Agenda packet — Modesto City Council, February 27, 2024 (part 3 of 8)

and deteriorating steel reinforcing and considerable deflection at the cantilevered sections. The bridge is listed as Structurally Deficient and has been weight restricted to four tons gross load since 1979 and restricted from legal truck load weights since 1937.

The Project is partially funded with Federal Highway Bridge Program (HBP) funds and will include replacement of the existing bridge, safety improvements for motorists, pedestrians, and bicyclists, curb ramps, raised center median/refuge, street lighting, and incidental roadway resurfacing. The Project will also include modifications at the intersections of 7th and B Streets at Tuolumne Boulevard and Crows Landing Road at 7th Street.

A Memorandum of Agreement (MOA) for Preliminary Engineering was approved by the City Council on April 5, 2011, by Resolution No. 2011-113, and by the County on March 15, 2011, by Resolution 2011-167. An Amended and Restated MOA to add Final Design was approved by the City Council on May 7, 2019, by Resolution No. 2019-206, and by the County on May 21, 2019, by Resolution No. 2019-305. That latest Amended and Restated MOA was approved by the City Council on August 23, 2022, by Resolution No. 2022-35, and by the County on July 12, 2022, by Resolution No. 2022-0386.

The MOA split the local match portion of the Project (11.47%) equally between the County and the City. At the time of the May 2019 MOA, the actual design cost was not finalized, and the MOA was based on an estimate. Since the 2022 MOA, some costs which are subject to the MOA have been updated and therefore an amendment to the MOA is required. The changes are presented in Attachment A to the MOA.

DISCUSSION:

The purpose of this request is to update the funding support for Final Design activities necessary to complete the construction Plans, Specifications, and Estimates (PS&E) so that the project can proceed to bid and construction.

Attachment A shows accounting for design-related costs, the local participating cost requirement match, and the split apportionments associated with each agency. These costs also include a 15% estimate for agency-supporting costs, including employee time and materials.

The result of the amended MOA is that the City will provide an additional $161,732 towards the total project funding. This represents the City’s revised share of the effort necessary to complete the Final Design for the Project. This MOA request also includes funding support for a waterline design requested by the City Utilities Department to be included within the bridge structure. The amount to provide the necessary design for the City’s waterline is estimated at $111,931. All other estimated design costs in this request are intended to be shared equally between the City and County. Staff recommends approving the amended MOA to provide an additional $161,732 towards the total City project funding of $865,510.

The Project’s total design cost is now estimated at $10.7M. City/County matching share is approximately $1.6M of the $10.7M costs, with HBP reimbursing approximately $9.1M of participating cost. The differing City/County supporting costs are attributed to separate activities specifically associated with City/County work.
#12..
- 450 -
City Council, February 27, 2024
Amended and Restated Memorandum of Agreement with Stanislaus County for the Design of the 7th Street Bridge Replacement Project

Page 3 of 3 ends

FISCAL IMPACT:

The MOA on August 23, 2022, authorized the City’s share in an amount up to $703,778. This amendment will increase the City’s share by $161,732 for a total amount of $865,510. A portion of the funding in the amount of $111,931 will come from the City’s Water Funds and the remaining $753,579 will come from the Streets Capital Facility Fee (CFF) fund.

There is sufficient funding in both projects, 100586 (Bridge) and 100933 (Water Main) to accommodate the proposed amendment. An additional MOA will be necessary to fund the construction of the bridge replacement project that will be entered into prior construction.

RECOMMENDED COMMITTEE ACTION:

Staff Recommendations:

Resolution approving the Amended and Restated Memorandum of Agreement for the Preliminary Engineering including Final Design Phase of the 7th Street Bridge Project with Stanislaus County, increasing the City’s share by $161,732, for a new total amount of $865,510, and authorizing the City Manager, or his designee to execute the Amended and Restated Memorandum of Agreement.

Approved by:
_________________
Toby Wells, Director of Engineering Services/City Engineer Joseph P. Lopez, City Manager
Attachments:

1. Resolution

2. Draft Amended and Restated Memorandum of Agreement 2024

3. Exhibit A – Cost Sharing Schedule

4. Amended and Restated Memorandum of Agreement – August 2019

5. Amended and Restated Memorandum of Agreement – May 2022

6. Original Memorandum of Agreement – April 2011
#12..
- 451 -
02/27/2024/ENG/T. Wells 1 2024-

MODESTO CITY COUNCIL
RESOLUTION NO. 2024-

RESOLUTION APPROVING THE AMENDED AND RESTATED MEMORANDUM OF

AGREEMENT FOR THE PRELIMINARY ENGINEERING INCLUDING FINAL DESIGN PHASE OF THE 7TH STREET BRIDGE PROJECT WITH STANISLAUS COUNTY, INCREASING THE CITY’S SHARE BY $161,732, FOR A NEW TOTAL AMOUNT OF $865,510, AND AUTHORIZING THE CITY MANAGER, OR HIS

DESIGNEE TO EXECUTE THE AMENDED AND RESTATED MEMORANDUM OF

AGREEMENT
WHEREAS, the Stanislaus County Department of Public Works (County), in cooperation with the City of Modesto (City), the California Department of Transportation (Caltrans), and the Federal Highway Administration (FHWA) have undertaken a project to replace the historic 7th Street Bridge over the Tuolumne River in order to correct structural and hydraulic deficiencies, increase the capacity of the 7th Street corridor, and improve safety for vehicles, bicycles, and pedestrians; and
WHEREAS, the historic 7th Street Bridge over the Tuolumne River was built in 1916 by Stanislaus County and consists of a series of “canticrete” type trusses supported on reinforced concrete piers and abutments all founded on concrete or timber piling; and WHEREAS, the entire bridge span is approximately 1,170 feet in length and the Average Daily Traffic (ADT) volume is approximately 15,700 vehicles per day; and WHEREAS, the bridge is the lowest rated bridge within the eight counties in Caltrans District 10 and has a Sufficiency Rating of 2, on a scale of 1 to 100; and WHEREAS, although the bridge is currently considered structurally sound, there is significant spalling, advanced signs of alkali silica reaction, exposed and deteriorating steel reinforcing and considerable deflection at the cantilevered sections; and WHEREAS, the bridge is listed as Structurally Deficient and has been weight restricted to four tons gross load since 1979 and restricted from legal truck load weights since 1937; and #12..
- 452 -
02/27/2024/ENG/T. Wells 2 2024-
WHEREAS, the Project is partially funded with Federal Highway Bridge Program (HBP) funds and will include replacement of the existing bridge, safety improvements for motorists, pedestrians and bicyclists, curb ramps, raised center median/refuge, street lighting, and incidental roadway resurfacing; and
WHEREAS, the Project will also include modifications at the intersections of 7th and B Streets at Tuolumne Boulevard and Crows Landing Road at 7th Street; and WHEREAS, County and the City entered into a Memorandum of Agreement (MOA) for Preliminary Engineering, which was approved by the governing bodies on March 15 and April 5, 2011, respectively; and
WHEREAS, an Amended and Restated MOA, to add Final Design, was approved by the County and City on July 12, 2022 and August 23, 2022, respectively; and WHEREAS, the MOA split the local match portion of the Project (11.47%) equally between the County and the City; and
WHEREAS, the purpose of this request is to update the funding support for Final Design activities necessary to generate construction Plans, Specifications, and Estimates (PS&E) so that project can proceed to bid and construction; and
WHEREAS, the result of the amended MOA is that the City is to provide an additional $161,732 towards the total project funding, representing the City’s revised share of the effort necessary to complete the Final Design for the Project; and WHEREAS, this MOA request also includes funding support for a waterline design requested by the City Utilities Department to be included within the bridge structure; and WHEREAS, the amount to provide the necessary design for the City’s waterline is estimated at $111,931; and
#12..
- 453 -
02/27/2024/ENG/T. Wells 3 2024-
WHEREAS, all other estimated design costs of this request are intended to be shared equally between the City and County, and
WHEREAS, Staff recommends approving the amended MOA to provide an additional $161,732 for a total of $865,510 towards the total project funding.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the Amended and Restated Memorandum of Agreement for the Preliminary Engineering including Final Design Phase of the 7th Street Bridge Project with Stanislaus County, increasing the City’s share by $161,732, for a new total amount of $865,510.

BE IT FURTHER RESOLVED, that the City Manager, or his designee, is hereby authorized to execute the Amended and Restated Memorandum of Agreement, in a form approved by the City Attorney.
#12..
- 454 -
02/27/2024/ENG/T. Wells 4 2024-
The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 27th day of February 27, by Councilmember ?, who moved its adoption, which motion being duly seconded by Councilmember ?, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST:

DIANE NAYARES-PEREZ, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: ______________________________________
JOSE M. SANCHEZ, City Attorney
#12..
- 455 -
-1-

AMENDED AND RESTATED MEMORANDUM OF AGREEMENT
For the Preliminary Engineering including
Final Design Phase of the 7TH Street Bridge Project
This Memorandum of Agreement (the “MOA”) is made and entered into by and between the County of Stanislaus (the “County”) and the City of Modesto (the “City”) on ____________________, 2024.

INTRODUCTION
A. The purpose of this MOA is to facilitate cooperation between the City and the County for the construction of a project to rehabilitate or replace the 7th Street Bridge over the Tuolumne River (the “Project”), which Project area is partially located within the City limits and within the unincorporated area of the County; and B. The Seventh Street Bridge is the lowest rated bridge within the 8 counties in District 10 of Caltrans. This bridge has a Sufficiency Rating of 2 on a scale from 1 to 100, with 100 being the best. Although the bridge is considered structurally sound for now, it is showing its age, as there is significant spalling, advanced signs of alkali silica reaction, exposed and deteriorating steel reinforcing and considerable deflection at the cantilevered sections. This bridge has been weight restricted to 4 tons gross load since 1979. The original order weight restricting this bridge was signed by the State Department of Public Works in 1937. The bridge has been weight restricted from legal loads for 85 of the 106 years that the bridge has been in existence. The bridge is listed as Structurally Deficient; and C. The current 7th Street Bridge requires reconstruction or replacement to meet standards for seismic events and, when completed, the project will provide an equal benefit to both the City and the County; and
D. The Project will be constructed using State of California and/or Federal funds, which will be obtained, collected and administered by the County, and local match funds; and
E. Due to the engineering significance and age of the 7th Street Bridge, this structure has been identified as a historical landmark. Because of this historical landmark status, the City and County acknowledge the Project will take several years to complete; and therefore, a separate MOA will be entered into by the City and County for each phase of the project. The three project phases consist of:

Preliminary Engineering including Final Design Phase, Right of Way Acquisition and Utility Relocation Phase, and Construction Phase.

NOW, THEREFORE, it is agreed as follows:
#12..
- 456 -
-2-
SECTION 1. OBLIGATIONS OF THE COUNTY

1.1 Project Planning. The County shall perform, or under its direction perform, all aspects of Project planning, engineering design, and environmental process, including the preparation of right-of-way plans, maps, documentation, preliminary and final project design, environmental analysis reports, and plans and specifications.

1.2 Project Costs. Unless otherwise specified in this MOA, the Local Match Project costs shall be shared equally (fifty percent (50%) City and fifty percent (50%) County) for all direct and indirect costs of Project planning throughout the Preliminary Engineering including Final Design Phase. The City and County’s respective 50% share of the Local Match is hereinafter referred to as “Local Match Cost Share.”

1.3 Project Accountability. The County shall be strictly accountable for all State and/or Federal funds used to pay for the Project. Pursuant to Government Code section 6512, any surplus money on hand after completion of the Project shall be returned in proportion to the contributions made by the City and the County.

1.4 Lead Agency. The County shall be the “Lead Agency,” as defined and used in sections 15050 and 15367 of title 14 of the California Code of Regulations, for purposes of compliance with the California Environmental Quality Act (Pub. Res. Code., §21000 et sec.).

1.5 The County shall act in its capacity as the fiscal agent for the Project and perform or secure performance of all work necessary for the advance administration, planning, development, engineering, environmental analyses, for the Project including, but not limited to, survey, preparation of the plans and specifications.

1.6 The County will apply for funding commitments for the Project from State and/or Federal funds, including the Federal HBP to reimburse up to the maximum limits for the participating costs of the Project, as specified herein in Exhibit A, and the remaining balance of the Project’s actual costs not covered or reimbursed by any state and/or federal funds, including Federal HBP funds, is referred to as “Local Match”.

1.7 The County shall timely pay all costs for the Project, and shall timely process Project payment requests to obtain Federal HBP reimbursement.

1.8 The cost of any work referred to herein in this MOA shall include all direct and indirect costs (functional and administrative overhead assessment) attributable to the Project, applied in accordance with County standard accounting procedures.

1.9 The County shall make available to the City all documents showing all cost incurred by County pertaining to the Project.
#12..
- 457 -
-3-
SECTION 2. OBLIGATIONS OF THE CITY

2.1 Project Engineering Plans and Project Specifications. The City shall be entitled to review and comment upon any and all designs, engineering plans, and specifications and the County shall incorporate all reasonable requests to modify such plans, specifications and designs for portions of the Project lying within the City limits.

2.2 PROJECT FINANCING.

2.2.1 The City shall invoice the County for all expenses incurred to cooperate and facilitate in the Project development, and associated expenses as described herein.

2.2.2 The City shall submit all invoices and supporting documentation to the County on or before 5:00pm on the tenth (10th) calendar day of the month following the date in which the City requests reimbursement payments.

2.2.3 The City shall fully cooperate with the County in providing all requested information or data necessary to apply for funding commitments for the Project from the Federal HBP to reimburse up to the maximum limits for the participating costs of the Project.

2.3 OTHER CITY OF MODESTO COVENANTS.

2.3.1 The City shall designate a project manager through whom all communications between the parties to this Agreement shall be channeled.

SECTION 3. IT IS MUTUALLY AGREED AS FOLLOWS:

3.1 Preliminary Engineering Cost. The Preliminary Engineering cost is estimated to be $3,200,000. The contract cost was determined through the Caltrans Consultant Selection Process utilizing a two-step RFQ/RFP.

3.2 Updated Preliminary Engineering Cost. Subsequent to the Amended and Restated MOA dated May 21st, 2019 the final Preliminary Engineering cost was $3,580,000, an increase of $380,000.

3.3 Final Design Cost. The Final Design is estimated to cost $2,807,152. The contract cost was determined through the Caltrans Consultant Selection Process utilizing a two-step RFQ/RFP.

3.4 Updated Final Design Cost. Subsequent to the Amended and Restated MOA dated May 21st, 2019 a Final Design cost of $4,185,971, an increase of $1,378,819, was awarded to the consultant through the Caltrans Consultant Selection Process utilizing a two-step RFQ/RFP.
#12..
- 458 -
-4-

3.5 Final Design Cost Amendment 1. Amendment 1 to the Final Design is $416,624 and is executed by the County Director of Public Works.

3.5.1 Except that a non-participating cost of $18,450 is for “CMAQ Invoicing Tracking” and is 100 percent at the cost of the County.

3.5.2 The remaining participating amount for Final Design Cost Amendment 1 is $398,174.

3.6 Final Design Cost Amendment 2. Amendment 2 to the Final Design is $1,471,957 and authorized by the Stanislaus County Board and executed by the County Director of Public Works.

3.6.1 Except that a non-participating cost of $97,985 is for “City of Modesto 16” Water Line Design” and is 100 percent at the cost of the City.

3.6.2 Except that a non-participating cost of $59,070 is for “B-Street Intersection – Stand-Alone Project Analyses and Coordination” and is shared equally (fifty percent (50%) City and fifty percent (50%) County).

3.6.3 Except that a non-participating cost of $41,748 is for “Park Maintenance Access Modification” and is shared equally (fifty percent (50%) City and fifty percent (50%) County).

3.6.4 Except that a non-participating cost of $32,000 is for “Structural Assessment of Beard Loading Dock Removal” and is shared equally (fifty percent (50%) City and fifty percent (50%) County).

3.6.5 The remaining participating amount for Final Design Cost Amendment 2 is $1,241,154.

3.7 Final Design Cost Amendment 3. Amendment 3 to the Final Design is $1,035,615 and authorized by the Stanislaus County Board and executed by the County Director of Public Works.

3.7.1 Except that a non-participating cost of $111,931 is for “City of Modesto 16” Water Line” related additional costs and is 100 percent at the cost of the City.

3.7.2 Except that a non-participating cost of $55,320 is for “County Bridge Investment Program (BIP) Funding Application” and is 100 percent at the cost of the County.

3.7.3 The remaining participating amount for Final Design Cost Amendment 2 is $868,364.
#12..
- 459 -
-5-

3.8 Local Match. The Local Match for this Phase is anticipated to be 11.47 percent (11.47%) of the total eligible Project costs plus non-participating costs as described in previous sections. This percentage could change depending upon the reimbursement ratio of the State and/or Federal funding source.

The total Local Match for the Preliminary Engineering of the work is estimated at $367,000 based on an estimated Preliminary Engineering cost of $3,200,000. Pursuant to Section 1.2 above, the City and County’s respective Local Match Cost Share for Preliminary Engineering shall be up to, and not exceed, $183,500 each.

The total Local Match for the Updated Preliminary Engineering of the work is estimated at $43,586 based on an Updated Preliminary Engineering cost increase of $380,000. Pursuant to Section 1.2 above, the City and County’s respective Local Match Cost Share for Updated Preliminary Engineering shall be up to, and not exceed, $21,793 each.

The total Local Match for the Final Design of the work is estimated at $322,000 based on an estimated Final Design cost of $2,807,000. Pursuant to Section 1.2 above, the City and County’s respective Local Match Cost Share for Final Design shall be up to, and not exceed, $161,000 each.

The total Local Match for the Updated Final Design of the work is estimated at $158,151 based on an Updated Final Design cost increase of $1,378,819.

Pursuant to Section 1.2 above, the City and County’s respective Local Match Cost Share for Updated Final Design shall be up to, and not exceed, $79,075 each.

The total Local Match for the Final Design Amendment 1 of the work is estimated at $64,121 based on an Amendment 1 Final Design cost of $416,624. Pursuant to Section 1.2 and 3.5 above, the County’s respective Local Match Cost Share for Final Design Amendment 2 shall be up to, and not exceed, $41,285 and the City’s Local Match Cost Share for Final Design Amendment 2 shall be up to, and not exceed, $22,835.

The total Local Match for the Final Design Amendment 2 of the work is estimated at $373,163 based on an Amendment 2 Final Design cost of $1,471,957. Pursuant to Section 1.2 and 3.6 above, the County’s respective Local Match Cost Share for Final Design Amendment 2 shall be up to, and not exceed, $137,589 and the City’s Local Match Cost Share for Final Design Amendment 2 shall be up to, and not exceed, $235,574.

The total Local Match for the Final Design Amendment 3 of the work is estimated at $266,853 based on an Amendment 3 Final Design cost of $1,035,615. Pursuant to Section 1.2 and 3.7 above, the County’s respective Local Match Cost Share for Final Design Amendment 3 shall be up to, and not exceed, $105,121 and the City’s Local Match Cost Share for Final Design Amendment 3 shall be up to, and not exceed, $161,732.

The City shall reimburse the County for City’s share of the Local Match as #12..
- 460 -
-6-
shown in Exhibit A up to the maximum amount of $183,500 (for Preliminary Engineering) plus $21,793 (Updated Preliminary Engineering) plus $161,000 (for Final Design) plus $79,075 (for Updated Final Design) plus $22,835 (for Final Design Amendment 1) plus $235,574 (for Final Design Amendment 2) plus $161,732 (for Final Design Amendment 3) for a total of $865,510. If for any reason, the City’s share of the Local Match is expected to exceed $865,510, an amendment to this MOA would be required prior to any payment beyond the $865,510.

3.9 Subject to any other limitations or exceptions as otherwise set forth in this MOA, upon County’s tender of payment pursuant to section 1.7 of this MOA, County shall invoice City for an amount equal to one-half or fifty percent (50%) of the Local Match during the course of the Project.

3.10 County may submit all invoices and supporting documentation to City on or before 5:00 p.m. on the tenth (10th) calendar day of the month in which County requests reimbursement payments. City shall issue a reimbursement payment to County on or before the last calendar day of the same month for all timely invoices submitted by County.

3.11 County’s total spending authority for a Project contract is approved by the Stanislaus County Board of Supervisors and includes the cost of the contracted services plus a contingency amount designated for any additions or changes to the contract if needed. County will provide written notice to City when the sum of all the task orders or contract change orders executed for a Project contract reaches 75% of the board-approved contingency. County will provide written notice to City prior to increasing the total spending authority for a Project contract that has been considered and approved by the Stanislaus County Board of Supervisors.

3.12 Indemnity. Neither party, nor any of its officers or employees, shall be responsible for any damage or liability occurring by reason of anything done or omitted to be done by the other party under or in connection with any work delegated to that party under this Agreement. The parties further agree, pursuant to Government Code section 895.4, that each party shall fully indemnify and hold harmless the other party and its agents, officers, employees and contractors from and against all claims, damages, losses, judgments, liabilities, expenses and other costs, including litigation costs and attorney fees, arising out of, resulting from, or in connection with any work delegated to or action taken or omitted to be taken by such party under this Agreement.

3.13 Amendments. This Agreement may be amended or provisions contained herein may be altered, changed, or amended for the Project only by mutual written agreement signed and approved by the respective approving authorities of City and County. No oral understanding or agreement, not incorporated herein, shall be binding on any of the parties hereto.

3.14 Any notice which may be required under this Agreement shall be in writing and shall be given by personal service, first-class mail, certified or registered mail return receipt requested, or overnight delivery to the addresses set forth #12..
- 461 -
-7-
below:

City of Modesto: Stanislaus County:

Toby Wells David Leamon
Director of Engineering Director
Services Department of Public Works
City of Modesto 1716 Morgan Road
Engineering Services Dept Modesto, CA 95358
1010 10th Street, Suite 3300
Modesto, CA 95354
All notices and other communications shall be deemed communicated as of actual receipt or after the second business day after the notice has been dispatched. The parties may change their respective address by giving notice of such change to the other party in the manner provided in this Section.

3.15 As may become necessary for Project development and delivery, through City and County cooperation, the Director of Public Works and City Engineer for City and County are authorized to administer and execute, by mutual written consent, various administrative documents necessary to engineer and construct the Project, provided that such actions do not exceed the authority of this Agreement.

3.16 Should any of this Agreement be determined to be unenforceable, invalid, or beyond the authority of either of the Parties to enter and carry out, such determination shall not affect the validity of the remainder of this Agreement, which shall continue in full force and effect; provided that the remainder of this Agreement can, absent the excised portion, be reasonably interpreted to give effect to the intentions of the Parties.

3.17 This Agreement may be terminated only by mutual written agreement signed and approved by the respective approving authorities of City and County.

3.18 County shall cause copies to be furnished to City following full execution of this Agreement
[SIGNATURES ON FOLLOWING PAGE]
#12..
- 462 -
-8-
IN WITNESS WHEREOF, the City of Modesto, a municipal corporation, has authorized the execution of this Agreement in duplicate by its City Manager and attestation by its City Clerk under authority of Resolution No. 2024-________, adopted by the Council of the City of Modesto on the _____ day of ______________, 2024, and COUNTY has authorized the execution of this Agreement in duplicate by the Chairman of the Board under authority of Resolution No. _________________, adopted by the Board of Supervisors of Stanislaus County on the _____ day of _______________, 2024.

COUNTY OF STANISLAUS, CITY OF MODESTO,
a political subdivision of the a Municipal Corporation
State of California
By: _____________________ By: _____________________
Jody Hayes JOSEPH P. LOPEZ
Chief Executive Officer City Manager
ATTEST: ATTEST:

Elizabeth King By: _____________________
Clerk of the Board of Supervisors DIANE NAYARES-PEREZ
of the County of Stanislaus, CMC, City Clerk
State of California
By: ____________________ (SEAL)
Deputy Clerk
APPROVED AS TO CONTENT:

Department of Public Works
By: ____________________
David Leamon, Director

APPROVED AS TO FORM: APPROVED AS TO FORM:

Thomas Boze JOSE M. SANCHEZ
County Counsel City Attorney
By: _____________________ By: _____________________
Donya Nunes Jose M. Sanchez
Deputy County Counsel City Attorney
#12..
- 463 -
-9-

EXHIBIT A

MOA COST SHARING
#12..
- 464 -
Seventh Street Bridge Replacement Project
Activity Begin End Duration Total Cost
Total Local
Match
City Local
Match
County Local
Match
Amended MOA - Design Phase
RFA - E-76 Jul-09 Aug-10 1 month
Execute MOU with BOS & City Council Aug-10 Apr-11 7 months RFP & Select Consultant Apr-11 Jul-11 3 months
Consultant Audit with Caltrans/Programming Jul-11 Jan-12 6 months Preliminary Engineering*1 Jan-12 Jun-19 7 years, 6 months 3,200,000 $ $ 367,000.00 $ 183,500 $ 183,500 Updated Preliminary Engineering*1 Jan-12 Jun-19 7 years, 6 months $ 380,000 $ 43,586.00 $ 21,793 $ 21,793 Environmental Document Jan-15 Mar-15 2 months
Final Design*1 Jun-19 Dec-21 18 months $ 2,807,000 $ 322,000.00 $ 161,000 $ 161,000 Updated Final Design*1 Dec-21 Jun-22 6 months $ 1,378,819 $ 158,150.54 $ 79,075 $ 79,075 Final Design Amendment 1*1 Jun-22 Jul-23 12 months $ 398,174 $ 45,670.56 $ 22,835 $ 22,835 Final Design Amendment 1 - CMAQ Invoicing
Tracking** Jun-22 Jul-23 12 months $ 18,450 $ 18,450.00 $ - $ 18,450 Final Design Amendment 2*1 Jun-22 Dec-23 18 months $ 1,241,154 $ 142,360.36 $ 71,180 $ 71,180 Final Design Amendment 2- City of Modesto
Water Line Design** Jun-22 Dec-23 18 months $ 97,985 $ 97,985.00 $ 97,985 $ - Final Design Amendment 2 - B-Street
Intersection - Stand-Alone Project** Jun-22 Dec-23 18 months $ 59,070 $ 59,070.00 $ 29,535 $ 29,535 Final Design Amendment 2 - Park Maintenance
Access Modification** Jun-22 Dec-23 18 months $ 41,748 $ 41,748.00 $ 20,874 $ 20,874 Final Design Amendment 2 - Structural
Assessment of Beard Loading Dock Removal** Jun-22 Dec-23 18 months $ 32,000 $ 32,000.00 $ 16,000 $ 16,000 Final Design Amendment 3*1 Dec-23 Dec-25 24 months $ 868,364 $ 99,601.35 $ 49,801 $ 49,801 Final Design Amendment 3- City of Modesto 16"
Water Line Related Additional Costs** Dec-23 Dec-25 24 months $ 111,931 $ 111,931 $ 111,931 $ - Final Design Amendment 3- County BIP Funding
Application** Dec-23 Dec-25 24 months $ 55,320 $ 55,320.18 $ - $ 55,320 Total Design Phase MOA: $ 10,690,015 $ 1,594,873 $ 865,510 $ 729,364 Notes: * Local Match = 11.47% participating cost
** Local Match = 100% of non-participating cost, split between County and City as defined in the MOA 1 Total includes consultant cost and support costs per section 1.8 of the MOA

EXHIBIT A
#12..
- 465 -
#12..
- 466 -
#12..
- 467 -
#12..
- 468 -
#12..
- 469 -
#12..
- 470 -
#12..
- 471 -
#12..
- 472 -
#12..
- 473 -
#12..
- 474 -
DocuSign Envelope ID: CE7BD14F-B6C2-487A-8CD2-BFA757D577A2 August 23rd
#12..
- 475 -
DocuSign Envelope ID: CE7BD14F-B6C2-487A-8CD2-BFA757D577A2 #12..
- 476 -
DocuSign Envelope ID: CE7BD14F-B6C2-487A-8CD2-BFA757D577A2 #12..
- 477 -
DocuSign Envelope ID: CE7BD14F-B6C2-487A-8CD2-BFA757D577A2 #12..
- 478 -
-5-
The total Local Match for the Final Design of the work is estimated at $322,000 based on an estimated Final Design cost of $2,807,000. Pursuant to Section 1.2 above, the City and County’s respective Local Match Cost Share for Final Design shall be up to, and not exceed, $161,000 each.

The total Local Match for the Updated Final Design of the work is estimated at $158,151 based on an Updated Final Design cost increase of $1,378,819.

Pursuant to Section 1.2 above, the City and County’s respective Local Match Cost Share for Updated Final Design shall be up to, and not exceed, $79,075 each.

The City shall reimburse the County for City’s share of the Local Match as shown in Exhibit A up to the maximum amount of $183,500 (for Preliminary Engineering) plus $21,793 (Updated Preliminary Engineering) plus $161,000 (for Final Design) plus $79,075 (for Updated Final Design) plus $22,835 (for Final Design Amendment 1) plus $235,574 (for Final Design Amendment 2) for a total of $703,778. If for any reason, the City’s share of the Local Match is expected to exceed $703,778, an amendment to this MOA would be required prior to any payment beyond the $703,778.

3.8 Subject to any other limitations or exceptions as otherwise set forth in this MOA, upon County’s tender of payment pursuant to section 1.7 of this MOA, County shall invoice City for an amount equal to one-half or fifty percent (50%) of the Local Match during the course of the Project.

3.9 County may submit all invoices and supporting documentation to City on or before 5:00 p.m. on the tenth (10th) calendar day of the month in which County requests reimbursement payments. City shall issue a reimbursement payment to County on or before the last calendar day of the same month for all timely invoices submitted by County.

3.10 County’s total spending authority for a Project contract is approved by the Stanislaus County Board of Supervisors and includes the cost of the contracted services plus a contingency amount designated for any additions or changes to the contract if needed. County will provide written notice to City when the sum of all the task orders or contract change orders executed for a DocuSign Envelope ID: CE7BD14F-B6C2-487A-8CD2-BFA757D577A2 #12..
- 479 -
DocuSign Envelope ID: CE7BD14F-B6C2-487A-8CD2-BFA757D577A2 #12..
- 480 -
DocuSign Envelope ID: CE7BD14F-B6C2-487A-8CD2-BFA757D577A2 #12..
- 481 -
DocuSign Envelope ID: CE7BD14F-B6C2-487A-8CD2-BFA757D577A2 23rd
351
August
#12..
- 482 -
DocuSign Envelope ID: CE7BD14F-B6C2-487A-8CD2-BFA757D577A2 #12..
- 483 -
DocuSign Envelope ID: CE7BD14F-B6C2-487A-8CD2-BFA757D577A2 #12..
- 484 -
#12..
- 485 -
#12..
- 486 -
#12..
- 487 -
#12..
- 488 -
#12..
- 489 -
#12..
- 490 -

CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

February 27, 2024
Date: February 4, 2024
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: DeAnna Christensen, Director of Finance
Bill Sandhu, Public Works Director
SUBJECT: Purchase of Fleet Additions and Replacements
CONTACT: Dianne Love, Purchasing Manager, [email protected], 209-571-5164 DESCRIPTION:

Consider approving the purchase for various Fleet Additions and Replacements for Fleet Vehicles which includes two (2) 3/4 Ton Regular Cab Pickup Trucks, two (2) Half Ton Regular Cab Pickup Trucks, one (1) Cargo Van and one (1) One Ton Crew Cab Pickup Truck in the amount not to exceed $361,667. (Funding Source: Fleet Replacement Fund, Solid Waste, American Rescue Plan Act and Measure H)
STRATEGIC PLAN ELEMENT:

This item advances the City of Modesto 2020-2025 Strategic Plan Area: Governance and Service Delivery: “build community trust in City government through responsive, transparent and efficient service delivery”; Goal J: “build a high-performance organization”.

BACKGROUND:

Every year, City vehicles and equipment are individually evaluated based on their age, condition, mileage, and maintenance costs including the addition of new vehicles due to the operational needs for the city. Following this process, a Fleet Addition and Replacement List is submitted to Council and is approved as part of a new fiscal year’s Public Works Fleet Budget.

Fleet Additions:

IFB Vehicle
#
Description Dept. Year of
Vehicle
Hours Repair
Cost
Addition Truck ¾ Ton Full
Size Reg. Cab
PW. Blight
Abatement
2324-26 N/A N/A N/A
Addition Truck ¾ Ton Full
Size Reg. Cab
PW. Blight
Abatement

N/A N/A N/A
These two trucks will be used to support the efforts for the expanded Blight Abatement program accommodating the increased staffing and ability to tow associated trailers. #13..
- 491 -
City Council, February 27, 2024
Purchase of Fleet Additions and Replacements

Page 2 of 5 ends

IFB Vehicle
#
Description Dept. Year of
Vehicle
Hours Repair
Cost
Addition Half Ton Full Size
Truck
PW. Blight
Abatement
2324-28 N/A N/A N/A
Addition Half Ton Full Size
Truck
PW. Solid Waste N/A N/A N/A
These two trucks will be used to support the expanded Blight Abatement program providing vehicles to accommodate the increased staffing and ability to tow larger trailers.

Fleet Replacements:

IFB Vehicle
#
Description Dept. Year of
Vehicle
Meter Repair
Cost
2324-25 40587
Van One-ton
Prisoner
Transportation
MPD – Field
Operations 2005 74,856 $48,444
This van is used by the Modesto Police Department to transport detained individuals within a secured vehicle
IFB Vehicle
#
Description Dept. Year of
Vehicle
Meter Repair
Cost
2324-27 40091
Truck 15.0
Pickup Bed 5th
Wheel
MPD – Field
Operations 2000 18,085 $27,594
This SWAT truck is used by the Modesto Police Department to transport specialized equipment and personnel for tactical response to volatile situations DISCUSSION:

Invitation for Bid (IFB) 2324-26 – Two (2) 3/4 Ton Regular Cab Pickup Trucks On February 9, 2024, the City Manager authorized the Purchasing Manager to solicit the procurement for the procurement for pickup trucks for the Public Works department. On October 19, 2023, the Purchasing Division issued Invitation for Bids (IFB) 2324-26 for two (2) 3/4 Ton Regular Cab Pickup Trucks with Long Bed on the City’s PlanetBids public bidding website under various commodity codes1. Prospective bidders were notified online and via email of the bid opportunity. Eight (8) companies downloaded the IFB document from PlanetBids.

On November 21, 2023, bids were formally opened in the City Clerk’s office and broadcast via Microsoft Teams Livestream. Two (2) bidders chose to respond. Based on providing the lowest responsive and responsible bid, City staff recommended to award the two (2) 3/4 Ton Regular Cab Pickup Trucks with Long Bed to American Chevrolet, Modesto, CA for the total amount not to exceed $113,564.
1 07048-Trucks (One-ton and less capacity); 07054 – Trucks, Diesel (All Capacities); 07057 – Trucks, Fire Protection and Crash Rescue; 07000 – Automobile Vehicles and Related Transportation Equipment; 07018 – Motor Scooters and Trucksters, Engine Driven; 07020 - Motor Scooters and Trucksters, Electric Powered #13..
- 492 -
City Council, February 27, 2024
Purchase of Fleet Additions and Replacements

Page 3 of 5 ends

IFB 2324-28 – Two (2) Half Ton Regular Cab Pickup Trucks with Long Bed On August 18, 2022, the City Manager authorized the Purchasing Manager to solicit the procurement for pickup trucks for the Public Works Blight Abatement program. On October 19, 2023, the Purchasing Division issued IFB 2324-28 for two (2) Half Ton Reg Cab Pickup Trucks with Long Bed on the City’s PlanetBids public bidding website under various commodity codes2.

Prospective bidders were notified online and via email of the bid opportunity. Eight (8) companies downloaded the IFB document from PlanetBids.

IFB 2324-25 One (1) 3/4 Ton Standard Length Cargo Van
On August 28, 2019, the City Manager authorized the Purchasing Manager to solicit the procurement for the Cargo Van for the Modesto Police Department. On October 19, 2023, the Purchasing Division issued IFB 2324-25 for one (1) 3/4 Ton Standard Length 4x2 Cargo Van on the City’s PlanetBids public bidding website under various commodity codes3. Prospective bidders were notified online and via email of the bid opportunity. Eight (8) companies downloaded the IFB document from PlanetBids.

