE A
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 14,176,254$ 4,176,254$ 4,176,254$ -$ Resources (Inflows):Intergovernmental 3,169,400 3,132,000 3,189,610 57,610 Use of money and property 10,000 69,395 245,276 175,881 Amounts Available for Appropriation7,355,654 7,377,649 7,611,140 233,491 Charges for Appropriation (Outflows):Capital outlay 2,098,762 - - - Transfers out 1,080,487 6,421,936 2,292,387 4,129,549 Total Charges to Appropriations 3,179,249 6,421,936 2,292,387 4,129,549 Budgetary Fund Balance, June 30 4,176,405$ 955,713$ 5,318,753$ 4,363,040$ Budgeted Amounts Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 106

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE

AIR QUALITY MANAGEMENT DISTRICT
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 1310,232$ 310,232$ 310,232$ -$ Resources (Inflows):Intergovernmental 119,775 119,775 109,870 (9,905) Use of money and property 225 6,387 13,349 6,962 Amounts Available for Appropriation430,232 436,394 433,451 (2,943) Charges for Appropriation (Outflows):Capital outlay - 147,779 29,591 118,188 Total Charges to Appropriations - 147,779 29,591 118,188 Budgetary Fund Balance, June 30 430,232$ 288,615$ 403,860$ 115,245$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 107

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE

LANDSCAPE AND LIGHTING MAINTENANCE DISTRICT
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 13,708,405$ 3,708,405$ 3,708,405$ -$ Resources (Inflows):Charges for services 886,004 896,400 895,746 (654) Use of money and property - 73,582 146,966 73,384 Transfers In - 85,000 85,000 - Amounts Available for Appropriation4,594,409 4,763,387 4,836,117 72,730 Charges for Appropriation (Outflows):General government 25,926 30,486 51,538 (21,052) Parks and recreation 727,353 915,946 788,667 127,279 Engineering and public works 177,224 119,946 62,663 57,283 Transfer out 10,197 10,197 10,197 - Total Charges to Appropriations 940,700 1,076,575 913,065 163,510 Budgetary Fund Balance, June 30 3,653,709$ 3,686,812$ 3,923,052$ 236,240$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 108

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE
COMMUNITY FACILITIES DISTRICT – AUDIE MURPHY RANCH
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 14,095,066$ 4,095,066$ 4,095,066$ -$ Resources (Inflows):Charges for services 2,378,001 2,455,038 2,466,173 11,135 Use of money and property 18,500 65,607 279,535 213,928 Amounts Available for Appropriation6,491,567 6,615,711 6,840,774 225,063 Charges for Appropriation (Outflows):General government 10,837 12,010 12,019 (9) Parks and recreation 1,574,349 1,713,426 1,533,514 179,912 Engineering and public works 246,939 244,549 111,702 132,847 Capital outlay - 36,250 10,949 25,301 Transfers out 32,237 782,281 96,730 685,551 Total Charges to Appropriations 1,864,362 2,788,516 1,764,914 1,023,602 Budgetary Fund Balance, June 30 4,627,205$ 3,827,195$ 5,075,860$ 1,248,665$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 109

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE
COMMUNITY FACILITIES DISTRICT – HIDDEN HILLS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 1868,165$ 868,165$ 868,165$ -$ Resources (Inflows):Charges for services 292,907 299,368 297,682 (1,686) Use of money and property - 18,435 41,038 22,603 Amounts Available for Appropriation1,161,072 1,185,968 1,206,885 20,917 Charges for Appropriation (Outflows):General government - - 9,129 (9,129) Parks and recreation 275,081 317,621 259,520 58,101 Engineering and public works 8,951 9,333 - 9,333 Total Charges to Appropriations 284,032 326,954 268,649 58,305 Budgetary Fund Balance, June 30 877,040$ 859,014$ 938,236$ 79,222$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 110

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE
COMMUNITY FACILITIES DISTRICT – 2014-1 TOWN CENTER
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 1197,704$ 197,704$ 197,704$ -$ Resources (Inflows):Charges for services 17,460 17,844 17,844 - Use of money and property - 3,022 11,338 8,316 Amounts Available for Appropriation215,164 218,570 226,886 8,316 Charges for Appropriation (Outflows):General government - - 1,479 (1,479) Parks and recreation 14,431 25,221 19,975 5,246 Engineering and public works 2,600 2,600 70 2,530 Total Charges to Appropriations 17,031 27,821 21,524 6,297 Budgetary Fund Balance, June 30 198,133$ 190,749$ 205,362$ 14,613$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 111

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE
COMMUNITY FACILITIES DISTRICT – 2014-2 COMMERCE POINT
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 174,186$ 74,186$ 74,186$ -$ Resources (Inflows):Charges for services 29,630 30,296 30,296 - Use of money and property - 1,373 1,985 612 Amounts Available for Appropriation 103,816 105,855 106,467 612 Charges for Appropriation (Outflows):General government - - 2,365 (2,365) Parks and recreation 8,555 8,786 5,504 3,282 Engineering and public works 8,659 10,019 7,938 2,081 Transfer out 412 412 412 - Total Charges to Appropriations 17,626 19,217 16,219 2,998 Budgetary Fund Balance, June 30 86,190$ 86,638$ 90,248$ 3,610$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 112

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE
COMMUNITY FACILITIES DISTRICT – 2015-2 CITYWIDE
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 14,039,938$ 4,039,938$ 4,039,938$ -$ Resources (Inflows):Charges for services 1,679,554 1,963,644 1,958,992 (4,652) Use of money and property - 73,741 151,733 77,992 Transfers in285,466 286,676 113,987 (172,689) Amounts Available for Appropriation 6,004,958 6,363,999 6,264,650 (99,349) Charges for Appropriation (Outflows):General government - - 33,957 (33,957) Parks and recreation 854,809 1,013,584 686,570 327,014 Engineering and public works 801,431 865,723 342,814 522,909 Capital outlay - 25,000 - 25,000 Transfers out 181,841 205,067 21,329 183,738 Total Charges to Appropriations 1,838,081 2,109,374 1,084,670 1,024,704 Budgetary Fund Balance, June 30 4,166,877$ 4,254,625$ 5,179,980$ 925,355$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 113

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE
COMMUNITY FACILITIES DISTRICT – 2017-1 MAINTENANCE SERVICES FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 1 675,473$ 675,473$ 675,473$ -$ Resources (Inflows):Charges for services 243,222 233,885 228,532 (5,353) Use of money and property - 6,082 12,339 6,257 Amounts Available for Appropriation 918,695 915,440 916,344 904 Charges for Appropriation (Outflows):General government - - 7,653 (7,653) Parks and recreation 198,185 198,932 169,566 29,366 Engineering and public works 36,616 36,616 5,575 31,041 Transfers out 2,472 2,472 2,472 - Total Charges to Appropriations 237,273 238,020 185,266 52,754 Budgetary Fund Balance, June 30 681,422$ 677,420$ 731,078$ 53,658$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 114

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE

PUBLIC, EDUCATIONAL AND GOVERNMENTAL ACCESS
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 1697,606$ 697,606$ 697,606$ -$ Resources (Inflows):Charges for services 135,000 135,000 100,073 (34,927) Use of money and property 5,000 7,334 37,418 30,084 Amounts Available for Appropriation 837,606 839,940 835,097 (4,843) Charges for Appropriation (Outflows):General government - - 6,552 (6,552) Capital outlay - 42,250 32,474 9,776 Total Charges to Appropriations - 42,250 39,026 3,224 Budgetary Fund Balance, June 30 837,606$ 797,690$ 796,071$ (1,619)$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 115

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE

COUNTY SERVICE AREAS (CSA)
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 11,881,250$ 1,881,250$ 1,881,250$ -$ Resources (Inflows):Charges for services 1,899,576 1,914,382 1,941,357 26,975 Use of money and property 10,000 30,478 110,080 79,602 Amounts Available for Appropriation3,790,826 3,826,110 3,932,687 106,577 Charges for Appropriation (Outflows):General government 24,782 26,547 22,798 3,749 Public safety 172,256 172,256 161,904 10,352 Parks and recreation 740,332 775,598 662,986 112,612 Engineering and public works 416,921 498,810 430,019 68,791 Capital outlay 900,000 49,000 - 49,000 Transfers out 558,643 2,004,880 662,120 1,342,760 Total Charges to Appropriations 2,812,934 3,527,091 1,939,827 1,587,264 Budgetary Fund Balance, June 30 977,892$ 299,019$ 1,992,860$ 1,693,841$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 116

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE

MAINTENANCE CFD
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 11,422,341$ 1,422,341$ 1,422,341$ -$ Resources (Inflows):Charges for services 999,675 1,613,967 1,629,718 15,751 Use of money and property - 32,013 63,567 31,554 Amounts Available for Appropriation2,422,016 3,068,321 3,115,626 47,305 Charges for Appropriation (Outflows):General government 600,836 660,124 271,508 388,616 Parks and recreation 39,103 43,063 11,219 31,844 Engineering and public works 65,833 65,833 8,862 56,971 Transfers out 113,925 113,987 113,987 - Total Charges to Appropriations 819,697 883,007 405,576 477,431 Budgetary Fund Balance, June 30 1,602,319$ 2,185,314$ 2,710,050$ 524,736$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 117

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE
BONDED CFD – MAJOR FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 115,447,412$ 15,447,412$ 15,447,412$ -$ Resources (Inflows):Use of money and property - 739,625 1,383,551 643,926 Miscellaneous - 35,800 46,125 10,325 Contributions from property owners - 25,134,078 30,051,705 4,917,627 Amounts Available for Appropriation 15,447,412 41,356,915 46,928,793 5,571,878 Charges for Appropriation (Outflows):General government - 20,110,519 13,515,235 6,595,284 Debt service:Bond issuance costs - 554,511 1,050,136 (495,625) Total Charges to Appropriations - 20,665,030 14,565,371 6,099,659 Budgetary Fund Balance, June 30 15,447,412$ 20,691,885$ 32,363,422$ 11,671,537$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 118

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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE
CAPITAL PROJECTS FUND – MAJOR FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 15,030,062$ 5,030,062$ 5,030,062$ -$ Resources (Inflows):Charges for services - 2,921,200 128,801 (2,792,399) Use of money and property - 52,533 246,089 193,556 Developer participation 258,679 258,679 - (258,679) Contributions from property owners - - 849,825 849,825 Transfers in - 66,196,015 40,328,379 (25,867,636) Amounts Available for Appropriation 5,288,741 74,458,489 46,583,156 (27,875,333) Charges for Appropriation (Outflows):Engineering and public works - 2,723,085 1,177,184 1,545,901 Capital outlay 258,679 107,004,761 26,678,648 80,326,113 Total Charges to Appropriations 258,679 109,727,846 27,855,832 81,872,014 Budgetary Fund Balance, June 30 5,030,062$ (35,269,357)$ 18,727,324$ 53,996,681$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 119

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January 21, 2026
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CITY OF MENIFEE

BUDGETARY COMPARISON SCHEDULE

DEBT SERVICE FUND
FOR THE FISCAL YEAR ENDED JUNE 30, 2025

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Actual Variance withOriginal Final Amounts Final BudgetBudgetary Fund Balance, July 1615,069$ 615,069$ 615,069$ -$ Resources (Inflows):Use of money and property - 34,870 79,410 44,540 Transfers in 1,759,325 1,759,325 1,759,325 - Amounts Available for Appropriation2,374,394 2,409,264 2,453,804 44,540 Charges for Appropriation (Outflows):General government 90,000 90,000 111,954 (21,954) Debt service:Principal retirement 837,941 837,941 1,130,897 (292,956) Interest and fiscal charges 831,384 831,384 538,428 292,956 Total Charges to Appropriations 1,759,325 1,759,325 1,781,279 (21,954) Budgetary Fund Balance, June 30 615,069$ 649,939$ 672,525$ 22,586$ Budgeted Amounts

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 120

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January 21, 2026
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Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 121

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STATISTICAL SECTION DESCRIPTIONS

This section of the City of Menifee’s 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 City’s overall financial health.

Financial Trends Schedules – These schedules contain trend information to help the reader understand how the City’s financial performance and well-being have changed over time. As a newly incorporated City, information relative to the exact City boundaries prior to incorporation is not readily available in most cases.

Therefore, trend information will be developed over time and reported annually.

Net Position
Changes in Net Position
Fund Balances of Governmental Funds
Changes in Fund Balances of Governmental Funds
Major Revenues by Source – Governmental Funds

Revenue Capacity Schedules – These schedules contain information to help the reader assess the factors affecting the City’s ability to generate its property taxes.

Assessed Value and Estimated Actual Value of Taxable Property Direct and Overlapping Property Tax Rates
Principal Property Tax Payers
Property Tax Levies and Collections

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

Ratio of Outstanding Debt by Type
Ratio of General Bonded Debt Outstanding
Direct and Overlapping Bonded Debt
Legal Debt Margin

Demographic and Economic Information – These schedules offer demographic and economic indicators to help the reader understand the environment within which the City’s financial activities take place and to help make comparisons over time and with other governments.

Demographic and Economic Statistics
Principal Employers
Full-time and Part-time City Employees by Program

Operating Information – These schedules contain information about the City’s operations and resources to help the reader understand how the City’s financial information related to the services the City provides and the activities it performs.

Capital Asset Statistics by Function/Program
Operating Indicators by Function/Program
Miscellaneous Statistics
Taxable Sales by Category
Top 25 Sales Tax Producers
Measure DD 1% Sales Tax – Revenues and Expenditures History

Sources: Unless otherwise noted, the information in these schedules is derived from various internal and other governmental and non-governmental sources where reliability of the data could be ascertained.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 122

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CITY OF MENIFEE

NET POSITION
LAST 10 FISCAL YEARS

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As of June 30, 2016 2017 2018 2019GOVERNMENTAL ACTIVITIESNet Investment in Capital Assets 51,416,214$ 69,469,330$ 110,924,809$ 156,771,192$ Restricted for:Community Development Projects 4,448,198 4,660,916 5,363,977 6,373,715 Public Safety - - 12,472 191,737 Public Works 23,908,504 20,471,018 32,360,079 44,929,363 Capital Projects 9,619,732 4,772,166 - - Debt service 1,359,694 1,358,034 1,371,931 7,884,527 Net pension asset - - - - Unrestricted 10,903,072 14,504,934 26,052,076 30,064,613 Total Governmental ActivitiesNet Position 101,655,414$ 115,236,398$ 176,085,344$ 246,215,147$ PRIMARY GOVERNMENTNet Investment in Capital Assets 51,416,214$ 69,469,330$ 110,924,809$ 156,771,192$ Restricted for:Community Development Projects 4,448,198 4,660,916 5,363,977 6,373,715 Public Safety - - 12,472 191,737 Public Works 23,908,504 20,471,018 32,360,079 44,929,363 Capital Projects 9,619,732 4,772,166 - - Debt service 1,359,694 1,358,034 1,371,931 7,884,527 Net pension asset - - - - Unrestricted 10,903,072 14,504,934 26,052,076 30,064,613 Total Primary GovernmentNet Position 101,655,414$ 115,236,398$ 176,085,344$ 246,215,147$

Source: City Finance Department
Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 123

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January 21, 2026
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2020 2021 2022 2023 2024 2025215,774,004$ 259,935,987$ 276,956,837$ 317,756,598$ 366,417,603$ 387,004,052$ 4,569,409 5,239,814 11,312,169 14,895,725 18,986,084 36,451,847 - - - - - - 40,108,013 49,139,697 61,290,160 64,574,642 74,958,469 108,541,142 - - - - - - 1,572,272 556,027 563,291 582,544 615,069 672,525 - - - - - 1,109,928 36,384,684 51,217,507 82,742,476 90,961,465 112,054,938 105,428,188 298,408,382$ 366,089,032$ 432,864,933$ 488,770,974$ 573,032,163$ 639,207,682$ 215,774,004$ 259,935,987$ 276,956,837$ 317,756,598$ 366,417,603$ 387,004,052$ 4,569,409 5,239,814 11,312,169 14,895,725 18,986,084 36,451,847 - - - - - - 40,108,013 49,139,697 61,290,160 64,574,642 74,958,469 108,541,142 - - - - - - 1,572,272 556,027 563,291 582,544 615,069 672,525 - - - - - 1,109,928 36,384,684 51,217,507 82,742,476 90,961,465 112,054,938 105,428,188 298,408,382$ 366,089,032$ 432,864,933$ 488,770,974$ 573,032,163$ 639,207,682$

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 124

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January 21, 2026
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CITY OF MENIFEE