IFB 2324-27 – One (1) One Ton Crew Cab Pickup Truck SRW 4x4 with Long Bed On August 31, 2023, the City Manager authorized the Purchasing Manager to solicit the procurement for the SWAT pickup truck for the Modesto Police Department. On October 19, 2023, the Purchasing Division issued Invitation for Bids (IFB) 2324-27 for the one (1) One Ton Crew Cab Pickup Truck SRW 4x4 with Long Bed on the City’s PlanetBids public bidding website under various commodity codes4. Prospective bidders were notified online and via email of the bid opportunity. Seven (7) companies downloaded the IFB document from PlanetBids.

On November 28, 2023, bids were formally opened in the City Clerk’s office and broadcast via Microsoft Teams Livestream. One (1) bidder chose to respond. Based on providing the lowest responsive and responsible bid, City staff recommended to award the one (1) One Ton Crew Cab Pickup Truck SRW 4x4 with Long Bed to American Chevrolet, Modesto, CA for the total amount not to exceed $60,601.
2 07048-Trucks (One-ton and less capacity); 07054 – Trucks, Diesel (All Capacities); 07057 – Trucks, Fire Protection and Crash Rescue; 07000 – Automobile Vehicles and Related Transportation Equipment; 07018 – Motor Scooters and Trucksters, Engine Driven; 07020 - Motor Scooters and Trucksters, Electric Powered 3 07048-Trucks (One-ton and less capacity); 07054 – Trucks, Diesel (All Capacities); 07057 – Trucks, Fire Protection and Crash Rescue; 07000 – Automobile Vehicles and Related Transportation Equipment; 07018 – Motor Scooters and Trucksters, Engine Driven; 07020 - Motor Scooters and Trucksters, Electric Powered 4 . 07048-Trucks (One-ton and less capacity); 07054 – Trucks, Diesel (All Capacities); 07057 – Trucks, Fire Protection and Crash Rescue; 07000 – Automobile Vehicles and Related Transportation Equipment; 07018 – Motor Scooters and Trucksters, Engine Driven; 07020 - Motor Scooters and Trucksters, Electric Powered #13..
- 493 -
City Council, February 27, 2024
Purchase of Fleet Additions and Replacements

Page 4 of 5 ends

Modesto Municipal Section 8-3.203 requires all purchases which meet or exceed $100,000 for material, equipment, or contractual services to be formally bid. Based on providing the lowest responsive and responsible bids which conforms to the Modesto Municipal Code, 8-3.203 City staff recommends the award of bid for two (2) 3/4 Ton Regular Cab Pickup Trucks to American Chevrolet, Modesto, CA, two (2) Half Ton Reg Cab Pickup Trucks with Long Bed to Towne Ford, Redwood City, CA, one (1) 3/4 Ton Standard Length 4x2 Cargo Van to American Chevrolet, Modesto, CA and one (1) One Ton Crew Cab Pickup Truck SRW 4x4 with Long Bed to American Chevrolet, Modesto, CA.

For all vehicles and equipment, City staff is recommending applying a change order of up to 15% in case any market changes occur between the timeframe of when the order is placed with the vendor and when the production of the vehicle is completed. With current inflation and the volatile vehicle market, City staff will ensure any prices increases requested by the vendor align with the market change based on using the Commodities Research Unit indexes which focuses on indexes related to steel.

FISCAL IMPACT:

Sufficient funds for the one (1) 3/4 Ton Standard Length 4x2 Cargo Van and one (1) One Ton Crew Cab Pickup Truck are budgeted in Fiscal Year 23-24 in the Fleet Replacement Fund. The four Fleet Additions for the two (2) 3/4 Ton Regular Cab Pickup Trucks will be funded through General Fund Measure H and American Rescue Plan Act and the two (2) Half Ton Regular Cab Pickup Trucks with Long Bed will be funded by Solid Waste and General Fund Measure H.

Below is a summary of the Fleet Addition and Replacements:

IFB No. Type of Fleet
Original
Amount
Change
Order
Amount not to
Exceed
2324-26 Two (2) 3/4 Ton Regular Cab Pickup Trucks $ 113,564 $ 17,035 $ 130,599 2324-28 Two (2) Half Ton Regular Cab Pickup Trucks $ 81,185 $ 12,178 $ 93,363 2324-25 One (1) 3/4 Ton Standard Length Cargo Van $ 59,141 $ 8,872 $ 68,013 2324-27 One (1) One Ton Crew Cab Pickup Truck SRW 4x4 $ 60,601 $ 9,091 $ 69,692 Grand Total $ 314,491 $ 47,176 $ 361,667
COMMITTEE RECOMMENDATION:

This item was presented at the May 23, 2022, Finance Committee to capture all City vehicle additions and replacements through Fiscal Year (FY) 2022-23 which included the one (1) 3/4 Ton Standard Length 4x2 Cargo Van. In addition, during the FY 2023-24 Finance Committee Budget Workshops the addition of two (2) 3/4 Ton Regular Cab Pickup Trucks and two (2) Half Ton Regular Cab Pickup Trucks with Long Bed were captured as part of the replacements identified by the Public Works Fleet Division. The replacement of the one (1) One Ton Crew Cab Pickup Truck was not presented as a Committee meeting due to the urgent need to replace a SWAT truck for the Modesto Police Department.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Resolution approving the Award of Bid and Purchase for two (2) 3/4 Ton Regular Cab Pickup Trucks with Long Bed to American Chevrolet, Modesto, CA for an amount not to exceed $113,564; authorizing the Purchasing Manager, or her designee, to issue the Purchase Order; and authorizing the Purchasing Manager or her designee to execute any Change Orders not to exceed 15% of the total purchase price.
#13..
- 494 -
City Council, February 27, 2024
Purchase of Fleet Additions and Replacements

Page 5 of 5 ends

Resolution approving the Award of Bid and Purchase for two (2) Half Ton Regular Cab Pickup Trucks with Long Bed to Towne Ford, Redwood City, CA for an amount not to exceed $81,185; authorizing the Purchasing Manager, or her designee, to issue the Purchase Order; and authorizing the Purchasing Manager or her designee to execute any Change Orders not to exceed 15% of the total purchase price.

Resolution approving the Award of Bid and Purchase for one (1) 3/4 Ton Standard Length 4x2 Cargo Van to American Chevrolet, Modesto, CA for an amount not to exceed $59,141; authorizing the Purchasing Manager, or her designee, to issue the Purchase Order; and authorizing the Purchasing Manager or her designee to execute any Change Orders not to exceed 15% of the total purchase price.

Resolution approving the Award of Bid and Purchase for one (1) One Ton Crew Cab Pickup Truck SRW 4x4 with Long Bed to American Chevrolet, Modesto, CA for an amount not to exceed $60,601; authorizing the Purchasing Manager, or her designee, to issue the Purchase Order; and authorizing the Purchasing Manager or her designee to execute any Change Orders not to exceed 15% of the total purchase price.

Approved by:

DeAnna Christensen, Director of Finance
Bill Sandhu, Public Works Director
Joseph P. Lopez, City Manager
Attachments:

1. Resolution (4)

2. IFB 2324-26 and Cost Abstract (2) 3/4 Ton Pickup Trucks

3. IFB 2324-28 and Cost Abstract (2) Half Ton Pickup Trucks

4. IFB 2324-25 and Cost Abstract (1) Cargo Van

5. IFB 2324-27 and Cost Abstract (1) One Ton Pickup Truck #13..
- 495 -
1 MODESTO CITY COUNCIL
RESOLUTION NO. 2024-

RESOLUTION APPROVING THE AWARD OF BID AND PURCHASE FOR
TWO (2) ¾ TON REGULAR CAB PICKUP TRUCKS WITH LONG BED TO

AMERICAN CHERVOLET, MODESTO, CA FOR AN AMOUNT NOT TO
EXCEED $113,564; AUTHORIZING THE PURCHASING MANAGER, OR HER DESIGNEE, TO ISSUE THE PURCHASE ORDER; AND AUTHORIZING THE

PURCHASING MANAGER OR HER DESIGNEE TO EXECUTE ANY CHANGE ORDERS NOT TO EXCEED 15% OF THE TOTAL PURCHASE PRICE
WHEREAS, every year, City vehicles and equipment are individually evaluated based on their age, condition, mileage and maintenance costs and a Fleet Replacement List is submitted to Council and is approved as part of a new fiscal year’s Public Works Fleet Budget; and
WHEREAS, the City Manager authorized the Purchasing Manager to solicit the procurement for the various pickup trucks for the Public Works Department; and WHEREAS, on October 19, 2023, the Purchasing Division issued Invitation for Bids (IFB) 2324-26 for two (2) 3/4 Ton Regular Cab Pickup Trucks with Long Bed on the City’s PlanetBids public bidding website under various commodity codes; and WHEREAS, eight (8) companies downloaded the IFB document from PlanetBids.; and
WHEREAS, on November 21, 2023, bids were formally opened in the City Clerk’s office and broadcast via Microsoft Teams Livestream; and WHEREAS, two (2) bidders chose to respond; and
WHEREAS, based on providing the lowest responsive and responsible bid, City staff recommended to award the two (2) 3/4 Ton Regular Cab Pickup Trucks with Long Bed to American Chevrolet, Modesto, CA for the total amount not to exceed $113,564. #13..
- 496 -
2 WHEREAS, Modesto Municipal Section 8-3.203 requires all purchases which meet or exceed $100,000 for material, equipment or contractual services to be formally bid. Based on providing the lowest responsive and responsible bid which conforms to the Modesto Municipal Code, 8-3.203 City staff recommends the award of bid for the two (2) 3/4 Ton Regular Cab Pickup Trucks with Long Bed to American Chevrolet, Modesto, CA.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the award of bid and purchase for two (2) 3/4 Ton Regular Cab Pickup Trucks with Long Bed to American Chevrolet, Modesto, CA for an amount not to exceed $113,564.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to issue the Purchase Order.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to execute any change orders not to exceed 15% of the total purchase price.
#13..
- 497 -
3 The foregoing resolution was introduced in a regular meeting of the Council of the City of Modesto held on the 27th day of February 2024, by Councilmember ________, who moved its adoption, which motion being duly seconded by Councilmember ______, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: __________________________________
DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: _____________________________
JOSE M. SANCHEZ, City Attorney
#13..
- 498 -
1 MODESTO CITY COUNCIL
RESOLUTION NO. 2024-

RESOLUTION APPROVING THE AWARD OF BID AND PURCHASE FOR
TWO (2) HALF TON REGULAR CAB PICKUP TRUCKS WITH LONG BED TO

TOWNE FORD, REDWOOD CITY, CA FOR AN AMOUNT NOT TO EXCEED $81,185; AUTHORIZING THE PURCHASING MANAGER, OR HER
DESIGNEE, TO ISSUE THE PURCHASE ORDER; AND AUTHORIZING THE

PURCHASING MANAGER OR HER DESIGNEE TO EXECUTE ANY CHANGE ORDERS NOT TO EXCEED 15% OF THE TOTAL PURCHASE PRICE
WHEREAS, every year, City vehicles and equipment are individually evaluated based on their age, condition, mileage and maintenance costs and a Fleet Replacement List is submitted to Council and is approved as part of a new fiscal year’s Public Works Fleet Budget; and
WHEREAS, on August 18, 2022, the City Manager authorized the Purchasing Manager to solicit the procurement for pickup trucks for the Public Works Blight Abatement program; and
WHEREAS, on October 19, 2023, the Purchasing Division issued IFB 2324-28 for two (2) Half Ton Reg Cab Pickup Trucks with Long Bed on the City’s PlanetBids public bidding website under various commodity codes; and WHEREAS, eight (8) companies downloaded the IFB document from PlanetBids; and
WHEREAS, on November 21, 2023, bids were formally opened in the City Clerk’s office and broadcast via Microsoft Teams Livestream; and WHEREAS, two (2) bidders chose to respond; and
WHEREAS, based on providing the lowest responsive and responsible bid, City staff recommended to award the two (2) Half Ton Reg Cab Pickup Trucks with Long Bed to Towne Ford, Redwood City, CA for the total amount not to exceed $81,185. #13..
- 499 -
2 WHEREAS, Modesto Municipal Section 8-3.203 requires all purchases which meet or exceed $100,000 for material, equipment or contractual services to be formally bid. Based on providing the lowest responsive and responsible bid which conforms to the Modesto Municipal Code, 8-3.203 City staff recommends the award of bid for two (2) Half Ton Reg Cab Pickup Trucks with Long Bed to Towne Ford, Redwood City, CA.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the award of bid and purchase for two (2) Half Ton Regular Cab Pickup Trucks with Long Bed to Towne Ford, Redwood City, CA for an amount not to exceed $81,185.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to issue the Purchase Order.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to execute any change orders not to exceed 15% of the total purchase price.
#13..
- 500 -
3 The foregoing resolution was introduced in a regular meeting of the Council of the City of Modesto held on the 27th day of February 2024, by Councilmember ________, who moved its adoption, which motion being duly seconded by Councilmember ______, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: __________________________________
DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: _____________________________
JOSE M. SANCHEZ, City Attorney
#13..
- 501 -
1 MODESTO CITY COUNCIL
RESOLUTION NO. 2024-

RESOLUTION APPROVING THE AWARD OF BID AND PURCHASE FOR
ONE (1) 3/4 TON STANDARD LENGTH 4x2 CARGO VAN TO AMERICAN CHEVROLET, MODESTO, CA FOR AN AMOUNT NOT TO EXCEED $59,141;

AUTHORIZING THE PURCHASING MANAGER, OR HER DESIGNEE, TO ISSUE THE PURCHASE ORDER; AND AUTHORIZING THE PURCHASING

MANAGER OR HER DESIGNEE TO EXECUTE ANY CHANGE ORDERS NOT TO EXCEED 15% OF THE TOTAL PURCHASE PRICE
WHEREAS, every year, City vehicles and equipment are individually evaluated based on their age, condition, mileage and maintenance costs and a Fleet Replacement List is submitted to Council and is approved as part of a new fiscal year’s Public Works Fleet Budget; and
WHEREAS, on August 28, 2019, the City Manager authorized the Purchasing Manager to solicit the procurement for the Cargo Van for the Modesto Police Department; and
WHEREAS, on October 19, 2023, the Purchasing Division issued IFB 2324-25 for one (1) 3/4 Ton Standard Length 4x2 Cargo Van on the City’s PlanetBids public bidding website under various commodity codes; and
WHEREAS, eight (8) companies downloaded the IFB document from PlanetBids; and
WHEREAS, on November 28, 2023, bids were formally opened in the City Clerk’s office and broadcast via Microsoft Teams Livestream; and WHEREAS, one (1) bidder chose to respond; and
WHEREAS, based on providing the lowest responsive and responsible bid, City staff recommended to award the one (1) 3/4 Ton Standard Length 4x2 Cargo Van to American Chevrolet, Modesto, CA for the total amount not to exceed $59,141. #13..
- 502 -
2 WHEREAS, Modesto Municipal Section 8-3.203 requires all purchases which meet or exceed $100,000 for material, equipment or contractual services to be formally bid. Based on providing the lowest responsive and responsible bid which conforms to the Modesto Municipal Code, 8-3.203 City staff recommends the award of bid for one (1) 3/4 Ton Standard Length 4x2 Cargo Van to American Chevrolet, Modesto, CA.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the award of bid and purchase for one (1) 3/4 Ton Standard Length 4x2 Cargo Van to American Chevrolet, Modesto, CA for an amount not to exceed $59,141.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to issue the Purchase Order.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to execute any change orders not to exceed 15% of the total purchase price.
#13..
- 503 -
3 The foregoing resolution was introduced in a regular meeting of the Council of the City of Modesto held on the 27th day of February 2024, by Councilmember ________, who moved its adoption, which motion being duly seconded by Councilmember ______, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: __________________________________
DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: _____________________________
JOSE M. SANCHEZ, City Attorney
#13..
- 504 -
1 MODESTO CITY COUNCIL
RESOLUTION NO. 2024-

RESOLUTION APPROVING THE AWARD OF BID AND PURCHASE FOR
ONE (1) ONE TON CREW CAB PICKUP TRUCK SRW 4x4 WITH LONG BED

TO AMERICAN CHEVROLET, MODESTO, CA FOR AN AMOUNT NOT TO EXCEED $60,601; AUTHORIZING THE PURCHASING MANAGER, OR HER DESIGNEE, TO ISSUE THE PURCHASE ORDER; AND AUTHORIZING THE

PURCHASING MANAGER OR HER DESIGNEE TO EXECUTE ANY CHANGE ORDERS NOT TO EXCEED 15% OF THE TOTAL PURCHASE PRICE
WHEREAS, every year, City vehicles and equipment are individually evaluated based on their age, condition, mileage and maintenance costs and a Fleet Replacement List is submitted to Council and is approved as part of a new fiscal year’s Public Works Fleet Budget; and
WHEREAS, on August 31, 2023, the City Manager authorized the Purchasing Manager to solicit the procurement for the SWAT pickup truck for the Modesto Police Department; and
WHERAS, on October 19, 2023, the Purchasing Division issued Invitation for Bids (IFB) 2324-27 for the one (1) One Ton Crew Cab Pickup Truck SRW 4x4 with Long Bed on the City’s PlanetBids public bidding website under various commodity codes; and
WHEREAS, seven (7) companies downloaded the IFB document from PlanetBids; and
WHEREAS, on November 28, 2023, bids were formally opened in the City Clerk’s office and broadcast via Microsoft Teams Livestream; and WHEREAS, one (1) bidder chose to respond; and
WHEREAS, based on providing the lowest responsive and responsible bid, City staff recommended to award the one (1) One Ton Crew Cab Pickup Truck SRW 4x4 with #13..
- 505 -
2 Long Bed to American Chevrolet, Modesto, CA for the total amount not to exceed $60,601.

WHEREAS, Modesto Municipal Section 8-3.203 requires all purchases which meet or exceed $100,000 for material, equipment or contractual services to be formally bid. Based on providing the lowest responsive and responsible bid which conforms to the Modesto Municipal Code, 8-3.203 City staff recommends the award of bid for one (1) One Ton Crew Cab Pickup Truck SRW 4x4 with Long Bed to American Chevrolet, Modesto, CA.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the award of bid and purchase for one (1) One Ton Crew Cab Pickup Truck SRW 4x4 with Long Bed to American Chevrolet, Modesto, CA for an amount not to exceed $60,601.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to issue the Purchase Order.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to execute any change orders not to exceed 15% of the total purchase price.
#13..
- 506 -
3 The foregoing resolution was introduced in a regular meeting of the Council of the City of Modesto held on the 27th day of February 2024, by Councilmember ________, who moved its adoption, which motion being duly seconded by Councilmember ______, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: __________________________________
DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: _____________________________
JOSE M. SANCHEZ, City Attorney
#13..
- 507 -
#13..
- 508 -
#13..
- 509 -
#13..
- 510 -
#13..
- 511 -
#13..
- 512 -
#13..
- 513 -
#13..
- 514 -
#13..
- 515 -
#13..
- 516 -
#13..
- 517 -
#13..
- 518 -
#13..
- 519 -
#13..
- 520 -
#13..
- 521 -
#13..
- 522 -
#13..
- 523 -
#13..
- 524 -
#13..
- 525 -
#13..
- 526 -
#13..
- 527 -
#13..
- 528 -
#13..
- 529 -
#13..
- 530 -
#13..
- 531 -
#13..
- 532 -
#13..
- 533 -
#13..
- 534 -
#13..
- 535 -
#13..
- 536 -
#13..
- 537 -
#13..
- 538 -
#13..
- 539 -
#13..
- 540 -
#13..
- 541 -
#13..
- 542 -
#13..
- 543 -
#13..
- 544 -
#13..
- 545 -
#13..
- 546 -
#13..
- 547 -
#13..
- 548 -
ITEM # ITEM/DESCRIPTION QTY UNIT OF

ISSUE UNIT PRICE EXTENSION UNIT PRICE EXTENSION
1 Three Quarter (3/4) Ton Regular Cab Long Bed Pickup Trucks. - Exhibit A, FY 22-23, #63 and #80 2 EA $52,145.00 $104,290.00 $53,645.00 $107,290.00 SUB-TOTAL: $104,290.00 $107,290.00
SALES TAX 8.875%: $9,255.74 $9,521.99
TIRE RECYCLING / FEES $17.50 $83.50
TOTAL: $113,563.24 $116,895.49
BID FORM D: Bidder Exceptions, Clarifications, Amendments

AMERICAN CHEVROLET NONE PROVIDED

TOWNE FORD NONE PROVIDED

AMERICAN CHEVROLET TOWNE FORD

CITY OF MODESTO
PO BOX 642 MODESTO CA 95353
IFB NO. 2324-26 Two (2) Three Quarter Ton Reg Cab Pickup Trucks with Long Bed Modesto, CA Redwood City, CA
#13..
#13..
- 550 -
#13..
- 551 -
#13..
- 552 -
#13..
- 553 -
#13..
- 554 -
#13..
- 555 -
#13..
- 556 -
#13..
- 557 -
#13..
- 558 -
#13..
- 559 -
#13..
- 560 -
#13..
- 561 -
#13..
- 562 -
#13..
- 563 -
#13..
- 564 -
#13..
- 565 -
#13..
- 566 -
#13..
- 567 -
#13..
- 568 -
#13..
- 569 -
#13..
- 570 -
#13..
- 571 -
#13..
- 572 -
#13..
- 573 -
#13..
- 574 -
#13..
- 575 -
#13..
- 576 -
#13..
- 577 -
#13..
- 578 -
#13..
- 579 -
#13..
- 580 -
#13..
- 581 -
#13..
- 582 -
#13..
- 583 -
#13..
- 584 -
#13..
- 585 -
#13..
- 586 -
#13..
- 587 -
ITEM # ITEM/DESCRIPTION QTY UNIT OF

ISSUE UNIT PRICE EXTENSION UNIT PRICE EXTENSION
1 Half Ton Regular Cab Long Bed Pickup Truck - Exhibit A, FY 22-23, #65 and #81 2 EA $37,047.00 $74,094.00 $37,245.00 $74,490.00 SUB-TOTAL: $74,094.00 $74,490.00
SALES TAX 8.875%: $6,575.84 $6,610.99
TIRE RECYCLING / FEES $17.50 $83.50
TOTAL: $80,687.34 $81,184.49
EXCEPTIONS - BIDDER FORM D:

AMERICAN CHEVROLET NONE PROVIDED

TOWNE FORD NONE PROVIDED
VEHICLE MAKE/MODEL BY BID:

AMERICAN CHEVROLET 2024 Chevy Silverado
TOWNE FORD 2024 Ford F-150
VENDOR AVAILABLE SPECIFICATIONS BY BID:

AMERICAN CHEVROLET Did not meet the minimum specifications required by the City TOWNE FORD Yes

AMERICAN CHEVROLET TOWNE FORD

CITY OF MODESTO
PO BOX 642 MODESTO CA 95353
IFB NO. 2324-28 Two (2) Half Ton Reg Cab Pickup Trucks with Long Bed Modesto, CA Redwood City, CA
#13..
#13..
- 589 -
#13..
- 590 -
#13..
- 591 -
#13..
- 592 -
#13..
- 593 -
#13..
- 594 -
#13..
- 595 -
#13..
- 596 -
#13..
- 597 -
#13..
- 598 -
#13..
- 599 -
#13..
- 600 -
#13..
- 601 -
#13..
- 602 -
#13..
- 603 -
#13..
- 604 -
#13..
- 605 -
#13..
- 606 -
#13..
- 607 -
#13..
- 608 -
#13..
- 609 -
#13..
- 610 -
#13..
- 611 -
#13..
- 612 -
#13..
- 613 -
#13..
- 614 -
#13..
- 615 -
#13..
- 616 -
#13..
- 617 -
#13..
- 618 -
#13..
- 619 -
#13..
- 620 -
#13..
- 621 -
#13..
- 622 -
#13..
- 623 -
#13..
- 624 -
#13..
- 625 -
#13..
- 626 -
#13..
- 627 -
#13..
- 628 -
#13..
- 629 -
#13..
- 630 -
ITEM # ITEM/DESCRIPTION QTY UNIT OF

ISSUE UNIT PRICE EXTENSION
1 Chevrolet/GMC ¾ Ton Standard Length Cargo Van. FY
19-20, unit # 39, replaces 40587 1
EA $54,312.00 $54,312.00
SUB-TOTAL: $54,312.00
SALES TAX 8.875%: $4,820.19
TIRE FEE ($8.75): $8.75
TOTAL: $59,140.94
BID FORM D: Bidder Exceptions, Clarifications, Amendments

AMERICAN CHEVROLET NONE PROVIDED
**please see pages 35-40 for vendor specifications per City specification per line

AMERICAN CHEVROLET

CITY OF MODESTO
PO BOX 642 MODESTO CA 95353
IFB NO. 2324-25, (1) THREE QTR TON CARGO VAN
Modesto, CA
#13..
- 631 -
#13..
- 632 -
#13..
- 633 -
#13..
- 634 -
#13..
- 635 -
#13..
- 636 -
#13..
- 637 -
#13..
- 638 -
#13..
- 639 -
#13..
- 640 -
#13..
- 641 -
#13..
- 642 -
#13..
- 643 -
#13..
- 644 -
#13..
- 645 -
#13..
- 646 -
#13..
- 647 -
#13..
- 648 -
#13..
- 649 -
#13..
- 650 -
#13..
- 651 -
#13..
- 652 -
#13..
- 653 -
#13..
- 654 -
#13..
- 655 -
#13..
- 656 -
#13..
- 657 -
#13..
- 658 -
#13..
- 659 -
#13..
- 660 -
#13..
- 661 -
#13..
- 662 -
#13..
- 663 -
#13..
- 664 -
#13..
- 665 -
#13..
- 666 -
#13..
- 667 -
#13..
- 668 -
#13..
- 669 -
#13..
- 670 -
#13..
- 671 -
#13..
- 672 -
#13..
- 673 -
#13..
- 674 -
#13..
- 675 -
ITEM # ITEM/DESCRIPTION QTY UNIT OF

ISSUE UNIT PRICE EXTENSION
1 One (1) 1 Ton Crew Cab Pickup Truck SRW 4x4 with
Long Bed. FY 23-24, Unit #110, replaces 40091 1 EA $55,646.00 $55,646.00 SUB-TOTAL: $55,646.00
SALES TAX 8.875%: $4,946.13
TIRE FEE ($8.75): $8.75
TOTAL: $60,600.88
BID FORM D: Bidder Exceptions, Clarifications, Amendments

AMERICAN CHEVROLET NONE PROVIDED

AMERICAN CHEVROLET

CITY OF MODESTO
PO BOX 642 MODESTO CA 95353
IFB NO. 2324-27, (1) 1 Ton Crew Cab Pickup Truck SRW 4x4 with Long Bed Modesto, CA
#13..

CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

February 27, 2024
Date: January 30, 2024
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: DeAnna Christensen, Director of Finance
SUBJECT: Monthly Investment Report – December 2023
CONTACT: Calogero Maniscalco, Senior Financial Analyst
[email protected], 209-577-5219
DESCRIPTION:

Consider accepting the Monthly Investment Report for December 2023. (Funding Source:

Various Funds)
STRATEGIC PLAN ELEMENT:

This item supports the City of Modesto 2020-2025 Strategic Plan focus of Governance and Service Delivery under Goal H: Achieve Financial Sustainability.

BACKGROUND:

The City’s Finance Department submits a monthly investment report to Council and the City Manager. Attached are the December investment reports (see attachment list below) generated by Public Financial Management, the City’s investment advisor. Investments in the portfolio (attachment 4) are for the City of Modesto, Modesto Public Financing Authority, Community Facilities Districts, Tuolumne River Regional Park, Successor Agency to the Redevelopment Agency, and the Modesto-Ceres Fire Protection Agency Joint Powers Authority.

DISCUSSION:

It is the function of the Finance Department to deposit and invest funds in accordance with sound treasury management and to safeguard the principal and maintain the liquidity needs of the City. The purpose of the Monthly Investment Report is to keep the City Council and City Manager informed of the City’s investment portfolio. As shown in Attachment 2, on December 31, 2023 the City had a closing market value of $477,033,453 in its investment portfolio. #14..
- 677 -
City Council, February 27, 2024
Monthly Investment Report – December 2023

Page 2 of 2 ends

FISCAL IMPACT:

In December, the approximate yield of the City’s combined investments was 3.51% (see attachment 3) on a weighted average. For the portfolio of securities alone, the yield to maturity on cost was 3.03%. For comparative purposes, the yields (as of December 31, 2023) of other investments commonly used by public agencies are listed below:

Local Agency Investment Fund: 3.93%
1-Year U.S. Treasury Note: 4.91%
2-Year U.S. Treasury Note: 4.30%

The Portfolio maintains sufficient liquidity to meet the City's projected expenditure requirements for at least the next six months.

COMMITTEE RECOMMENDATION:

This item has not gone before a committee.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Motion accepting the Monthly Investment Report for December 2023.

Approved by:

DeAnna Christensen, Director of Finance
Joseph P. Lopez, City Manager
Attachments:

1. Monthly Investment Report

2. Account Statement

3. Combined Yields

4. Portfolio Holdings and Earnings Projections

5. Cash with Fiscal Agent
#14..
- 678 -

Page 1 ends

PORTFOLIO HOLDINGS
Attachment 1
Percentages may not total to 100% due to rounding.

Investment Type No. of Investments Amount Invested
CAMP 1 49,318,081
Federal Agency 20 36,643,165
Federal Home Loan Bank 1 2,251,637
Federal Home Loan Mortgage Co. 4 6,001,476
Federal Nat’l Mortgage Assc. 15 28,390,052
Federal Agency CMO 18 50,124,020
U.S. Treasury 52 209,473,761
Commercial Paper 2 21,173,731
Negotiable CD 2 6,792,250
Corporate Note 27 68,063,306
Asset-Backed 20 26,460,309
Municipal 9 5,021,505
Supranational 1 3,963,325
Total Invested 152 477,033,453
Sector Allocation
December 31, 2023 versus November 30, 2023
Sector December 31, 2023 November 30, 2023 Change in Allocation Permitted by Policy
U.S. Treasury 43.9% 44.6% -0.66% 100%
Federal Agency 7.7% 7.7% 0.02% 100%
Federal Agency CMO 10.5% 10.0% 0.55% 100%
Commercial Paper 4.4% 4.4% -0.01% 25%
Negotiable CD 1.4% 1.4% -0.01% 30%
Corporate Note 14.3% 14.6% -0.32% 30%
Asset-Backed 5.5% 5.1% 0.45% 20%
Municipal 1.1% 1.1% 0.00% 100%
Supranational 0.8% 0.8% 0.00% 30%
CAMP 10.3% 10.4% -0.02% 100%
* Total invested includes only the bolded numbers
* * Amount invested are market values excluding accrued interest Additional, detailed information regarding security types and investment activity may be found in Attachment 2 accompanying this memo. Moreover, the addendum data will confirm continued compliance with the investment policy as well as with California Government Code.

RECENT ACTIVITY & CORPORATE EXPOSURE
The dovish December Fed maintained the downward pressure on absolute yields, as policymakers appeared to affirm a rate policy pivot may be the most likely outcome in 2024. U.S. Treasury yields continued their descent from multiyear highs reached in October and rallied significantly into year-end.

CPI fell to 3.1% in November despite the surge of nearly 7% in housing rent. Shelter costs were largely offset by energy as gasoline fell 6% in November and 9% over the year. In the Long-Term portfolio we utilized the proceeds of maturing and sold securities to purchase two 5-year agency CMBS, one 4-year ABS, one 5-year ABS, and one 3-year corporate note. There was no activity in the Short-Term Portfolio. #14..
- 679 -

Page 2 ends

PERFORMANCE
Along with the broad market expectation that the Fed has reached the end of an historic hiking cycle, we now view the risk to downward rate trajectory outweighing significant moves higher. As a result, after several quarters of modestly defensive duration bias, we now prefer a neutral stance relative to benchmarks.

Spreads on agencies, municipals, and supranationals spent the better part of the past 12 months in a very low and narrow range largely as demand for already light issuance persisted. Investment-grade (IG) corporates were a top of class performer in December as modestly tighter spreads and attractive incremental income pushed relative returns higher. ABS fell in line with other spread sectors over the month, generating positive excess returns. The portfolio’s diversification led to its outperformance relative to the benchmark by 9 basis points (0.09%).

1. Performance is calculated on trade-date basis, gross (i.e., before fees) in accordance the CFA Institute's Global Investment Performance Standards (GIPS).

2. Performance numbers for periods greater than 1 year are presented on an annualized basis unless otherwise noted.

3. The performance calculation excludes any funds not invested in the 1-5 year strategy.

4. Performance benchmark through December 31, 2018 was the ICE BofAML 1-3 Year U.S. Treasury Index, and is now the ICE BofAML 1-5 Year U.S. Treasury Index, sourced from Bloomberg.

5. Inception date is 3/31/04.

Percentages may not add due to rounding.

Long-Term Portfolio Total Return
December 31, 2023
1 Month Trailing
12 Months
Trailing 36
Months
Trailing 60
Months
Since
Inception5
City of Modesto Investment Portfolio1,2,3 1.58% 4.75% -0.39% 1.74% 2.06% Modesto Performance Benchmark41.49% 4.30% -0.76% 1.36% 1.76% Average Portfolio Yields
December 31, 2023
Past
Month
Past 3
Months
Past
Year
Past 3
Years
Past 5
Years
City of Modesto Investment Portfolio 3.03% 3.00% 2.36% 1.93% 1.99% City of Modesto Short-Term Portfolio 5.60% 5.61% 5.27% - - $85.0
$23.8
$98.3 $98.5
$60.3
$111.1
$-
$30.0
$60.0
$90.0
$120.0
$150.0
Under 6
Months
6-12
Months
1-2 Years 2-3 Years 3-4 Years 4-5 Years
Millions
Maturity Distribution
December 31, 2023
#14..
- 680 -

Page 3 ends

INVESTMENT POLICY
The City’s investment policy embraces the following standards: the prudent investor rule, requiring the safety of principal, through prudent and safe investments; sufficient liquidity to meet expected and unforeseen cash flows; generation of an above-market, risk-adjusted rate of return (meaning, returnsexpectations taking safety and liquidity into account). No investments longer than five years are permitted.

Some investments have maturity limits of 270 days or less. The table below details the City’s permitted investments.

Investment Type
Maximum
Maturity
Maximum Specified
% of Portfolio
Maximum
% per
Issuer
Minimum Quality
Requirements
Local Agency Bonds 5 Years None None None
Treasury Obligations 5 Years None None None
State Obligations 5 Years None None A rating
CA Local Agency Obligations 5 Years None None A rating
Federal Agencies 5 Years None None None
Supranationals 5 Years 30 percent 5 percent AA
Banker’s Acceptances 180 days 40 percent 5 percent Federal Reserve eligible Commercial Paper 270 days 25 percent 5 percent A1/P1 rating Negotiable Certificates of Deposit 5 Years 30 percent 5 percent A rating Certificates of Deposit 1 Year 20 percent 5 percent FDIC insured or collateralized Repurchase Agreements 90 days None 5 percent None
Reverse Repurchase Agreements 92 days 20 percent of
combined base value 5 percent None
Medium Term Notes 5 Years 30 percent 5 percent A rating Money Market Mutual Funds N/A 20 percent 10 percent Multiple Mortgage and Asset-backed Securities 5 Years 20 percent 5 percent AA Rating CAMP N/A None None N/A
LAIF N/A N/A None N/A
The City is not required to include a list of investments held by our bond trustees; however, staff believes the City Council should be kept informed of these investments. These investments are identified on Attachment A.

LONG TERM PORTFLIO INCOME RETURN
Monthly Income Return

0.20%
Fiscal Year-to-Date Income Return

0.94%
Prior 12 Months Income Return

1.81%
#14..
- 681 -

Page 4 ends

Source: Bloomberg, Federal Reserve, and U.S. Bureau of Economic Analysis as of November 2023.

Economic Summary
Inflation Continues to Trend Lower
Nov-23

3.1%
-2%
0%
2%
4%
6%
8%
10%
Nov-20 May-21 Nov-21 May-22 Nov-22 May-23 Nov-23
Consumer Prices (CPI)
Year-over-Year Change in Top-Line Contributions
Services (Ex Food & Energy) Goods (Ex Food & Energy)
Food Energy
Headline YoY%
-5.4%
-3.8%
-0.9%

1.1% 1.3%

2.9% 3.1%

6.5%

10.1%
-10%
-5%
0%
5%
10%
Energy
Used Cars & Trucks
Medical Care
Apparel
New Cars
Food
CPI YoY
Shelter
Transportation
Key Consumer Price Index Components
% Change YoY
#14..
- 682 -

Page 5 ends

Source: Bloomberg, Federal Reserve, and U.S. Bureau of Economic Analysis as of December 2023 and November 2023.