CHANGES IN NET POSITION
LAST 10 FISCAL YEARS

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For the Year Ended June 30, 2016 2017 2018 2019EXPENSESGovernmental Activities:General Government 4,236,457$ 5,158,876$ 6,265,963$ 8,177,727$ Public Safety 20,927,524 18,129,742 25,497,233 27,595,237 Community Development 3,255,560 3,403,182 4,925,868 5,347,196 Recreation Services 1,145,208 1,664,348 3,034,270 4,082,858 Engineering and Public Works 10,361,131 8,281,676 6,082,233 16,979,928 Interest on Long-term Debt 902,716 891,605 917,342 863,713 Total Governmental Activities Expenses 40,828,596 37,529,429 46,722,909 63,046,659 PROGRAM REVENUESGovernmental Activities:Charges for Services 12,764,259 19,257,460 27,218,239 33,823,689 Operating Contributions and Grants 3,041,014 3,578,315 4,722,133 5,141,336 Capital Contributions and Grants 16,930,639 3,107,374 33,885,278 46,785,288 Total Governmental Activities Program Revenues 32,735,912 25,943,149 65,825,650 85,750,313 Total Net Revenues (Expenses) (8,092,684)$ (11,586,280)$ 19,102,741$ 22,703,654$ GENERAL REVENUES AND OTHER CHANGES IN NET POSITIONGovernmental Activities:Taxes:Property Tax 14,577,983$ 12,369,587$ 18,876,904$ 20,771,353$ Transient Occupancy Tax 217,122 225,956 232,117 238,464 Sales Taxes 7,137,168 8,661,218 18,005,117 20,384,878 Franchise Tax 3,084,175 2,973,633 3,076,719 3,141,174 Other Taxes 460,751 582,937 615,333 623,801 Motor Vehicle in-lieu tax, unrestricted 34,451 39,873 47,721 44,113 Use of Money and Property 253,336 221,371 613,165 2,011,031 Other 94,005 92,689 166,682 211,335 Loss on Disposal of Asset - - - - Total Governmental Activities 25,858,991 25,167,264 41,633,758 47,426,149 Special item - 1,066,734 - - Restatement 168,345 - - - Change in Net Position17,766,307$ 13,580,984$ 60,736,499$ 70,129,803$

Source: City Finance Department

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 125

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2020 2021 2022 2023 2024 20259,907,689$ 14,183,374$ 12,323,993$ 33,033,004$ 27,374,493$ 35,476,891$ 29,559,843 27,853,563 31,656,830 43,999,757 44,266,879 51,131,903 5,253,832 5,408,287 6,437,034 9,365,371 8,906,681 8,916,422 5,432,196 3,546,483 1,083,554 9,507,152 8,634,157 9,852,490 18,331,483 16,251,977 3,257,056 22,646,459 6,075,482 26,527,280 1,108,218 569,679 1,240,597 1,463,336 622,071 1,646,071 69,593,261 67,813,363 55,999,064 120,015,079 95,879,763 133,551,057 24,835,036 30,631,445 35,013,739 46,428,763 44,218,494 51,158,222 5,530,426 8,057,443 10,832,899 12,278,329 12,041,584 16,476,836 38,642,004 34,739,876 17,727,525 48,472,712 40,366,619 39,181,538 69,007,466 73,428,764 63,574,163 107,179,804 96,626,697 106,816,596 (585,795)$ 5,615,401$ 7,575,099$ (12,835,275)$ 746,934$ (26,734,461)$ 22,361,021$ 24,076,949$ 26,024,300$ 30,117,514$ 33,849,512$ 35,297,340$ 189,032 506,967 529,006 430,098 507,446 485,200 21,102,457 27,476,156 31,684,459 31,922,596 41,064,793 40,206,315 6,289,806 3,653,129 4,055,791 4,433,059 4,765,363 4,838,540 801,896 1,126,860 1,523,574 858,617 871,948 986,027 73,963 73,963 115,162 109,295 135,915 346,458 1,805,179 48,592 (4,886,350) 550,807 8,327,212 10,318,496 155,676 665,758 185,488 319,330 535,387 431,604 - - (30,628) - - - 52,779,030 57,628,374 59,200,802 68,741,316 90,057,576 92,909,980 - - - - - - - - - - (6,543,321) - 52,193,235$ 63,243,775$ 66,775,901$ 55,906,041$ 84,261,189$ 66,175,519$

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 126

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CITY OF MENIFEE

FUND BALANCES OF GOVERNMENTAL FUNDS
LAST 10 FISCAL YEARS

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As of June 30, 2016 2017 2018 2019GENERAL FUND:Nonspendable 1,880,909$ 64,540$ 28,073$ 65,751$ Committed 6,546,700 3,543,729 3,543,729 3,543,729 Assigned 226,500 461,890 4,396,969 13,437,218 Unassigned1,268,621 8,547,350 16,886,664 18,089,574 Total General Fund 9,922,730 12,617,509 24,855,435 35,136,272 ALL OTHER GOVERNEMENTAL FUNDSNonspendable - - - - Restricted for Community Development Projects 4,180,264 4,660,916 5,363,977 6,373,715 Restricted for Public Safety 267,934 234,782 12,472 191,737 Restricted for Engineering/Public Works 23,908,504 19,781,187 32,360,079 44,929,363 Restricted for Capital Projects 9,619,732 5,461,997 - - Restricted for Debt Service 1,359,694 1,358,034 1,371,931 7,884,527 Unassigned - - (154) - Total All Other Governmental Funds 39,336,128 31,496,916 39,108,305 59,379,342 Fund Balances of Governmental Funds

1 Establish $15,000 self-insurance, retention reserve.
2 Certificates of Participations issued for capital construction. 3 Establish emergency reserve of 20% of General Fund expenditures and $250,000 towards construction of new City Hall.
4 Transferred proceeds from Certificates of Participation to debt service fund. 5 Transferred proceeds from Certificates of Participation to capital project fund.

Source: City Finance Department
Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 127

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2020 2021 2022 2023 2024 202513,473$ -$ -$ -$ 44,888$ 283,029$ 5,688,958 7,642,510 13,365,638 15,155,133 21,547,672 26,477,456 8,701,430 9,349,272 12,362,984 18,539,728 13,428,030 33,698,772 27,202,215 39,321,579 51,177,085 56,272,032 74,562,723 45,825,454 41,606,076 56,313,361 76,905,707 89,966,893 109,583,313 106,284,711 - 174,389 166,085 237,451 189,312 141,173 4,569,409 5,839,667 12,368,526 14,895,725 18,986,084 17,724,788 - - - - - - 40,165,976 48,539,844 60,237,030 64,798,514 74,958,469 127,268,466 - - - - - - 1,572,272 381,638 397,206 424,763 465,592 531,352 (57,963) (446,980) (412,708) (1,158,298) (938,340) (1,569,838) 46,249,694 54,488,558 72,756,139 79,198,155 93,661,117 144,095,941

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 128

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CITY OF MENIFEE

CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
LAST 10 FISCAL YEARS

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For the Year Ended June 30, 2016 2017 2018 2019REVENUESTaxes 25,477,199$ 24,813,331$ 34,743,397$ 38,523,243$ Licenses and permits 6,832,170 8,061,714 10,867,727 10,765,702 Intergovernmental 6,369,501 5,748,048 12,580,822 13,820,929 Charges for services 1,630,272 6,219,925 6,677,180 8,428,907 Use of money and property 254,526 221,382 613,165 2,011,031 Fines and forfeitures 553,986 655,544 718,890 942,403 Developer participation 4,518,711 5,295,110 9,078,142 14,077,226 Miscellaneous 77,778 95,359 128,323 162,935 Contributions from property owners - - - - Total Revenues 45,714,143 51,110,413 75,407,646 88,732,376 EXPENDITURESCurrent:General government 4,253,708 5,391,081 6,151,518 8,169,511 Public safety 20,836,489 21,350,629 25,062,622 27,389,574 Community development 3,154,443 3,643,590 4,872,304 5,693,505 Parks and recreation 1,182,854 2,461,119 2,833,753 3,592,890 Engineering and public works 20,576,193 5,947,990 9,438,808 13,436,193 Capital outlay 1,200,818 16,157,949 5,898,238 5,143,341 Debt service:Principal retirement 370,000 380,000 390,000 410,000 Interest and fiscal charges 933,587 922,488 911,088 895,488 Bond issuance costs - - - - Total Expenditures 52,508,092 56,254,846 55,558,331 64,730,502 Excess (Deficiency) of Revenues Over (Under) Expenditures (6,793,949) (5,144,433) 19,849,315 24,001,874 OTHER FINANCING SOURCES (USES)Transfers in 1,645,900 1,442,815 1,475,606 2,444,198 Transfers out (1,645,900) (1,442,815) (1,475,606) (2,444,198) Other debts issued - - - 6,550,000 Payment to refunded bond escrow agent - - - - Lease/subscription acquisition - - - - Total Financing Sources (Uses) - - - 6,550,000 Net Change in Fund Balances (6,793,949) (5,144,433) 19,849,315 30,551,874 Fund Balances, beginning of year 56,052,807 49,258,858 44,114,425 63,963,740 Restatements - - - - Fund Balances, end of year $ 49,258,858 $ 44,114,425 $ 63,963,740 $ 94,515,614

Source: City Finance Department

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 129

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2020 2021 2022 2023 2024 202544,111,372$ 49,468,537$ 56,042,702$ 58,634,584$ 70,546,687$ 71,147,589$ 10,011,450 10,914,819 13,343,572 10,929,850 11,419,395 11,315,032 16,762,108 19,146,908 23,165,414 26,597,128 36,304,333 26,637,268 8,177,911 9,431,071 10,803,623 20,327,036 17,590,996 21,074,297 1,805,179 63,611 (4,886,358) 1,232,839 10,282,103 14,130,433 598,244 329,487 438,833 306,549 483,068 439,280 5,559,177 9,600,934 10,262,446 13,877,821 13,245,107 15,344,404 117,986 630,271 114,987 278,328 512,657 482,690 - - 14,110,185 10,805,326 25,927,269 30,901,530 87,143,427 99,585,638 123,395,404 142,989,461 186,311,615 191,472,523 9,981,475 13,962,912 18,688,827 31,107,678 29,668,362 37,101,364 33,869,480 29,174,294 34,950,472 42,281,642 45,565,463 55,415,288 5,196,946 5,377,780 6,811,947 8,740,384 9,202,687 8,823,453 3,977,479 4,943,713 5,752,300 7,309,632 7,945,083 8,400,548 20,997,861 7,041,057 5,528,660 6,546,643 9,737,693 9,984,711 18,164,545 13,332,826 17,605,427 25,957,044 50,352,498 30,294,369 475,088 2,585,843 7,250,613 1,432,841 1,384,957 1,595,632 1,140,397 540,059 1,202,754 1,420,140 578,198 552,425 - 306,935 40,000 - - 1,050,136 93,803,271 77,265,419 97,831,000 124,796,004 154,434,941 153,217,926 (6,659,844) 22,320,219 25,564,404 18,193,457 31,876,674 38,254,597 11,477,822 5,509,717 6,051,725 5,074,330 4,461,799 42,772,961 (11,477,822) (5,509,717) (6,051,725) (5,074,330) (4,461,799) (42,772,961) - 17,885,000 6,355,581 - - - - (17,372,007) - - - - - - 6,939,942 1,309,745 2,202,708 8,881,625 - 512,993 13,295,523 1,309,745 2,202,708 8,881,625 (6,659,844) 22,833,212 38,859,927 19,503,202 34,079,382 47,136,222 94,515,614 87,855,770 110,801,919 149,661,846 169,165,048 203,244,430 - 112,937 - - - - $ 87,855,770 $ 110,801,919 $ 149,661,846 $ 169,165,048 $ 203,244,430 $ 250,380,652 Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 130

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CITY OF MENIFEE

MAJOR REVENUES BY SOURCE – GOVERNMENTAL FUNDS
LAST 10 FISCAL YEARS

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Fiscal Property Sales Motor Vehicle FranchiseYear Tax Tax In Lieu Tax Tax Total2016 14,577,983$ 7,137,168$ 34,451$ 3,084,175$ 24,833,777$ 2017 12,369,587 8,661,218 39,873 2,973,633 24,044,311 2018 18,876,904 18,005,117 47,721 3,076,719 40,006,461 2019 20,771,353 20,384,878 44,113 3,141,174 44,341,518 2020 22,361,021 21,102,457 73,963 6,289,086 49,826,527 2021 24,076,949 27,476,156 73,963 3,653,129 55,280,197 2022 26,024,300 31,684,459 115,162 4,055,791 61,879,712 2023 30,118,595 31,922,596 109,295 4,433,059 66,583,545 2024 33,849,512 41,064,793 135,915 4,765,363 79,815,584 2025 37,686,684 40,383,098 346,458 4,838,540 83,254,780 Source: City Finance Department

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 131

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CITY OF MENIFEE

ASSESSED VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY LAST 10 FISCAL YEARS

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Total TaxableFiscal Assessed PercentYear Secured Unsecured SBE Nonunitary Exemptions Value Change2016 7,686,424,297$ 95,234,280$ 295,028,271$ (131,240,361)$ 7,945,446,487$ 10.65%2017 8,204,501,816 94,227,737 253,828,271 (144,682,408) 8,407,875,416 7.27%2018 8,712,740,063 99,807,071 105,828,271 (21,427,691) 8,896,947,714 5.82%2019 9,492,168,800 113,916,759 118,100,000 (21,889,314) 9,702,296,245 5.82%2020 10,257,311,309 119,918,747 13,800,000 (1,199,425) 10,389,830,631 9.05%2021 11,130,368,586 140,615,466 - - 11,270,984,052 7.09%2022 12,129,504,862 174,182,957 - - 12,303,687,819 9.05%2023 13,872,320,886 165,575,367 - - 14,037,896,253 14.10%2024 15,324,067,513 212,134,718 - - 15,536,202,231 10.67%2025 16,638,031,377 218,695,934 - - 16,856,727,311 8.50%Source: HdL Companies, Riverside County AssessorIn 1978, California voters passed Proposition 13 which set the property tax rate at 1.00% based upon the assessedvalue of the property being taxed. Each year, the assessed value of property may be increased by an "inflationfactor" (limited to a maximum increase of 2%). With few exceptions, property is only re-assessed at the time it issold to a new owner. At that point, the new assessed value is reassessed at the purchase price sold. Theassessed valuation data shown above represents the only data currently available with respect to the actual marketvalue of taxable property and is subject to the limitations described above.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 132

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CITY OF MENIFEE

ASSESSED VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY

BY USE CATEGORY
LAST 10 FISCAL YEARS

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Total Taxable TotalFiscal Residential Commercial Industrial Assessed Percent DirectYear Property Property Property Dry Farm Other Exemptions Value Change Rate2016 6,349,493,758$ 444,912,094$ 79,232,788$ 21,615,968$ 1,070,534,347$ (20,342,468)$ 7,945,446,487$ 18.69% 0.140692017 6,823,268,713 465,564,229 80,678,726 21,511,185 1,038,617,091 (21,764,528) 8,407,875,416 5.82% 0.139432018 7,368,551,565 522,390,630 86,731,580 20,505,027 920,196,603 (21,427,691) 8,896,947,714 5.82% 0.138092019 8,050,646,652 592,624,119 97,305,521 20,895,440 962,713,827 (21,889,314) 9,702,296,245 9.05% 0.137392020 8,789,370,483 634,623,902 96,855,473 84,679,342 785,500,856 (1,199,425) 10,389,830,631 7.09% 0.136972021 9,605,927,556 718,201,265 92,954,481 61,632,016 792,268,734 - 11,270,984,052 8.48% 0.143022022 10,521,453,404 768,722,082 96,436,403 69,173,323 847,902,607 - 12,303,687,819 9.16% 0.141442023 12,057,202,958 923,154,976 133,416,320 71,921,568 852,200,431 - 14,037,896,253 14.10% 0.139982024 13,384,289,668 990,033,611 151,418,983 88,860,932 921,599,037 - 15,536,202,231 10.67% 0.138902025 14,391,635,650 1,055,154,094 279,966,636 100,311,054 1,029,659,877 - 16,856,727,311 8.50% 0.13809Source: HdL Companies, Riverside County AssessorIn 1978, California voters passed Proposition 13 which set the property tax rate at 1.00% based upon the assessed value of the property being taxed. Each year, the assessed value of property may beincreased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only re-assessed at the time it is sold to new owner. At that point, the new assessed value is reassessed at the purchase price 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.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 133