Economic Summary
Federal Reserve Projects a Soft Landing

3.3%

7.0%
-2.0%
-0.6%

2.7%

2.6% 2.3% 2.1%

5.2%
-4%
-2%
0%
2%
4%
6%
8%
10%
Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
U.S. Real GDP Contributors and Detractors
Personal Consumption Fixed Investment Private Inventories Net Exports Gov't Expenditures

2.6%

1.4%

1.8% 1.9% 1.8%
0%
1%
2%
3%
4%
2023 2024 2025 2026 Longer
Run
Change in Real GDP
September Projections December Projections
#14..
- 683 -

Page 6 ends

Source: ICE BofAML 1-5 year Indices via Bloomberg, MarketAxess and PFMAM as of 12/31/2023. Spreads on ABS are option-adjusted spreads of 0-5 year indices based on weighted average life; spreads on agencies are relative to comparable maturity Treasuries.

Economic Summary
Agency, Corporate, and ABS Sectors Generating Strong
Relative Performance

0.00%

0.05%

0.10%

0.15%

0.20%

0.25%

0.30%

0.35%
Dec-22 Mar-23 Jun-23 Sep-23 Dec-23
Federal Agency Yield Spreads

0.50%

0.60%

0.70%

0.80%

0.90%

1.00%

1.10%

1.20%
Dec-22 Mar-23 Jun-23 Sep-23 Dec-23
Corporate Notes A-AAA Yield Spreads

0.20%

0.30%

0.40%

0.50%

0.60%

0.70%

0.80%

0.90%

1.00%

1.10%

1.20%
Dec-22 Mar-23 Jun-23 Sep-23 Dec-23
Asset-Backed Securities AAA Yield Spreads
#14..
- 684 -

Page 7 ends

Interest Rates Moderate But Remain High
Source: Bloomberg as of 12/31/2023.

Economic Summary

5.33%

4.25%

3.85%3.88% 3.88%

4.03%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%
U.S. Treasury Yield Curve
December 31, 2023
November 30, 2023
October 31, 2023
3mo 2y 5yr 7yr 10yr 20yr 30yr
#14..
- 685 -

Page 8 ends

This material is based on information obtained from sources generally believed to be reliable and available to the public, however, PFM Asset Management LLC cannot guarantee its accuracy, completeness or suitability. This material is for general information purposes only and is not intended to provide specific advice or a specific recommendation. All statements as to what will or may happen under certain circumstances are based on assumptions, some but not all of which are noted in the presentation. Assumptions may or may not be proven correct as actual events occur, and results may depend on events outside of your or our control. Changes in assumptions may have a material effect on results. Past performance does not necessarily reflect and is not a guaranty of future results. The information contained in this presentation is not an offer to purchase or sell any securities.

Investment advisory services are provided by PFM Asset Management LLC (“PFMAM”), an investment adviser registered with the U.S. Securities and Exchange Commission and a subsidiary of U.S. Bancorp Asset Management, Inc. (“USBAM”). USBAM is a subsidiary of U.S. Bank National Association (“U.S. Bank”). U.S. Bank is a separate entity and subsidiary of U.S. Bancorp. U.S. Bank is not responsible for and does not guarantee the products, services or performance of PFMAM. The information contained is not an offer to purchase or sell any securities. Additional applicable regulatory information is available upon request.

For more information regarding PFMAM’s services or entities, please visit www.pfmam.com.

Disclosures
#14..
- 686 -
For the Month Ending December 31, 2023
Account Statement
Consolidated Summary Statement
CITY OF MODESTO - Combined Portfolio
Investment Allocation
Investment Type Closing Market Value Percent
Asset-Backed Security 26,460,309.39 5.55
Federal Agency Bond / Note 36,643,165.12 7.68
Corporate Note 62,334,770.22 13.07
Bank Note 5,728,535.37 1.20
Certificate of Deposit 6,792,250.37 1.42
Federal Agency Commercial Mortgage-Backed Security 50,124,019.55 10.51 Commercial Paper 21,173,730.74 4.44
Municipal Bond / Note 5,021,504.75 1.05
Supra-National Agency Bond / Note 3,963,325.28 0.83
U.S. Treasury Bond / Note 209,473,761.49 43.91
CAMP Pool 49,318,080.86 10.34
Total $477,033,453.14 100.00%
Portfolio Summary
and Income
Closing
Portfolio Holdings Market Value
Cash Dividends
PFMAM Managed Account 51,749.75 427,715,372.28
CAMP Pool 0.00 49,318,080.86
Total $51,749.75 $477,033,453.14
Maturity Distribution (Fixed Income Holdings)
Portfolio Holdings Closing Market Value Percent
49,318,080.86
10,532,841.80
13,167,442.26
12,019,623.53
23,816,199.06
98,265,252.58
98,545,057.55
60,318,539.37
111,050,416.13

0.00 10.34

2.21 2.76

2.52 4.99

20.60 20.66

12.64 23.28

0.00 Under 30 days
31 to 60 days
61 to 90 days
91 to 180 days
181 days to 1 year
1 to 2 years
2 to 3 years
3 to 4 years
4 to 5 years
Over 5 years
Total $477,033,453.14
853
100.00%
Weighted Average Days to Maturity
Sector Allocation

5.55% ABS

7.68%
Fed Agy Bond /
Note

13.07%
Corporate Note

1.20%
Bank Note

1.42%
Cert of Deposit

10.51%
Federal Agency
Commercial
Mortgage-Backed
Security

4.44%
Commercial Paper

1.05%
Muni Bond / Note

0.83%
Supra-National
Agency Bond / Note

43.91%
US TSY Bond / Note

10.34%
CAMP Pool
Summary Page 1
#14..
- 687 -
Managed Account Summary Statement For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Total Cash Basis Earnings
Plus Net Realized Gains/Losses
Less Purchased Interest Related to Interest/Coupons
Interest/Dividends/Coupons Received
Earnings Reconciliation (Cash Basis) - Managed Account
Less Beginning Accrued Interest
Less Beginning Amortized Value of Securities
Less Cost of New Purchases
Plus Coupons/Dividends Received
Plus Proceeds of Maturities/Calls/Principal Payments
Plus Proceeds from Sales
Ending Accrued Interest
Ending Amortized Value of Securities
Earnings Reconciliation (Accrual Basis)
$424,591,542.97
(2,370,912.39)
(7,575,645.38)
7,652,781.00

0.00 5,417,606.08
$427,715,372.28
513,017.45
(7,096.25)
(454,171.45)
$51,749.75
Total
436,009,835.64
1,980,735.33
7,627,192.98
2,370,912.39
461,469.85
(7,658,156.00)
(438,083,126.11)
(1,658,211.28)
Total Accrual Basis Earnings $1,050,652.80
Closing Market Value
Change in Current Value
Unsettled Trades
Principal Acquisitions
Principal Dispositions
Maturities/Calls
Opening Market Value
Transaction Summary - Managed Account
_________________
_________________
_______________________________________________ _______________________________________________ Reconciling Transactions Net Cash Contribution
Security Purchases
Principal Payments
Coupon/Interest/Dividend Income
Sale Proceeds
Maturities/Calls
Cash Transactions Summary - Managed Account
2,185,000.00
7,627,192.98
461,469.85
185,912.39
(9,778,772.13)
(0.18)

0.00 Cash Balance
Closing Cash Balance $868,081.22
CITY OF MODESTO - COMBINED PORTFOLIO Page 1
#14..
- 688 -
Portfolio Summary and Statistics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Account Summary
Description Par Value Market Value Percent
U.S. Treasury Bond / Note 221,970,000.00 209,473,761.49 48.97 Supra-National Agency Bond / Note 4,095,000.00 3,963,325.28 0.93 Municipal Bond / Note 5,280,000.00 5,021,504.75 1.17
Federal Agency Commercial
Mortgage-Backed Security
50,036,713.07 50,124,019.55 11.72
Federal Agency Bond / Note 38,760,000.00 36,643,165.12 8.57 Corporate Note 63,205,000.00 62,334,770.22 14.57
Commercial Paper 21,387,000.00 21,173,730.74 4.95
Certificate of Deposit 6,855,000.00 6,792,250.37 1.59
Bank Note 5,635,000.00 5,728,535.37 1.34
Asset-Backed Security 26,175,794.24 26,460,309.39 6.19
Managed Account Sub-Total 443,399,507.31 427,715,372.28 100.00% Accrued Interest 1,980,735.33
Total Portfolio 443,399,507.31 429,696,107.61
Unsettled Trades 0.00 0.00
Sector Allocation

6.19%
ABS

1.34%
Bank Note

1.59%
Cert of Deposit

4.95%
Commercial Paper

14.57%
Corporate Note

8.57%
Fed Agy Bond /
Note

11.72%
Federal Agency
Commercial
Mortgage-Backed
Security

1.17%
Muni Bond / Note

0.93%
Supra-National
Agency Bond / Note

48.97%
US TSY Bond / Note
0 - 6 Months 6 - 12 Months 1 - 2 Years 2 - 3 Years 3 - 4 Years 4 - 5 Years Over 5 Years

8.36%

5.57%

22.97% 23.04%

14.10%

25.96%

0.00%
Maturity Distribution Characteristics
Yield to Maturity at Cost
Yield to Maturity at Market
Weighted Average Days to Maturity 951

3.28%

4.49%
CITY OF MODESTO - COMBINED PORTFOLIO Page 2
#14..
- 689 -
Managed Account Issuer Summary For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Credit Quality (S&P Ratings)

4.01%
A

7.57%
A+

1.00%
A2.49%
A-1

2.46%
A-1+

2.92%
AA

70.67%
AA+

0.25%
AA7.03%
AAA

1.60%
NR
Issuer Summary
Issuer of Holdings Percent
Market Value
AMAZON.COM INC 4,917,907.81 1.15
AMERICAN EXPRESS CO 3,143,102.58 0.73
APPLE INC 5,190,380.00 1.21
BANK OF AMERICA CO 11,644,321.98 2.72
BRISTOL-MYERS SQUIBB CO 2,077,960.83 0.49
CALIFORNIA DEPARTMENT OF WATER RESOURCES 96,011.00 0.02 CALIFORNIA STATE UNIVERSITY 578,766.00 0.14
CARMAX AUTO OWNER TRUST 403,693.74 0.09
CHASE ISSURANCE 3,066,538.20 0.72
CITIGROUP INC 6,724,511.23 1.57
DEERE & COMPANY 2,619,835.68 0.61
DISCOVER FINANCIAL SERVICES 749,339.36 0.18
FANNIE MAE 32,249,528.99 7.54
FEDERAL HOME LOAN BANKS 2,251,637.46 0.53
FIFTH THIRD AUTO TRUST 2,451,550.60 0.57
FLORIDA STATE BOARD OF ADMIN FIN CORP 1,709,370.00 0.40 FREDDIE MAC 52,266,018.22 12.22
HOME DEPOT INC 3,432,283.31 0.80
HONDA AUTO RECEIVABLES 2,357,640.27 0.55
HYUNDAI AUTO RECEIVABLES 1,608,828.17 0.38
INTER-AMERICAN DEVELOPMENT BANK 3,963,325.28 0.93
JP MORGAN CHASE & CO 5,829,987.88 1.36
KUBOTA CREDIT OWNER TRUST 901,174.93 0.21
LMA AMERICAS LLC 10,640,888.94 2.49
LOS ANGELES COMMUNITY COLLEGE DISTRICT 869,398.25 0.20
MASTERCARD INC 4,169,621.60 0.97
MICROSOFT CORP 5,783,517.00 1.35
NEW JERSEY TURNPIKE AUTHORITY 471,266.00 0.11
PACCAR FINANCIAL CORP 2,912,121.10 0.68
PFIZER INC 2,142,462.21 0.50
RABOBANK NEDERLAND 3,432,775.50 0.80
STATE OF MARYLAND 603,799.40 0.14
CITY OF MODESTO - COMBINED PORTFOLIO Page 3
#14..
- 690 -
Managed Account Issuer Summary For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Issuer of Holdings Percent
Market Value
TARGET CORP 340,611.43 0.08
THE BANK OF NEW YORK MELLON CORPORATION 3,193,669.71 0.75 THUNDER BAY FUNDING LLC 10,532,841.80 2.46
TORONTO-DOMINION BANK 3,359,474.87 0.79
TOYOTA MOTOR CORP 4,926,864.93 1.15
UNITED STATES TREASURY 209,473,761.49 48.99
UNIVERSITY OF CALIFORNIA 692,894.10 0.16
USAA AUTO OWNER TRUST 3,048,365.50 0.71
WAL-MART STORES INC 5,158,789.56 1.21
WELLS FARGO & COMPANY 5,728,535.37 1.34
Total $427,715,372.28 100.00%
CITY OF MODESTO - COMBINED PORTFOLIO Page 4
#14..
- 691 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
U.S. Treasury Bond / Note

US TREASURY NOTES
DTD 05/15/2014 2.500% 05/15/2024
912828WJ5 10,565,000.00 AA+ Aaa 10/16/23 10/16/23 10,385,890.23 5.50 34,104.05 10,450,944.25 10,457,699.75

US TREASURY NOTES
DTD 07/31/2022 3.000% 07/31/2024
91282CFA4 10,645,000.00 AA+ Aaa 11/29/23 11/30/23 10,484,909.18 5.31 133,641.03 10,505,904.70 10,516,927.88

US TREASURY NOTES
DTD 12/15/2021 1.000% 12/15/2024
91282CDN8 775,000.00 AA+ Aaa 04/06/22 04/07/22 741,335.94 2.68 359.97 763,048.06 747,390.63

US TREASURY NOTES
DTD 02/15/2022 1.500% 02/15/2025
91282CDZ1 2,300,000.00 AA+ Aaa 07/13/23 07/17/23 2,183,203.13 4.88 13,031.25 2,217,092.38 2,219,500.00

US TREASURY NOTES
DTD 02/15/2022 1.500% 02/15/2025
91282CDZ1 4,400,000.00 AA+ Aaa 04/06/22 04/07/22 4,255,109.38 2.70 24,929.35 4,343,014.31 4,246,000.00

US TREASURY NOTES
DTD 04/30/2020 0.375% 04/30/2025
912828ZL7 4,945,000.00 AA+ Aaa 04/29/21 04/30/21 4,894,777.34 0.63 3,158.55 4,928,327.86 4,679,978.66

US TREASURY NOTES
DTD 07/02/2018 2.750% 06/30/2025
912828XZ8 4,230,000.00 AA+ Aaa 04/06/22 04/07/22 4,232,148.05 2.73 319.57 4,230,993.93 4,126,893.75

US TREASURY NOTES
DTD 08/31/2020 0.250% 08/31/2025
91282CAJ0 4,340,000.00 AA+ Aaa 08/02/21 08/06/21 4,291,514.06 0.53 3,666.34 4,320,161.88 4,052,475.00

US TREASURY NOTES
DTD 08/31/2020 0.250% 08/31/2025
91282CAJ0 4,635,000.00 AA+ Aaa 04/06/22 04/07/22 4,262,932.62 2.74 3,915.56 4,452,860.74 4,327,931.25

US TREASURY NOTES
DTD 09/30/2020 0.250% 09/30/2025
91282CAM3 1,100,000.00 AA+ Aaa 09/27/21 09/28/21 1,076,023.44 0.80 698.77 1,089,544.06 1,024,375.00

US TREASURY NOTES
DTD 09/30/2020 0.250% 09/30/2025
91282CAM3 4,550,000.00 AA+ Aaa 09/07/21 09/09/21 4,473,574.22 0.67 2,890.37 4,517,098.75 4,237,187.50

US TREASURY NOTES
DTD 10/31/2020 0.250% 10/31/2025
91282CAT8 5,010,000.00 AA+ Aaa 04/29/21 04/30/21 4,894,339.45 0.77 2,133.38 4,962,962.37 4,653,820.06

US TREASURY NOTES
DTD 10/31/2020 0.250% 10/31/2025
91282CAT8 6,930,000.00 AA+ Aaa 10/04/21 10/06/21 6,783,278.91 0.78 2,950.96 6,863,945.89 6,437,319.97

US TREASURY NOTES
DTD 11/30/2020 0.375% 11/30/2025
91282CAZ4 4,250,000.00 AA+ Aaa 11/01/21 11/02/21 4,133,291.02 1.07 1,393.44 4,195,211.84 3,946,523.65 CITY OF MODESTO - COMBINED PORTFOLIO Page 5
#14..
- 692 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
U.S. Treasury Bond / Note

US TREASURY NOTES
DTD 11/30/2020 0.375% 11/30/2025
91282CAZ4 4,635,000.00 AA+ Aaa 04/06/22 04/07/22 4,254,785.16 2.75 1,519.67 4,435,622.53 4,304,032.26

US TREASURY NOTES
DTD 12/31/2020 0.375% 12/31/2025
91282CBC4 500,000.00 AA+ Aaa 02/02/21 02/04/21 498,613.28 0.43 5.15 499,434.78 463,437.50

US TREASURY NOTES
DTD 12/31/2020 0.375% 12/31/2025
91282CBC4 1,040,000.00 AA+ Aaa 01/07/21 01/08/21 1,035,978.13 0.45 10.71 1,038,385.06 963,950.00

US TREASURY NOTES
DTD 12/31/2020 0.375% 12/31/2025
91282CBC4 3,735,000.00 AA+ Aaa 04/05/21 04/07/21 3,646,439.65 0.89 38.48 3,697,608.99 3,461,878.13

US TREASURY NOTES
DTD 01/31/2021 0.375% 01/31/2026
91282CBH3 2,400,000.00 AA+ Aaa 07/02/21 07/07/21 2,353,875.00 0.80 3,766.30 2,378,968.77 2,217,000.00

US TREASURY NOTES
DTD 01/31/2021 0.375% 01/31/2026
91282CBH3 5,000,000.00 AA+ Aaa 02/17/22 02/18/22 4,719,531.25 1.85 7,846.47 4,852,088.21 4,618,750.00

US TREASURY NOTES
DTD 01/31/2021 0.375% 01/31/2026
91282CBH3 5,775,000.00 AA+ Aaa 01/04/22 01/06/22 5,570,167.97 1.27 9,062.67 5,670,102.84 5,334,656.25

US TREASURY NOTES
DTD 01/31/2021 0.375% 01/31/2026
91282CBH3 7,980,000.00 AA+ Aaa 05/03/22 05/04/22 7,256,812.50 2.95 12,522.96 7,577,700.52 7,371,525.00

US TREASURY NOTES
DTD 02/28/2019 2.500% 02/28/2026
9128286F2 3,210,000.00 AA+ Aaa 03/01/21 03/01/21 3,492,881.25 0.70 27,117.45 3,332,297.70 3,098,151.40

US TREASURY NOTES
DTD 02/28/2021 0.500% 02/28/2026
91282CBQ3 4,645,000.00 AA+ Aaa 04/06/22 04/07/22 4,259,973.05 2.76 7,848.01 4,431,517.03 4,292,270.31

US TREASURY NOTES
DTD 02/28/2021 0.500% 02/28/2026
91282CBQ3 6,000,000.00 AA+ Aaa 12/03/21 12/07/21 5,838,281.25 1.15 10,137.36 5,917,360.04 5,544,375.00

US TREASURY NOTES
DTD 03/31/2021 0.750% 03/31/2026
91282CBT7 2,480,000.00 AA+ Aaa 09/07/21 09/09/21 2,479,031.25 0.76 4,726.23 2,479,522.61 2,301,750.00

US TREASURY NOTES
DTD 03/31/2021 0.750% 03/31/2026
91282CBT7 4,925,000.00 AA+ Aaa 04/29/21 04/30/21 4,896,719.73 0.87 9,385.76 4,912,088.07 4,571,015.63

US TREASURY NOTES
DTD 05/31/2021 0.750% 05/31/2026
91282CCF6 1,405,000.00 AA+ Aaa 06/23/21 06/25/21 1,396,987.11 0.87 921.31 1,401,080.31 1,296,990.63 CITY OF MODESTO - COMBINED PORTFOLIO Page 6
#14..
- 693 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
U.S. Treasury Bond / Note

US TREASURY NOTES
DTD 05/31/2021 0.750% 05/31/2026
91282CCF6 4,615,000.00 AA+ Aaa 04/06/22 04/07/22 4,253,551.76 2.76 3,026.23 4,404,811.29 4,260,221.87

US TREASURY NOTES
DTD 05/31/2021 0.750% 05/31/2026
91282CCF6 4,800,000.00 AA+ Aaa 06/06/22 06/08/22 4,399,125.00 2.99 3,147.54 4,556,936.77 4,431,000.00

US TREASURY NOTES
DTD 08/31/2021 0.750% 08/31/2026
91282CCW9 4,640,000.00 AA+ Aaa 04/06/22 04/07/22 4,258,106.25 2.75 11,759.34 4,408,772.48 4,255,024.77

US TREASURY NOTES
DTD 09/30/2021 0.875% 09/30/2026
91282CCZ2 4,310,000.00 AA+ Aaa 04/05/22 04/07/22 3,968,398.83 2.77 9,582.68 4,100,698.86 3,959,812.50

US TREASURY NOTES
DTD 11/15/2016 2.000% 11/15/2026
912828U24 4,545,000.00 AA+ Aaa 06/06/22 06/08/22 4,355,920.90 3.01 11,737.09 4,422,640.98 4,297,865.63

US TREASURY NOTES
DTD 02/15/2017 2.250% 02/15/2027
912828V98 9,220,000.00 AA+ Aaa 07/05/22 07/07/22 8,981,576.56 2.85 78,357.47 9,058,455.38 8,753,237.50

US TREASURY NOTES
DTD 03/31/2022 2.500% 03/31/2027
91282CEF4 910,000.00 AA+ Aaa 11/29/22 11/30/22 854,973.44 4.03 5,780.74 868,782.25 869,903.13

US TREASURY NOTES
DTD 04/30/2020 0.500% 04/30/2027
912828ZN3 6,480,000.00 AA+ Aaa 08/03/22 08/05/22 5,791,500.00 2.92 5,518.68 5,996,178.43 5,786,437.82

US TREASURY NOTES
DTD 06/30/2020 0.500% 06/30/2027
912828ZV5 5,545,000.00 AA+ Aaa 08/09/22 08/10/22 4,920,754.30 2.99 76.17 5,098,760.50 4,925,519.25

US TREASURY NOTES
DTD 08/15/2017 2.250% 08/15/2027
9128282R0 1,200,000.00 AA+ Aaa 08/29/22 08/31/22 1,142,625.00 3.30 10,198.37 1,158,094.06 1,131,750.00

US TREASURY NOTES
DTD 08/15/2017 2.250% 08/15/2027
9128282R0 2,985,000.00 AA+ Aaa 09/01/22 09/06/22 2,830,036.52 3.40 25,368.44 2,871,440.29 2,815,228.13

US TREASURY NOTES
DTD 09/30/2022 4.125% 09/30/2027
91282CFM8 5,380,000.00 AA+ Aaa 11/01/22 11/03/22 5,344,903.91 4.27 56,390.78 5,353,207.90 5,416,987.50

US TREASURY NOTES
DTD 10/31/2022 4.125% 10/31/2027
91282CFU0 2,715,000.00 AA+ Aaa 12/06/22 12/08/22 2,752,755.47 3.81 19,075.86 2,744,541.33 2,733,241.54

US TREASURY NOTES
DTD 10/31/2022 4.125% 10/31/2027
91282CFU0 3,160,000.00 AA+ Aaa 12/13/22 12/14/22 3,229,495.31 3.63 22,202.47 3,214,558.89 3,181,231.41 CITY OF MODESTO - COMBINED PORTFOLIO Page 7
#14..
- 694 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
U.S. Treasury Bond / Note

US TREASURY NOTES
DTD 10/31/2020 0.500% 10/31/2027
91282CAU5 8,775,000.00 AA+ Aaa 01/04/23 01/06/23 7,472,803.71 3.91 7,473.21 7,739,313.47 7,716,515.63

US TREASURY NOTES
DTD 12/31/2022 3.875% 12/31/2027
91282CGC9 4,250,000.00 AA+ Aaa 06/01/23 06/05/23 4,266,933.59 3.78 452.44 4,264,804.22 4,245,351.35

US TREASURY NOTES
DTD 01/31/2023 3.500% 01/31/2028
91282CGH8 2,220,000.00 AA+ Aaa 05/16/23 05/18/23 2,218,265.63 3.52 32,515.76 2,218,495.67 2,186,353.24

US TREASURY NOTES
DTD 01/31/2021 0.750% 01/31/2028
91282CBJ9 3,450,000.00 AA+ Aaa 01/31/23 01/31/23 2,994,761.72 3.66 10,828.13 3,078,280.24 3,042,468.75

US TREASURY NOTES
DTD 02/28/2023 4.000% 02/29/2028
91282CGP0 2,825,000.00 AA+ Aaa 03/03/23 03/07/23 2,793,660.16 4.25 38,184.06 2,798,826.07 2,835,593.75

US TREASURY NOTES
DTD 02/28/2023 4.000% 02/29/2028
91282CGP0 2,970,000.00 AA+ Aaa 03/03/23 03/06/23 2,931,134.77 4.29 40,143.96 2,937,558.95 2,981,137.50

US TREASURY NOTES
DTD 03/31/2021 1.250% 03/31/2028
91282CBS9 2,555,000.00 AA+ Aaa 05/08/23 05/09/23 2,299,400.20 3.49 8,115.27 2,333,280.04 2,291,515.63

US TREASURY NOTES
DTD 03/31/2023 3.625% 03/31/2028
91282CGT2 2,675,000.00 AA+ Aaa 05/01/23 05/02/23 2,672,178.71 3.65 24,639.60 2,672,562.22 2,646,578.13

US TREASURY NOTES
DTD 04/30/2023 3.500% 04/30/2028
91282CHA2 2,810,000.00 AA+ Aaa 05/01/23 05/01/23 2,796,937.89 3.60 16,751.92 2,798,690.47 2,766,971.88

US TREASURY NOTES
DTD 04/30/2023 3.500% 04/30/2028
91282CHA2 6,530,000.00 AA+ Aaa 05/03/23 05/04/23 6,559,844.14 3.40 38,928.85 6,555,882.38 6,430,009.37 Security Type Sub-Total 221,970,000.00 212,882,047.32 2.78 802,356.18 216,120,461.62 209,473,761.49 Supra-National Agency Bond / Note

INTER-AMERICAN DEVEL BK NOTES
DTD 09/23/2021 0.500% 09/23/2024
4581X0DZ8 4,095,000.00 AAA Aaa 09/15/21 09/23/21 4,091,969.70 0.52 5,573.75 4,094,264.54 3,963,325.28 Security Type Sub-Total 4,095,000.00 4,091,969.70 0.52 5,573.75 4,094,264.54 3,963,325.28 Municipal Bond / Note
CITY OF MODESTO - COMBINED PORTFOLIO Page 8
#14..
- 695 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
Municipal Bond / Note

MD ST TXBL GO BONDS
DTD 08/05/2020 0.510% 08/01/2024
574193TQ1 620,000.00 AAA Aaa 07/23/20 08/05/20 619,826.40 0.52 1,317.50 619,974.62 603,799.40

CA ST UNIV TXBL REV BONDS
DTD 09/17/2020 0.685% 11/01/2024
13077DMK5 600,000.00 AA- Aa2 08/27/20 09/17/20 600,000.00 0.69 685.00 600,000.00 578,766.00

CA ST DEPT WTR RES WTR SYS TXBL REV
BNDS
DTD 08/06/2020 0.560% 12/01/2024
13067WRB0 100,000.00 AAA Aa1 07/30/20 08/06/20 100,000.00 0.56 46.67 100,000.00 96,011.00

UNIV OF CAL TXBL REV BONDS
DTD 07/16/2020 0.883% 05/15/2025
91412HGE7 220,000.00 AA Aa2 07/14/20 07/16/20 220,796.40 0.81 248.22 220,215.86 208,817.40

UNIV OF CAL TXBL REV BONDS
DTD 07/16/2020 0.883% 05/15/2025
91412HGE7 510,000.00 AA Aa2 07/10/20 07/16/20 510,000.00 0.88 575.42 510,000.00 484,076.70

FL ST BOARD OF ADMIN TXBL REV BONDS
DTD 09/16/2020 1.258% 07/01/2025
341271AD6 505,000.00 AA Aa3 09/03/20 09/16/20 508,570.35 1.11 3,176.45 506,116.63 479,573.25

FL ST BOARD OF ADMIN TXBL REV BONDS
DTD 09/16/2020 1.258% 07/01/2025
341271AD6 1,295,000.00 AA Aa3 09/03/20 09/16/20 1,295,000.00 1.26 8,145.55 1,295,000.00 1,229,796.75

LOS ANGELES CCD, CA TXBL GO BONDS
DTD 11/10/2020 0.773% 08/01/2025
54438CYK2 925,000.00 AA+ Aaa 10/30/20 11/10/20 925,000.00 0.77 2,979.27 925,000.00 869,398.25

NJ TURNPIKE AUTHORITY TXBL REV BONDS
DTD 02/04/2021 1.047% 01/01/2026
646140DP5 505,000.00 AA- A1 01/22/21 02/04/21 505,000.00 1.05 2,643.68 505,000.00 471,266.00 Security Type Sub-Total 5,280,000.00 5,284,193.15 0.92 19,817.76 5,281,307.11 5,021,504.75 Federal Agency Commercial Mortgage-Backed Security

FANNIEMAE-ACES
DTD 04/01/2014 3.346% 03/01/2024
3136AJB54 386,576.46 AA+ Aaa 12/13/19 12/18/19 405,361.65 2.14 1,077.90 387,310.73 384,091.11 FHMS K061 A2
DTD 01/30/2017 3.347% 11/01/2026
3137BTUM1 2,471,300.67 AA+ Aaa 05/19/23 05/24/23 2,395,230.95 4.31 6,892.87 2,408,665.70 2,399,274.29 FHMS K064 A2
DTD 05/15/2017 3.224% 03/01/2027
3137BXQY1 4,000,000.00 AA+ Aaa 08/16/23 08/18/23 3,773,125.00 4.98 10,746.67 3,797,025.08 3,864,262.32 CITY OF MODESTO - COMBINED PORTFOLIO Page 9
#14..
- 696 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
Federal Agency Commercial Mortgage-Backed Security

FHLMC MULTIFAMILY STRUCTURED P
DTD 07/01/2017 3.243% 04/01/2027
3137F1G44 2,275,000.00 AA+ Aaa 08/16/23 08/18/23 2,144,987.30 4.97 6,148.19 2,158,362.28 2,195,799.01

FHLMC MULTIFAMILY STRUCTURED P
DTD 08/01/2017 3.117% 06/01/2027
3137F2LJ3 3,530,000.00 AA+ Aaa 08/17/23 08/22/23 3,301,101.56 5.01 9,169.18 3,323,012.07 3,390,891.21 FHMS K507 A1
DTD 09/01/2023 4.800% 04/01/2028
3137HAMR4 3,659,310.90 AA+ Aaa 09/20/23 09/28/23 3,601,885.33 5.19 14,637.24 3,604,826.25 3,691,692.47 FHMS K506 A1
DTD 09/01/2023 4.650% 05/01/2028
3137HAMG8 1,895,295.76 AA+ Aaa 09/07/23 09/14/23 1,866,951.61 5.01 7,344.27 1,868,580.44 1,911,839.06 FHMS KJ46 A1
DTD 07/01/2023 4.777% 06/01/2028
3137HAD45 2,807,418.60 AA+ Aaa 07/19/23 07/27/23 2,807,348.41 4.78 11,175.87 2,807,354.67 2,819,686.54 FHMS K505 A2
DTD 07/01/2023 4.819% 06/01/2028
3137HACX2 3,500,000.00 AA+ Aaa 07/13/23 07/20/23 3,534,958.00 4.59 14,055.42 3,531,713.87 3,557,396.36 FNA 2023-M6 A2
DTD 07/01/2023 4.190% 07/01/2028
3136BQDE6 3,500,000.00 AA+ Aaa 07/18/23 07/31/23 3,440,664.06 4.58 12,220.83 3,445,749.05 3,475,386.36 FHMS KJ47 A1
DTD 09/01/2023 5.272% 08/01/2028
3137HAMN3 2,146,810.68 AA+ Aaa 09/19/23 09/28/23 2,146,799.94 5.27 9,431.65 2,146,800.46 2,199,050.63 FHMS K506 A2
DTD 09/01/2023 4.650% 08/01/2028
3137HAMH6 3,800,000.00 AA+ Aaa 09/07/23 09/14/23 3,743,786.60 4.99 14,725.00 3,746,833.13 3,843,930.05 FHMS K508 A2
DTD 10/01/2023 4.740% 08/01/2028
3137HAQ74 3,850,000.00 AA+ Aaa 10/11/23 10/19/23 3,765,546.40 5.26 15,207.50 3,768,693.35 3,908,164.80 FHMS K509 A2
DTD 10/01/2023 4.850% 09/01/2028
3137HAST4 2,890,000.00 AA+ Aaa 10/25/23 10/31/23 2,797,858.13 5.60 11,680.42 2,800,681.63 2,948,001.64 FHMS K507 A2
DTD 09/01/2023 4.800% 09/01/2028
3137HAMS2 3,800,000.00 AA+ Aaa 09/20/23 09/28/23 3,754,578.60 5.07 15,200.00 3,756,690.13 3,869,813.41 FHMS K510 A2
DTD 11/01/2023 5.069% 10/01/2028
3137HB3D4 1,465,000.00 AA+ Aaa 11/14/23 11/21/23 1,460,764.69 5.14 6,188.40 1,460,850.18 1,506,485.65 FHMS K511 A2
DTD 12/01/2023 4.860% 10/01/2028
3137HB3G7 2,125,000.00 AA+ Aaa 11/28/23 12/07/23 2,118,894.88 4.93 8,606.25 2,118,970.48 2,170,021.40 CITY OF MODESTO - COMBINED PORTFOLIO Page 10
#14..
- 697 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
Federal Agency Commercial Mortgage-Backed Security
FHMS K512 A2
DTD 12/01/2023 5.000% 11/01/2028
3137HBCF9 1,935,000.00 AA+ Aaa 12/11/23 12/21/23 1,953,069.03 4.78 8,062.50 1,952,971.35 1,988,233.24 Security Type Sub-Total 50,036,713.07 49,012,912.14 4.95 182,570.16 49,085,090.85 50,124,019.55 Federal Agency Bond / Note

FANNIE MAE NOTES
DTD 01/10/2020 1.625% 01/07/2025
3135G0X24 3,500,000.00 AA+ Aaa 03/04/20 03/05/20 3,628,135.00 0.85 27,489.58 3,526,945.29 3,389,484.00

FREDDIE MAC NOTES
DTD 02/14/2020 1.500% 02/12/2025
3137EAEP0 640,000.00 AA+ Aaa 02/27/20 02/28/20 649,676.80 1.18 3,706.67 642,180.09 617,908.48

FEDERAL HOME LOAN BANK NOTES
DTD 04/16/2020 0.500% 04/14/2025
3130AJHU6 2,370,000.00 AA+ Aaa 04/15/20 04/16/20 2,358,244.80 0.60 2,534.58 2,366,977.42 2,251,637.46

FANNIE MAE NOTES
DTD 04/24/2020 0.625% 04/22/2025
3135G03U5 475,000.00 AA+ Aaa 04/29/20 04/30/20 475,731.50 0.59 569.01 475,191.93 451,564.93

FANNIE MAE NOTES
DTD 04/24/2020 0.625% 04/22/2025
3135G03U5 1,910,000.00 AA+ Aaa 06/03/20 06/05/20 1,919,779.20 0.52 2,288.02 1,912,617.66 1,815,766.33

FANNIE MAE NOTES
DTD 04/24/2020 0.625% 04/22/2025
3135G03U5 3,195,000.00 AA+ Aaa 04/22/20 04/24/20 3,188,418.30 0.67 3,827.35 3,193,278.80 3,037,368.29

FANNIE MAE NOTES
DTD 04/24/2020 0.625% 04/22/2025
3135G03U5 3,345,000.00 AA+ Aaa 05/01/20 05/04/20 3,347,475.30 0.61 4,007.03 3,345,650.89 3,179,967.73

FANNIE MAE NOTES
DTD 06/19/2020 0.500% 06/17/2025
3135G04Z3 200,000.00 AA+ Aaa 09/17/20 09/18/20 200,712.00 0.42 38.89 200,218.98 188,802.20

FANNIE MAE NOTES
DTD 06/19/2020 0.500% 06/17/2025
3135G04Z3 1,075,000.00 AA+ Aaa 10/01/20 10/05/20 1,080,041.75 0.40 209.03 1,076,566.00 1,014,811.82

FANNIE MAE NOTES
DTD 06/19/2020 0.500% 06/17/2025
3135G04Z3 1,190,000.00 AA+ Aaa 01/04/21 01/05/21 1,197,223.30 0.36 231.39 1,192,370.70 1,123,373.09

FANNIE MAE NOTES
DTD 06/19/2020 0.500% 06/17/2025
3135G04Z3 3,675,000.00 AA+ Aaa 06/17/20 06/19/20 3,667,392.75 0.54 714.58 3,672,777.05 3,469,240.43

FANNIE MAE NOTES
DTD 06/19/2020 0.500% 06/17/2025
3135G04Z3 3,820,000.00 AA+ Aaa 10/02/20 10/05/20 3,836,311.40 0.41 742.78 3,825,066.42 3,606,122.02 CITY OF MODESTO - COMBINED PORTFOLIO Page 11
#14..
- 698 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
Federal Agency Bond / Note

FREDDIE MAC NOTES
DTD 07/23/2020 0.375% 07/21/2025
3137EAEU9 2,220,000.00 AA+ Aaa 07/21/20 07/23/20 2,208,944.40 0.48 3,700.00 2,216,563.31 2,086,025.22

FANNIE MAE NOTES
DTD 08/27/2020 0.375% 08/25/2025
3135G05X7 450,000.00 AA+ Aaa 10/22/20 10/23/20 447,480.00 0.49 590.62 449,141.46 421,384.50

FANNIE MAE NOTES
DTD 08/27/2020 0.375% 08/25/2025
3135G05X7 550,000.00 AA+ Aaa 10/15/20 10/16/20 548,289.50 0.44 721.87 549,419.55 515,025.50

FANNIE MAE NOTES
DTD 08/27/2020 0.375% 08/25/2025
3135G05X7 2,360,000.00 AA+ Aaa 08/25/20 08/27/20 2,348,955.20 0.47 3,097.50 2,356,354.73 2,209,927.60

FREDDIE MAC NOTES
DTD 09/25/2020 0.375% 09/23/2025
3137EAEX3 130,000.00 AA+ Aaa 09/29/20 09/30/20 129,829.70 0.40 132.71 129,940.92 121,439.24

FREDDIE MAC NOTES
DTD 09/25/2020 0.375% 09/23/2025
3137EAEX3 3,400,000.00 AA+ Aaa 09/23/20 09/25/20 3,389,766.00 0.44 3,470.83 3,396,459.62 3,176,103.20

FANNIE MAE NOTES
DTD 11/12/2020 0.500% 11/07/2025
3135G06G3 2,040,000.00 AA+ Aaa 11/19/20 11/24/20 2,039,224.80 0.51 1,530.00 2,039,710.32 1,902,024.60

FANNIE MAE NOTES
DTD 11/12/2020 0.500% 11/07/2025
3135G06G3 2,215,000.00 AA+ Aaa 11/09/20 11/12/20 2,207,070.30 0.57 1,661.25 2,212,056.30 2,065,188.48 Security Type Sub-Total 38,760,000.00 38,868,702.00 0.56 61,263.69 38,779,487.44 36,643,165.12 Corporate Note

PFIZER INC CORP NOTES
DTD 03/11/2019 2.950% 03/15/2024
717081ES8 2,155,000.00 A A2 04/02/19 04/04/19 2,180,881.55 2.69 18,718.57 2,155,655.04 2,142,462.21 AMAZON.COM INC CORPORATE NOTES
DTD 05/12/2021 0.450% 05/12/2024
023135BW5 1,590,000.00 AA A1 05/10/21 05/12/21 1,587,678.60 0.50 973.88 1,589,720.42 1,561,923.78

WALMART INC CORPORATE NOTES
DTD 04/23/2019 2.850% 07/08/2024
931142EL3 4,000,000.00 AA Aa2 07/10/19 07/12/19 4,124,840.00 2.19 54,783.33 4,011,070.59 3,950,504.00

PACCAR FINANCIAL CORP CORPORATE
NOTES
DTD 02/06/2020 1.800% 02/06/2025
69371RQ66 1,810,000.00 A+ A1 05/11/20 05/13/20 1,839,014.30 1.45 13,122.50 1,816,742.05 1,750,898.07 CITY OF MODESTO - COMBINED PORTFOLIO Page 12
#14..
- 699 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
Corporate Note

MASTERCARD INC CORP NOTES (CALLABLE)
DTD 12/03/2019 2.000% 03/03/2025
57636QAN4 1,760,000.00 A+ Aa3 05/04/20 05/06/20 1,836,225.60 1.08 11,537.78 1,777,539.80 1,704,927.84 AMAZON.COM INC CORPORATE NOTES
DTD 04/13/2022 3.000% 04/13/2025
023135CE4 3,430,000.00 AA A1 04/11/22 04/13/22 3,424,546.30 3.06 22,295.00 3,427,671.23 3,355,984.03

JPMORGAN CHASE & CO (CALLABLE) CORP
NOTE
DTD 06/01/2021 0.824% 06/01/2025
46647PCH7 865,000.00 A- A1 05/24/21 06/01/21 865,000.00 0.82 593.97 865,000.00 850,016.47

BRISTOL-MYERS SQUIBB CO CORPORATE
NOTES
DTD 11/13/2020 0.750% 11/13/2025
110122DN5 2,230,000.00 A A2 06/23/21 06/25/21 2,210,888.90 0.95 2,230.00 2,221,864.06 2,077,960.83

BANK OF NY MELLON CORP (CALLABLE)
CORPOR
DTD 01/28/2021 0.750% 01/28/2026
06406RAQ0 3,465,000.00 A A1 02/02/21 02/04/21 3,465,831.60 0.75 11,044.69 3,465,338.13 3,193,669.71

BANK OF AMERICA CORP NOTES
(CALLABLE)
DTD 03/22/2022 3.384% 04/02/2026
06051GKM0 2,025,000.00 A- A1 03/17/22 03/22/22 2,025,000.00 3.38 16,941.15 2,025,000.00 1,971,714.15

MICROSOFT CORP (CALLABLE) NOTES
DTD 08/08/2016 2.400% 08/08/2026
594918BR4 3,000,000.00 AAA Aaa 02/23/22 02/25/22 3,033,150.00 2.14 28,600.00 3,018,553.62 2,861,190.00

BANK OF AMERICA NA CORPORATE NOTES
DTD 08/18/2023 5.526% 08/18/2026
06428CAA2 3,750,000.00 A+ Aa1 08/15/23 08/18/23 3,749,700.00 5.53 76,558.13 3,749,737.23 3,822,157.50

MASTERCARD INC CORP NOTES (CALLABLE)
DTD 11/21/2016 2.950% 11/21/2026
57636QAG9 2,560,000.00 A+ Aa3 12/20/22 12/22/22 2,434,099.20 4.33 8,391.11 2,467,115.14 2,464,693.76

JP MORGAN CORP NOTES (CALLABLE)
DTD 12/08/2023 5.110% 12/08/2026
48125LRU8 3,500,000.00 A+ Aa2 12/05/23 12/08/23 3,500,000.00 5.11 11,426.53 3,500,000.00 3,535,343.00

TARGET CORP CORP NOTES (CALLABLE)
DTD 01/24/2022 1.950% 01/15/2027
87612EBM7 365,000.00 A A2 01/19/22 01/24/22 364,379.50 1.99 3,281.96 364,620.94 340,611.43

MICROSOFT CORP CORP NOTES (CALLABLE)
DTD 02/06/2017 3.300% 02/06/2027
594918BY9 3,000,000.00 AAA Aaa 12/14/22 12/16/22 2,914,170.00 4.06 39,875.00 2,935,783.50 2,922,327.00

HOME DEPOT INC CORP NOTES (CALLABLE)
DTD 09/14/2017 2.800% 09/14/2027
437076BT8 3,610,000.00 A A2 01/26/23 01/30/23 3,405,674.00 4.16 30,043.22 3,446,345.53 3,432,283.31 CITY OF MODESTO - COMBINED PORTFOLIO Page 13
#14..
- 700 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
Corporate Note

JPMORGAN CHASE CORP NOTES (CALLABLE)
DTD 02/24/2022 2.947% 02/24/2028
46647PCW4 1,535,000.00 A- A1 09/14/23 09/18/23 1,403,557.95 5.13 15,958.41 1,412,077.34 1,444,628.41

WALMART INC CORPORATE NOTES
(CALLABLE)
DTD 04/18/2023 3.900% 04/15/2028
931142FB4 1,220,000.00 AA Aa2 05/16/23 05/18/23 1,217,279.40 3.95 10,044.67 1,217,625.16 1,208,285.56

APPLE INC CORP NOTES CALLABLE
DTD 05/10/2023 4.000% 05/10/2028
037833ET3 5,200,000.00 AA+ Aaa 05/16/23 05/18/23 5,216,380.00 3.93 29,466.67 5,214,292.44 5,190,380.00

JOHN DEERE CAPITAL CORP CORPORATE
NOTES
DTD 07/14/2023 4.950% 07/14/2028
24422EXB0 495,000.00 A A2 07/13/23 07/14/23 501,732.00 4.64 11,366.44 501,101.91 507,561.12

JOHN DEERE CAPITAL CORP CORPORATE
NOTES
DTD 07/14/2023 4.950% 07/14/2028
24422EXB0 895,000.00 A A2 07/14/23 07/18/23 903,690.45 4.73 20,551.44 902,894.34 917,711.52

JOHN DEERE CAPITAL CORP CORPORATE
NOTES
DTD 07/14/2023 4.950% 07/14/2028
24422EXB0 1,165,000.00 A A2 07/11/23 07/14/23 1,163,264.15 4.98 26,751.31 1,163,426.62 1,194,563.04

PACCAR FINANCIAL CORP CORPORATE
NOTES
DTD 08/10/2023 4.950% 08/10/2028
69371RS64 1,130,000.00 A+ A1 08/17/23 08/21/23 1,122,914.90 5.09 21,907.88 1,123,433.80 1,161,223.03

TOYOTA MOTOR CREDIT CORP CORPORATE
NOTES
DTD 09/11/2023 5.250% 09/11/2028
89236TLB9 2,800,000.00 A+ A1 09/06/23 09/11/23 2,795,128.00 5.29 44,916.67 2,795,392.50 2,889,552.40

CITIBANK NA CORP NOTES (CALLABLE)
DTD 09/29/2023 5.803% 09/29/2028
17325FBB3 5,650,000.00 A+ Aa3 09/26/23 09/29/23 5,650,000.00 5.80 83,788.87 5,650,000.00 5,882,198.05 Security Type Sub-Total 63,205,000.00 62,935,026.40 3.61 615,169.18 62,818,001.39 62,334,770.22 Commercial Paper

THUNDER BAY FUNDING LLC COMM PAPER
DTD 08/02/2023 0.000% 02/27/2024
88602TBT9 10,630,000.00 A-1+ P-1 08/04/23 08/04/23 10,287,714.00 5.79 0.00 10,535,747.33 10,532,841.80 CITY OF MODESTO - COMBINED PORTFOLIO Page 14
#14..
- 701 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
Commercial Paper

LMA AMERICAS LLC COMM PAPER
DTD 09/07/2023 0.000% 03/08/2024
53944QC81 10,757,000.00 A-1 P-1 09/07/23 09/07/23 10,449,690.44 5.79 0.00 10,644,487.76 10,640,888.94 Security Type Sub-Total 21,387,000.00 20,737,404.44 5.79 0.00 21,180,235.09 21,173,730.74 Certificate of Deposit

TORONTO DOMINION BANK NY CERT
DEPOS
DTD 10/31/2022 5.470% 10/25/2024
89115B6F2 3,355,000.00 A A1 10/27/22 10/31/22 3,355,000.00 5.44 34,664.61 3,355,000.00 3,359,474.87

COOPERAT RABOBANK UA/NY CERT DEPOS
DTD 07/20/2023 5.080% 07/17/2026
21684LGS5 3,500,000.00 A+ Aa2 07/17/23 07/20/23 3,500,000.00 5.08 79,516.11 3,500,000.00 3,432,775.50 Security Type Sub-Total 6,855,000.00 6,855,000.00 5.26 114,180.72 6,855,000.00 6,792,250.37 Bank Note

WELLS FARGO BANK NA BANK NOTES
(CALLABLE
DTD 08/09/2023 5.450% 08/07/2026
94988J6D4 5,635,000.00 A+ Aa2 08/15/23 08/17/23 5,621,645.05 5.54 121,136.85 5,623,329.79 5,728,535.37 Security Type Sub-Total 5,635,000.00 5,621,645.05 5.54 121,136.85 5,623,329.79 5,728,535.37 Asset-Backed Security
HAROT 2021-1 A3
DTD 02/24/2021 0.270% 04/21/2025
43813GAC5 108,101.70 NR Aaa 02/17/21 02/24/21 108,099.71 0.27 8.11 108,101.08 106,786.04 HART 2021-A A3
DTD 04/28/2021 0.380% 09/15/2025
44933LAC7 147,493.09 AAA NR 04/20/21 04/28/21 147,477.57 0.38 24.91 147,487.05 145,479.62 CARMX 2021-1 A3
DTD 01/27/2021 0.340% 12/15/2025
14316NAC3 104,216.57 AAA NR 01/20/21 01/27/21 104,195.97 0.34 15.75 104,208.32 102,335.11 TAOT 2021-C A3
DTD 09/27/2021 0.430% 01/15/2026
89239BAC5 576,701.98 AAA Aaa 09/21/21 09/27/21 576,656.00 0.43 110.21 576,680.18 561,547.64 CARMX 2021-2 A3
DTD 04/21/2021 0.520% 02/17/2026
14314QAC8 308,191.86 AAA NR 04/13/21 04/21/21 308,125.45 0.52 71.23 308,162.55 301,358.63 CITY OF MODESTO - COMBINED PORTFOLIO Page 15
#14..
- 702 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
Asset-Backed Security
HART 2021-C A3
DTD 11/17/2021 0.740% 05/15/2026
44935FAD6 321,089.04 AAA NR 11/09/21 11/17/21 321,017.37 0.75 105.60 321,051.24 312,518.02 DCENT 2021-A1 A1
DTD 09/27/2021 0.580% 09/15/2026
254683CP8 775,000.00 AAA Aaa 09/20/21 09/27/21 774,834.07 0.58 199.78 774,909.63 749,339.36 CCCIT 2023-A1 A1
DTD 12/01/2023 5.230% 12/01/2027
17305EGW9 835,000.00 AAA Aaa 12/04/23 12/11/23 834,895.29 5.23 3,639.21 834,896.65 842,313.18 KCOT 2023-2A A3
DTD 07/26/2023 5.280% 01/18/2028
500945AC4 890,000.00 NR Aaa 07/18/23 07/26/23 889,775.19 5.29 2,088.53 889,797.03 901,174.93 BAAT 2023-1A A3
DTD 07/31/2023 5.530% 02/15/2028
06428AAC2 1,465,000.00 NR Aaa 07/25/23 07/31/23 1,464,944.48 5.53 3,600.64 1,464,949.63 1,482,799.75 HAROT 2023-3 A3
DTD 08/22/2023 5.410% 02/18/2028
43815QAC1 2,220,000.00 AAA NR 08/15/23 08/22/23 2,219,542.24 5.42 4,337.02 2,219,579.06 2,250,854.23 TAOT 2023-C A3
DTD 08/15/2023 5.160% 04/17/2028
89231FAD2 690,000.00 AAA NR 08/08/23 08/15/23 689,843.92 5.17 1,582.40 689,856.63 695,940.49 USAOT 2023-A A3
DTD 09/15/2023 5.580% 05/15/2028
90291VAC4 3,015,000.00 AAA Aaa 09/07/23 09/15/23 3,014,472.38 5.58 7,477.20 3,014,501.89 3,048,365.50 BAAT 2023-2A A3
DTD 11/21/2023 5.740% 06/15/2028
06054YAC1 2,925,000.00 NR Aaa 11/15/23 11/21/23 2,924,947.06 5.74 7,462.00 2,924,948.20 2,988,530.47 TAOT 2023-D A3
DTD 11/14/2023 5.540% 08/15/2028
89239FAD4 765,000.00 AAA NR 11/07/23 11/14/23 764,917.53 5.54 1,883.60 764,919.54 779,824.40 FITAT 2023-1 A3
DTD 08/23/2023 5.530% 08/15/2028
31680EAD3 2,425,000.00 AAA Aaa 08/15/23 08/23/23 2,424,849.65 5.53 5,960.11 2,424,860.48 2,451,550.60 CHAIT 2023-A1 A
DTD 09/15/2023 5.160% 09/15/2028
161571HT4 3,020,000.00 AAA NR 09/07/23 09/15/23 3,019,162.86 5.17 6,925.87 3,019,206.59 3,066,538.20 AMXCA 2023-3 A
DTD 09/19/2023 5.230% 09/15/2028
02582JKD1 3,090,000.00 AAA NR 09/12/23 09/19/23 3,089,861.88 5.23 7,182.53 3,089,868.83 3,143,102.58 HART 2023-C A3
DTD 11/13/2023 5.540% 10/16/2028
44918CAD4 1,130,000.00 AAA NR 11/03/23 11/13/23 1,129,851.41 5.54 2,782.31 1,129,854.95 1,150,830.53 CITY OF MODESTO - COMBINED PORTFOLIO Page 16
#14..
- 703 -
Managed Account Detail of Securities Held For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Rating Rating Date Date Cost at Cost Interest Cost Value Security Type/Description S&P Moody's Trade Settle Original YTM Accrued Amortized Market Par
Asset-Backed Security
BACCT 2023-A2 A2
DTD 12/14/2023 4.980% 11/15/2028
05522RDH8 1,365,000.00 NR Aaa 12/07/23 12/14/23 1,364,816.68 4.98 3,210.03 1,364,818.28 1,379,120.11 Security Type Sub-Total 26,175,794.24 26,172,286.71 4.99 58,667.04 26,172,657.81 26,460,309.39 Managed Account Sub-Total 443,399,507.31 432,461,186.91 3.28 1,980,735.33 436,009,835.64 427,715,372.28 $443,399,507.31 $432,461,186.91 3.28% $1,980,735.33 $436,009,835.64 $427,715,372.28 $429,696,107.61
$1,980,735.33
Total Investments
Accrued Interest
Securities Sub-Total
CITY OF MODESTO - COMBINED PORTFOLIO Page 17
#14..
- 704 -
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost at Mkt Security Type/Description Next Call Market Market Unreal G/L Unreal G/L Effective YTM Duration
U.S. Treasury Bond / Note
US TREASURY NOTES 912828WJ5 10,565,000.00 RBS 98.98 10,457,699.75 71,809.52 6,755.50 DTD 05/15/2014 2.500% 05/15/2024

0.38 5.26
US TREASURY NOTES 91282CFA4 10,645,000.00 CITIGRP 98.80 10,516,927.88 32,018.70 11,023.18 DTD 07/31/2022 3.000% 07/31/2024

0.58 5.11
US TREASURY NOTES 91282CDN8 775,000.00 BNP_PAR 96.44 747,390.63 6,054.69 (15,657.43) DTD 12/15/2021 1.000% 12/15/2024

0.96 4.86
US TREASURY NOTES 91282CDZ1 2,300,000.00 BNP_PAR 96.50 2,219,500.00 36,296.87 2,407.62 DTD 02/15/2022 1.500% 02/15/2025

1.12 4.73
US TREASURY NOTES 91282CDZ1 4,400,000.00 RBS 96.50 4,246,000.00 (9,109.38) (97,014.31) DTD 02/15/2022 1.500% 02/15/2025

1.12 4.73
US TREASURY NOTES 912828ZL7 4,945,000.00 JPM_CHA 94.64 4,679,978.66 (214,798.68) (248,349.20) DTD 04/30/2020 0.375% 04/30/2025

1.33 4.57
US TREASURY NOTES 912828XZ8 4,230,000.00 BARCLAY 97.56 4,126,893.75 (105,254.30) (104,100.18) DTD 07/02/2018 2.750% 06/30/2025

1.46 4.45
US TREASURY NOTES 91282CAJ0 4,340,000.00 WELLS_F 93.38 4,052,475.00 (239,039.06) (267,686.88) DTD 08/31/2020 0.250% 08/31/2025

1.67 4.42
US TREASURY NOTES 91282CAJ0 4,635,000.00 BNP_PAR 93.38 4,327,931.25 64,998.63 (124,929.49) DTD 08/31/2020 0.250% 08/31/2025

1.67 4.42
US TREASURY NOTES 91282CAM3 1,100,000.00 BNP_PAR 93.13 1,024,375.00 (51,648.44) (65,169.06) DTD 09/30/2020 0.250% 09/30/2025

1.75 4.38
US TREASURY NOTES 91282CAM3 4,550,000.00 HSBC 93.13 4,237,187.50 (236,386.72) (279,911.25) DTD 09/30/2020 0.250% 09/30/2025

1.75 4.38
US TREASURY NOTES 91282CAT8 5,010,000.00 HSBC 92.89 4,653,820.06 (240,519.39) (309,142.31) DTD 10/31/2020 0.250% 10/31/2025

1.83 4.33
US TREASURY NOTES 91282CAT8 6,930,000.00 TD 92.89 6,437,319.97 (345,958.94) (426,625.92) DTD 10/31/2020 0.250% 10/31/2025

1.83 4.33
US TREASURY NOTES 91282CAZ4 4,250,000.00 WELLS_F 92.86 3,946,523.65 (186,767.37) (248,688.19) DTD 11/30/2020 0.375% 11/30/2025

1.92 4.30
US TREASURY NOTES 91282CAZ4 4,635,000.00 WELLS_F 92.86 4,304,032.26 49,247.10 (131,590.27) DTD 11/30/2020 0.375% 11/30/2025

1.92 4.30
US TREASURY NOTES 91282CBC4 500,000.00 HSBC 92.69 463,437.50 (35,175.78) (35,997.28) DTD 12/31/2020 0.375% 12/31/2025

2.00 4.23
US TREASURY NOTES 91282CBC4 1,040,000.00 CITIGRP 92.69 963,950.00 (72,028.13) (74,435.06) DTD 12/31/2020 0.375% 12/31/2025

2.00 4.23
CITY OF MODESTO - COMBINED PORTFOLIO Page 18
#14..
- 705 -
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost at Mkt Security Type/Description Next Call Market Market Unreal G/L Unreal G/L Effective YTM Duration
U.S. Treasury Bond / Note
US TREASURY NOTES 91282CBC4 3,735,000.00 JPM_CHA 92.69 3,461,878.13 (184,561.52) (235,730.86) DTD 12/31/2020 0.375% 12/31/2025

2.00 4.23
US TREASURY NOTES 91282CBH3 2,400,000.00 BNP_PAR 92.38 2,217,000.00 (136,875.00) (161,968.77) DTD 01/31/2021 0.375% 01/31/2026

2.08 4.24
US TREASURY NOTES 91282CBH3 5,000,000.00 NOMURA 92.38 4,618,750.00 (100,781.25) (233,338.21) DTD 01/31/2021 0.375% 01/31/2026

2.08 4.24
US TREASURY NOTES 91282CBH3 5,775,000.00 MORGAN_ 92.38 5,334,656.25 (235,511.72) (335,446.59) DTD 01/31/2021 0.375% 01/31/2026

2.08 4.24
US TREASURY NOTES 91282CBH3 7,980,000.00 JPM_CHA 92.38 7,371,525.00 114,712.50 (206,175.52) DTD 01/31/2021 0.375% 01/31/2026

2.08 4.24
US TREASURY NOTES 9128286F2 3,210,000.00 GOLDMAN 96.52 3,098,151.40 (394,729.85) (234,146.30) DTD 02/28/2019 2.500% 02/28/2026

2.11 4.20
US TREASURY NOTES 91282CBQ3 4,645,000.00 NOMURA 92.41 4,292,270.31 32,297.26 (139,246.72) DTD 02/28/2021 0.500% 02/28/2026

2.16 4.21
US TREASURY NOTES 91282CBQ3 6,000,000.00 WELLS_F 92.41 5,544,375.00 (293,906.25) (372,985.04) DTD 02/28/2021 0.500% 02/28/2026

2.16 4.21
US TREASURY NOTES 91282CBT7 2,480,000.00 WELLS_F 92.81 2,301,750.00 (177,281.25) (177,772.61) DTD 03/31/2021 0.750% 03/31/2026

2.23 4.13
US TREASURY NOTES 91282CBT7 4,925,000.00 MORGAN_ 92.81 4,571,015.63 (325,704.10) (341,072.44) DTD 03/31/2021 0.750% 03/31/2026

2.23 4.13
US TREASURY NOTES 91282CCF6 1,405,000.00 MERRILL 92.31 1,296,990.63 (99,996.48) (104,089.68) DTD 05/31/2021 0.750% 05/31/2026

2.40 4.13
US TREASURY NOTES 91282CCF6 4,615,000.00 NOMURA 92.31 4,260,221.87 6,670.11 (144,589.42) DTD 05/31/2021 0.750% 05/31/2026

2.40 4.13
US TREASURY NOTES 91282CCF6 4,800,000.00 CITIGRP 92.31 4,431,000.00 31,875.00 (125,936.77) DTD 05/31/2021 0.750% 05/31/2026

2.40 4.13
US TREASURY NOTES 91282CCW9 4,640,000.00 RBC 91.70 4,255,024.77 (3,081.48) (153,747.71) DTD 08/31/2021 0.750% 08/31/2026

2.64 4.07
US TREASURY NOTES 91282CCZ2 4,310,000.00 RBC 91.88 3,959,812.50 (8,586.33) (140,886.36) DTD 09/30/2021 0.875% 09/30/2026

2.72 4.03
US TREASURY NOTES 912828U24 4,545,000.00 RBC 94.56 4,297,865.63 (58,055.27) (124,775.35) DTD 11/15/2016 2.000% 11/15/2026

2.80 4.02
US TREASURY NOTES 912828V98 9,220,000.00 JPM_CHA 94.94 8,753,237.50 (228,339.06) (305,217.88) DTD 02/15/2017 2.250% 02/15/2027

3.01 3.99
CITY OF MODESTO - COMBINED PORTFOLIO Page 19
#14..
- 706 -
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost at Mkt Security Type/Description Next Call Market Market Unreal G/L Unreal G/L Effective YTM Duration
U.S. Treasury Bond / Note
US TREASURY NOTES 91282CEF4 910,000.00 BARCLAY 95.59 869,903.13 14,929.69 1,120.88 DTD 03/31/2022 2.500% 03/31/2027

3.12 3.96
US TREASURY NOTES 912828ZN3 6,480,000.00 NOMURA 89.30 5,786,437.82 (5,062.18) (209,740.61) DTD 04/30/2020 0.500% 04/30/2027

3.31 3.96
US TREASURY NOTES 912828ZV5 5,545,000.00 WELLS_F 88.83 4,925,519.25 4,764.95 (173,241.25) DTD 06/30/2020 0.500% 06/30/2027

3.47 3.95
US TREASURY NOTES 9128282R0 1,200,000.00 BNP_PAR 94.31 1,131,750.00 (10,875.00) (26,344.06) DTD 08/15/2017 2.250% 08/15/2027

3.47 3.95
US TREASURY NOTES 9128282R0 2,985,000.00 HSBC 94.31 2,815,228.13 (14,808.39) (56,212.16) DTD 08/15/2017 2.250% 08/15/2027

3.47 3.95
US TREASURY NOTES 91282CFM8 5,380,000.00 MERRILL 100.69 5,416,987.50 72,083.59 63,779.60 DTD 09/30/2022 4.125% 09/30/2027

3.48 3.92
US TREASURY NOTES 91282CFU0 2,715,000.00 NOMURA 100.67 2,733,241.54 (19,513.93) (11,299.79) DTD 10/31/2022 4.125% 10/31/2027

3.57 3.93
US TREASURY NOTES 91282CFU0 3,160,000.00 JPM_CHA 100.67 3,181,231.41 (48,263.90) (33,327.48) DTD 10/31/2022 4.125% 10/31/2027

3.57 3.93
US TREASURY NOTES 91282CAU5 8,775,000.00 WELLS_F 87.94 7,716,515.63 243,711.92 (22,797.84) DTD 10/31/2020 0.500% 10/31/2027

3.80 3.92
US TREASURY NOTES 91282CGC9 4,250,000.00 NOMURA 99.89 4,245,351.35 (21,582.24) (19,452.87) DTD 12/31/2022 3.875% 12/31/2027

3.68 3.90
US TREASURY NOTES 91282CGH8 2,220,000.00 BNP_PAR 98.48 2,186,353.24 (31,912.39) (32,142.43) DTD 01/31/2023 3.500% 01/31/2028

3.79 3.90
US TREASURY NOTES 91282CBJ9 3,450,000.00 HSBC 88.19 3,042,468.75 47,707.03 (35,811.49) DTD 01/31/2021 0.750% 01/31/2028

4.02 3.91
US TREASURY NOTES 91282CGP0 2,825,000.00 TD 100.38 2,835,593.75 41,933.59 36,767.68 DTD 02/28/2023 4.000% 02/29/2028

3.83 3.90
US TREASURY NOTES 91282CGP0 2,970,000.00 JPM_CHA 100.38 2,981,137.50 50,002.73 43,578.55 DTD 02/28/2023 4.000% 02/29/2028

3.83 3.90
US TREASURY NOTES 91282CBS9 2,555,000.00 BNP_PAR 89.69 2,291,515.63 (7,884.57) (41,764.41) DTD 03/31/2021 1.250% 03/31/2028

4.14 3.91
US TREASURY NOTES 91282CGT2 2,675,000.00 RBS 98.94 2,646,578.13 (25,600.58) (25,984.09) DTD 03/31/2023 3.625% 03/31/2028

3.94 3.90
US TREASURY NOTES 91282CHA2 2,810,000.00 BARCLAY 98.47 2,766,971.88 (29,966.01) (31,718.59) DTD 04/30/2023 3.500% 04/30/2028

4.04 3.89
CITY OF MODESTO - COMBINED PORTFOLIO Page 20
#14..
- 707 -
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost at Mkt Security Type/Description Next Call Market Market Unreal G/L Unreal G/L Effective YTM Duration
U.S. Treasury Bond / Note
US TREASURY NOTES 91282CHA2 6,530,000.00 GOLDMAN 98.47 6,430,009.37 (129,834.77) (125,873.01) DTD 04/30/2023 3.500% 04/30/2028

4.04 3.89
Security Type Sub-Total 221,970,000.00 209,473,761.49 (3,408,285.83) (6,646,700.13) 2.41 4.25 Supra-National Agency Bond / Note
INTER-AMERICAN DEVEL BK NOTES 4581X0DZ8 4,095,000.00 JPM_CHA 96.78 3,963,325.28 (128,644.42) (130,939.26) DTD 09/23/2021 0.500% 09/23/2024

0.73 5.04
Security Type Sub-Total 4,095,000.00 3,963,325.28 (128,644.42) (130,939.26) 0.73 5.04 Municipal Bond / Note
MD ST TXBL GO BONDS 574193TQ1 620,000.00 JPM_CHA 97.39 603,799.40 (16,027.00) (16,175.22) DTD 08/05/2020 0.510% 08/01/2024

0.59 5.09
CA ST UNIV TXBL REV BONDS 13077DMK5 600,000.00 GOLDMAN 96.46 578,766.00 (21,234.00) (21,234.00) DTD 09/17/2020 0.685% 11/01/2024

0.84 5.06
CA ST DEPT WTR RES WTR SYS TXBL REV 13067WRB0 100,000.00 MORGAN_ 96.01 96,011.00 (3,989.00) (3,989.00) BNDS
DTD 08/06/2020 0.560% 12/01/2024

0.92 5.05
UNIV OF CAL TXBL REV BONDS 91412HGE7 220,000.00 JPM_CHA 04/15/25 94.92 208,817.40 (11,979.00) (11,398.46) DTD 07/16/2020 0.883% 05/15/2025

1.29 4.74
UNIV OF CAL TXBL REV BONDS 91412HGE7 510,000.00 JPM_CHA 04/15/25 94.92 484,076.70 (25,923.30) (25,923.30) DTD 07/16/2020 0.883% 05/15/2025

1.29 4.74
FL ST BOARD OF ADMIN TXBL REV BONDS 341271AD6 505,000.00 MERRILL 94.97 479,573.25 (28,997.10) (26,543.38) DTD 09/16/2020 1.258% 07/01/2025

1.49 4.77
FL ST BOARD OF ADMIN TXBL REV BONDS 341271AD6 1,295,000.00 MERRILL 94.97 1,229,796.75 (65,203.25) (65,203.25) DTD 09/16/2020 1.258% 07/01/2025

1.49 4.77
LOS ANGELES CCD, CA TXBL GO BONDS 54438CYK2 925,000.00 MERRILL 93.99 869,398.25 (55,601.75) (55,601.75) DTD 11/10/2020 0.773% 08/01/2025

1.58 4.75
NJ TURNPIKE AUTHORITY TXBL REV 646140DP5 505,000.00 CITIGRP 93.32 471,266.00 (33,734.00) (33,734.00) BONDS
DTD 02/04/2021 1.047% 01/01/2026

1.98 4.58
Security Type Sub-Total 5,280,000.00 5,021,504.75 (262,688.40) (259,802.36) 1.33 4.82 CITY OF MODESTO - COMBINED PORTFOLIO Page 21
#14..
- 708 -
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost at Mkt Security Type/Description Next Call Market Market Unreal G/L Unreal G/L Effective YTM Duration
Federal Agency Commercial Mortgage-Backed Security
FANNIEMAE-ACES 3136AJB54 386,576.46 JPM_CHAS 99.36 384,091.11 (21,270.54) (3,219.62) DTD 04/01/2014 3.346% 03/01/2024

0.19 7.17
FHMS K061 A2 3137BTUM1 2,471,300.67 CITIGRP 97.09 2,399,274.29 4,043.34 (9,391.41) DTD 01/30/2017 3.347% 11/01/2026

2.55 4.44
FHMS K064 A2 3137BXQY1 4,000,000.00 MORGAN_ 96.61 3,864,262.32 91,137.32 67,237.24 DTD 05/15/2017 3.224% 03/01/2027

2.85 4.37
FHLMC MULTIFAMILY STRUCTURED P 3137F1G44 2,275,000.00 CITIGRP 96.52 2,195,799.01 50,811.71 37,436.73 DTD 07/01/2017 3.243% 04/01/2027

2.99 4.39
FHLMC MULTIFAMILY STRUCTURED P 3137F2LJ3 3,530,000.00 CANT_FI 96.06 3,390,891.21 89,789.65 67,879.14 DTD 08/01/2017 3.117% 06/01/2027

3.09 4.36
FHMS K507 A1 3137HAMR4 3,659,310.90 MERRILL 100.88 3,691,692.47 89,807.14 86,866.22 DTD 09/01/2023 4.800% 04/01/2028

3.35 4.57
FHMS K506 A1 3137HAMG8 1,895,295.76 WELLS_F 100.87 1,911,839.06 44,887.45 43,258.62 DTD 09/01/2023 4.650% 05/01/2028

3.59 4.43
FHMS KJ46 A1 3137HAD45 2,807,418.60 JPM_CHA 100.44 2,819,686.54 12,338.13 12,331.87 DTD 07/01/2023 4.777% 06/01/2028

3.10 4.67
FHMS K505 A2 3137HACX2 3,500,000.00 JPM_CHA 101.64 3,557,396.36 22,438.36 25,682.49 DTD 07/01/2023 4.819% 06/01/2028

3.86 4.41
FNA 2023-M6 A2 3136BQDE6 3,500,000.00 JPM_CHA 99.30 3,475,386.36 34,722.30 29,637.31 DTD 07/01/2023 4.190% 07/01/2028

4.02 4.36
FHMS KJ47 A1 3137HAMN3 2,146,810.68 JPM_CHA 102.43 2,199,050.63 52,250.69 52,250.17 DTD 09/01/2023 5.272% 08/01/2028

3.32 4.68
FHMS K506 A2 3137HAMH6 3,800,000.00 WELLS_F 101.16 3,843,930.05 100,143.45 97,096.92 DTD 09/01/2023 4.650% 08/01/2028