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CITY OF MENIFEE

DIRECT AND OVERLAPPING PROPERTY TAX RATES
LAST 10 FISCAL YEARS

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Agency 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025Basic Levy* 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 Eastern Municipal Water Imp District 0.05000 0.05000 0.05000 0.05000 0.05000 0.05000 0.05000 0.03750 0.03750 0.03750 Menifee School Debt Service 0.03010 0.03269 0.06080 0.06303 0.06277 0.06111 0.06319 0.06201 0.06063 0.05080 Metropolitan Water District Original Area0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00350 0.00700 Perris Union High School Debt Service 0.06236 0.06092 0.01320 0.01320 0.08244 0.08569 0.01320 0.01320 0.08173 0.06850 Mt. San Jacinto Jr. College 0.01394 0.01320 0.05675 0.05243 0.01320 0.01320 0.08859 0.08859 0.01320 0.00268 Total Direct & Overlapping Tax Rates1.14596 1.14711 1.12750 1.18216 1.21191 1.21350 1.21848 1.20480 1.19656 1.16648 City of Menifee Share of 1% per Prop 13 0.12740 0.12740 0.12904 0.12903 0.12903 0.12643 0.12643 0.12643 0.12643 0.12643Total Direct Rate**0.14552 0.14227 0.14069 0.13943 0.13809 0.14302 0.14144 0.13998 0.13890 0.13809This schedule shows information for all city tax rate areas.**Total Direct Rate is the weighted average of all individual direct rates applied by the government entity.Source:HdL Companies*In 1978, California voters passed Proposition 13 which set the property tax rate at 1.00% fixed amount. This 1.00% is shared by all taxing Overlapping rates are those of local and county governments that apply to property owners within the City. Not all overlapping rates apply to all city

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 134

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CITY OF MENIFEE

PRINCIPAL PROPERTY TAXPAYERS

CURRENT YEAR AND NINE YEARS AGO

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2025 2016Percent Percentof Total City of Total CityTotal Taxable Total Taxable Assessed Assessed Assessed AssessedTaxpayerValue Value Rank Value Value RankMG Artesa Apartments LLC $162,302,398 0.96% 1Scott Road Property 122,408,167 0.73% 2Newport Property LLC 112,702,364 0.67% 3Malcolm Jerome and Maxine Winer 97,077,176 0.58% 4Antelope Ridge Apartments LLC 51,224,884 0.30% 5 $42,987,662 0.54% 4Jefferson Menifee 50,003,247 0.30% 6Cantabria Development LP 49,752,257 0.30% 7Forterra Pipe and Precast LLC 44,855,478 0.27% 8Menifee Commerce Center Phase II 43,512,316 0.26% 9STAG California Holdings 36,000,000 0.21% 10Inland Empire Energy Center, LLC 295,000,000 3.71% 1Donahue Schriber Realty Group 51,259,549 0.65% 2Carrington Place Limited 46,227,829 0.58% 3Stark Menifee Land 39,847,235 0.50% 5PHH Real Estate 32,486,894 0.41% 6Strata Cantabria 31,801,853 0.40% 7KB Home Coastal Inc. 23,412,302 0.29% 8Target Corporation 23,340,717 0.29% 9HCP HB2 Carrington Cherry Hills 21,585,827 0.27% 10Totals 769,838,287 4.57% 607,949,868 7.65%All Other 16,086,889,024 95.43% 7,337,496,619 92.35%City Total16,856,727,311$ 100.00%7,945,446,487$ 100.00% Source: HDL Companies

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 135

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CITY OF MENIFEE

PROPERTY TAX LEVIES AND COLLECTIONS
LAST 10 FISCAL YEARS

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Total TaxFiscal Levy for Percentage of Amount Collected in Total Tax PercentageYear Fiscal Year Amount Levy Subsequent Year Collections of Levy2016 10,903,160$ 10,707,116$ 98.20% 196,044$ 10,903,161$ 100%2017 11,592,282 11,391,985 98.27% 200,297 11,592,283 100%2018 12,027,685 11,935,913 99.24% 91,772 12,027,686 100%2019 13,268,770 13,077,732 98.56% 191,038 13,268,771 100%2020 14,397,065 14,170,014 98.42% 227,051 14,397,066 100%2021 16,382,479 16,347,132 99.78% 35,348 16,382,481 100%2022 17,649,773 17,263,608 97.81% 386,165 17,649,774 100%2023 20,540,213 20,423,009 99.43% 117,205 20,540,215 100%2024 22,834,638 22,655,541 99.22% 179,097 22,834,639 100%2025 24,181,356 24,071,082 99.54% 110,274 24,181,357 100%Source: County of RiversideFiscal Year of LevyCollected within the WiththepassageofResolution10-138inJune2010,theCityofMenifeeagreedtoparticipateintheRiversideCountyTeeterProgram. Under the Teeter Plan, the City is paid in full each year for the actual amount of property taxes levied, regardless of theamount of delinquencies.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 136

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CITY OF MENIFEE

RATIO OF OUTSTANDING DEBT BY TYPE
LAST 10 FISCAL YEARS

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Certificates Distribution Total Percentage ofFiscal of Facilities County Other Governmental Personal PerYear Participation Financing Repayment (1) liabilites Activities Income Capita (2)2016 19,815,936$ -$ 1,057,619$ -$ 20,873,555$ 1.10% 235.80 2017 19,415,528 - - - 19,415,528 1.00% 214.16 2018 19,005,120 - - - 19,005,120 0.09% 206.80 2019 18,144,304 6,550,000 - - 24,694,304 1.09% 264.25 2020 17,688,896 6,499,912 - - 24,188,808 0.99% 249.13 2021 16,040,392 6,120,786 - - 22,161,178 0.84% 222.31 2022 16,315,000 5,900,754 - 5,922,140 28,137,894 0.84% 216.74 2023 15,640,000 5,485,266 - 5,703,908 26,829,174 0.80% 243.83 2024 14,960,000 5,057,262 - 6,333,181 26,350,443 0.71% 236.20 2025 14,270,000 4,616,365 - 12,690,470 31,576,835 0.80% 273.83 (1) County Repayment is not bonded debt(2) See the schedule of demographic and economic statistics for population data.

Source: City Finance Department

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 137

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CITY OF MENIFEE

RATIO OF GENERAL BONDED DEBT OUTSTANDING
LAST 10 FISCAL YEARS

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Total Less PercentGeneral Debt Net of Debt to DebtFiscal Assessed Obligation Service Bonded Assessed perYear Population Value Bonds Fund (1) Debt Value (2) Capita2016 88,524$ 7,945,446,487$ -$ -$ -$ 0.00% -$ 2017 90,660 8,407,875,416 - - - 0.00% - 2018 91,902 8,896,947,714 - - - 0.00% - 2019 93,452 9,702,296,245 - - - 0.00% - 2020 97,093 10,389,830,631 - - - 0.00% - 2021 99,686 11,270,984,052 - - - 0.00% - 2022 106,627 12,303,687,819 - - - 0.00% - 2023 110,034 14,037,896,253 - - - 0.00% - 2024 111,560 15,536,202,231 - - - 0.00% - 2025 115,316 16,856,727,311 - - - 0.00% - (1) Amounts available for repayment of general obligation bonds.(2) Assessed value has been used because the actual value of taxable property is not readily available in the State of California.

Source: City Finance Department
Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 138

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January 21, 2026
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CITY OF MENIFEE

DIRECT AND OVERLAPPING BONDED DEBT
JUNE 30, 2025

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Percent City's Total Applicable Share ofDebt to City DebtDirect DebtCity of Menifee-Certificates of Participation 14,270,000$ 100.0% 14,270,000$ City of Menifee-Distribution Facilities Financing Agreement 4,616,365 100.0% 4,616,365 Lease Liabilities 11,244,324 100.0% 11,244,324 Subscription Liabilities 1,446,146 100.0% 1,446,146 Total Direct Debt25,620,671$ 100.0%31,576,835$ Direct and Overlapping Tax and Assessment DebtMetropolitan Water District 17,155,000$ 0.396% 67,934$ Eastern Municipal Water District Improvement Districts 10,555,000 77.290-100. 8,672,300 Mount San Jacinto Community College District 237,330,000 12.064 28,631,491 Perris Union High School District 284,456,372 58.221 165,613,344 Menifee Union School District 184,411,292 75.303 138,867,235 Perris Union High School District Community Facilites District No. 92-129,055,000 62.792 18,244,216 Menifee Union School District Community Facilities Districts 187,580,000 37.715-100. 184,531,761 Romoland School District Communit Facilities Districts 200,355,000 54.833-100. 187,974,230 Eastern Municipal Water District Community Facilities Districts 81,250,000 62.092-100. 78,602,126 City of Menifee Community Facilities District Nos. 2016-2 and 2017-184,670,000 100 84,670,000 Riverside County Community Facilities Districts 24,890,000 25.986-94.131 19,071,333 Eastern Municipal Water District 1915 Act Bonds 1,090,000 64.231 700,118 City of Menifee - 100 - Total Direct and Overalapping Tax and Assessment Debt 915,646,088$ Overlapping General Fund Debt:Riverside County General Fund Obligations 1,134,209,783$ 3.973% 45,062,155$ Riverside County Pension Obligations 603,055,000 3.973 23,959,375 Perris Union High School District Certificates of Participation 39,720,566 58.221 23,125,711 Menifee Union School District Certificates of Participation 48,185,565 75.303 36,285,176 City of Menifee Distribution Facilities Financing Agreement 4,616,365 100.000 4,616,365 Total Gross Overlapping General Fund Debt 133,048,782$ Less: Riverside County Supported Obligations - Total Net Overlapping General Fund Debt 133,048,782$ Overlapping Tax Increment Debt 219,174,720$ 2.118-10.60112,166,518$ (Riverside County Successor Agency)Total Direct Debt31,576,835$ Total Overlapping Debt1,092,438,223$ Total Direct and Overlapping Debt1,124,015,058$ Gross Combined Total Debt 11,124,015,058$ Ratios to 2024-25 Assessed Valuation:Total Direct Debt 0.03%Total Direct and Overlapping Tax and Asssessment Debt 5.43%Gross Combined Total Debt 6.29%Net Combined Total Debt 6.29%The percentage of overlapping debt applicable to the city is estimated using taxable assessed property value. Applicable percentages were estimated by determining the portion of the overlapping district's assessed value thatis within the boundaries of the city divided by the district's total assessed value.(1) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bondedcapital lease obligations.Source: California Municipal Statisitics Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 139