4.00 4.37
FHMS K508 A2 3137HAQ74 3,850,000.00 BMO 101.51 3,908,164.80 142,618.40 139,471.45 DTD 10/01/2023 4.740% 08/01/2028

4.02 4.38
FHMS K509 A2 3137HAST4 2,890,000.00 MORGAN_ 102.01 2,948,001.64 150,143.51 147,320.01 DTD 10/01/2023 4.850% 09/01/2028

4.09 4.37
FHMS K507 A2 3137HAMS2 3,800,000.00 MERRILL 101.84 3,869,813.41 115,234.81 113,123.28 DTD 09/01/2023 4.800% 09/01/2028

4.05 4.36
FHMS K510 A2 3137HB3D4 1,465,000.00 JPM_CHA 102.83 1,506,485.65 45,720.96 45,635.47 DTD 11/01/2023 5.069% 10/01/2028

4.10 4.41
FHMS K511 A2 3137HB3G7 2,125,000.00 MERRILL 102.12 2,170,021.40 51,126.52 51,050.92 DTD 12/01/2023 4.860% 10/01/2028

4.15 4.37
CITY OF MODESTO - COMBINED PORTFOLIO Page 22
#14..
- 709 -
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost at Mkt Security Type/Description Next Call Market Market Unreal G/L Unreal G/L Effective YTM Duration
Federal Agency Commercial Mortgage-Backed Security
FHMS K512 A2 3137HBCF9 1,935,000.00 JPM_CHA 102.75 1,988,233.24 35,164.21 35,261.89 DTD 12/01/2023 5.000% 11/01/2028

4.30 4.37
Security Type Sub-Total 50,036,713.07 50,124,019.55 1,111,107.41 1,038,928.70 3.59 4.45 Federal Agency Bond / Note
FANNIE MAE NOTES 3135G0X24 3,500,000.00 CITIGRP 96.84 3,389,484.00 (238,651.00) (137,461.29) DTD 01/10/2020 1.625% 01/07/2025

1.01 4.84
FREDDIE MAC NOTES 3137EAEP0 640,000.00 WELLS_FA 96.55 617,908.48 (31,768.32) (24,271.61) DTD 02/14/2020 1.500% 02/12/2025

1.11 4.71
FEDERAL HOME LOAN BANK NOTES 3130AJHU6 2,370,000.00 CITIGRP 95.01 2,251,637.46 (106,607.34) (115,339.96) DTD 04/16/2020 0.500% 04/14/2025

1.29 4.53
FANNIE MAE NOTES 3135G03U5 475,000.00 WELLS_F 95.07 451,564.93 (24,166.57) (23,627.00) DTD 04/24/2020 0.625% 04/22/2025

1.31 4.54
FANNIE MAE NOTES 3135G03U5 1,910,000.00 HSBC 95.07 1,815,766.33 (104,012.87) (96,851.33) DTD 04/24/2020 0.625% 04/22/2025

1.31 4.54
FANNIE MAE NOTES 3135G03U5 3,195,000.00 CITIGRP 95.07 3,037,368.29 (151,050.01) (155,910.51) DTD 04/24/2020 0.625% 04/22/2025

1.31 4.54
FANNIE MAE NOTES 3135G03U5 3,345,000.00 WELLS_F 95.07 3,179,967.73 (167,507.57) (165,683.16) DTD 04/24/2020 0.625% 04/22/2025

1.31 4.54
FANNIE MAE NOTES 3135G04Z3 200,000.00 WELLS_F 94.40 188,802.20 (11,909.80) (11,416.78) DTD 06/19/2020 0.500% 06/17/2025

1.46 4.49
FANNIE MAE NOTES 3135G04Z3 1,075,000.00 NOMURA 94.40 1,014,811.82 (65,229.93) (61,754.18) DTD 06/19/2020 0.500% 06/17/2025

1.46 4.49
FANNIE MAE NOTES 3135G04Z3 1,190,000.00 RBS 94.40 1,123,373.09 (73,850.21) (68,997.61) DTD 06/19/2020 0.500% 06/17/2025

1.46 4.49
FANNIE MAE NOTES 3135G04Z3 3,675,000.00 NOMURA 94.40 3,469,240.43 (198,152.32) (203,536.62) DTD 06/19/2020 0.500% 06/17/2025

1.46 4.49
FANNIE MAE NOTES 3135G04Z3 3,820,000.00 RBS 94.40 3,606,122.02 (230,189.38) (218,944.40) DTD 06/19/2020 0.500% 06/17/2025

1.46 4.49
FREDDIE MAC NOTES 3137EAEU9 2,220,000.00 WELLS_F 93.97 2,086,025.22 (122,919.18) (130,538.09) DTD 07/23/2020 0.375% 07/21/2025

1.56 4.43
FANNIE MAE NOTES 3135G05X7 450,000.00 NOMURA 93.64 421,384.50 (26,095.50) (27,756.96) DTD 08/27/2020 0.375% 08/25/2025

1.65 4.41
CITY OF MODESTO - COMBINED PORTFOLIO Page 23
#14..
- 710 -
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost at Mkt Security Type/Description Next Call Market Market Unreal G/L Unreal G/L Effective YTM Duration
Federal Agency Bond / Note
FANNIE MAE NOTES 3135G05X7 550,000.00 CITIGRP 93.64 515,025.50 (33,264.00) (34,394.05) DTD 08/27/2020 0.375% 08/25/2025

1.65 4.41
FANNIE MAE NOTES 3135G05X7 2,360,000.00 BARCLAY 93.64 2,209,927.60 (139,027.60) (146,427.13) DTD 08/27/2020 0.375% 08/25/2025

1.65 4.41
FREDDIE MAC NOTES 3137EAEX3 130,000.00 WELLS_F 93.41 121,439.24 (8,390.46) (8,501.68) DTD 09/25/2020 0.375% 09/23/2025

1.73 4.37
FREDDIE MAC NOTES 3137EAEX3 3,400,000.00 CITIGRP 93.41 3,176,103.20 (213,662.80) (220,356.42) DTD 09/25/2020 0.375% 09/23/2025

1.73 4.37
FANNIE MAE NOTES 3135G06G3 2,040,000.00 NOMURA 93.24 1,902,024.60 (137,200.20) (137,685.72) DTD 11/12/2020 0.500% 11/07/2025

1.85 4.34
FANNIE MAE NOTES 3135G06G3 2,215,000.00 BARCLAY 93.24 2,065,188.48 (141,881.82) (146,867.82) DTD 11/12/2020 0.500% 11/07/2025

1.85 4.34
Security Type Sub-Total 38,760,000.00 36,643,165.12 (2,225,536.88) (2,136,322.32) 1.46 4.50 Corporate Note
PFIZER INC CORP NOTES 717081ES8 2,155,000.00 BONY 02/15/24 99.42 2,142,462.21 (38,419.34) (13,192.83) DTD 03/11/2019 2.950% 03/15/2024

0.13 5.73
AMAZON.COM INC CORPORATE NOTES 023135BW5 1,590,000.00 JPM_CHA 98.23 1,561,923.78 (25,754.82) (27,796.64) DTD 05/12/2021 0.450% 05/12/2024

0.37 5.36
WALMART INC CORPORATE NOTES 931142EL3 4,000,000.00 CITIGRP 06/08/24 98.76 3,950,504.00 (174,336.00) (60,566.59) DTD 04/23/2019 2.850% 07/08/2024

0.44 5.28
PACCAR FINANCIAL CORP CORPORATE 69371RQ66 1,810,000.00 MITSU 96.73 1,750,898.07 (88,116.23) (65,843.98) NOTES
DTD 02/06/2020 1.800% 02/06/2025

1.09 4.88
MASTERCARD INC CORP NOTES 57636QAN4 1,760,000.00 JSEB 02/03/25 96.87 1,704,927.84 (131,297.76) (72,611.96) (CALLABLE)
DTD 12/03/2019 2.000% 03/03/2025

1.08 4.77
AMAZON.COM INC CORPORATE NOTES 023135CE4 3,430,000.00 JPM_CHA 97.84 3,355,984.03 (68,562.27) (71,687.20) DTD 04/13/2022 3.000% 04/13/2025

1.27 4.75
JPMORGAN CHASE & CO (CALLABLE) CORP 46647PCH7 865,000.00 JPM_CHA 06/01/24 98.27 850,016.47 (14,983.53) (14,983.53) NOTE
DTD 06/01/2021 0.824% 06/01/2025

0.42 2.07
CITY OF MODESTO - COMBINED PORTFOLIO Page 24
#14..
- 711 -
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost at Mkt Security Type/Description Next Call Market Market Unreal G/L Unreal G/L Effective YTM Duration
Corporate Note
BRISTOL-MYERS SQUIBB CO CORPORATE 110122DN5 2,230,000.00 MERRILL 10/13/25 93.18 2,077,960.83 (132,928.07) (143,903.23) NOTES
DTD 11/13/2020 0.750% 11/13/2025

1.78 4.60
BANK OF NY MELLON CORP (CALLABLE) 06406RAQ0 3,465,000.00 US_BANC 12/28/25 92.17 3,193,669.71 (272,161.89) (271,668.42) CORPOR
DTD 01/28/2021 0.750% 01/28/2026

1.98 4.75
BANK OF AMERICA CORP NOTES 06051GKM0 2,025,000.00 MERRILL 04/02/25 97.37 1,971,714.15 (53,285.85) (53,285.85) (CALLABLE)
DTD 03/22/2022 3.384% 04/02/2026

1.23 4.62
MICROSOFT CORP (CALLABLE) NOTES 594918BR4 3,000,000.00 TD 05/08/26 95.37 2,861,190.00 (171,960.00) (157,363.62) DTD 08/08/2016 2.400% 08/08/2026

2.28 4.30
BANK OF AMERICA NA CORPORATE NOTES 06428CAA2 3,750,000.00 MERRILL 101.92 3,822,157.50 72,457.50 72,420.27 DTD 08/18/2023 5.526% 08/18/2026

2.44 4.74
MASTERCARD INC CORP NOTES 57636QAG9 2,560,000.00 CSFB 08/21/26 96.28 2,464,693.76 30,594.56 (2,421.38) (CALLABLE)
DTD 11/21/2016 2.950% 11/21/2026

2.55 4.33
JP MORGAN CORP NOTES (CALLABLE) 48125LRU8 3,500,000.00 JPM_CHA 11/08/26 101.01 3,535,343.00 35,343.00 35,343.00 DTD 12/08/2023 5.110% 12/08/2026

2.69 4.74
TARGET CORP CORP NOTES (CALLABLE) 87612EBM7 365,000.00 CITIGRP 12/15/26 93.32 340,611.43 (23,768.07) (24,009.51) DTD 01/24/2022 1.950% 01/15/2027

2.86 4.32
MICROSOFT CORP CORP NOTES 594918BY9 3,000,000.00 GOLDMAN 11/06/26 97.41 2,922,327.00 8,157.00 (13,456.50) (CALLABLE)
DTD 02/06/2017 3.300% 02/06/2027

2.71 4.20
HOME DEPOT INC CORP NOTES 437076BT8 3,610,000.00 TD 06/14/27 95.08 3,432,283.31 26,609.31 (14,062.22) (CALLABLE)
DTD 09/14/2017 2.800% 09/14/2027

3.29 4.25
JPMORGAN CHASE CORP NOTES 46647PCW4 1,535,000.00 MERRILL 02/24/27 94.11 1,444,628.41 41,070.46 32,551.07 (CALLABLE)
DTD 02/24/2022 2.947% 02/24/2028

3.00 4.52
WALMART INC CORPORATE NOTES 931142FB4 1,220,000.00 BARCLAY 03/15/28 99.04 1,208,285.56 (8,993.84) (9,339.60) (CALLABLE)
DTD 04/18/2023 3.900% 04/15/2028

3.89 4.15
APPLE INC CORP NOTES CALLABLE 037833ET3 5,200,000.00 HSBC 04/10/28 99.82 5,190,380.00 (26,000.00) (23,912.44) DTD 05/10/2023 4.000% 05/10/2028

3.95 4.05
CITY OF MODESTO - COMBINED PORTFOLIO Page 25
#14..
- 712 -
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost at Mkt Security Type/Description Next Call Market Market Unreal G/L Unreal G/L Effective YTM Duration
Corporate Note
JOHN DEERE CAPITAL CORP CORPORATE 24422EXB0 495,000.00 SIEBERT 102.54 507,561.12 5,829.12 6,459.21 NOTES
DTD 07/14/2023 4.950% 07/14/2028

4.04 4.33
JOHN DEERE CAPITAL CORP CORPORATE 24422EXB0 895,000.00 TD 102.54 917,711.52 14,021.07 14,817.18 NOTES
DTD 07/14/2023 4.950% 07/14/2028

4.04 4.33
JOHN DEERE CAPITAL CORP CORPORATE 24422EXB0 1,165,000.00 CITIGRP 102.54 1,194,563.04 31,298.89 31,136.42 NOTES
DTD 07/14/2023 4.950% 07/14/2028

4.04 4.33
PACCAR FINANCIAL CORP CORPORATE 69371RS64 1,130,000.00 TD 102.76 1,161,223.03 38,308.13 37,789.23 NOTES
DTD 08/10/2023 4.950% 08/10/2028

4.11 4.28
TOYOTA MOTOR CREDIT CORP 89236TLB9 2,800,000.00 MERRILL 103.20 2,889,552.40 94,424.40 94,159.90

CORPORATE NOTES
DTD 09/11/2023 5.250% 09/11/2028

4.17 4.49
CITIBANK NA CORP NOTES (CALLABLE) 17325FBB3 5,650,000.00 CITIGRP 08/29/28 104.11 5,882,198.05 232,198.05 232,198.05 DTD 09/29/2023 5.803% 09/29/2028

4.11 4.82
Security Type Sub-Total 63,205,000.00 62,334,770.22 (600,256.18) (483,231.17) 2.51 4.59 Commercial Paper
THUNDER BAY FUNDING LLC COMM PAPER 88602TBT9 10,630,000.00 GOLDMAN 99.09 10,532,841.80 245,127.80 (2,905.53) DTD 08/02/2023 0.000% 02/27/2024

0.17 5.73
LMA AMERICAS LLC COMM PAPER 53944QC81 10,757,000.00 JPM_CHA 98.92 10,640,888.94 191,198.50 (3,598.82) DTD 09/07/2023 0.000% 03/08/2024

0.20 5.78
Security Type Sub-Total 21,387,000.00 21,173,730.74 436,326.30 (6,504.35) 0.19 5.76 Certificate of Deposit
TORONTO DOMINION BANK NY CERT 89115B6F2 3,355,000.00 TD 100.13 3,359,474.87 4,474.87 4,474.87 DEPOS
DTD 10/31/2022 5.470% 10/25/2024

0.84 5.14
COOPERAT RABOBANK UA/NY CERT DEPOS 21684LGS5 3,500,000.00 RABOBAN 98.08 3,432,775.50 (67,224.50) (67,224.50) DTD 07/20/2023 5.080% 07/17/2026

2.37 5.90
CITY OF MODESTO - COMBINED PORTFOLIO Page 26
#14..
- 713 -
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost at Mkt Security Type/Description Next Call Market Market Unreal G/L Unreal G/L Effective YTM Duration
Security Type Sub-Total 6,855,000.00 6,792,250.37 (62,749.63) (62,749.63) 1.61 5.52 Bank Note
WELLS FARGO BANK NA BANK NOTES 94988J6D4 5,635,000.00 WELLS_F 07/07/26 101.66 5,728,535.37 106,890.32 105,205.58 (CALLABLE
DTD 08/09/2023 5.450% 08/07/2026

2.42 4.76
Security Type Sub-Total 5,635,000.00 5,728,535.37 106,890.32 105,205.58 2.42 4.76 Asset-Backed Security
HAROT 2021-1 A3 43813GAC5 108,101.70 JPM_CHA 98.78 106,786.04 (1,313.67) (1,315.04) DTD 02/24/2021 0.270% 04/21/2025

0.21 1.21
HART 2021-A A3 44933LAC7 147,493.09 BARCLAY 98.63 145,479.62 (1,997.95) (2,007.43) DTD 04/28/2021 0.380% 09/15/2025

0.25 1.19
CARMX 2021-1 A3 14316NAC3 104,216.57 MITSU 98.19 102,335.11 (1,860.86) (1,873.21) DTD 01/27/2021 0.340% 12/15/2025

0.31 1.27
TAOT 2021-C A3 89239BAC5 576,701.98 BARCLAY 97.37 561,547.64 (15,108.36) (15,132.54) DTD 09/27/2021 0.430% 01/15/2026

0.45 1.74
CARMX 2021-2 A3 14314QAC8 308,191.86 MERRILL 97.78 301,358.63 (6,766.82) (6,803.92) DTD 04/21/2021 0.520% 02/17/2026

0.37 1.58
HART 2021-C A3 44935FAD6 321,089.04 SMBC 97.33 312,518.02 (8,499.35) (8,533.22) DTD 11/17/2021 0.740% 05/15/2026

0.52 1.89
DCENT 2021-A1 A1 254683CP8 775,000.00 CITIGRP 96.69 749,339.36 (25,494.71) (25,570.27) DTD 09/27/2021 0.580% 09/15/2026

0.68 1.83
CCCIT 2023-A1 A1 17305EGW9 835,000.00 CITIGRP 100.88 842,313.18 7,417.89 7,416.53 DTD 12/01/2023 5.230% 12/01/2027

3.58 4.98
KCOT 2023-2A A3 500945AC4 890,000.00 JPM_CHA 101.26 901,174.93 11,399.74 11,377.90 DTD 07/26/2023 5.280% 01/18/2028

2.24 4.94
BAAT 2023-1A A3 06428AAC2 1,465,000.00 MERRILL 101.22 1,482,799.75 17,855.27 17,850.12 DTD 07/31/2023 5.530% 02/15/2028

1.83 5.20
HAROT 2023-3 A3 43815QAC1 2,220,000.00 MERRILL 101.39 2,250,854.23 31,311.99 31,275.17 DTD 08/22/2023 5.410% 02/18/2028

1.87 5.04
TAOT 2023-C A3 89231FAD2 690,000.00 BNP_PAR 100.86 695,940.49 6,096.57 6,083.86 DTD 08/15/2023 5.160% 04/17/2028

1.91 4.94
CITY OF MODESTO - COMBINED PORTFOLIO Page 27
#14..
- 714 -
Managed Account Fair Market Value & Analytics For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Dated Date/Coupon/Maturity CUSIP Par Broker Date Price Value On Cost Amort Cost at Mkt Security Type/Description Next Call Market Market Unreal G/L Unreal G/L Effective YTM Duration
Asset-Backed Security
USAOT 2023-A A3 90291VAC4 3,015,000.00 JPM_CHA 101.11 3,048,365.50 33,893.12 33,863.61 DTD 09/15/2023 5.580% 05/15/2028

1.75 5.30
BAAT 2023-2A A3 06054YAC1 2,925,000.00 MERRILL 102.17 2,988,530.47 63,583.41 63,582.27 DTD 11/21/2023 5.740% 06/15/2028

2.10 5.19
TAOT 2023-D A3 89239FAD4 765,000.00 JPM_CHA 101.94 779,824.40 14,906.87 14,904.86 DTD 11/14/2023 5.540% 08/15/2028

2.25 5.07
FITAT 2023-1 A3 31680EAD3 2,425,000.00 JPM_CHA 101.09 2,451,550.60 26,700.95 26,690.12 DTD 08/23/2023 5.530% 08/15/2028

1.93 5.26
CHAIT 2023-A1 A 161571HT4 3,020,000.00 JPM_CHA 101.54 3,066,538.20 47,375.34 47,331.61 DTD 09/15/2023 5.160% 09/15/2028

2.46 4.79
AMXCA 2023-3 A 02582JKD1 3,090,000.00 CITIGRP 101.72 3,143,102.58 53,240.70 53,233.75 DTD 09/19/2023 5.230% 09/15/2028

2.46 4.82
HART 2023-C A3 44918CAD4 1,130,000.00 BNP_PAR 101.84 1,150,830.53 20,979.12 20,975.58 DTD 11/13/2023 5.540% 10/16/2028

2.26 5.11
BACCT 2023-A2 A2 05522RDH8 1,365,000.00 MERRILL 101.03 1,379,120.11 14,303.43 14,301.83 DTD 12/14/2023 4.980% 11/15/2028

4.33 4.74
Security Type Sub-Total 26,175,794.24 26,460,309.39 288,022.68 287,651.58 2.13 4.75 Managed Account Sub-Total 443,399,507.31 427,715,372.28 (4,745,814.63) (8,294,463.36) 2.31 4.49 Total Investments $429,696,107.61
$1,980,735.33
$427,715,372.28
Accrued Interest
Securities Sub-Total $443,399,507.31 ($4,745,814.63) ($8,294,463.36) 2.31 4.49% CITY OF MODESTO - COMBINED PORTFOLIO Page 28
#14..
- 715 -
Managed Account Security Transactions & Interest For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Transaction Type
Trade Settle Security Description CUSIP Par Proceeds
Principal Accrued
Interest Total Cost
Realized G/L Realized G/L Sale
Amort Cost Method
BUY
12/07/23 FHMS K511 A2
DTD 12/01/2023 4.860% 10/01/2028
11/28/23 3137HB3G7 2,125,000.00 (2,118,894.88) (1,721.25) (2,120,616.13) 12/11/23 CCCIT 2023-A1 A1
DTD 12/01/2023 5.230% 12/01/2027
12/04/23 17305EGW9 835,000.00 (834,895.29) 0.00 (834,895.29) 12/08/23 JP MORGAN CORP NOTES (CALLABLE)
DTD 12/08/2023 5.110% 12/08/2026
12/05/23 48125LRU8 3,500,000.00 (3,500,000.00) 0.00 (3,500,000.00) 12/14/23 BACCT 2023-A2 A2
DTD 12/14/2023 4.980% 11/15/2028
12/07/23 05522RDH8 1,365,000.00 (1,364,816.68) 0.00 (1,364,816.68) 12/21/23 FHMS K512 A2
DTD 12/01/2023 5.000% 11/01/2028
12/11/23 3137HBCF9 1,935,000.00 (1,953,069.03) (5,375.00) (1,958,444.03) Transaction Type Sub-Total 9,760,000.00 (9,771,675.88) (7,096.25) (9,778,772.13)

INTEREST
12/01/23 12/01/23 MONEY MARKET FUND MONEY0002 0.00 0.00 1,833.91 1,833.91 12/01/23 CA ST DEPT WTR RES WTR SYS TXBL

REV BNDS
DTD 08/06/2020 0.560% 12/01/2024
12/01/23 13067WRB0 100,000.00 0.00 280.00 280.00
12/01/23 JPMORGAN CHASE & CO (CALLABLE)

CORP NOTE
DTD 06/01/2021 0.824% 06/01/2025
12/01/23 46647PCH7 865,000.00 0.00 3,563.80 3,563.80
12/25/23 FHMS K505 A2
DTD 07/01/2023 4.819% 06/01/2028
12/01/23 3137HACX2 3,500,000.00 0.00 14,055.42 14,055.42 12/25/23 FHMS K506 A2
DTD 09/01/2023 4.650% 08/01/2028
12/01/23 3137HAMH6 3,800,000.00 0.00 14,725.00 14,725.00 12/25/23 FNA 2023-M6 A2
DTD 07/01/2023 4.190% 07/01/2028
12/01/23 3136BQDE6 3,500,000.00 0.00 12,220.83 12,220.83 12/25/23 FHLMC MULTIFAMILY STRUCTURED P
DTD 08/01/2017 3.117% 06/01/2027
12/01/23 3137F2LJ3 3,530,000.00 0.00 9,169.18 9,169.18
12/25/23 FHLMC MULTIFAMILY STRUCTURED P
DTD 07/01/2017 3.243% 04/01/2027
12/01/23 3137F1G44 2,275,000.00 0.00 6,148.19 6,148.19
12/25/23 FHMS K507 A1
DTD 09/01/2023 4.800% 04/01/2028
12/01/23 3137HAMR4 3,670,089.25 0.00 14,680.36 14,680.36 12/25/23 FHMS K510 A2
DTD 11/01/2023 5.069% 10/01/2028
12/01/23 3137HB3D4 1,465,000.00 0.00 6,188.40 6,188.40
CITY OF MODESTO - COMBINED PORTFOLIO Page 29
#14..
- 716 -
Managed Account Security Transactions & Interest For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Transaction Type
Trade Settle Security Description CUSIP Par Proceeds
Principal Accrued
Interest Total Cost
Realized G/L Realized G/L Sale
Amort Cost Method

INTEREST
12/25/23 FHMS K064 A2
DTD 05/15/2017 3.224% 03/01/2027
12/01/23 3137BXQY1 4,000,000.00 0.00 10,746.67 10,746.67 12/25/23 FANNIEMAE-ACES
DTD 04/01/2014 3.346% 03/01/2024
12/01/23 3136AJB54 387,570.37 0.00 1,080.68 1,080.68
12/25/23 FHMS K061 A2
DTD 01/30/2017 3.347% 11/01/2026
12/01/23 3137BTUM1 2,475,000.00 0.00 6,903.19 6,903.19
12/25/23 FHMS KJ46 A1
DTD 07/01/2023 4.777% 06/01/2028
12/01/23 3137HAD45 2,809,172.53 0.00 11,182.85 11,182.85 12/25/23 FHMS K509 A2
DTD 10/01/2023 4.850% 09/01/2028
12/01/23 3137HAST4 2,890,000.00 0.00 11,680.42 11,680.42 12/25/23 FHMS KJ47 A1
DTD 09/01/2023 5.272% 08/01/2028
12/01/23 3137HAMN3 2,149,765.83 0.00 9,444.64 9,444.64
12/25/23 FHMS K507 A2
DTD 09/01/2023 4.800% 09/01/2028
12/01/23 3137HAMS2 3,800,000.00 0.00 15,200.00 15,200.00 12/25/23 FHMS K508 A2
DTD 10/01/2023 4.740% 08/01/2028
12/01/23 3137HAQ74 3,850,000.00 0.00 15,207.50 15,207.50 12/25/23 FHMS K506 A1
DTD 09/01/2023 4.650% 05/01/2028
12/01/23 3137HAMG8 1,896,944.76 0.00 7,350.66 7,350.66
12/15/23 CHAIT 2023-A1 A
DTD 09/15/2023 5.160% 09/15/2028
12/15/23 161571HT4 3,020,000.00 0.00 12,986.00 12,986.00 12/15/23 KCOT 2023-2A A3
DTD 07/26/2023 5.280% 01/18/2028
12/15/23 500945AC4 890,000.00 0.00 3,916.00 3,916.00
12/15/23 FITAT 2023-1 A3
DTD 08/23/2023 5.530% 08/15/2028
12/15/23 31680EAD3 2,425,000.00 0.00 11,175.21 11,175.21 12/15/23 TAOT 2023-C A3
DTD 08/15/2023 5.160% 04/17/2028
12/15/23 89231FAD2 690,000.00 0.00 2,967.00 2,967.00
12/15/23 HART 2023-C A3
DTD 11/13/2023 5.540% 10/16/2028
12/15/23 44918CAD4 1,130,000.00 0.00 5,564.62 5,564.62
12/15/23 CARMX 2021-1 A3
DTD 01/27/2021 0.340% 12/15/2025
12/15/23 14316NAC3 117,209.80 0.00 33.21 33.21
12/15/23 US TREASURY NOTES
DTD 12/15/2021 1.000% 12/15/2024
12/15/23 91282CDN8 775,000.00 0.00 3,875.00 3,875.00
12/15/23 HART 2021-A A3
DTD 04/28/2021 0.380% 09/15/2025
12/15/23 44933LAC7 171,009.79 0.00 54.15 54.15
CITY OF MODESTO - COMBINED PORTFOLIO Page 30
#14..
- 717 -
Managed Account Security Transactions & Interest For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Transaction Type
Trade Settle Security Description CUSIP Par Proceeds
Principal Accrued
Interest Total Cost
Realized G/L Realized G/L Sale
Amort Cost Method

INTEREST
12/15/23 AMXCA 2023-3 A
DTD 09/19/2023 5.230% 09/15/2028
12/15/23 02582JKD1 3,090,000.00 0.00 13,467.25 13,467.25 12/15/23 USAOT 2023-A A3
DTD 09/15/2023 5.580% 05/15/2028
12/15/23 90291VAC4 3,015,000.00 0.00 14,019.75 14,019.75 12/15/23 BAAT 2023-1A A3
DTD 07/31/2023 5.530% 02/15/2028
12/15/23 06428AAC2 1,465,000.00 0.00 6,751.21 6,751.21
12/15/23 TAOT 2023-D A3
DTD 11/14/2023 5.540% 08/15/2028
12/15/23 89239FAD4 765,000.00 0.00 3,649.48 3,649.48
12/15/23 HART 2021-C A3
DTD 11/17/2021 0.740% 05/15/2026
12/15/23 44935FAD6 345,679.35 0.00 213.17 213.17
12/15/23 BAAT 2023-2A A3
DTD 11/21/2023 5.740% 06/15/2028
12/15/23 06054YAC1 2,925,000.00 0.00 11,193.00 11,193.00 12/15/23 TAOT 2021-C A3
DTD 09/27/2021 0.430% 01/15/2026
12/15/23 89239BAC5 626,165.44 0.00 224.38 224.38
12/15/23 CARMX 2021-2 A3
DTD 04/21/2021 0.520% 02/17/2026
12/15/23 14314QAC8 338,661.55 0.00 146.75 146.75
12/15/23 DCENT 2021-A1 A1
DTD 09/27/2021 0.580% 09/15/2026
12/15/23 254683CP8 775,000.00 0.00 374.58 374.58
12/17/23 FANNIE MAE NOTES
DTD 06/19/2020 0.500% 06/17/2025
12/17/23 3135G04Z3 9,960,000.00 0.00 24,900.00 24,900.00 12/18/23 HAROT 2023-3 A3
DTD 08/22/2023 5.410% 02/18/2028
12/18/23 43815QAC1 2,220,000.00 0.00 10,008.50 10,008.50 12/21/23 HAROT 2021-1 A3
DTD 02/24/2021 0.270% 04/21/2025
12/21/23 43813GAC5 131,151.03 0.00 29.51 29.51
12/31/23 US TREASURY NOTES
DTD 06/30/2020 0.500% 06/30/2027
12/31/23 912828ZV5 5,545,000.00 0.00 13,862.50 13,862.50 12/31/23 US TREASURY NOTES
DTD 12/31/2020 0.375% 12/31/2025
12/31/23 91282CBC4 5,275,000.00 0.00 9,890.63 9,890.63
12/31/23 US TREASURY NOTES
DTD 12/31/2022 3.875% 12/31/2027
12/31/23 91282CGC9 4,250,000.00 0.00 82,343.75 82,343.75 12/31/23 US TREASURY NOTES
DTD 07/02/2018 2.750% 06/30/2025
12/31/23 912828XZ8 4,230,000.00 0.00 58,162.50 58,162.50 Transaction Type Sub-Total 101,138,419.70 0.00 461,469.85 461,469.85 CITY OF MODESTO - COMBINED PORTFOLIO Page 31
#14..
- 718 -
Managed Account Security Transactions & Interest For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Transaction Type
Trade Settle Security Description CUSIP Par Proceeds
Principal Accrued
Interest Total Cost
Realized G/L Realized G/L Sale
Amort Cost Method

MATURITY
12/07/23 US TREASURY BILL
DTD 06/08/2023 0.000% 12/07/2023
12/07/23 912797FT9 2,185,000.00 2,185,000.00 0.00 2,185,000.00 2,237.32 0.00 Transaction Type Sub-Total 2,185,000.00 2,185,000.00 0.00 2,185,000.00 2,237.32 0.00

PAYDOWNS
12/25/23 FANNIEMAE-ACES
DTD 04/01/2014 3.346% 03/01/2024
12/01/23 3136AJB54 993.91 993.91 0.00 993.91 (48.30) 0.00 12/25/23 FHMS K507 A1
DTD 09/01/2023 4.800% 04/01/2028
12/01/23 3137HAMR4 10,778.35 10,778.35 0.00 10,778.35 169.14 0.00 12/25/23 FHMS K506 A1
DTD 09/01/2023 4.650% 05/01/2028
12/01/23 3137HAMG8 1,649.00 1,649.00 0.00 1,649.00 24.66 0.00 12/25/23 FHMS KJ46 A1
DTD 07/01/2023 4.777% 06/01/2028
12/01/23 3137HAD45 1,753.93 1,753.93 0.00 1,753.93 0.04 0.00 12/25/23 FHMS K061 A2
DTD 01/30/2017 3.347% 11/01/2026
12/01/23 3137BTUM1 3,699.33 3,699.33 0.00 3,699.33 113.87 0.00 12/25/23 FHMS KJ47 A1
DTD 09/01/2023 5.272% 08/01/2028
12/01/23 3137HAMN3 2,955.15 2,955.15 0.00 2,955.15 0.01 0.00 12/15/23 HART 2021-A A3
DTD 04/28/2021 0.380% 09/15/2025
12/15/23 44933LAC7 23,516.70 23,516.70 0.00 23,516.70 2.47 0.00 12/15/23 TAOT 2021-C A3
DTD 09/27/2021 0.430% 01/15/2026
12/15/23 89239BAC5 49,463.46 49,463.46 0.00 49,463.46 3.94 0.00 12/15/23 CARMX 2021-2 A3
DTD 04/21/2021 0.520% 02/17/2026
12/15/23 14314QAC8 30,469.69 30,469.69 0.00 30,469.69 6.57 0.00 12/15/23 HART 2021-C A3
DTD 11/17/2021 0.740% 05/15/2026
12/15/23 44935FAD6 24,590.31 24,590.31 0.00 24,590.31 5.49 0.00 12/15/23 CARMX 2021-1 A3
DTD 01/27/2021 0.340% 12/15/2025
12/15/23 14316NAC3 12,993.23 12,993.23 0.00 12,993.23 2.57 0.00 12/21/23 HAROT 2021-1 A3
DTD 02/24/2021 0.270% 04/21/2025
12/21/23 43813GAC5 23,049.33 23,049.33 0.00 23,049.33 0.42 0.00 Transaction Type Sub-Total 185,912.39 185,912.39 0.00 185,912.39 280.88 0.00 SELL
CITY OF MODESTO - COMBINED PORTFOLIO Page 32
#14..
- 719 -
Managed Account Security Transactions & Interest For the Month Ending December 31, 2023 CITY OF MODESTO - Combined Portfolio
Transaction Type
Trade Settle Security Description CUSIP Par Proceeds
Principal Accrued
Interest Total Cost
Realized G/L Realized G/L Sale
Amort Cost Method
SELL
12/08/23 JP MORGAN CHASE BANK CORP NOTE
DTD 05/13/2014 3.625% 05/13/2024
12/05/23 46625HJX9 1,320,000.00 1,308,846.00 3,322.92 1,312,168.92 (152,182.80) (27,839.40) FIFO 12/08/23 US TREASURY NOTES
DTD 11/30/2017 2.125% 11/30/2024
12/05/23 9128283J7 1,595,000.00 1,549,704.49 740.85 1,550,445.34 (137,070.32) (70,375.95) FIFO 12/08/23 US TREASURY NOTES
DTD 12/15/2021 1.000% 12/15/2024
12/05/23 91282CDN8 610,000.00 585,504.69 2,933.33 588,438.02 2,001.57 (14,441.05) FIFO 12/11/23 US BANK NA CINCINNATI CORP NOTES
(CALLAB
DTD 02/04/2019 3.375% 02/05/2024
12/07/23 91159HHV5 2,200,000.00 2,191,486.00 25,987.50 2,217,473.50 (112,772.00) (10,116.00) FIFO 12/21/23 US BANK NA CINCINNATI CORP NOTES
(CALLAB
DTD 02/04/2019 3.375% 02/05/2024
12/18/23 91159HHV5 660,000.00 657,947.40 8,415.00 666,362.40 (33,330.00) (2,340.96) FIFO 12/21/23 PFIZER INC CORP NOTES
DTD 03/11/2019 2.950% 03/15/2024
12/18/23 717081ES8 1,290,000.00 1,282,156.80 10,148.00 1,292,304.80 (23,336.10) (8,331.17) FIFO Transaction Type Sub-Total 7,675,000.00 7,575,645.38 51,547.60 7,627,192.98 (456,689.65) (133,444.53) Managed Account Sub-Total 174,881.89 505,921.20 680,803.09 (454,171.45) (133,444.53) Total Security Transactions $174,881.89 $505,921.20 $680,803.09 ($454,171.45) ($133,444.53) CITY OF MODESTO - COMBINED PORTFOLIO Page 33
#14..
- 720 -
Attachment 3
City of Modesto Combined Yields
Month
Ending
Combined
Yield
CAMP
Balance
CAMP Monthly
Distribution Yields
Long Term
Amortized Cost
Balance
Long Term
Portfolio Yield
Short Term
Amortized Cost
Balance
Short Term
Portfolio Yield
1/31/2022 0.92% 123,759,932.29 0.05% 276,103,753.02 1.31% 2/28/2022 0.92% 106,765,158.19 0.06% 276,530,404.21 1.31% 39,948,433.34 0.53% 3/31/2022 0.98% 106,788,084.24 0.25% 277,035,730.56 1.33% 39,948,380.00 0.53% 4/30/2022 1.39% 30,016,017.61 0.50% 353,203,903.46 1.56% 39,984,016.67 0.53% 5/31/2022 1.47% 50,044,305.28 0.82% 353,781,386.85 1.59% 39,880,961.12 1.26% 6/30/2022 1.56% 75,106,114.53 1.14% 354,423,884.74 1.64% 39,871,394.45 1.66% 7/31/2022 1.66% 46,186,072.35 1.64% 354,553,148.20 1.66% 39,928,141.66 1.66% 8/31/2022 1.79% 46,276,184.59 2.30% 356,564,454.56 1.69% 39,858,625.00 2.14% 9/30/2022 1.95% 46,375,593.86 2.61% 356,228,719.05 1.71% 39,880,797.64 3.34% 10/31/2022 2.03% 46,499,174.80 3.14% 357,511,536.00 1.74% 39,981,172.30 3.34% 11/30/2022 2.18% 46,648,406.54 3.90% 357,994,150.30 1.78% 40,170,337.16 3.76% 12/31/2022 2.29% 46,818,929.81 4.30% 357,777,379.76 1.84% 40,298,306.29 3.93% 1/31/2023 2.48% 46,999,023.63 4.53% 358,294,563.63 1.95% 40,452,260.96 4.84% 2/28/2023 2.51% 47,169,689.38 4.73% 358,174,068.29 1.94% 40,550,744.43 4.97% 3/31/2023 2.57% 47,361,889.08 4.80% 359,784,568.86 2.01% 40,708,200.79 4.97% 4/30/2023 2.58% 47,555,527.53 4.97% 357,043,234.53 1.99% 40,860,577.92 4.97% 5/31/2023 2.71% 47,763,982.55 5.16% 360,186,419.97 2.10% 41,114,697.00 5.21% 6/30/2023 2.75% 47,969,832.62 5.24% 360,251,679.25 2.14% 41,289,235.20 5.21% 7/31/2023 2.94% 48,186,346.94 5.31% 360,659,807.46 2.35% 41,419,189.81 5.28% 8/31/2023 3.14% 48,412,208.12 5.52% 392,278,686.76 2.60% 41,598,139.19 5.44% 9/30/2023 3.36% 48,632,969.13 5.55% 392,056,693.34 2.85% 41,767,569.64 5.55% 10/31/2023 3.40% 48,862,493.00 5.56% 393,319,562.86 2.89% 41,829,190.02 5.63% 11/30/2023 3.46% 49,086,612.73 5.58% 396,095,890.19 2.97% 41,987,235.92 5.60% 12/31/2023 3.51% 49,318,080.86 5.55% 393,872,751.60 3.03% 42,137,084.04 5.60% Notes:

1. Long and Short Term Portfolio AC Balance is the amortized cost value of the separately managed portfolios.

2. Long and Short Term Portfolio Yields are the separately managed portfolios yield at costs. #14..
- 721 -
Attachment 4
City of Modesto - Portfolio Holdings and Earnings Projections Issuer Par Maturity Date Current Yield
Years to
Maturity
Expected Earnings
Rate to June 30, 2024
Expected Earnings
to June 30, 2024
Main Portfolio
Federal Agency
FNMA 3,500,000 1/7/2025 4.840% 1 30,440 0.85% 14,853
FNMA 640,000 2/12/2025 4.710% 1 8,498 1.18% 3,781
FNMA 2,370,000 4/14/2025 4.530% 1 18,340 0.60% 7,102
FHLMC 3,195,000 4/22/2025 4.540% 1 27,908 0.67% 10,626
FNMA 475,000 4/22/2025 4.540% 1 3,692 0.59% 1,406
FNMA 3,345,000 4/22/2025 4.540% 1 26,715 0.61% 10,172
FNMA 1,910,000 4/22/2025 4.540% 1 12,972 0.52% 4,939
FNMA 3,675,000 6/17/2025 4.490% 1 29,145 0.54% 9,933
FNMA 200,000 6/17/2025 4.490% 1 1,241 0.42% 423
FNMA 1,075,000 6/17/2025 4.490% 1 6,278 0.40% 2,140
FNMA 3,820,000 6/17/2025 4.490% 1 22,811 0.41% 7,775
FNMA 1,190,000 6/17/2025 4.490% 1 6,309 0.36% 2,150
FNMA 2,220,000 7/21/2025 4.430% 2 16,445 0.48% 5,269
FNMA 2,360,000 8/25/2025 4.410% 2 18,321 0.47% 5,530
FHLMC 550,000 8/25/2025 4.410% 2 3,996 0.44% 1,206
FHLB 450,000 8/25/2025 4.410% 2 3,659 0.49% 1,105
FNMA 3,400,000 9/23/2025 4.370% 2 25,667 0.44% 7,392
FNMA 130,000 9/23/2025 4.370% 2 904 0.40% 260
FHLMC 2,215,000 11/7/2025 4.340% 2 23,538 0.57% 6,328
FHLMC 2,040,000 11/7/2025 4.340% 2 19,213 0.51% 5,165
Federal Agency CMBS
FHLMC 386,576 3/1/2024 7.170% 0 1,380 3.13% 6,033
FHLMC 2,471,301 11/1/2026 4.440% 3 302,491 4.31% 53,140 FHLMC 4,000,000 3/1/2027 4.370% 3 630,451 4.98% 99,258
FHLMC 2,275,000 4/1/2027 4.390% 3 367,810 4.97% 56,395
FHLMC 3,530,000 6/1/2027 4.360% 3 604,167 5.01% 88,108
FHLMC 3,659,311 4/1/2028 4.570% 4 808,243 5.19% 94,720
FHLMC 1,895,296 5/1/2028 4.430% 4 412,026 5.01% 47,371
FHLMC 3,500,000 6/1/2028 4.410% 4 710,295 4.59% 80,095
FNMA 2,807,419 6/1/2028 4.670% 4 593,094 4.78% 66,879
FHLMC 3,500,000 7/1/2028 4.360% 5 721,300 4.58% 79,852
FNMA 3,800,000 8/1/2028 4.370% 5 870,549 4.99% 94,591
FHLMC 2,146,811 8/1/2028 4.680% 5 519,399 5.27% 56,436
FHLMC 3,850,000 8/1/2028 4.380% 5 929,245 5.26% 100,969 FHLMC 3,800,000 9/1/2028 4.360% 5 901,341 5.07% 96,157
FHLMC 2,890,000 9/1/2028 4.370% 5 757,000 5.60% 80,759
FHLMC 1,465,000 10/1/2028 4.410% 5 357,888 5.14% 37,521 FHLMC 2,125,000 10/1/2028 4.370% 5 497,977 4.93% 52,207 FHLMC 1,935,000 11/1/2028 4.370% 5 448,179 4.78% 46,162 U.S. Treasury
U.S. Treasury 10,565,000 5/15/2024 5.260% 0 216,429 5.00% 263,591 U.S. Treasury 10,645,000 7/31/2024 5.110% 1 330,038 5.31% 282,004 U.S. Treasury 775,000 12/15/2024 4.860% 1 19,950 2.68% 10,374 U.S. Treasury 4,400,000 2/15/2025 4.730% 1 134,308 2.70% 59,330 U.S. Treasury 2,300,000 2/15/2025 4.730% 1 126,626 4.88% 55,937 U.S. Treasury 4,945,000 4/30/2025 4.570% 1 41,648 0.63% 15,597 U.S. Treasury 4,230,000 6/30/2025 4.450% 1 173,233 2.73% 57,639 U.S. Treasury 4,340,000 8/31/2025 4.420% 2 38,230 0.53% 11,425 U.S. Treasury 4,635,000 8/31/2025 4.420% 2 211,980 2.74% 63,350 U.S. Treasury 4,550,000 9/30/2025 4.380% 2 53,396 0.67% 15,208 U.S. Treasury 1,100,000 9/30/2025 4.380% 2 15,485 0.80% 4,410 U.S. Treasury 5,010,000 10/31/2025 4.330% 2 71,087 0.77% 19,310 U.S. Treasury 6,930,000 10/31/2025 4.330% 2 99,192 0.78% 26,945 U.S. Treasury 4,250,000 11/30/2025 4.300% 2 86,817 1.07% 22,572 U.S. Treasury 4,635,000 11/30/2025 4.300% 2 244,772 2.75% 63,641 U.S. Treasury 1,040,000 12/31/2025 4.230% 2 9,449 0.45% 2,353 U.S. Treasury 500,000 12/31/2025 4.230% 2 4,328 0.43% 1,078 U.S. Treasury 3,735,000 12/31/2025 4.230% 2 66,406 0.89% 16,533 U.S. Treasury 2,400,000 1/31/2026 4.240% 2 40,309 0.80% 9,628 U.S. Treasury 5,775,000 1/31/2026 4.240% 2 153,407 1.27% 36,641 U.S. Treasury 5,000,000 1/31/2026 4.240% 2 193,546 1.85% 46,228 U.S. Treasury 7,980,000 1/31/2026 4.240% 2 491,451 2.95% 117,381 U.S. Treasury 3,210,000 2/28/2026 4.200% 2 48,795 0.70% 11,241 U.S. Treasury 6,000,000 2/28/2026 4.210% 2 149,963 1.15% 34,549 U.S. Treasury 4,645,000 2/28/2026 4.210% 2 277,285 2.76% 63,881 U.S. Treasury 4,925,000 3/31/2026 4.130% 2 96,322 0.87% 21,353 U.S. Treasury 2,480,000 3/31/2026 4.130% 2 42,324 0.76% 9,382 U.S. Treasury 1,405,000 5/31/2026 4.130% 2 29,482 0.87% 6,084 U.S. Treasury 4,615,000 5/31/2026 4.130% 2 307,905 2.76% 63,536 U.S. Treasury 4,800,000 5/31/2026 4.130% 2 347,087 2.99% 71,621 U.S. Treasury 4,640,000 8/31/2026 4.070% 3 340,515 2.75% 63,628 U.S. Treasury 4,310,000 9/30/2026 4.030% 3 328,151 2.77% 59,485 U.S. Treasury 4,545,000 11/15/2026 4.020% 3 393,400 3.01% 68,189 U.S. Treasury 9,220,000 2/15/2027 3.990% 3 822,890 2.85% 131,144 U.S. Treasury 910,000 3/31/2027 3.960% 3 119,297 4.03% 18,307 U.S. Treasury 6,480,000 4/30/2027 3.960% 3 629,953 2.92% 94,286 U.S. Treasury 5,545,000 6/30/2027 3.950% 3 580,544 2.99% 82,740 U.S. Treasury 1,200,000 8/15/2027 3.950% 4 143,690 3.30% 19,767 U.S. Treasury 2,985,000 8/15/2027 3.950% 4 367,893 3.40% 50,610 U.S. Treasury 5,380,000 9/30/2027 3.920% 4 862,242 4.27% 114,630 U.S. Treasury 8,775,000 10/31/2027 3.920% 4 1,316,409 3.91% 171,133 U.S. Treasury 2,715,000 10/31/2027 3.930% 4 396,780 3.81% 51,581 U.S. Treasury 3,160,000 10/31/2027 3.930% 4 439,769 3.63% 57,170 U.S. Treasury 4,250,000 12/31/2027 3.900% 4 642,821 3.78% 80,078 U.S. Treasury 3,450,000 1/31/2028 3.910% 4 516,441 3.66% 62,998 U.S. Treasury 2,220,000 1/31/2028 3.900% 4 319,183 3.52% 38,935 U.S. Treasury 2,825,000 2/29/2028 3.900% 4 500,233 4.25% 59,857 U.S. Treasury 2,970,000 2/29/2028 3.900% 4 531,481 4.29% 63,596 U.S. Treasury 2,555,000 3/31/2028 3.910% 4 379,318 3.49% 44,482 U.S. Treasury 2,675,000 3/31/2028 3.900% 4 414,946 3.65% 48,660 U.S. Treasury 2,810,000 4/30/2028 3.890% 4 438,752 3.60% 50,476 U.S. Treasury 6,530,000 4/30/2028 3.890% 4 962,166 3.40% 110,692 Commercial Paper
LMA Americas LLC 10,630,000 2/27/2024 5.730% 0 97,740 4.32% 229,021 Thunder Bay Funding LLC 10,757,000 3/8/2024 5.780% 0 115,939 4.43% 237,673 Negotiable CD
Rabobank Nederland 3,355,000 10/25/2024 5.140% 1 149,515 5.44% 91,009 Toronto-Dominion Bank 3,500,000 7/17/2026 5.900% 3 452,554 5.08% 88,660 Earnings to
Maturity
December 31, 2023
#14..
- 722 -
Attachment 4
City of Modesto - Portfolio Holdings and Earnings Projections Issuer Par Maturity Date Current Yield
Years to
Maturity
Expected Earnings
Rate to June 30, 2024
Expected Earnings
to June 30, 2024
Earnings to
Maturity
December 31, 2023
Corporate Note
Microsoft Corp 2,155,000 3/15/2024 5.730% 0 11,906 3.23% 34,743 Pfizer Inc 1,590,000 5/12/2024 5.360% 0 2,892 1.32% 10,458 Paccar Financial Corp 4,000,000 7/8/2024 5.280% 1 45,521 2.19% 43,605 Wal-Mart Stores Inc 1,810,000 2/6/2025 4.880% 1 28,937 1.45% 13,068 Apple Inc 1,760,000 3/3/2025 4.770% 1 22,213 1.08% 9,446 Amazon.Com Inc 3,430,000 4/13/2025 4.750% 1 134,682 3.06% 52,265 Mastercard Inc 865,000 6/1/2025 2.070% 1 10,115 0.82% 3,554 JPMorgan Chase & Co 2,230,000 11/13/2025 4.600% 2 39,644 0.95% 10,564 Mastercard Inc 3,465,000 1/28/2026 4.750% 2 53,685 0.75% 12,873 Paccar Financial Corp 2,025,000 4/2/2026 4.620% 2 154,502 3.38% 34,167 Toyota Motor Corp 5,635,000 8/7/2026 4.760% 3 812,102 5.54% 155,582 JPMorgan Chase & Co 3,000,000 8/8/2026 4.300% 3 167,146 2.14% 31,988 Amazon.Com Inc 3,750,000 8/18/2026 4.740% 3 545,887 5.53% 103,383 Deere & Company 2,560,000 11/21/2026 4.330% 3 320,618 4.33% 55,258 Deere & Company 3,500,000 12/8/2026 4.740% 3 525,770 5.11% 89,180 Home Depot Inc 365,000 1/15/2027 4.320% 3 22,066 1.99% 3,615 Microsoft Corp 3,000,000 2/6/2027 4.200% 3 377,801 4.06% 60,688 Bank Of America Co 3,610,000 9/14/2027 4.250% 4 556,407 4.16% 74,846 Deere & Company 1,535,000 2/24/2028 4.520% 4 327,096 5.13% 39,269 Citigroup Inc 1,220,000 4/15/2028 4.150% 4 206,882 3.95% 24,028 Wal-Mart Stores Inc 5,200,000 5/10/2028 4.050% 4 891,238 3.93% 101,888 The Bank Of New York Mellon Corporation 1,165,000 7/14/2028 4.330% 5 263,595 4.98% 28,952 Bank Of America Co 495,000 7/14/2028 4.330% 5 104,315 4.64% 11,458 Wells Fargo & Company 895,000 7/14/2028 4.330% 5 192,145 4.73% 21,105 JPMorgan Chase & Co 1,130,000 8/10/2028 4.280% 5 265,574 5.09% 28,702 Target Corp 2,800,000 9/11/2028 4.490% 5 696,375 5.29% 73,858 Bristol-Myers Squibb Co 5,650,000 9/29/2028 4.820% 5 1,557,605 5.80% 163,486 Asset-Backed Securities
Bank of America Auto Trust 108,102 4/21/2025 1.210% 1 382 0.27% 146 Bank of America Auto Trust 147,493 9/15/2025 1.190% 2 964 0.38% 281 Hyundai Auto Receivables 104,217 12/15/2025 1.270% 2 702 0.34% 179 Toyota Motor Corp 576,702 1/15/2026 1.740% 2 5,090 0.43% 1,242 Carmax Auto Owner Trust 308,192 2/17/2026 1.580% 2 3,450 0.52% 806 USAA Owners Trust 321,089 5/15/2026 1.890% 2 5,676 0.75% 1,193 Kubota Credit Owners Trust 775,000 9/15/2026 1.830% 3 12,271 0.58% 2,258 Citigroup Inc 835,000 12/1/2027 4.980% 4 171,328 5.23% 21,790 Chase Issurance 890,000 1/18/2028 4.940% 4 190,642 5.29% 23,460 Toyota Motor Corp 1,465,000 2/15/2028 5.200% 4 334,551 5.53% 40,404 Fifth Third Auto Trust 2,220,000 2/18/2028 5.040% 4 497,339 5.42% 59,944 Hyundai Auto Receivables 690,000 4/17/2028 4.940% 4 153,211 5.17% 17,772 American Express Co 3,015,000 5/15/2028 5.300% 4 736,658 5.58% 83,952 Carmax Auto Owner Trust 2,925,000 6/15/2028 5.190% 4 748,917 5.74% 83,724 Toyota Motor Corp 2,425,000 8/15/2028 5.260% 5 620,711 5.53% 66,885 Bank Of America Co 765,000 8/15/2028 5.070% 5 196,205 5.54% 21,142 Honda Auto Receivables 3,090,000 9/15/2028 4.820% 5 761,694 5.23% 80,598 Discover Card Execution Note Trust 3,020,000 9/15/2028 4.790% 5 735,229 5.17% 77,797 Honda Auto Receivables 1,130,000 10/16/2028 5.110% 5 300,484 5.54% 31,232 Hyundai Auto Receivables 1,365,000 11/15/2028 4.740% 5 331,896 4.98% 33,916 Municipal Securities
University Of California 620,000 8/1/2024 5.090% 1 1,880 0.52% 1,599 California State University 600,000 11/1/2024 5.060% 1 3,445 0.68% 2,049 Maryland St 100,000 12/1/2024 5.050% 1 516 0.56% 279
Los Angeles Community College District 510,000 5/15/2025 4.740% 1 6,182 0.88% 2,246 New Jersey Turnpike Authority 220,000 5/15/2025 4.740% 1 2,435 0.81% 885 University Of California 1,295,000 7/1/2025 4.770% 2 24,461 1.26% 8,124 Florida State Board of Administration Finance 505,000 7/1/2025 4.770% 2 8,387 1.11% 2,785 Florida State Board of Administration Finance 925,000 8/1/2025 4.750% 2 11,343 0.77% 3,566 State Of California 505,000 1/1/2026 4.580% 2 10,604 1.05% 2,637 Supranational Securities
Inter-American Development Bank 4,095,000 9/23/2024 5.040% 1 15,723 0.52% 10,718 Overnight Investments 49,318,081 Varies Varies 5.00% 1,229,961 Totals (Main Portfolio) 492,717,588 41,351,893 3.35% 8,221,429 Notes:

1. Earnings projections are based on stated par value, future market expectations and current investment positions.

2. Earnings on overnight investments are based on the investment balances and the Fed Funds Futures rates.

3. Callable securities priced above par are considered to be called on their next call date. #14..
- 723 -
Attachment 5
Issue Name / Type Trustee Bank Investment Total Amount
Instl Res Tre and Agny Cash Adv6541 $256,304.78
Financial Guaranty Insurance Pol $1.00
CAMP $2,059,792.98
Total $2,316,098.76
Instl Res Tre and Agny Cash Adv6541 $61,020.85
Cash $226,427.00
CAMP $5,095,690.09
Total $5,383,137.94
2018 Wastewater Refunding Bank of New York Fidelity Inv MM Trsy Only $326.18 Fairview Village Refunding US Bank First American Treasury Obligation Fund $200,534.81 Blackrock Federal Fund Instl 30 $4,475.39
CAMP $2,917,425.09
Total $2,921,900.48
Other Post Employment Benefits Section 115
Trust PARS HighMark Plus Moderate $1,566,927.71
Pension Section 115 Trust PARS HighMark Plus Moderately Conservative $2,764,139.47 Athens Administrators (New Third Party
Administrator - Worker's Compensation) Wells Fargo Bank $550,584.92 George Hills Company - General Liability Claims
Administration Services California Bank & Trust $10,107.53 Kemper Sports Management Inc. BMO Harris Bank Business Money Market $135,532.94 Stanislaus Community Foundation Modesto Commerce Bank Charles Schwab $766,438.58 Third-Party Construction Contract Retention California Bank of Commerce $2,244,414.26
Umpqua Bank $299,387.26
Village One #2 Refunding Bank of New York
Cash with Fiscal Agent Investments
As of December 31, 2023
2008 Water Refunding COP Bank of New York
2008 Lease Revenue Bonds Bank of New York
#14..
- 724 -

CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

February 27, 2024
Date: January 25, 2024
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: DeAnna Christensen, Director of Finance
SUBJECT: Fiscal Year 2022-2023 Audited Financial Statements CONTACT: Maria Garnica, Accounting Manager, [email protected], 209-577-5249 DESCRIPTION:

Consider approving the audited Financial Statements and various Audit Reports for Fiscal Year 2022-2023, audited by External Auditor Vasquez + Company, LLP. for the City’s Annual Comprehensive Financial Report (ACFR), thirteen (13) Community Facilities Districts (CFDs), Measure H, Single Audit, and various Joint Powers Agencies. (Funding Source: Not Applicable) STRATEGIC PLAN ELEMENT:

This item supports the City of Modesto 2020-2025 Strategic Plan focus of Governance and Service Delivery under Goal H: Achieve Financial Sustainability.

BACKGROUND:

Annual Comprehensive Financial Report and Other Annual financial Reports The Modesto City Charter requires an annual audit, which shall be presented to the Council, as follows:

SECTION 1306. INDEPENDENT AUDIT.

The Council shall employ, at the beginning of each fiscal year, an independent certified public accountant who, at such time or times as may be specified by the Council, at least annually, shall examine the books, records, inventories, and reports of all officers and employees who receive, handle or disburse public funds and all such other officers and employees and departments as the Council may direct.

As soon as practicable after the end of the fiscal year, a final audit and report shall be submitted by such accountant to the Council, one (1) copy thereof to be distributed to each member, one (1) to the City Auditor, one (1) to the City Manager and one (1) to the City Attorney respectively, and three (3) additional copies to be placed on file in the office of the City Clerk, where they shall be available for inspection by the general public.
#15..
- 725 -
City Council, February 27, 2024
Fiscal Year 2022-2023 Audited Financial Statements

Page 2 of 5 ends

The City’s Annual Comprehensive Financial Report (ACFR), for the Fiscal Year ending June 30, 2023, is an annual report which includes audited financial statements with an external auditor’s opinion on the financial condition and the results of operations for the period under audit. The accounting firm Vasquez + Company, LLP. conducted the Fiscal Year 2022-2023 audit for the City.

Federal Single Audit
The City of Modesto Single Audit report is federally mandated by the provisions of the Federal Single Audit Act Amendments of 1996 and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), which requires an audit to be conducted for any non-Federal entity that expends $750,000 or more a year in Federal awards. This audit was conducted by the City’s external auditor, Vasquez + Company, LLP. and the main objectives were to ensure a fair presentation of the basic financial statements and the schedule of expenditures of Federal awards, and to also audit the City's internal controls and compliance with legal requirements, with special emphasis on internal controls and legal requirements involving the administration of federal awards expended during the fiscal year.

DISCUSSION:

Annual Comprehensive Financial Report (ACFR)
The independent auditors concluded for the ACFR that there was a reasonable basis for rendering an unmodified (clean) opinion and that the statements were fairly presented in accordance with generally accepted accounting principles. In conjunction with this audit, Vasquez + Company, LLP. also performed certain agreed-upon procedures as applied to the Appropriations Limitation (GANN Limit) prescribed by Article XIII-B of the California Constitution.

Copies of these reports are attached.

Community Facilities Districts (CFDs)
In addition, our independent auditors examined the financial statements of thirteen (13) Community Facilities Districts (CFDs) and concluded that there was a reasonable basis for rendering an unmodified (clean) opinion and that the statements were fairly presented in accordance with generally accepted accounting principles. The thirteen (13) CFDs examined include:

1. Community Facilities District Number 1998-2 (Carver-Bangs/Pelandale-Snyder)

2. Community Facilities District Number 2000-2 (Coffee-Claratina)

3. Community Facilities District Number 1998-1 (Enterprise Business Park)

4. Community Facilities District Number 2003-1 (Fairview Village)

5. Community Facilities District Number 2007-2 (Kiernan Business Park West)

6. Community Facilities District Number 1997-1 (North Beyer Park)

7. Community Facilities District Number 2002-1 (Northpointe)

8. Community Facilities District Number 2004-1 (Village One #2)

9. Community Facilities District Number 1996-1 (Village One)

10. Community Facilities District Number 2016-1 (Kiernan Business Park East #2)

11. Community Facilities District Number 2007-1 (North Beyer #2)

12. Community Facilities District Number 2016-2 (The Vintage)

13. Community Facilities District Number 2021-1 (Woodglen) #15..
- 726 -
City Council, February 27, 2024
Fiscal Year 2022-2023 Audited Financial Statements

Page 3 of 5 ends

Joint Powers Agencies (JPAs) and Smaller Programs
The City is the financial administrator for several joint powers agencies (JPAs) which require an independent audit of their financial statements.

The joint powers agencies and mandated audit reports included in this report are:

1. Abandoned Vehicle Abatement (AVA)

2. Modesto-Ceres Fire Protection Agency

3. Tuolumne River Regional Park (TRRP)

4. Transportation Development Agency (TDA)
On November 8, 2022, the Modesto Voters approved Measure H, a one-cent local sales tax for general city services. On November 29, 2022, by Resolution No. 2022-453 The Modesto City Council certified the election results. The City began collecting sales tax revenue in April of 2023, this sales tax revenue can be used for any general city purposes. Language under this ordinance identifies examples of expenditures that allow the City to proactively develop a plan to improve City services and the quality of life in Modesto, such as funding to address public safety, and homelessness. Additionally, the ordinance also requires an annual financial report be performed by an independent auditor and establishes a Citizen Oversight Board to audit the revenues and expenditures of Measure H to ensure that funds are being spent appropriately by the City and for the purposes approved by Council.

Based on the attached Auditors’ Reports, the financial statements for ACFR, GANN Limit, Measure H, CFDs and JPAs were prepared and presented fairly in all material respects.

Federal Single Audit
And finally, the City also directly receives funding from various state and federal agencies that mandate annual audit reports. On an annual basis the auditors select a number of programs based on specific criteria in accordance with auditing standards which are deemed Major Programs which require auditing. For Fiscal Year 2022-2023, the Major Programs selected were:

Outdoor Recreation Acquisition, Development and Planning Federal Transit Cluster
Coronavirus State and Local Fiscal Recovery Funds
As part of the City’s Fiscal Year 2022-2023 Single Audit report, no findings were reported for any of the grants funding received from the various federal agencies.

Internal Controls Over Financial reporting
In the planning and performing of the financial statements as of the year ended June 30, 2023 and in accordance with auditing standards generally accepted, applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General, the City’s internal controls over financial reporting (internal controls) were considered as a basis for designing audit procedures that are appropriate for the purposes of expressing an opinion over the financial statements. A separate communication describing matters and deficiencies in internal control were determined to not constitute significant or material weaknesses in internal control over financial reporting during the audit of the basic financial statement as required by the Government Auditing Standards, the communication was provided to Management for review.
#15..
- 727 -
City Council, February 27, 2024
Fiscal Year 2022-2023 Audited Financial Statements

Page 4 of 5 ends

FISCAL IMPACT:

While the information contained in these reports discloses the financial performance for the City, there is no direct fiscal impact.

COMMITTEE RECOMMENDATION:

This item was accepted by the Audit Committee on January 24, 2024 and approved to forward to Council.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Resolution approving the audited Financial Statements and various Audit Reports for Fiscal Year 2022-2023 audited by External Auditors Vasquez + Company, LLP. for the City’s Annual Comprehensive Financial Report (ACFR), thirteen (13) Community Facilities Districts (CFDs), Measure H and various Joint Powers Agencies (JPAs).

Resolution approving the audited Fiscal Year 2022-2023 Federal Single Audit Report for the City of Modesto from External Auditors Vasquez + Company, LLP.

Approved by:

DeAnna Christensen, Director of Finance
Joseph P. Lopez, City Manager
Attachments:

1. Resolution audited financial statements FY 2022-2023

2. Resolution Single Audit FY 2022-2023

3. Annual Comprehensive Financial Report FY 2022-2023

4. GANN Limit Report FY 2022-2023

5. Community Facilities District Number 1998-2 (Carver-Bangs/Pelandale-Snyder)

6. Community Facilities District Number 2000-2 (Coffee-Claratina)

7. Community Facilities District Number 1998-1 (Enterprise Business Park)

8. Community Facilities District Number 2003-1 (Fairview Village)

9. Community Facilities District Number 2007-2 (Kiernan Business Park West)

10. Community Facilities District Number 1997-1 (North Beyer Park)

11. Community Facilities District Number 2002-1 (Northpointe)

12. Community Facilities District Number 2004-1 (Village One #2)

13. Community Facilities District Number 1996-1 (Village One)

14. Community Facilities District Number 2016-1 (Kiernan Business Park East #2)

15. Community Facilities District Number 2007-1 (North Beyer #2)

16. Community Facilities District Number 2016-2 (The Vintage)

17. Community Facilities District Number 2021-1 (Woodglen)

18. Abandoned Vehicle Abatement (AVA)

19. Modesto-Ceres Fire Protection Agency Financial Statements

20. Tuolumne River Regional Park (TRRP)
#15..
- 728 -
City Council, February 27, 2024
Fiscal Year 2022-2023 Audited Financial Statements

Page 5 of 5 ends

21. Transportation Development Agency (TDA)

22. Federal Single Audit Report FY 2022-2023

23. Measure H Audited Report FY 2022-2023

24. CoM Audit Presentation
#15..
- 729 -

MODESTO CITY COUNCIL
RESOLUTION NO. 2024-XX

RESOLUTION APPROVING THE AUDITED FINANCIAL STATEMENTS AND VARIOUS AUDIT REPORTS FOR FISCAL YEAR 2022-2023 AUDITED BY EXTERNAL AUDITORS VASQUEZ + COMPANY, LLP. FOR THE CITY’S ANNUAL COMPREHENSIVE FINANCIAL REPORT (ACFR), THIRTEEN (13)

COMMUNITY FACILITIES DISTRICTS (CFDS), MEASURE H, AND VARIOUS

JOINT POWERS AGENCIES (JPAS)
WHEREAS, pursuant to Section 1306 of the Charter of the City of Modesto, the City Council shall employ an independent certified public accountant who, at least annually, shall audit the books and records of the City of Modesto, and submit a final audit and report to the City Council as soon as practicable after the end of the fiscal year, and
WHEREAS, the accounting firm of Vasquez + Company, LLP., has completed their audit of the City’s financial statements for the fiscal year ended June 30, 2023, and has provided its opinion on these financial statements based on that audit, and WHEREAS, the independent auditors also audited financial statements of twelve Community Facilities Districts and various Joint Powers Agencies, as required by their respective enabling legislations, and for which the City of Modesto serves as the financial administrator, and
WHEREAS, by the Council of the City of Modesto it hereby accepts the Fiscal Year 2022-2023 annual audit reports for the City of Modesto, Community Facilities Districts, Measure H, and various Joint Powers Agencies, as listed in Exhibit A, which is incorporated by reference herein.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby accepts the Fiscal Year 2022-2023 annual audit reports for the City of #15..
- 730 -
Modesto and other Joint Power Agencies, as listed in Exhibit A, which is incorporated by reference herein.

The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 27th day of February, 2024, by Councilmember ?, who moved its adoption, which motion being duly seconded by Councilmember ?, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers: ?
NOES: Councilmembers: ?
ABSENT: Councilmembers: ?
ATTEST: _ ___________________________
DIANA NAYARES-PEREZ, City Clerk
(SEAL)
APPROVED AS TO FORM:

By: ____________________________________
JOSE M SANCHEZ, City Attorney
#15..
- 731 -

MODESTO CITY COUNCIL
RESOLUTION NO. 2024-?
RESOLUTION ACCEPTING THE FISCAL YEAR 2022-2023 ANNUAL AUDIT

REPORTS

EXHIBIT A
City of Modesto:

1. Annual Comprehensive Financial Report FY 2022-2023

2. GANN Limit Report FY 2022-2023

3. Community Facilities District Number 1998-2 (Carver-Bangs/Pelandale-Snyder)

4. Community Facilities District Number 2000-2 (Coffee-Claratina)

5. Community Facilities District Number 1998-1 (Enterprise Business Park)

6. Community Facilities District Number 2003-1 (Fairview Village)

7. Community Facilities District Number 2007-2 (Kiernan Business Park West)

8. Community Facilities District Number 1997-1 (North Beyer Park)

9. Community Facilities District Number 2002-1 (Northpointe)

10. Community Facilities District Number 2004-1 (Village One #2)

11. Community Facilities District Number 1996-1 (Village One)

12. Community Facilities District Number 2016-2 (Kiernan Business Park East #2)

13. Community Facilities District Number 2007-1 (North Beyer #2)

14. Community Facilities District Number 2016-2 (The Vintage)

15. Community Facilities District Number 2021-1 (Woodglen)

16. Measure H 2022-2023
Other Agencies:

17. Abandoned Vehicle Abatement (AVA)

18. Modesto-Ceres Fire Protection Agency Financial Statements

19. Tuolumne River Regional Park (TRRP)

20. Transportation Development Agency (TDA)
#15..
- 732 -

MODESTO CITY COUNCIL
RESOLUTION NO. 2024-
RESOLUTION APPROVING THE FISCAL YEAR 2022-2023 SINGLE AUDIT

REPORT FOR THE CITY OF MODESTO FROM EXTERNAL AUDITORS
VASQUEZ + COMPANY, LLP
WHEREAS, the City of Modesto Single Audit reports are federally mandated by the provisions of the Federal Single Audit Act Amendments of 1996 and Title 2 U.S.

Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), which requires an audit to be conducted for any non-Federal entity that expends $750,000 or more a year in Federal awards, and
WHEREAS, this audit was conducted by the City’s external auditors, Vasquez + Company, LLP, and the main objectives were to ensure a fair presentation of the basic financial statements and the schedule of expenditures of Federal awards, and to also audit the City's internal controls and compliance with legal requirements, with special emphasis on internal controls and legal requirements involving the administration of federal awards expended during the fiscal year, and
WHEREAS, as part of the City’s Fiscal Year 2022-2023 Single Audit report, no findings were reported.