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CITY OF MENIFEE

LEGAL DEBT MARGIN INFORMATION
LAST 6 FISCAL YEARS*

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202020212022202320242025Assessed valuation10,389,830,631$ 11,270,984,052$ 12,303,687,819$ 14,037,896,253$ 15,536,202,231$ 16,856,727,311$ Debit Limit Percentage15%15%15%15%15%15%Debt limit1,558,474,595 1,690,647,608 1,845,553,173 2,105,684,438 2,330,430,335 2,528,509,097 Total Net Debt Applicable to the LimitGeneral Obligation Bonds:- - - - - - Legal debt margin1,558,474,595$ 1,690,647,608$ 1,845,553,173$ 2,105,684,438$ 2,330,430,335$ 2,528,509,097$ Total Debt Applicable to the Limitas a Percentage of Debt Limit0.00%0.00%0.00%0.00%0.00%0.00%The City of Menifee has no general obligation indebtedness.* Only last six years shown.Source: City Finance Department, HdL CompaniesSection 43605 of the Government Code of the State of California limits the amount of indebtedness for public improvements to 15% of the assessed valuation of all real and personal property of the City.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 140

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CITY OF MENIFEE

DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST 10 FISCAL YEARS

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Personal Per Capita Median Occupied PersonsFiscal Income Personal Home Housing per Median UnemploymentYear Population (In 1000) Income Price Units Household Age Rate2016 88,524 1,891,622$ 21,253$ 300,000$ 30,226 2.93 38.7 7.90%2017 90,660 1,936,648 21,253 325,000 31,253 3.94 37.4 7.10%2018 91,902 2,055,023 22,667 340,000 31,253 2.94 37.4 4.70%2019 93,452 2,264,845 24,235 350,000 31,222 2.99 37.9 4.50%2020 97,093 2,450,076 25,234 374,000 33,348 2.91 37.9 4.00%2021 99,686 2,647,056 26,553 450,000 34,256 2.91 37.7 10.10%2022 106,627 2,871,857 26,933 560,000 36,308 2.94 38.0 7.50%2023 110,034 3,340,202 30,356 525,000 37,979 2.89 37.3 4.20%2024 111,560 3,699,561 33,162 555,000 38,989 2.86 37.3 5.00%2025 115,316 3,965,869 34,391 555,000 39,096 2.95 38.2 5.20%Source: Riverside County Center for Demographic Research, California Department of Finance E-5

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 141

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CITY OF MENIFEE

PRINCIPAL EMPLOYERS
JUNE 30, 2025

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Number of Percentage ofEmployer Employees Employment RankMenifee Union School District 1,620 31.21% 1Mt. San Jacinto College 1,309 25.22% 2Romoland Elementary School District 746 14.37% 3Target 450 8.67% 4Stater Bros 348 6.70% 5City of Menifee 345 6.65% 6Texas Roadhouse 188 3.62% 7Southern California Edison 185 3.56% 80.00% 90.00% 10Total Employment Listed 5,191 100.00%Source: Menifee Valley Chamber of Commerce, City of Menifee Business License Division 2025

Information for the nine years prior is not currently available.

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 142

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CITY OF MENIFEE

FULL AND PART-TIME CITY EMPLOYEES BY PROGRAM
LAST 10 FISCAL YEARS

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2016 2017 2018 2019 2020 2021 2022 2023 2024 2025Full Time EquivalentFull Time EquivalentFull Time EquivalentFull Time EquivalentFull Time EquivalentFull Time EquivalentFull Time EquivalentFull Time EquivalentFull Time EquivalentFull Time EquivalentFUNCTIONCity Manager 2 1 4 4 5 5 8 10 10 9Administrative Services 5 6 0 0 0 0 0 0 0 0City Clerk 2 2 3 3 5 5 6 6 6 6Emergency Services 0 0 0 0 0 0 0Finance 6 7 10 12.5 13.5 13.5 17 21 21 21Human Resources 1 0 4 8.5 6.5 6.5 8 9 9 9Information Technology 0 0 2 5 8 8 13 14 15 15Economic Development 2 3 3 5 3.5 3.5 4 5 5 5Community Development 4 5 11 13.5 13 13 15 15.5 15.5 15.5Code Enforcement 4 4 7 7 5 6 8 8 8 8Fire 0 0 1 2 2 2 2 2 1 1Engineering/ Pub Works 12 16 24 32 33 33 44.5 46.5 50 51Building/Safety 8 9 12 14 12 12 15 15 15 15Community Services 13 18.58 21.55 31.68 23.39 23.39 44.2 48.4 55 56Police 0 0 0 76 77 78 118 120 122 122Total 59.00 71.58 102.55 138.18 206.89 208.89 302.70 320.40 332.50 333.50 Part-Time Employees are expressed as Full-Time Equivalents.Source: City Finance Department Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 143

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CITY OF MENIFEE

CAPITAL ASSETS STATISTICS BY FUNCTION/PROGRAM
LAST 10 FISCAL YEARS

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As of June 30, 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025FUNCTIONPublic WorksStreets (Miles) 317.9 317.9 317.9 317.9 327.1 341.0 347.2 355.9 386.3 520.9Traffic Signals 73 68 71 72 75 84 89 99 94 96Community ServicesParks 7 8 11 12 14 14 15 21 22 22Park Acreage 39 45 53.7 58.7 79.1 79.0 85.1 100.1 118.2 118.2Source: City Public Works Department, Community Services

Item Title: 12.1
Annual Comprehensive Financial Report for Fiscal Year End June 30, 2025 Item Page Number: 144

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CITY OF MENIFEE

OPERATING INDICATORS BY FUNCTION/PROGRAM
LAST 10 FISCAL YEARS

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As of June 30, 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025FUNCTIONPolice ServicesPhysical Arrests 1,295 1,412 1,385 1,500 1,582 1,403 1,154 1,471 1,617 1,597 Parking Citations 330 230 569 435 241 473 356 528 836 768 Traffic Citations 3,720 1,733 4,422 5,927 2,492 2,877 3,835 7,125 7,244 6,658 Calls for Service 47,728 47,926 47,961 49,291 48,615 52,152 50,342 73,192 74,456 73,341 Fire ServicesMedical/Public service Calls 9,741 10,081 9,342 10,071 9,172 10,232 10,612 11,031 11,059 11,491 Fire calls 144 184 182 167 193 225 210 188 183 201 All other calls 1,310 1,499 2,158 1,552 2,315 1,494 2,327 2,359 2,431 2,676 Total 11,195 11,764 11,682 11,790 11,680 11,951 13,149 13,578 13,673 14,368 Public WorksPotholes/Skinpatch (square feet) 12,335 18,215 31,458 135,277 63,348 16,358 20,052 104,000 426 618 Curb Refurbishment/Painting (linear feet)285 3,254 983 722 3,540 7,276 39,246 1,200 100 500 Right of Way Clearing (linear feet) 14,020,200 13,853,520 4,475,936 886,818 20,006 988,916 381,828 1,600 2,348 1,639 Traffic Signs repaired/replaced 213 275 821 418 461 1,176 572 638 472 561 Building & SafetyBuilding Permits Issued 4,031 4,365 5,179 6,232 6,147 6,778 5,959 6,261 4,015 4,454 Building Inspections Completed 13,410 15,417 21,522 23,540 25,480 33,567 30,736 28,363 32,225 29,608 Community DevelopmentPlanning Applications Completed 275 327 259 208 348 393 402 336 342 196 Source: City Finance Division, City Community Development Department, City Building Department, City Police Services Department, City Public Works Department

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CITY OF MENIFEE

MISCELLANEOUS STATISTICS
JUNE 30, 2025

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Geographic Location: The City of Menifee is located approximately 80 miles south east of Los Angeles in the southwestern portion of Riverside CountyPopulation: 115,316Area in square miles: 46Form of Government: Council-ManagerDate of Incorporation: October 1, 2008Number of Full Time Employees: 333.50Public Safety:Police Department Menifee City Police Department as of 6/30/2025, 122 FTEFire DepartmentRiverside County/Cal Fire Department contract, 70 FTE, 4 Fire StationsLibrary: 2 branches, Riverside County Library SystemRecreation:24 Parks owned by Valley Wide Recreation and Park District 22 Parks owned by the CitySchools:Elementary 15Middle Schools 6High Schools 3Community Colleges 1Source: City Finance Department Item Title: 12.1
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CITY OF MENIFEE

TAXABLE SALES BY CATEGORY*

LAST TEN CALENDAR YEARS (IN THOUSANDS OF DOLLARS)

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2015 2016 2017 2018 2019 2020 2021 2022 2023 2024Apparel Stores 27,964$ 30,952$ 34,074$ 35,524$ 38,787$ 41,407$ 30,146$ 45,691$ 50,614$ 54,560$ General Merchandise 66,085 68,839 69,651 71,315 75,403 76,332 81,531 105,862 107,512 96,989 Food Stores 23,456 26,677 28,867 31,793 36,815 39,660 47,444 48,980 53,328 55,199 Eating and Drinking Places 80,576 91,283 102,449 116,287 125,691 144,016 143,668 180,789 207,493 219,715 Building Materials 40,526 72,621 79,070 87,091 93,238 91,679 111,335 144,990 147,040 131,018 Auto Dealers and Suppliers 33,916 41,301 54,074 57,404 55,065 60,944 52,579 61,433 67,121 74,146 Service Stations 102,256 91,394 84,643 95,334 117,995 123,332 104,514 153,057 182,819 165,105 Other Retail Stores 103,300 118,629 130,023 140,778 146,801 143,542 132,786 178,792 180,933 173,766 All other Outlets 39,131 45,703 51,449 53,236 60,917 62,444 56,727 229,999 261,708 359,805 Total 517,210$ 587,399$ 634,299$ 688,762$ 750,711$ 783,357$ 760,729$ 1,149,592$ 1,258,568$ 1,330,303$ Source: State of California Board of Equalization and the HdL CompaniesNote: Due to confidentiality issues, the names of the ten largest revenue payers are not available.* Information for 2025 is not yet avaibale.

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CITY OF MENIFEE

TOP 25 SALES TAX PRODUCERS
FOR FISCAL YEAR ENDED JUNE 30, 2025 AND JUNE 30, 2016

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Business Business Business Name Category Business Name Category 7 11 38490 Service Stations Americamax ContractorsArco AM PM Service Stations Arco AM PM Service StationsArco AM PM Service Stations Arco AM PM Service StationsArco AM PM Service Stations Best Buy Electronics/Appliance StoresArco AM PM Service Stations BJ's Restaurant Brewhouse Casual DiningBest Buy Electronics/Appliance Stores Chevron Service StationsCamping World RV Sales Trailers/RVs Chevron/Circle K Service StationsChevron/Circle K Service Stations Circle K Service StationsCircle K Service Stations Grove Lumber Building MaterialsGrove Lumber Building Matericals Kohl's Department StoresHome Goods Home Furnishings Living Spaces Furniture Home FurnishingsImperial Sprinkler Supply Garden/Agricultural Supplies Lowes Building MaterialsIn N Out Burger Quick-Service Restaurants Menifee Car Wash Service StationsKohls Department Stores Ralph's Grocery StoresLiving Spaces Furniture Home Furnishings Richardson's Auto & RV Sales Trailers/RVsLowes Building Matericals Ross Dress for Less Family ApparelM A Mortenson Company Contractors Shell Service StationsNova Power, LLC Energy/Utilities Stater Bros. Markets Grocery StoresRoss Dress for Less Family Apparel Target Discount Dept StoresRV Supercenter Trailers/RVs Texas Roadhouse Casual DiningStater Brothers Grocery Stores T J Maxx Family ApparelTarget Discount Dept. Stores United Oil Service StationsTexas Roadhouse Casual Dining Valero Service StationsTJ Maxx Family Apparel Verizon Wireless Electronics/Appliance StoresUnited Rentals North America Repair Shop/Equip. Rentals Walgreens Drug StoresPercentage of Fiscal Year TotalPaid by Top 25 Accounts 60.82% 61.63%Source: HdL Reports 2025 2016

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CITY OF MENIFEE

MEASURE DD 1% SALES TAX REVENUES AND EXPENDITURES HISTORY

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Fiscal Year20172018201920202021Revenues1% Transaction Tax 1,369,814$ 9,961,049$ 11,416,810$ 12,617,232$ 16,724,722$ Interest Income - 24,668 96,362 141,559 4,951 Total Revenue:1,369,814 9,985,717 11,513,172 12,758,791 16,729,673 ExpendituresCode Enforcement - - 188,042 234,261 263,112 County Sheriff Services - 2,404,849 1,869,310 3,573,072 - County Fire Services - 1,969,424 1,768,811 3,893,526 3,353,950 Capital Equipment - - - 593,105 1,305,108 Capital Projects-Roads - 2,852,248 3,791,111 1,646,995 942,402 Menifee Police - - 273,779 4,855,886 4,906,555 Total Expenditures:- 7,226,521 7,891,053 14,796,845 10,771,127 Cumulative Balance:1,369,814$ 4,129,010$ 7,751,129$ 5,713,075$ 11,671,621$ 2022202320242025Revenues1% Transaction Tax 19,607,014$ 19,634,904$ 24,088,083$ 23,370,559$ Interest Income (110,856) 236,870 499,582 826,946 Total Revenue:19,496,159 19,871,774 24,587,665 24,197,505 ExpendituresCode Enforcement 319,706 357,907 387,426 429,640 County Sheriff Services - - - - County Fire Services 5,171,600 10,928,976 12,140,268 12,318,177 Capital Equipment 42,319 460,204 252,619 358,559 Capital Projects-Roads 2,765,313 748,442 2,787,065 - Menifee Police 5,746,016 6,966,283 7,120,472 7,669,732 Total Expenditures:14,044,955 19,461,812 22,687,850 20,776,108 Cumulative Balance:17,122,825$ 17,532,786$ 19,432,601$ 22,853,998$ The City's citizens voted and approved the 1% sales tax in November 2016 with the implementation date of January 2017. No information prior to that year is available.Source: City Finance Department

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Item Title: 12.1
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Tel. 909-889-0871 | www.ramscpa.net | 735 E. Carnegie Dr. Suite 100, San Bernardino, CA 92408

CERTIFIED PUBLIC ACCOUNTANTS

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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

Independent Auditor’s Report

To the Honorable City Council
City of Menifee, California

We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States (Government Auditing Standards), the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the City of Menifee (the City), as of and for the year ended June 30, 2025, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements, and have issued our report thereon dated December 18, 2025.

Report on Internal Control over Financial Reporting

In planning and performing our audit of the financial statements, we considered the City’s internal control over financial reporting (internal control) as a basis for designing procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the City’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 or significant deficiencies may exist that were not identified.

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Report on Compliance and Other Matters

As part of obtaining reasonable assurance about whether the City’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on 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 City’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

San Bernardino, California
December 18, 2025

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Tel. 909-889-0871 | www.ramscpa.net | 735 E. Carnegie Dr. Suite 100, San Bernardino, CA 92408

CERTIFIED PUBLIC ACCOUNTANTS

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December 18, 2025

To the Honorable City Council
City of Menifee, California

We have audited the financial statements of the City of Menifee (the City) as of and for the year ended June 30, 2025, and have issued our report thereon dated Dece mber 18, 2025. Professional standards require that we advise you of the following matters relating to our audit.

Our Responsibility in Relation to the Financial Statement Audit

As communicated in our engagement letter dated May 8, 2025, our responsibility, as described by professional standards, is to form and express opinions about whether the financial statements that have been prepared by management with your oversight are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America. Our audit of the financial statements does not relieve you or management of your respective responsibilities.