NOW, THEREFORE, BE IT RESOLVED, by the Council of the City of Modesto that it hereby accepts the Fiscal Year 2022-2023 Single Audit report for the City of Modesto.
#15..
- 733 -
The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 27th day of February, 2024, by Councilmember ?, who moved its adoption, which motion being duly seconded by Councilmember ?, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers: ?
NOES: Councilmembers: ?
ABSENT: Councilmembers: ?
ATTEST: _ ___________________________
DIANA NAYARES-PEREZ, City Clerk
(SEAL)
APPROVED AS TO FORM:

By: ____________________________________
JOSE M. SANCHEZ, City Attorney
#15..
- 734 -

IN PARTNERSHIP

WE THRIVE
Annual Comprehensive Financial Report
Fiscal Year Ended June 30, 2023 2022 23
Collaborative Success in our City
#15..
- 735 -
#15..
- 736 -

CITY OF
Modesto, California

ANNUAL COMPREHENSIVE FINANCIAL REPORT
Fiscal Year Ended June 30, 2023
Prepared by
Finance Department
#15..
- 737 -
#15..
- 738 -

CITY OF MODESTO
June 30, 2023

TABLE OF CONTENTS

INTRODUCTORY SECTION
Transmittal Letter ........................................................................................................................ iii - xxviii Certificate of Achievement for Excellence in Financial Reporting ..................................................... xxix City of Modesto Organizational Chart ................................................................................................. xxx

FINANCIAL SECTION
Independent Auditors’ Report ............................................................................................................. 3-6 Management’s Discussion and Analysis ........................................................................................... 7-16 Basic Financial Statements:

Government-wide Financial Statements:

Statement of Net Position ........................................................................................................ 19 Statement of Activities ........................................................................................................ 20-21 Fund Financial Statements:

Balance Sheet – Governmental Funds .................................................................................... 22 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position – Governmental Activities ............................................................ 23 Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds.............................................................................................................. 24 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities – Governmental Activities ......................................................................................................... 25 Statement of Net Position – Proprietary Funds ....................................................................... 26 Statement of Revenues, Expenses, and Changes in Fund Net Position - Proprietary Funds ................................................................................................................... 27 Statement of Cash Flows – Proprietary Funds .................................................................. 28-29 Statement of Fiduciary Net Position ........................................................................................ 30 Statement of Changes in Fiduciary Net Position – Fiduciary Funds…………...…………… …31 Notes to Basic Financial Statements ........................................................................................ 32-81 Required Supplementary Information:

Schedule of Changes in the Net Pension Liability and Related Ratios .................................... 84-85 Schedule of Plan Contributions ...................................................................................................... 86 Schedule of Changes in the OPEB Liability and Related Ratios ................................................... 87 Schedule of Contributions .............................................................................................................. 88 Schedule of Revenues, Expenditures and Changes in Fund – Budget (GAAP Basis) and Actual – General Fund ............................................................ 89-90 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget (GAAP Basis) and Actual – Operating Grants Special Revenue Fund ........................................................... 91 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget (GAAP Basis) and Actual –Housing and Community Development Special Revenue Fund.......................... 92 Notes to Required Supplementary Information ........................................................................ 94-95 Combining and Individual Fund Statements and Schedules:

Nonmajor Governmental Funds:

Combining Balance Sheet ............................................................................................. 101-103 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ............................................................................................................. 105-107 #15..
- 739 -
Schedules of Revenues, Expenditures, and Changes in Fund Balance – Budget (GAAP Basis) and Actual:

Local Transportation Special Revenue Fund .................................................................. 108 Traffic Safety Special Revenue Fund .............................................................................. 109 Transportation Special Tax Revenue Fund…………………………………………. …… 110 Downtown Improvement District Special Revenue Fund ................................................ 111 Strategic Planning and Development Special Revenue Fund…………………………….112 Nonmajor Enterprise Funds:

Combining Statement of Net Position ............................................................................ 115-116 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position ......................................................................................................... 117-118 Combining Statement of Cash Flows ............................................................................ 119-122 Internal Service Funds:

Combining Statement of Net Position ............................................................................ 125-126 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position ......................................................................................................... 127-128 Combining Statement of Cash Flows ............................................................................. 129-132 Fiduciary Trust Funds:

Combining Statement of Fiduciary Net Position Fiduciary Trust Funds – Private Purpose Trust Funds……..…………………………………… ……………… ……….135 Combining Statements in Changes in Fiduciary Net position – Fiduciary Trust Funds - Private Purpose Funds......................................................................................................... 136 Combining Statement of Fiduciary Net Position Fiduciary Trust Funds – Investment Trust Funds………………………………………… ……………………………….137 Combining Statements in Changes in Fiduciary Net position – Fiduciary Trust Funds - Investment Trust Funds ....................................................................................................... 138

STATISTICAL SECTION
Financial Trends:

Net Position by Component .......................................................................................................... 143 Changes in Net Position ....................................................................................................... 144-145 Fund Balances of Governmental Funds ....................................................................................... 146 Changes in Fund Balances of Governmental Funds.................................................................... 147 Revenue Capacity:

Water Utility System .................................................................................................................... 148 Debt Capacity:

Ratio of Outstanding Debt by Type .............................................................................................. 149 Computation of Direct and Overlapping Debt ............................................................................... 150 Computation of Legal Debt Margin ............................................................................................... 151 Revenue Bond Coverage, Wastewater Revenue Bonds ............................................................. 152

Demographic and Economic Information:

Demographic and Economic Statistics ......................................................................................... 153 Principal Employers ...................................................................................................................... 154 Principal Property Taxpayers ....................................................................................................... 155

Operating Information:

Full-Time City Government Employees by Function .................................................................... 156 Operating Indicators by Function .................................................................................................. 157 Capital Asset Statistics by Function/Program ............................................................................... 158

CONTINUING DISCLOSURE SECTION
Continuing Disclosure Requirements Information ...................................................................... 162-174 #15..
- 740 -

INTRODUCTORY TAB
#15..
- 741 -
#15..
- 742 -

INTRODUCTORY SECTION
#15..
- 743 -
This page is intentionally left blank.
#15..
- 744 -
Department of Finance
P.O. Box 642
Modesto, California 95353
209.577.5369
Modestogov.com
Hearing and Speech Impaired Only
TDD 209.526.9211
December 08, 2023
To the Honorable Mayor, Members of the City Council, and Citizens of the City of Modesto:

We are pleased to present to you the Annual Comprehensive Financial Report (ACFR) for the City of Modesto (the City). The City Charter and Municipal Code require that a complete ACFR, which is comprised of financial statements and reports on the finances of the City, be submitted to the City Council at the end of each fiscal year. This report fulfills that requirement for the year ending on June 30, 2023.

City management assumes full responsibility for the completeness and reliability of the information contained in this report. We believe the data fairly represents the financial position and results of operations of the City. The disclosures necessary to enable the reader to understand the City's financial affairs have been included. The City's accounting system has been developed and maintained with due consideration given to the adequacy of internal controls.

Because the cost of internal controls should not exceed the anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements. The evaluation of the costs and benefits of a particular control requires estimates and judgments by management.

The Modesto City Charter also requires an annual audit be performed by an independent certified public accountant selected by the Modesto City Council. The accounting firm of Vasquez + Company, LLP was selected in 2023 to perform the City's annual financial audits. The auditors have issued an unmodified (“clean”) opinion on the financial statements for the fiscal year ending on June 30, 2023, which is presented on page 3. In addition to meeting the City Charter audit requirements, the audit was also designed to meet the requirements of the Federal Single Audit Act Amendments of 1996 and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). The auditors’ reports related specifically to the Single Audit will be presented separately at a later date.

Management’s discussion and analysis (MD&A) immediately follows the independent auditors’ report and provides a narrative introduction, overview, and analysis of the basic financial statements. The MD&A is designed to be read in conjunction with this transmittal letter.

City of Modesto Profile
Modesto is located in the heart of California's San Joaquin Valley and is the County Seat of Stanislaus County. It is also the retail, service and financial center of Stanislaus County. The City currently occupies a land area of 37.8 square miles and serves a population of 216,995. The City has a diverse economy and population with a strong sense of community pride. iii
#15..
- 745 -
Incorporated as a municipal city in 1884, the City adopted its City Charter on March 12, 1951, with a Council-Manager form of government. The Modesto City Council (Council) is the City’s legislative body and is made up of seven elected officials serving overlapping 4-year terms. The Mayor is elected at-large by the entire City, while the six Councilmembers are elected by district and are limited to two terms.

The Council sets policy and tax rates, approves budgets, and passes ordinances and resolutions, which govern the City. The Council also appoints citizens to advisory boards, committees, and commissions, and appoints the City Manager, City Attorney, City Clerk, and City Auditor. The City Manager is responsible for carrying out Council policy and managing the day-to-day affairs of the City.

The City is a “full-service” city including police and fire; public works; water and sewer; community and economic development; parks and recreation; and cultural and convention visitor services.

The City’s financial reporting entity includes all funds and activities of the City as the primary government and its component units, which are legally separate entities that operate under the auspices of the City and provide services that supplement City services. The City’s component units are blended into the City’s funds because there is a financial benefit/burden relationship when the City or management has operational responsibility over the component unit. These component units are the Modesto Public Financing Authority and the City of Modesto Community Facilities Districts.

The annual operating budget serves as the foundation for the City’s financial planning and control.

The proposed budget is adopted annually prior to July 1 by Council ordinance. The Council’s legally-adopted budget level is at the fund level. Throughout the fiscal year, the budget may be modified. The Council has also adopted fiscal policies that delineate the delegated budget control authority to the following parties: Council, the City Manager, and the Budget Manager.

Local Economy
A major center for local commerce, the City attracts thousands to its environs for work, shopping, and entertainment. Major employment sectors include manufacturing, healthcare, education, and retail. Modesto and its surrounding communities contain canneries, packing plants, and warehouses which ship agricultural products across the nation and the world. An active farm-totable movement has been spearheaded by the area’s large production of nuts, dairy, poultry, and other locally grown products.

The unemployment rate within the county-wide Modesto Statistical Area (MSA) increased during the 2022-2023 fiscal year. Unemployment reached its lowest level in the City at 4.6% in December 2022. As of June 30, 2023, the City’s unemployment rate was recorded at 6.5%, up from the

5.2% rate of a year ago due to the economic impacts to employers as a result of higher inflation and interest rates approved by the Federal Government.

According to Zillow, the ZHVI (Zillow Home Value Index) for homes listed in Modesto was $424,220 (as of June 30, 2023), a decrease of 6% over 2022. CoStar Realty Information stated the average Modesto MSA multifamily unit asking rent was $1,510, up 2.2% from $1,478 in 2022. Modesto building permit activity during fiscal year 2022-2023 ended with a total of 4,790 permits issued with a valuation of $173,801,514.

Modesto is a prime and central location for business and has attracted both start-ups and expanding firms. Specialized health care facilities like HealthSouth and Central Valley Specialty Hospital have chosen to expand their services and operations in Modesto. There is also a strong iv
#15..
- 746 -
culture of entrepreneurship and innovation. Datapath, a technology management company with headquarters in Modesto, has been recognized by Inc. Magazine as one of the fastest-growing private companies in America. E&J Gallo Winery, also based in Modesto, is the world’s largest privately-owned winery and the leading US exporter of California wines. The Gallo Glass Company is a state-of-the-art glass manufacturer and a leading producer of wine and spirits glass bottles in the US.

New Growth
In April 2021, President Biden signed into law the American Rescue Plan Act (ARPA) a $1.9 trillion emergency relief measure intended to provide relief to address the impact of COVID-19.

Key allocations from the American Rescue Plan have been made available directly from the federal government for the community including direct support for businesses, homeowners, renters, and restaurant/bar owners. This legislation made a historic investment into local governments that includes $45,897,056 available to the City of Modesto to help address the local impact of COVID-19. The $45.89 million is being made available by the U.S Treasury directly to the City in two tranches: 50 percent was made available in May 2021, and the remaining 50 percent was received on June 6, 2022. The deadline to obligate funds is December 31, 2024 and the deadline to expend the funds is December 31, 2026.

The Modesto Forward strategy was approved by Resolution 2021-194 on May 25, 2021, and was later modified by Resolution 2022-104 on February 8, 2022, and Resolution 2022-237 on July 12, 2022, Resolution 2023-97 on March 7, 2023, and finally Resolution 2023-254 on June 6, 2023. It included various allocations of funding approved by Council identified in the 2021 spending plan, totaling $44.8 million. At the time of this report, $20.2 million of the Spending Plan has been expended, and $25.6 million is allocated to programs currently in progress.

To arrive at the Year 2 expenditure plan, staff solicited priorities from the public and the Council at the three standing City Council Committees: Economic Development, Safety and Communities, and Finance. Staff also released a 10-question survey intended to gauge the priority areas of the community and received approximately 700 responses to the survey. Key priorities identified in the survey and in the standing committees include the following: housing stability/ homeownership, neighborhood safety, and improvements to roads and sidewalks. The Council and community expressed an interest in continuing many of the pilot initiatives that were launched as part of the 2021 spending plan and expressed a desire to extend the program periods with funds made available from the second allotment of ARPA funds. Approximately $11.1 million was recommended for allocation for the half of the second allotment in anticipation of another surge in COVID-19 cases. Throughout FY 2022-2023, the spending plan has been updated and approved by Council based on reallocating funding to other programs based on the time sensitivity of the ARPA deadlines. City staff continue to monitor and manage these programs to ensure all expenditures comply with the Treasury guidelines.
v
#15..
- 747 -
ARPA Funds Spending Plan – Economic Vitality
Eligible Category Year Description Allocation
Exp Claim / Rev Loss 1 Revolving loan fund for attraction of downtown development $1,000,000 Exp Claim / Rev Loss 1 Revolving loan fund for water/sewer connection fees $1,000,000 Exp Claim / Rev Loss 1 Tuolumne River – Economic Development $750,000 Exp Claim / Rev Loss 1 Relief Across Downtown Card $708,500 Business Support 1 Small biz support with expansion and retention $610,000 Business Support 1 Implementation of a workforce development program $500,000 Exp Claim / Rev Loss 1 Support for Children’s Museum $500,000 Exp Claim / Rev Loss 1 Support for Awesome Spot Playground $500,000 Exp Claim / Rev Loss 1 Support for Car Museum $500,000
Affordable Housing 1 Affordable Housing Trust $500,000
Exp Claim / Rev Loss 1 Support for Convention and Visitor’s Bureau $250,000 Broadband
Infrastructure
1 Expanded Wi-Fi downtown and available at community
facilities
$200,000
Exp Claim / Rev Loss 1 Funding to support the development of Enhanced Infrastructure Financing District
$200,000
Exp Claim / Rev Loss Reall. Funding to support the development of Enhanced Infrastructure Financing District
$218,286
Business Support 1 Support for the Arts $200,000
Business Support 1 Opportunity Stanislaus $100,000
Business Support 1 Stanislaus Equity Partners $100,000
Business Support 1 Stanislaus 2030 Initiative $90,000
Exp Claim / Rev Loss 2 Downtown Quiet Zone $1,000,000
Exp Claim / Rev Loss 2 Parking Infrastructure $250,000
Exp Claim / Rev Loss 2 Support for Convention and Visitor's Bureau $250,000 Exp Claim / Rev Loss Reall. Support for Convention and Visitor's Bureau $250,000 Exp Claim / Rev Loss Reall. Support for State Theatre $75,000 Exp Claim / Rev Loss Reall. Support for Modesto Area Partners in Science $50,000 Exp Claim / Rev Loss Reall. Support for Gallo Arts Center $25,000 Exp Claim / Rev Loss Reall. Support for Modesto Sister Cities $35,000 Exp Claim / Rev Loss Reall. Support for Central Valley Opportunity Center $25,000 Business Support Reall. Opportunity Stanislaus (2nd Allocation) $200,000 Business Support Reall. Business Incentives - Expand outside of Downtown $500,000 TOTAL $10,586,786
vi
#15..
- 748 -
ARPA Funds Spending Plan – Quality of Life
Eligible Category Year Description Allocation
Public Health/Safety Labor 1 COVID-19 labor expenses $4,630,000 Behavioral Health 1 Mental Health Clinician Program – Partnership with BHRS $800,000 Exp Claim / Rev Loss 1 Blight Abatement $750,000
Exp Claim / Rev Loss 1 Downtown Beautification $700,000 Homeless Services 1 Homeless Support Program: Park Rangers $624,000 COVID-19 Expenditures 1 Emergency Medical Service equipment $600,000 Homeless Services 1 Homeless Support Program $276,000
Revenue Loss 1 Grants to neighborhoods $120,000
Homeless Services 2 Downtown Streets Team $1,800,000
Exp Claim / Rev Loss 2 Park Improvements (including turf at Mary Grogan) $1,000,000 Homeless Services 2 Community Assistance Team $400,000
Exp Claim / Rev Loss 2 Multifamily Bulky Item Program $180,000 Business Support 2 West Modesto Collaborative $43,000
Exp Claim / Rev Loss Reall. Cesar Chavez Renovation Project $1,200,000 Exp Claim / Rev Loss Reall. Expand Downtown Beautification $500,000 Homeless Services Reall. Homeless Services (Day Center, Safe Park, Bridge Housing) $1,500,000 TOTAL $15,123,000
ARPA Funds Spending Plan – Governance and Service Delivery Eligible Category Year Description Allocation
Exp Claim / Rev Loss 1 Fire Station 1 Deferred Maintenance $2,000,000 Exp Claim / Rev Loss 1 Forestry Program Enhancements $1,850,000 Exp Claim / Rev Loss 1 Address deferred maintenance at various parks and public facilities
$1,270,028
Exp Claim / Rev Loss 1 General Plan Update $700,000
Exp Claim / Rev Loss 1 Discoverer Replacement $500,000
Exp Claim / Rev Loss 1 Cybersecurity Mitigation $490,000 Exp Claim / Rev Loss 1 TSP Battery Back Up System Upgrade $50,000 Exp Claim / Rev Loss 1 Upgrade secure online service application software for Utility billing
$23,063
Exp Claim / Rev Loss 2 Forestry Maintenance $1,000,000
Hazard Pay Reall. Employee Hazard Pay $6,552,810
Public Health/Safety Labor 2 Reserve (Unallocated) $1,369 Public Health/Safety Labor 2 FY22-23 Budget Funding $4,500,000 Public Health/Safety Labor 2 911 Dispatch Services $1,000,000 Exp Claim / Rev Loss 2 LED Lighting $250,000
TOTAL $20,187,270
vii
#15..
- 749 -
New Growth
Establishing a Community Police Review Board and Independent Police Auditor On May 22, 2021, a listening session was held as a formal launch of the Forward Together initiative where the following key primary themes emerged: 1) Accountability, 2) Policies and Practices, and 3) Alternate Response Models. Subsequently, on June 8, 2021, by Resolution No. 2021-216, the City Council approved the formation of the Forward Together working group in support of a community engagement process to educate and explore solutions that address broad areas of concern as expressed in the listening session. The Forward Together working group then held a series of facilitated public workshops and ad hoc meetings focused on improving police-community relations in the City of Modesto.

On August 23, 2022, by Resolution No. 2022-358, the City Council accepted the Forward Together work group’s report which contained several recommendations and directed staff to carry out the appropriate next steps. Staff completed a comprehensive evaluation of various accountability models involving a community oversight board and independent police auditor, prepared an overview of this research to obtain Council and Community input on these topics, and utilized this input to develop a model to best meet the needs of Modesto.

As a result, in December of 2022, the City Council established a Community Police Review Board (CPRB) in conjunction with contracting the services of an Independent Police Auditor (IPA). The recommendation to establish a Community Police Review Board, as a dual component of a hybrid police accountability model, is the culmination of the efforts of the Forward Together work group.

Passage of Measure H, a One-Cent Sales Tax for General City Services On November 8, 2022, the Modesto voters approved Measure H, a one-cent local sales tax for general city services. On November 29, 2022, by Resolution No. 2022-453 the Modesto City Council certified the election results.

With the passage of Measure H, the City began collecting sales tax revenue in April of 2023.

While the sales tax revenue generated by Measure H can be used for any general city purpose, the ordinance language did identify examples of expenditures that allow the City to proactively develop a plan to improve City services and the quality of life in Modesto. The expenditures include:
 Funding to address police patrols, gang, drug, and crime prevention.  Funding to address fire protection, paramedic, and 911 emergency response.  Funding to address homelessness.
 Funding for cleaning up trash and illegal dumping.
 Funding for keeping streets, parks, sidewalks, landscapes, and infrastructure safe, clean, and well-maintained.

As part of the ordinance language that was passed with Measure H, a citizen Oversight Board was created to audit the revenues and expenditures of the new sales tax to ensure that funds are being spent appropriately by the City and for the purposes approved by Council.

Measure H Sales Tax is estimated to bring in an additional amount estimated at over $41 million annually. This funding will be critical in the City’s ability to provide improved and sustainable services to the citizens of Modesto.
viii
#15..
- 750 -
Entertainment and Tourism
Modesto features vibrant arts, entertainment, sports, and cultural expression. With the Modesto Convention and Visitor’s Bureau and Tourism Marketing District, Modesto is committed to attracting visitors by promoting and marketing Modesto as a convention, sports, tourism, and leisure travel destination.

Annually, the community supports some of its treasured events like the Celebration of Lights Parade, Historic Graffiti Cruise Route Parade, Fourth of July Parade, Music in the Plaza, Veteran’s Day Parade, and MoBand summer concert series at Mancini Bowl. Several new events made their debut this past year, including Visit Modesto’s Almond Blossom Cruise with hopes of being selected as a Visit California site in in the future. It is nice to see visitors return each year to Modesto to enjoy all the wonderful places and events we have to offer.

Some examples of the places and events are:
 Downtown Modesto is home to the world-class Gallo Center for the Arts which brings national and international entertainment, arts, and multicultural programming to the Central Valley region. Downtown, you can experience the Historic Graffiti Cruise Route, the Legends of the Cruise Walk of Fame, and the Classic Community Mural Series celebrating the cruising culture phenomenon born in Modesto and immortalized by native son George Lucas in American Graffiti. Live entertainment is a prominent feature in the Civic Plaza and nearby clubs, and a busy calendar of entertaining and educational events can be experienced just across the street at the Modesto Centre Plaza.  Baseball with the Modesto Nuts baseball team is just minutes from the City center, and golfers enjoy two-highly rated 18-hole courses. Modesto is gaining recognition for its bike routes and trails, and is a recently hosted, for the second time, the NorCal Interscholastic Cycling League at Tuolumne River Regional Park and have plans to return to Modesto annually.
 The McHenry Mansion and McHenry Museum anchor the city’s loving preservation of its historical heritage, drawing visitors from all over the world. The iconic State Theatre hosts countless non-profit events and provides an enhanced cinematic experience. Arts live year-round with monthly Art Walks, and seasonal activities including the Spirit of Giving Run, Graffiti Cruise, parades, the Modesto on Ice downtown skating rink, the Victorian Christmas Faire (formerly Dickens Faire), ModShop Arts and Crafts Walk, and PorchFest community music stroll bring joy to residents and visitors. Modesto truly offers something great for everyone.

Our Strategic Priorities
During 2020, the City adopted the 2020-2025 Strategic Plan to incorporate input from newly elected Councilmembers and to reaffirm our strategic priorities. Our priorities bring the City’s vision and values to life in our community and define our overall direction as a city. It also confirms our commitment to our citizens. While the priorities are individually important, they are also interconnected and cannot be addressed in isolation. In addition, they are the basis of our scorecard that measures success and upon which our performance metrics are built.  Quality of Life: Engage partners across the community to ensure the safety, resilience, and attractiveness of Modesto.
ix
#15..
- 751 -
 Economic Vitality: Retain and attract residential, commercial, and industrial development to meet the community’s needs today and for the next generation.  Governance and Service Delivery: Build community trust in City government through responsive, transparent, and efficient service delivery.

Long-Term Financial Planning
The City continues to refine its 10-year forecasting model and update estimates and assumptions used to project future operations. At the end of fiscal year 2022-23, General Fund Balance was as follows: Restricted and Nonspendable: $10.6 million; Committed: $18.4 million; Assigned: $1.1 million; and Unassigned: $23.4 million. The Committed Fund Balance allows the City to respond to unplanned circumstances and maintain adequate working capital to meet its cash flow needs.

The City’s long-term maintenance of a stable fund balance is a direct reflection of the Mayor and Council’s leadership and prudent fiscal management. The City will continue to monitor the revenue impacts and monitor the General Fund reserves to address any shortfall during the current fiscal year.

SIGNIFICANT EVENTS / ACCOMPLISHMENTS
Quality of Life
• The Forestry Division resolved 4,191 broken limb issues and completed 10,141 tree pruning activities.
• The Solid Waste Division collected 2,587 tons of bulky items and recycled 3,549 waste tires and 821 mattresses.
• The Modesto Police Department (MPD) Street Gang Unit took 335 firearms off the street. • After securing funding the Community Health and Assistance Team (CHAT) is currently recruiting to increase the unit from 6 to 12 Outreach Specialists. x
#15..
- 752 -
• Adopted a Park Ranger program after successful completion of a pilot phase. Park Rangers address quality of life issues at City parks, trails and outdoor recreational areas. 12 full-time positions were created to properly staff the unit.
xi
#15..
- 753 -
• The Modesto Senior Citizens Center continues to provide a wide array of programming with over 15,500 participants attending this past year. The recreation team added an adult Barre class and Circle Crafts to the offering at the facility. • Recreation programming served nearly 1,000 participants in specialty youth and adaptive programing including Winter Camp, Adaptive Bowling, Friday Night Out, Archery, Dance, Tennis, Crime Scene Investigation (CSI) Camp and Driver’s Education and Soccer. This year the Modesto City Kickers Soccer League was implemented with every class reaching capacity.
• The Aquatics program was in full force and taught 1,944 children to swim through our Learnto-Swim classes at one of our 5 operating pools. xii
#15..
- 754 -
 Both Celebration of Lights Parade Dashing through the Decades with a Tree Lighting Ceremony and 7 MoBand Concerts in the Park at Graceada Park had over 20,000 in attendance.
• Mary Grogan Park was visited by over 100,000 players and spectators. • The Parks, Recreation and Neighborhoods (PRN) Department coordinated the City’s volunteer efforts at 297 events, including Love Modesto, historical properties, and river trail clean-ups. Overall, there were 3,107 volunteers that provided 21,659 hours of service with a total leveraged value of $681,582.
• The PRN Department Increased its website and social media presence utilizing Instagram and Facebook platforms to connect directly with the community and have another form of communication to answer questions.
o Facebook followers- 8,321 followers, increased by 1,224 followers o Instagram followers- 3,452 followers, increased by 625 followers o PRND Homepage Website- 16,556 pageviews
o PRND Activity Guide Website- 19,675 pageviews
• After School Education and Safety (ASES) program took place at seven school sites with a total of 32,456 students for the year. The program has increased to include Expanded Learning Opportunities Programming (ELOP) during winter, spring, and summer breaks. xiii
#15..
- 755 -
• The City of Modesto Youth Commission returned for the 2022-2023 school year. Eight students from several high schools. During their term, the Commission partnered with Stanislaus County Commission for Women at the State Theatre’s release of “The Swimmers”’; participated at panelist in the 2023 StanYea Youth Summit on resources and strategies for youth mental health; oversaw the Hope Blooms Garden project during Love Modesto; and held student workshops at several junior high schools.
• Maddux Youth Center enriched 2,376 youth for a variety of programs & fun activities including All Sports Camp, After-School Activities, creative projects, homework assistance and fitness/nutrition classes.
xiv
#15..
- 756 -
• Junior Giants Baseball League served over 750 kids this season. Junior Giants is a completely free, youth baseball league that focuses on the fundamentals of baseball while teaching children the importance of confidence, integrity, leadership, and teamwork. • McHenry Mansion and McHenry Museum tours provided a window to the past for 18,344 visitors.
xv
#15..
- 757 -
• The CalVIP Grant added seven events to the Recreation roster with 3 SportsFests, 2 Pop Up Parties and 2 Movie Nights serving over 400 members of the community. • The Norcal Interscholastic Cycling League returned to Modesto to host their Northern California races. The races wound through the Gateway Parcel at Tuolumne River Regional Park. Over 1,000 junior and senior high schoolers participated while friends and family cheered them on.
xvi
#15..
- 758 -
• In July 2022, the City of Modesto Fire Department entered into an agreement with the City of Ceres, Stanislaus Consolidated Fire Protection District and City of Turlock for fire department shared training services. The participating agencies realized operational and fiscal efficiencies by sharing resources to deliver a common training platform. The partnership provides training staff, equipment, and facilities to meet the training needs of the agencies and better serve the communities.
• In September 2022, the City of Modesto Fire Department entered into an agreement with the Salida Fire Protection District to provide fire protection services. With this agreement, the City of Modesto was able to add three Fire Captains, three Fire Engineers and three Firefighters, ultimately staffing one additional fire station (Station 12). xvii
#15..
- 759 -
• In November 2022, the Modesto Fire Department established a Type III all-hazard Incident Management Team, better known as Central Valley IMT, with agencies from Stanislaus County and CalFire Tuolumne Calaveras Unit (TCU). The IMT is deployed as a team of 10- 35 trained personnel to manage major and/or complex incidents, as well as incidents that extend into multiple operational periods and require written Incident Action Plans (IAPs).

Incidents include, but are not limited to fires, tornado touchdowns, earthquakes, floods, and hostage/standoff situations.
• 14 firefighters graduated from the academy in January 2023. Several employees were also promoted, including one Battalion Chief, six Fire Captains and 9 Fire Engineers. xviii
#15..
- 760 -
• Through the City’s Park Partners Program, multiple projects were completed: new bench seating at the Mancini Bowl, fundraising was continued for The Awesome Spot Playground, and conversion of four tennis courts to twelve pickleball courts at Graceada Park.

The Awesome Spot Playground
Pickleball Court at Graceada Park
Bench seating at the Mancini Bowl
xix
#15..
- 761 -
• Purchased the parking lot at the Monterosso Trailhead to increase the available parking at Dry Creek Regional Park.
• In partnership with Modesto City Schools, the tennis courts at Davis Park and Downey Park were resurfaced.
• Construction of a new park near Ralston Tower was completed in June 2023. The Senior playground features an open area for Tai Chi, seating area, drinking fountain, and low-impact and durable exercise features designed to improve strength, balance, and coordination. This park is a public facility open to all citizens.
• Golf rounds for Dryden and Creekside Golf Courses totaled 72,432. • Centre Plaza successfully held 186 events, a 92% increase from FY 2022-23. xx
#15..
- 762 -
• A rod iron security fence was successfully installed around the Centre Plaza. • Two new annual public events were held at the Centre Plaza this year including the Modesto Tattoo Convention and a Car Show.
• Park Operations completed the Pelandale cleanup resulting in 9.93 tons of trash collection funded by Measure H.
• Park Operations completed the Sisk Road cleanup resulting in 4.75 tons of trash collection funded by Measure H.
• Marshall Park’s ballfield underwent a mini renovation. The Park Operations team removed weeds and overgrown grass from the infield, leveled it and added 10 yards of cinder clay mix, repaired the irrigation, and installed a new gently used Homeplate. • Orchard Park underwent improvements to its Basketball Court by renewing its striping. • Beyer Park’s Volleyball Pit and adjacent Sand and Turf areas underwent improvements and renovations. Overgrown turf, weeds and debris were removed. • The bridge at TRRP Picnic Area B was repaired by Park Operations staff with new wood after a gaping hole was found.
• A spiral slide was installed at Fairview Park in the Rancho Encantado neighborhood. xxi
#15..
- 763 -
• Martone Tot Lot playground underwent renovations with installation of a new slide and deck stairs.
• Partnered with RH Community Builders for a State of California Homekey 3.0 award in the amount of $17 million for the acquisition and rehab of the Traveler’s Motel into 54 units of permanent supportive housing.
• Partnered with Visionary Homebuilders for a State of California Affordable Housing and Sustainable Communities Award in the amount of $43 million for the construction of a 79-unit mixed-use development in downtown – the first of its kind. • Partnered with Self Help Enterprises for a Multifamily Housing Program Award in the amount of $12.5 million for the construction of 45-housing units. • Partnered with Stanislaus Equity Partners and R3 development for a 9-unit transitional housing project at 225 E. Orangeburg.
• Camp2Home program has assisted 114 individuals with job and housing readiness services. xxii
#15..
- 764 -
• Camp2Home has also assisted 10 individuals in obtaining employment and has housed a total of 27 individuals.
• A total of $255,998 was distributed in loans and grants through the City's Homeowner Rehabilitation Program. A total of ten (10) eligible households were served through this program. The City assisted eligible households with health and safety repairs including, but not limited to installation of energy efficient windows, energy efficient HVAC systems, re-roof, ADA bathroom improvements, electrical repairs, and ADA ramps. Provided below are before and after images of a Homeowner Repair Program Project.

Before Repair
xxiii
#15..
- 765 -
After Repair
• The Planning Division, working with consultant Opticos Design, Inc., completed a Housing Plan for the City that provides strategies and recommendations on how to increase housing supply in Modesto. The Housing Plan was adopted by the City Council in January 2023.

Economic Vitality
• The Compost Division processed over 49,235 tons of residential and commercial organics into compost.
• The Solid Waste Division collected and recycled 9,847 pounds of California Redemption Value (CRV) keeping it out of the waste stream.
• The Solid Waste Division recycled 474 gallons of used oil and 174used oils filters. • The Streets Division completed 33.6 lane miles of crack seal application and 154.12 lane miles of slurry seal application.
• The Traffic Division replaced 2,509 traffic signs and completed 120,983 square feet of striping for legends and crosswalks.
• The Traffic Division converted 126 high voltage lights to regular voltage. xxiv
#15..
- 766 -
• The Traffic Division installed 297 traffic detection cameras. • The Community and Economic Development Department initiated the first comprehensive update of the City’s General Plan since 1995, working with the City’s consultant, PlaceWorks, and has been conducting extensive public outreach efforts with a broad spectrum of the community in support of the visioning phase of the update. • The Community and Economic Development Department submitted a first draft of the City of Modesto’s 2023-2031 Housing Element to the California Department of Housing and Community Development for review.
• The Community and Economic Development Department has been working on the implementation of the Tivoli Specific Plan, the City’s major new growth area. Included in this effort has been the approval of the two-subdivision map in the plan area, which will create 354 new residential lots, and the formation of a new Community Facilities District to provide funding for new infrastructure in the area. An additional map, totaling 74 lots, are currently under review.
• The Planning Division also approved two new high-density housing projects, one a six-story mixed use building comprised of 74 low-income units and ground floor retail/office/child daycare uses, located at 7th and J Streets, and a four-story building comprised of 49 lowincome units and supportive services to be located on E. Morris Ave east of McHenry Avenue. • A new three-story 112,500 sq. ft. medical office building was approved on Dale Road as part of the Kaiser Permanente Modesto Medical Center development. • The Economic Development Division hosted a small business webinar with the State Controller’s Office providing business resource information to nearly 200 area small businesses.
• The Economic Development Division received three Downtown Occupancy Incentive applications and one Downtown Façade Incentive application which was awarded to the State Theatre for their Intermission project at the corner of J St and 13th Street. • The Economic Development Division restarted the “Portraits in Success" program that recognizes outstanding Modesto businesses in the 2nd and 3rd floor lobby showcases. • The Economic Development Division completed the first phase of an ARPA-funded Feasibility Study for the creation of an Enhanced Infrastructure Financing District to generate funds for infrastructure investment that can attract private development.