Our responsibility, as prescribed by professional standards, is to plan and perform our audit to obtain reasonable, rather than absolute, assurance about w hether the financial statements are free of material misstatement. An audit of financial statements includes consideration of the system of internal control over financial reporting as a basis for designing 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 over financial reporting. Accordingly, as part of our audit, we consider ed the system of internal control of the City solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control.

We are also responsible for communicating significant matters related to the audit that are, in our professional judgment, relevant to your responsibilit ies in overseeing the financial reporting process.

However, we are not required to design procedures for the purpose of identifying other matters to communicate to you.

Planned Scope and Timing of the Audit

We conducted our audit consistent with the planned scope and timing we previously communicated to you.

Compliance with All Ethics Requirements Regarding Independence

The engagement team, others in our firm, as appropriate, and our firm have complied with all relevant ethical requirements regarding independence.

We have evaluated whether certain nonattest services performed by our firm during the audit have created a significant threat to our independence in relation to the City. We have identified a threat to our independence (preparation of the City’s financial stat ements, creating a self-rev iew threat) that if not reduced to an acceptable level, would impair our i ndependence. In order to reduce the threat to an acceptable level, we have applied the following safeguard:

Prior to the issuance of the City’s financial statements, another partner or manager, independent of the engagement, will review the financial statements.

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Significant Risks Identified

We have identified the possibility of the following significant risks:

Management's override of internal c ontrols over financial reporting – Management override of internal controls is the intervention by management in handling financial information and making decisions contrary to internal control policy.

Revenue recognition – Revenue recognition is a generally accepted accounting principle that refers to the conditions under which an entity can recognize a transaction as revenue. Auditing standards indicate that recognizing revenue is a presumed fr aud risk and usually classified as a significant risk in most audits.

These significant risks are presumptive in most audits and merit attention by the auditors due to the direct impact over financial reporting and internal control processes. Although identified as significant risks, we noted no matters of management override of controls or deviations from generally accepted accounting principles which caused us to modify our audit procedures or any related matters which are required to be communicated to those charged with governance due to these identified risks.

Qualitative Aspects of the City’s Significant Accounting Practices

Significant Accounting Policies

Management has the responsibility to select and use appropriate accounting policies. A summary of the significant accounting policies adopted by the City is included in Note 1 to the financial statements. The City adopted GASB Statement No. 101, Compensated Absence, and GASB Statement No. 102, Certain Risk Disclosures during 2025. No matters have come to our attention that would require us, under professional standards, to inform you about (1) t he methods used to account for significant unusual transactions and (2) the effect of significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus.

Significant Accounting Estimates and Related Disclosures

Accounting estimates and related disclosures are an integral part of the financial statements prepared by management and are based on management’s current judgments. Those judgments are normally based on 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 markedly from management’s current judgments.

The most sensitive accounting estimates affecting the City’s financial statements are:

Management’s estimate of the net pension liab ility and related deferred inflows and outflows of resources are based on actuarial reports by independent actuaries. We evaluated the key factors and assumptions used to develop the estimate in determining that it is reasonable in relation to the basic financial statements taken as a whole and in relation to the applicable opinion units.

Management’s estimate of the liability for ot her post-employment benef its (OPEB) and related deferred inflows and outflows of resources are based on actuarial reports provided by independent actuaries. We evaluated the key factors and assumptions used to develop the estimate in determining that it is reasonable in relation to the basic financial statements taken as a whole and in relation to the applicable opinion units.

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Financial Statement Disclosures

Certain financial statement disclosures involve significant judgment and are particularly sensitive because of their significance to financial statement users.

The most sensitive disclosures affecting the City’s financial statements relate to:

The disclosure of net pension liability and related deferred inflows and outflows of resources in the basic financial statements is based on actuarial assumptions. Actual future liabilities and actuarial deferred inflows and outflows may vary from disclosed estimates.

The disclosures of the other post-employment benefits (OPEB) liability and related deferred inflows and outflows of resources in the basic financial statements is based on actuarial assumptions.

Actual future liabilities and actuarial deferred inflows and outflows may vary from disclosed estimates.

The disclosure of leases and subscription liabilities, right-to-use assets, and asset amortization in the basic financial statements is based on certain terms and assumptions in the agreements which could differ from actual amounts.

Significant Difficulties Encountered during the Audit

We encountered no significant difficulties in dealing wi th management relating to the performance of the audit.

Uncorrected and Corrected Misstatements

For purposes of this communication, professional standards require us to accumulate all known and likely misstatements identified during the aud it, other than those that we belie ve are trivial, and communicate them to the appropriate level of management. Furthe r, professional standards require us to also communicate the effect of uncorrect ed misstatements related to prior periods on the relevant classes of transactions, account balances or disclosures, and the financial statements as a whole and each applicable opinion unit.

There were no uncorrected misstatements noted.

In addition, professional standards require us to communicate to you all material, corrected misstatements that were brought to the attenti on of management as a result of our audit procedures. None of the misstatements identified by us as a result of our audit procedures and corrected by management were material, either individually or in the aggregate, to the financial statements taken as a whole or applicable opinion unit.

Disagreements with Management

For purposes of this letter, professional standards define a disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter, which could be significant to the City’s financial statements or the auditor’s report. No such disagreements arose during the course of the audit.

Representations Requested from Management

We have requested certain written representations from management, which are included in the attached letter dated December 18, 2025.

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Management’s Consultations with Other Accountants

In some cases, management may decide to consult with other accountants about auditing and accounting matters. Management informed us that, and to our knowledge, there were no consultations with other accountants regarding auditing and accounting matters.

Other Significant Matters, Findings, or Issues

In the normal course of our professional association with the City, we generally discuss a variety of matters, including the application of accounting principles and auditing standards, significant events or transactions that occurred during the year, operating and regulatory conditions affecting the City’s, and operational plans and strategies that may affect the ri sks of material misstatement. None of the matters discussed resulted in a condition to our retention as the City’s auditors.

Other Information Included in Annual Reports

Pursuant to professional standards, our responsibility as auditors for other information, whether financial or nonfinancial, included in the City’s annual reports, does not extend beyond the information identified in the audit report, and we are not required to perform any pr ocedures to corroborate such other information.

However, in accordance with such standards, we have:

Read the transmittal letter and statistical section and considered whether a material inconsistency existed between the other the information and t he basic financial statements, or the other information otherwise appears to be materially misstated. 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

Our responsibility also includes communicating to you any information which we believe is a material misstatement of fact. Nothing came to our attention that caused us to believe that such information, or its manner of presentation, is materially inconsistent wi th the information, or m anner of its presentation, appearing in the financial statements.

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

Very truly yours,

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CITY OF MENIFEE
SUBJECT: Independence Celebration 2026 - Semiquincentennial MEETING DATE: January 21, 2026
TO: Mayor and City Council
PREPARED BY: Gabbi Cao, Community Services Manager
REVIEWED BY: Mariana Mitchell, Community Services Director APPROVED BY: Armando G. Villa, City Manager
-------------------------------------------------------------------------------------------------------------------------------

RECOMMENDED ACTION

1.Review and provide direction to staff on recommended operational updates and consideration of a one-time entertainment enhancement for the 2026 Independence Celebration Event.

DISCUSSION
The City of Menifee, in partnership with the Lake Menifee Women’s Club, annually hosts the Independence Celebration on the Saturday prior to Independence Day. This long-standing community tradition draws an average attendance of more than 13,000 residents and visitors and remains one of the City’s most well-attended and anticipated events. The celebration reflects strong volunteer involvement, interdepartmental coordination, and a shared commitment to fostering community pride.

As the City looks ahead to 2026, the Independence Celebration will also serve as Menifee’s primary opportunity to commemorate the 250th anniversary of the signing of the Declaration of Independence. In alignment with City Council direction provided on May 3, 2023, the Community Services Department (CSD) initiated early planning efforts to thoughtfully incorporate this national milestone into the existing event framework, while preserving the traditions and partnerships that have long defined the celebration.

On November 6, 2025, staff shared early planning concepts and potential operational refinements with the Parks, Recreation and Trails Commission (PRTC). Commissioners expressed support for the overall direction, particularly efforts focused on improving attendee comfort, expanding access to the parade, and recognizing the Semiquincentennial in a way that is meaningful yet fiscally responsible. That feedback, together with community input and staff’s operational experience, informed the recommendations presented below.

Item Title: 12.2
Independence Celebration 2026 - Semiquincentennial
Item Page Number: 1

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City of Menifee Staff Report
Independence Celebration 2026 - Semiquincentennial
January 21, 2026