Governance and Service Delivery
• Received the first Triple Crown Award through the Government Finance Officers Award for receiving the GFOA's Certificate of Achievement for Excellence in Financial Reporting, Popular Annual Financial Reporting Award, and the Distinguished Budget Presentation Award in the same year.
• Assisted over 700 utility customers in participating in State Low Income Household Water Assistance Program which assists utility customers with one-time payments on past due utility bills.
• Implemented two new Utility Billing Discount programs to encourage utility customers to enroll in Auto Pay or eBilling.
• Established an extension of the Letter of Credit for the 2008 Lease Revenue Bond and establish a new Standby Certificate Purchase Agreement for the 2008 Water Certificates of Participation saving the Water Fund over $200,000.
• Appointed two new Public Members for the Audit Committee as part of the implementation of Measure G updates.
xxv
#15..
- 767 -
• As part of the new virtual City Council meetings, the IT Department working with the City Manager’s Office began testing a real-time translation solution named “Wordly” that allows the online viewer to see real-time remarks being spoken in any 1 of 30+ different languages options which equates to over 700 language interpretations pairs. • In addition to Wordly, Closed Captioning in English and Spanish was implemented via our cable TV outlets for all City Council Meetings.
• IT Department submitted itself for review by the Municipal Information Systems Association of California (MISAC) and won the 2022 MISAC Excellence Award for IT Best Practices. • IT Department presented the City of Modesto’s various digital capabilities and improvements for the benefit of residents to the Digital Cities Survey and was named one of the Top 10 Digital Cities in the USA.
•
• IT Department implemented the City’s first “Zoom Room” which allows for residents to interact with City Committees in-person and online (hybrid meetings). • MPD reestablished the Mobile Crisis Emergency Response Team (M.C.E.R.T.). Mental Health clinicians will be responding with officers to calls involving individuals in crisis. xxvi
#15..
- 768 -
• MPD created a 3 year Strategic Plan which will act as a roadmap aiming at meeting the public safety needs and concerns of Modesto.
• The MPD created an air support unit to help assist with its crime reduction efforts. The plane was chosen due to it lower cost of purchase and operation. Its success has already attracted interest from other public safety agencies.
• The MPD added an all-electric Ford Mach-E to its fleet of patrol cars. The vehicle will help MPD assess usability of an EV for police use.
• MPD is continuing to enroll staff in Cultural Relations Community Coaching Series classes. • MPD is working closely with the recently established Community Police Review Board and Independent Auditor to continue its efforts of transparency and accountability to the community.
• The Forestry Division responded to 9,951 forestry service requests. • In honor of Building Safety Month, the Building Safety Division presented a workshop on the 2022 California Building Code updates to developers in the community. • In June, the Building Safety Division was selected as the recipients of the 2023 Smart Community Award from CentralSquare Technologies for their work on automating green energy permits.
xxvii
#15..
- 769 -
xxviii
#15..
- 770 -
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Modesto
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2022
Executive Director/CEO
xxix
#15..
- 771 -
Allison Van Guilder Vacant
Jessica Hill (Interim)
Rosa Escutia-Braaton, Dist. 1
Eric Alvarez, Dist. 2
Chris Ricci, Dist. 3
Nick Bavaro, Dist. 4
Jeremiah Williams, Dist. 5
David Wright, Dist. 6
xxx
#15..
- 772 -

FINANCIAL SECTION TAB
#15..
- 773 -
#15..
- 774 -

FINANCIAL SECTION
1 #15..
- 775 -
This page is intentionally left blank.
2 #15..
- 776 -
3 Independent Auditor’s Report
Honorable Members of the City Council
City of Modesto, California
Report on the Audit of the Financial Statements
Opinions
We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Modesto, California (the City), as of and for the year ended June 30, 2023, 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, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Modesto, California, as of June 30, 2023, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

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 the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Emphasis of Matter
As discussed in Note I, the City implemented the provisions of Governmental Accounting Standards Board Statement No. 96, Subscription-Based Information Technology Arrangements, during the fiscal year ended June 30, 2023. Our opinion is not modified with respect to this matter. #15..
- 777 -
4 Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

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

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 the City’s ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control–related matters that we identified during the audit.
#15..
- 778 -
5 Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, schedule of changes in the net pension liability and related ratios, schedule of pension plan contributions, schedule of changes in the OPEB liability and related ratios, schedule of OPEB contributions, and budgetary comparison information for the General Fund, Operating Grants Special Revenue Fund and Housing and Community Development Special Revenue Fund, 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.

Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining and individual fund financial statements and budgetary comparison schedules as listed in the table of contents are presented for purposes of additional analysis and are not a required part of the basic financial statements. 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 supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Information
Management is responsible for the other information included in the annual report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditor’s report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon. #15..
- 779 -
6 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 a report dated December 8, 2023 on our consideration of the City’s internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance.

That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.

Glendale, California
December 8, 2023
#15..
- 780 -
Management’s Discussion and Analysis
This section of the City of Modesto (the City) annual comprehensive financial report presents a discussion and analysis of the City’s financial performance during the fiscal year ended June 30, 2023. Please read it in conjunction with the transmittal letter at the front of this report and the basic financial statements following this section.

FINANCIAL HIGHLIGHTS
 The assets plus deferred outflows of resources of the City exceeded liabilities plus deferred inflows of resources at the close of the 2023 fiscal year by $1,337,162,490 (total net position). Of this amount, $225,261,510 is restricted for a specific purpose (restricted net position), $1,057,301,510 is net investment in capital assets and $54,599,470 is unrestricted (unrestricted net position).  The City’s total deferred outflows of resources increased by $61,499,865 as compared to the prior year.  The City’s total deferred inflows of resources decreased by $74,128,816 as compared to the prior year.  The City’s total liabilities increased by $104,584,100 as compared to the prior year.  The City’s total net position increased by $54,350,841 compared to the prior year. This increase is attributed mainly to an increase in unrestricted investment earnings of $18,002,636 as compared to prior year, an increase in operating grants and contributions of $3,805,546 as compared to prior year, an increase in sales tax revenue with the voters approval under Measure H which increased the sales tax rates by 1% from 7.875% to 8.875% increasing sales tax revenues in the amount of $11,116,219 and a decrease in general government expenses in the amount of $3,715,539 as compared to prior year.
 As of June 30, 2023, the City’s governmental funds reported combined fund balances of $223,905,892 an increase of $28,903,804 in comparison with the prior year.  As of June 30, 2023, 43.77% of the General fund balance, $23,445,340 is available to meet the City’s current and future needs (General Fund unassigned fund balance).  At the end of the fiscal year, the General Fund balance was $53,570,568 or 32.2% of total General Fund expenditures. Of this, $8,486,061 is the restricted fund balances. The unassigned fund balance of $23,445,340 represents 13.5% of total General Fund outflows. The City Council has adopted a goal of maintaining a General Fund reserve at a minimum level of no less than the average of two months of regular General Fund operating expenditures.
 The City’s total long-term liabilities showed a net decrease of $19,464,944 in comparison with the prior year.

This decrease was attributed to a reduction in debt from the principal payments made during the fiscal year.

OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis are intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements comprise three components 1) Government-wide financial statements; 2) Fund financial statements and 3) Notes to basic financial statements. Required Supplementary Information is included in addition to the basic financial statements.

Government-wide Financial Statements are designed to provide readers with a broad overview of the City finances, in a manner similar to a private-sector business.

The Statement of Net Position presents information on all the City assets and liabilities, deferred outflows of resources and deferred inflow of resources, with the difference between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating.

The Statement of Activities presents information showing how 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 result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).
7 #15..
- 781 -
Management’s Discussion and Analysis (continued)
Both of these government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, community development, highways and streets, public works, parks and recreation, and public safety. The business-type activities of the City include the Water, Sewer, Parking, Storm Drain, Compost, Airport, Golf, Community Center and Abatement and Public Nuisance operations.

Component units are included in our basic financial statements and consist of legally separate entities for which the City is financially accountable and that have substantially the same board as the City Council, or provide services entirely to the City or the City has operational responsibility for the entities. Examples are the Community Facilities Districts, Redevelopment Successor Agency of the City of Modesto and the Modesto Public Financing Authority.

The government-wide financial statements can be found on pages 19-21 of this report.

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

Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental funds 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 the City’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 reports 18 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 for the General Fund, Operating Grants Fund, Housing and Community Development and Capital Grants Fund, and.

Data from the other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements elsewhere in this report.

The governmental funds financial statements can be found on pages 22-25 of this report.

Proprietary funds are maintained two ways. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its Water, Sewer, Parking, Storm Drain, Compost, Airport, Golf, Community Center and Abatement and Public Nuisance operations. Internal service funds are an accounting device used to accumulate and allocate costs internally among the City’s various functions. The City uses internal service funds to account for its Fleet Management, Central Services, Information and Technology Services, Insurance, Employee Benefits Management and Building Services functions. Because these services predominantly benefit governmental rather than businesstype functions, they have been included within governmental activities in the government-wide financial statements with the exception of portions of the compensated absences that have been included within business-type activities.

The rest of internal services benefiting business-type functions have been allocated as “internal balances”.

Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The Water, and Sewer funds are considered to be major funds of the City. The City’s six internal service funds are combined into a single, aggregated presentation in the proprietary funds financial statements. Individual fund data for the internal service funds is provided in the form of combining statements elsewhere in this report.

The proprietary funds financial statements can be found on pages 26-29 of this report.

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 statements because the resources of those funds are not available to support the City's own programs. Private Purpose and Investment trust funds account for assets held 8 #15..
- 782 -
Management’s Discussion and Analysis (continued)
by the City as an agent for individuals, governmental entities and non-public organizations. The accounting used for fiduciary, private purpose, and investment trust funds is much like that used for proprietary funds.

The fiduciary fund financial statements can be found on page 30-31 of this report.

Notes to Basic Financial Statements provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes can be found on pages 32-81 of this report.

Required Supplementary Information is also presented. The City adopts an annual appropriated budget.

Budgetary comparison schedules for the General Fund, Operating Grants Fund, Housing and Urban Development Fund, and Special Revenue Funds have been provided to demonstrate compliance with this budget. This section also includes the schedules for net pension liability and OPEB.

Required supplementary information can be found on pages 82-95 of this report.

The combining and individual fund statements and schedules referred to earlier provide information for nonmajor governmental, enterprise and internal service funds and are presented immediately following the required supplementary information. Combining and individual fund statements and schedules can be found on pages 96- 138 of this report.

GOVERNMENT-WIDE FINANCIAL ANALYSIS
As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the City, assets plus deferred outflows exceeded liabilities plus deferred inflows by $1,337,162,490 at the close of the most recent fiscal year.

Statements of Net Position
The largest portion of the City’s net position, $1,057,301,510 or 79.1%, reflects its investment in capital assets (e.g. land, water rights, buildings, improvements, furnishings and equipment, fare boxes, pipelines, leases – right to use, SBITAs – right to use and infrastructure), less any related debt used to acquire those assets that are 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 net investment in capital assets is reported net of debt and related deferred outflows and inflows, 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.

Another significant portion of the City’s net position represents unrestricted net position of $54,599,470 or 4.1%.

The remaining balance of the City’s net position of $225,261,510 or 16.8% represents resources that are subject to external restrictions on how they may be used.

Governmental activities Business-type activities Total
2023 2022 2023 2022 2023 2022
Current and other assets $382,722,741 $383,654,540 $351,861,218 $332,053,761 $734,583,959 $715,708,301 Capital assets 502,335,113 493,364,112 857,439,196 861,979,595 1,359,774,309 1,355,343,707 Total assets 885,057,854 877,018,652 1,209,300,414 1,194,033,356 2,094,358,268 2,071,052,008 Deferred outflows of resources 105,199,286 49,483,707 33,261,533 27,477,247 138,460,819 76,960,954 Current and other liabilities 396,128,708 292,993,303 109,170,225 88,256,585 505,298,933 $381,249,888 Long-term liabilities 88,174,629 90,280,751 269,491,685 286,850,508 357,666,314 377,131,259 Total liabilities 484,303,337 383,274,054 378,661,910 375,107,093 862,965,247 758,381,147 Deferred inflows of resources 16,520,102 79,721,948 16,171,248 27,098,218 32,691,350 106,820,166 Net position:

Net investment in capital assets 468,002,326 457,620,157 589,299,184 687,640,266 1,057,301,510 1,145,260,423 Restricted net position 208,472,568 195,793,646 16,788,942 15,918,799 225,261,510 211,712,445 Unrestricted net position (187,041,193) (189,907,446) 241,640,663 115,746,227 54,599,470 (74,161,219) Total net position $489,433,701 $463,506,357 $847,728,789 $819,305,292 $1,337,162,490 $1,282,811,649 9 #15..
- 783 -
Management’s Discussion and Analysis (continued)
The City’s net position increased by $54,350,841 during the current fiscal year was largely due to the increases to unrestricted investment earnings in the amount of $18,002,636, an increase in operating grants and contributions in the amount of $3,805,546 and an increase in sales tax revenues under Measure H in the amount of $11,116,219 as compared to prior year.

The following table indicates the changes in net position for governmental and business-type activities, as well as comparative data for the prior year:

Statement of Activities
Governmental activities. Governmental activities increased the City’s net position by $25,927,344 mainly due to City voter’s approval of Measure H in November 2022, which went into effect on April 1, 2023, and increased sales tax rates by 1% from 7.875% to 8.875%. Revenues collected under Measure H can be used for any general City purposes. The long-term liabilities decrease was attributed mainly to the principal debt payments of $4,210,255 and $11,043,483 in claim liability made during the fiscal year.

Intergovernmental revenue decreased by $7,777,679, this revenue source established in Fiscal Year 2017-18 from the Stanislaus County county-wide, 25-year, half-cent sales tax increase known as Measure L, is mainly used as a local fund contribution, required by other grant sources, or to fund projects for which other funding sources such as Governmental activities Business-type activities Total
2023 2022 2023 2022 2023 2022
Revenues:

Program revenues:

Charges for services $36,398,285 $40,589,213 $175,253,435 $174,581,470 $211,651,720 $215,170,683 Operating grants and contributions 19,539,354 15,352,734 1,263,264 1,644,338 20,802,618 16,997,072 Capital grants and contributions 4,174,014 12,835,899 3,310,141 2,452,983 7,484,155 15,288,882 General revenues:

Taxes 75,043,463 71,192,182 291,711 212,978 75,335,174 71,405,160 Intergovernment revenue not
restricted for specific purposes 135,764,740 143,542,419 - 135,764,740 143,542,419 - Unrestricted investment earnings 3,403,539 (3,911,830) 2,562,708 (8,124,559) 5,966,247 (12,036,389) Miscellaneous 923,411 1,643,071 1,707,204 1,301,658 2,630,615 2,944,729 Total revenues 275,246,806 281,243,688 184,388,463 172,068,868 459,635,269 453,312,556 Expenses:

General government 16,573,945 20,268,611 - 16,573,945 20,268,611 - Community development 28,589,701 20,615,432 - 28,589,701 20,615,432 - Highways and streets 27,337,181 27,463,523 - 27,337,181 27,463,523 - Public works 7,795,895 3,086,419 - 7,795,895 3,086,419 - Parks and recreation 16,227,064 12,439,250 - 16,227,064 12,439,250 - Public safety 147,700,874 121,675,443 - 147,700,874 121,675,443 - Interest on long-term debt 1,719,479 1,954,306 - 1,719,479 1,954,306 - Water - 77,533,248 73,421,868 77,533,248 73,421,868 -
Sewer - 48,558,199 44,263,767 48,558,199 44,263,767 -
Parking - 2,026,547 1,926,834 2,026,547 1,926,834 -
Storm drain - 6,767,327 5,965,352 6,767,327 5,965,352 - Compost - 11,902,440 11,497,333 11,902,440 11,497,333 - Airport - 2,130,694 1,686,375 2,130,694 1,686,375 -
Golf - 3,238,111 3,229,764 3,238,111 3,229,764 -
Community center - 1,899,017 1,570,818 1,899,017 1,570,818 - Abatement and pubic nuisance - - 137,992 124,097 137,992 124,097 Total expenses 245,944,139 207,502,984 154,193,575 143,686,208 400,137,714 351,189,192 Change in net position before
transfers 29,302,667 73,740,704 30,194,888 28,382,660 59,497,555 102,123,364 Transfers 66,244 21,077,584 (66,244) (21,077,584) - -
Total transfers 66,244 21,077,584 (66,244) (21,077,584) - - Special item - - (19,461,712) - (19,461,712) -
Change in net position 29,368,911 94,818,288 30,128,644 (12,156,636) 59,497,555 82,661,652 Net position - beginning 463,506,357 373,589,871 819,305,292 843,876,401 1,282,811,649 1,217,466,272 Prior year adjustments (3,441,567) (4,901,802) (1,705,147) (12,414,473) (5,146,714) (17,316,275) Net position - ending $489,433,701 $463,506,357 $847,728,789 $819,305,292 $1,337,162,490 $1,282,811,649 10 #15..
- 784 -
Management’s Discussion and Analysis (continued)
grants, are not available. During Fiscal Year 2022-23, the need for local match requirements decreased as other funding sources were available to fund local transportation improvement projects.

Total expenses increased compared to the prior year by $38,441,155. This increase is mainly attributed to an increase in salary and benefit costs, along with an increase in hiring of previously vacant positions in public safety and the one-time hazard pay issued to active employees who worked full time and who provided their services during the pandemic.

Business-type activities. Business-type activities increased the City’s net position by $28,423,497. The increase was mainly attributed to increases in capital grants and contributions in the amount of $857,158 and an increase in unrestricted investment earnings in the amount of $10,687,267. Also, during fiscal year 2022 the net position for business activities was decreased by $19,461,712 due to the transfer of operations of the bus funds to the Stanislaus Regional Transit Authority (StanRTA) that was a one-time impact to the City’s net position.

FINANCIAL ANALYSIS OF THE CITY’S FUNDS
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.

Governmental funds. The general government functions are contained in the general, special revenue, capital projects, and debt service 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 is 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.

At June 30, 2023, the City’s governmental funds reported combined fund balances of $223,905,892 an increase of $28,903,804 from the prior year. The total unassigned fund balance for the governmental funds was $16,372,486 which includes a positive $23,445,340 which represents the General Fund unassigned fund balance that is available to meet the City’s current and future needs. The remainder of the fund balance is nonspendable, restricted, committed and assigned to indicate that it is not available for new spending because certain constraints have been placed on the use of the balances. The unassigned fund balance for the General Fund increased by $13,502,942.

The General Fund is the chief operating fund of the City. At June 30, 2023, unassigned fund balance of the General Fund was $23,445,340 while total fund balance was $53,570,568. As a measure of the General Fund’s liquidity, it may be useful to compare both unassigned fund balance and total fund balance to total fund expenditures.

Unassigned fund balance represents 14.1% of total General Fund expenditures, while total fund balance represents

32.2% of that same amount. The prior year ratios were 5.9% and 25.2%, respectively.

The Operating Grants fund accounts for receipts and disbursements of a variety of Governmental Fund Operating grants. At June 30, 2023, total fund balance was $4,731,444 this is an increase of $2,253,107 from prior year.

The Housing and Community Development fund accounts for the grants and funds received to disburse for projects developed and administered under the Housing and Community Development Act. At June 30, 2023, the total fund balance was $33,771,463, a decrease of $42,464 from the prior year.

The Capital Grants fund accounts for receipts and disbursements of a variety of Governmental Fund capital grants.

At June 30, 2023, total fund balance was ($4,751,207) which was a decrease of $2,569,091 from prior year, due to large scale construction projects nearing completion. During fiscal year 2022-23, construction for the State Route 132 project has been on-going, and nearing completion for the first phase of the project. This is a large-scale construction project which is funded by grants from various local and State agencies.

Revenues of governmental funds totaled $284,439,964 in fiscal year 2022-23, which represents an increase of $6,474,196 from fiscal year 2021-22.

Expenditures of governmental funds totaled $255,587,573 in fiscal year 2022-23, representing a decrease of $1,637,539 from fiscal year 2021-22.
11 #15..
- 785 -
Management’s Discussion and Analysis (continued)
The following table presents governmental fund revenues from various sources, with comparisons to the prior year:

Revenues Classified by Source – Governmental Funds
FY 2023 FY 2022
Increase
(Decrease)
Revenues by Source Amount Percent Amount Amount % Change Taxes $75,043,463 26.4% $71,192,182 $3,851,281 5.4%
Licenses and permits 409,082 0.1% 434,118 ($25,036) -5.8% Intergovernmental 168,444,765 59.4% 166,804,885 $1,639,880 1.0% Charges for services 30,208,091 10.6% 33,744,323 ($3,536,232) -10.5% Special assessments 4,900,860 1.7% 5,578,262 ($677,402) -12.1% Interest and rent 4,113,653 1.4% 2,191,466 $1,922,187 87.7% Net increase (decrease) in fair
value of investments (487,727) -0.2% (4,317,623) $3,829,896 -88.7% Fines and forfeits 880,252 0.3% 832,510 $47,742 5.7%
Donations and contributions - - 44,338 ($44,338 -100%
Miscellaneous 927,525 0.3% 1,461,307 ($533,782) -36.5%
Total $284,439,964 100.0% $277,965,768 $6,474,196 2.3%
 Taxes – Revenues for property and business license taxes came in higher than the prior year due to an ongoing positive upturn in the economy and the increased collection and compliance efforts by the City staff, additionally, effective April 1, 2023, sales tax rate increased by 1% to 8.875% under the Citizen’s vote to approve Measure H.
 Licenses and Permits – Revenues decreased by $25,036 due to a decrease in Cannabis annual permit fees.  Intergovernmental – Revenues increased by $1,639,880 due to an increase in Federal and State grants awarded to the City for the mitigation efforts against the novel coronavirus (COVID-19). As well as an increase in the revenue source for the Stanislaus County county-wide, 25 year, half-cent sales tax increase known as Measure L to assist with the funding for local transportation improvements for the City.  Charges for Services – Revenues decreased by $3.536,232, due primarily to a reduction to permits issuance for new construction developments. During the prior year the City experienced an increase in new construction development permits, as opposed to the fiscal year when construction is occurring for those new developments.  Interest and Net decrease in fair value of investments – The increase in interest earned along with the increase in fair market value of the city’s investment portfolio is showing a positive outturn due to the current market conditions and continuous on-going improvements to the City’s investment strategy which has increased our return on investment in the City’s portfolio.

The following table presents expenditures by function compared to prior year amounts.

Expenditures by Function – Governmental Funds
FY 2023 FY 2022
Increase
(Decrease)
Exp by Function Amount Percent Amount Amount % Change
General government $15,483,071 6.1% $21,110,258 ($5,627,187) -26.7% Community development 26,878,953 10.5% 21,429,140 $5,449,813 25.4% Highways and streets 14,694,631 5.7% 16,510,434 ($1,815,803) -11.0% Public works 7,359,391 2.9% 3,215,409 $4,143,982 128.9% Parks and recreation 15,247,166 6.0% 12,943,340 $2,303,826 17.8% Public safety 139,450,451 54.7% 126,649,307 $12,801,144 10.1% Capital outlay 30,540,807 11.9% 50,042,664 ($19,501,857) -39.0% Debt Service-principal retirement 4,210,255 1.6% 3,362,904 $847,351 25.2% Debt Service-interest charges 1,609,215 0.6% 1,913,046 ($303,831) -15.9% Debt Service-other 113,633 - 48,610 $65,023 133.8%
Total $255,587,573 100.0% $257,225,112 ($1,637,539) -0.6% 12 #15..
- 786 -
Management’s Discussion and Analysis (continued)
The following provides an explanation of the expenditures by function that changed significantly over the prior year:
 General Government – Expenditures decreased in the amount of $5,627,187 or 26.7% mainly due to the GASB 87- “Leases”, implementation during Fiscal Year 2021-22 resulting in higher overall expenditures for general governmental functions during the prior year. Expenditures during Fiscal Year 2022-23 are more reflective of the regular fiscal year general governmental expenditures.  Community Development – Expenditures increased by $5,449,813 or 25.4% over the prior year, mainly due to the one-time hazard pay awarded to all active, full time City staff who worked in full time positions during the pandemic. Additionally, the total expenditures increased as more projects were undertaken by the City due to increase in grant funding.
 Public Works – Expenditures increased in the amount of $4,143,982 or 128.9% mainly due to a one time the one-time hazard pay awarded to all active City staff who worked in full time positions during the pandemic. Additionally, the total expenditure increased as more projects were undertaken by City staff due to increase in available funding.
 Parks and Recreations – Expenditures increased by $2,303,826 or 17.8% over the prior year due to the reopening of parks and increase in recreational activities which had been closed or limited during the prior years due the effects of the pandemic.
 Public safety – Expenditures increased by $12,801,144 or 10.1% over the prior year mainly due to an increase in services that are provided and equipment purchases, based on grant fund availability that fluctuates year to year depending on grants awarded. Additionally, during fiscal year 2023 the City entered into an agreement with City of Salida for temporary Fire Chief services to assist City of Salida with Fire Services Program Planning and administration amongst other leadership services. The City incurred additional salary and benefit costs which were then reimbursed by City of Salida.  Capital Outlay – Expenditures decreased in the amount of $19,501,857 or 39.0% due to large scale multiyear projects, such as the State Route 132, nearing completion during Fiscal Year 2022-23 which resulted in less construction expenditures during this fiscal year as compared to the prior year.

Other financing sources and uses are presented below to illustrate changes from the prior year:

Increase/(Decrease)
FY 2023 FY 2022 Amount Percent
Transfers in $17,408,119 $15,993,594 $1,414,525 8.8%
Transfers out (19,129,521) (17,677,119) (1,452,402) 8.2% Other financing proceeds 1,772,045 3,741,926 (1,969,881) -52.6% Sale of assets 10,540 32,551 (22,011) -67.6%
Net financing (uses) $61,183 $2,090,952 ($2,029,769) -97.1% Transfers - The City uses interfund transfers to: (1) move resources from a fund to other funds that will utilize them in accordance with statutory and budgetary requirements, (2) utilize unrestricted resources collected in the General Fund to help finance various programs and capital projects accounted for in other funds in accordance with budgetary authorization, and (3) move cash to pay debt service to the funds that are responsible for payment as those payments become due.
 The net financing (uses) from governmental funds for 2023 were $61,183 compared to $2,090,952 in the prior year. This net transfer is to various City funds including transferring funds from the General Fund, Housing and Community Development fund, Local Transportation fund, Transportation Special Tax fund, Special Fund for Capital Outlays, Parks funds, Community Facilities Districts fund, Capital Facility Fee funds, Fleet Fund, Information Technology Services fund, and Building Services fund, to cover the debt service payments, fleet replacement, funding for capital projects and various transfers to cover City grant matches.

The fund balance of the City’s General Fund increased by $14,151,443 during the fiscal year. This result is consistent with the City Council’s budgetary direction to reduce spending and identify additional revenue sources 13 #15..
- 787 -
Management’s Discussion and Analysis (continued)
that would allow the General Fund to retain an unrestricted reserve that meets the City Council’s adopted reserve requirements level of no less than the average of two months of regular General Fund expenditures.

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

The following table shows actual revenues, expenses, and results of operations of enterprise funds for the current fiscal year:

Major Funds
Nonmajor
Funds
Water Sewer Other Total
Operating revenues $81,863,397 $63,813,925 $28,871,874 $174,549,196 Operating expenses (73,190,944) (46,555,621) (28,475,857) (148,162,422) Operating income (loss) 8,732,453 17,258,304 396,017 26,386,774 Nonoperating revenues (expenses), net (3,453,433) 73,320 2,625,133 (754,980) Income (loss) before capital
contributions and transfers 5,279,020 17,331,624 3,021,150 25,631,794 Contributions and transfers (5,958,033) 7,605,509 1,596,421 3,243,897 Changes in net position ($679,013) $24,937,133 $4,617,571 $28,875,691 The Sewer fund had a rate increase of 3.5% effective July 1, 2022. This rate was approved on April 12, 2022.

A pollution remediation liability was reported for the Water and Sewer fund in the amounts of $3,855,856 and $6,541,398, respectively based on net recoveries the City has received from various settlements. Additional information regarding these liabilities can be found under Note II-Q.

GENERAL FUND BUDGETARY HIGHLIGHTS
Budget to actual information for the General Fund is presented as Required Supplementary Information, beginning on page 89-90 of this report.

While the City Council amended the budget several times through the year, the differences between the original budget and the final amended budget for the General Fund were increased overall mainly due to an increase in intergovernmental revenues. The estimated revenues increased about $9,352,197 while total appropriations increased by $4,807,516. These amendments were to adjust the actual beginning balances and carryovers after closing the prior fiscal year, to reflect adjustments to current estimates based on the periodic monitoring of revenue and expenditures throughout the year and to factor in the much-anticipated increase to sales tax by 1% to a total

8.875% sales tax rate. On November 2022, Citizens voted to approve a sales tax increase under Measure H which went into effect on April 1, 2023.

Revenues came in $9,039,454 more than final estimates. Variances in Franchise Tax $818,382, Utility Users Tax $1,413,013, Property Tax $704,830, and Intergovernmental $7,375,272, were due to an increase in collection efforts, and a quicker recovery from the pandemic than was anticipated and stronger property values.

Expenditures, overall, were $10,862,422 under budget, primarily due to efforts of departments to realize savings, and certain purchases being deferred to future periods.

CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital assets
The City’s investment in capital assets for its governmental and business-type activities as of June 30, 2023, amounted to $1,359,774,309 (net of accumulated depreciation). The total decrease in the City’s investment in capital assets compared to 2022 was less than 1.0%.
14 #15..
- 788 -
Management’s Discussion and Analysis (continued)
Capital assets net of depreciation, for the governmental and business-type activities are presented below to illustrate changes from the prior year.

Major capital asset events during the current fiscal year included the following:
 Improvements – Fleet maintenance facility was completed in fiscal year 2022-23 in the amount of $6.2 million.

The Del Rio water tank was completed in fiscal year 2022-23 in the amount of $13.7 million. Replacement water well 226 was completed in fiscal year 2022-23 in the amount of $2.5 million.  Water rights – Depreciation expense for fiscal year 2022-23 in the amount of $11.9 million.  Pipelines – The Wastewater Sonoma trunk extension was completed in fiscal year 2022-23 in the amount of $2.7 million. Roosevelt Park cross connection was completed in fiscal year 2022-23 in the amount of $5.0 million.
 Construction in progress – Ongoing water construction projects related to improvements to the City’s water infrastructure were made during fiscal year 2022-23, ongoing construction of the Jennings water quality control (WQC) entrance, Sutter Trunk, West Trunk Crossing Highway 132, and River Trunk Gravity system, River Trunk Shackelford pump, as well as the ongoing construction of the State Route 132 project.

The City’s infrastructure assets are recorded at historical cost in the government-wide financial statements.

Depreciation expense is recorded using the straight-line method, based on estimated useful life of the asset.

Additional information on the City’s capital assets can be found in note II-B on pages 46-48 of this report and the purchase of additional fleet vehicles in the amount of $1.0 million. Additional information on the City’s commitments can be found in note III-D on page 70-71 of this report.

Long-term debt and liabilities
At June 30, 2023, the City had total long-term liabilities outstanding of $357,666,314 net of unamortized discounts and premiums, as compared to $377,131,259 in the prior year. This amount was comprised of $41,770,000 of lease revenue bonds, $42,798,534 of certificates of participation, $104,323,169 of revenue bonds payable, $93,190,000 of reimbursement agreement related to Modesto Irrigation District bonds, $11,919,153 of estimated compensated absences, $27,038,914 of claims liability, $26,214,883 of loans payable, $582,953 of developer advances, $6,576,301 of finance purchase obligations, $718,103 of lease payables, $1,861,304 of SBITAs payables and $673,000 of notes payable.

For the governmental and business activities, the long-term debt decrease was mainly due to the principal payments made during the fiscal year. Additional information on the City’s long-term debt can be found in Note II-D on pages 50-61 of this report.

Increase
Governmental Business-type Total (decrease)
Percent
2023 2022 Restated 2023 2022 2023 2022 Restated Change $ Change Land $34,995,346 $33,774,611 $30,647,169 $30,452,365 $65,642,515 $64,226,976 88% $1,415,539 Capitalized interest - 3,969,880 - 4,474,666 3,969,880 $4,474,666 -11% (504,786) Buildings 20,264,105 21,906,089 29,115,695 30,854,543 49,379,800 $52,760,632 -6% (3,380,832) Improvements 57,885,970 53,086,976 243,047,851 243,092,019 300,933,821 $296,178,995 2% 4,754,826 Furnishings and equipment 2,517,365 2,969,784 2,565,952 3,084,741 5,083,317 $6,054,525 -16% (971,208) Intangible assets 1,178,550 1,586,708 3 1,178,553 3 $1,586,711 -26% (408,158) Equipment pool 16,825,643 16,124,456 - 16,825,643 - $16,124,456 4% 701,187 Service animals 27,435 24,756 - - 27,435 $24,756 11% 2,679 Water rights - 202,995,122 - 214,936,012 202,995,122 $214,936,012 -6% (11,940,890) Streets 153,607,619 160,217,422 - 153,607,619 - $160,217,422 -4% (6,609,803) Signalization 5,486,212 5,974,925 - 5,486,212 - $5,974,925 -8% (488,713) Bridges 25,163,549 25,905,120 - 25,163,549 - $25,905,120 -3% (741,571) Buses & fareboxes 25,103 25,103 - - 25,103 $25,103
Pipelines 400,269 405,844 279,380,650 276,142,582 279,780,919 $276,548,426 1% 3,232,493 Construction in progress 181,780,996 170,696,297 65,251,234 58,491,351 247,032,230 229,187,648 8% 17,844,582 Right to use SBITAS 1,742,623 2,372,661 194,851 1,937,474 - 2,372,661.00 100% (435,187) Right to use Leases
Buildings 367,428 515,062 - - 367,428 $515,062 -29% (147,634) Equipment pool 1 8,644 - - 1 $8,644 -100% (8,643)
Land 66,899 142,630 270,789 451,313 337,688 $593,943 -43% (256,255) Total $502,335,113 $495,737,088 $857,439,196 $861,979,595 $1,359,774,309 $1,357,716,683 0% $2,057,626 15 #15..
- 789 -
Management’s Discussion and Analysis (continued)
The City maintains a current bond rating for the various bonds listed below.

BONDS Moody’s Rating S & P Rating Fitch Rating
2008 Lease Revenue Bonds A1 AA+/A-1 AA2008 Water Certificates of Participation Aa1 AA/A-1 Wastewater Revenue Bonds, Series 2018A AA
Wastewater Revenue Bonds, Series 2020A AA
Wastewater Revenue Bonds, Series 2020B AA
With the implementation of GASB Statement No. 75 “Accounting and Financial Reporting for Postemployment Benefits Other than Pension, the City’s net OPEB liability as of June 30, 2023 was $18,938,102. Additional information on the City’s net OPEB liability and Pension can be found in Notes III-F and III-G.

With the implementation of GASB Statement No. 87 “Leases”, the City reported lease receivables in the amount of $23,142,482, deferred inflows of resources-leases in the amount of $22,121,597, and lease liability in the amount of $718,103 as of June 30, 2023.

With the implementation of GASB Statement No 96 “Subscription-Based Information Technology Arrangements SBITAS”, the City reported SBITA liability in the amount of $1,861,304 as of June 30, 2023.

Economic Factors and Next Year’s Budget and Rates
 Consumer Price Index – Growth in the CPI had been relatively stable during the previous ten year, however, as a result of the COVID pandemic the CPI became volatile. During fiscal year 2023 CPI begin to stabilize but it has not been as low as in prior years, due to factors such as inflation and higher rates approved by the Federal Government. CPI serves as a measure for the growth in the cost for supplies and services used by the City. In the second half of fiscal year ended June 30, 2023, the CPI-Western Urban Index did see a continuous increase up to 3.1%.
 Utility Service Charges – Wastewater rates increased by 3.5% for residential, commercial, industrial, and septage sewer and 2.5% for canary segregation, effective July 1, 2022. Rate increases were approved by City Council on April 12, 2022. Water rates increased by 4.5% annually effective October 1, 2023 to fiscal year 2027-2028 were approved by Council on August 22, 2023.

All of these factors were considered in preparing the City’s budget for fiscal year 2022-23.

During the current fiscal year, fund balance in the General Fund increased by $14,151,443, to $53,570,568 which represents 30.9% of total General Fund outflows which exceeds the City’s target value of minimal level of no less than the average of two months of regular general fund operating outflows as unassigned fund. The budget adopted for fiscal year 2022-2023 reflects the Council policy reserve level of a minimum $18,397,817 emergency reserve policy. This amount is reported as part of the committed fund balance.

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 City’s financial condition. Questions concerning any of the information provided in this report and requests for additional financial information should be addressed to the City of Modesto, Attention: Finance Department, P.O.

Box 642, Modesto, CA 95353.
16 #15..
- 790 -

BASIC FINANCIAL STATEMENTS
17 #15..
- 791 -
This page is intentionally left blank.
18 #15..
- 792 -

CITY OF MODESTO

STATEMENT OF NET POSITION
JUNE 30, 2023
Governmental Business-type
Activities Activities Total
ASSETS
Cash and cash equivalents $ 120,989,218 $ 289,669,601 $ 410,658,819 Accounts receivable, net 3,089,785 4,372,829 7,462,614
Interest receivable 861,905 833,330 1,695,235
Utility billings receivable, net 2,267,253 18,452,568 20,719,821 Taxes receivable 23,378,092 1,890 23,379,982
Leases receivable 8,167,219 14,975,263 23,142,482
Due from governments, net 38,113,632 2,856,641 40,970,273 Prepaid expenses 1,339,108 2,338,724 3,677,832
Internal balances (436,626) 436,626 -
Inventories 4,331,375 89,674 4,421,049
Investments in joint ventures 6,408,759 - 6,408,759
Restricted assets:

Cash and cash equivalents 86,627,373 14,515,236 101,142,609 Cash and cash equivalents with fiscal agent 13,013,373 3,318,836 16,332,209 Due from governments, net 4,871,631 - 4,871,631
Reimbursement agreement 12,113,300 - 12,113,300
Notes and loan receivable, net 57,587,344 - 57,587,344
Capital assets:

Land and construction in progress 216,776,342 95,898,403 312,674,745 Other capital assets, net of accumulated depreciation 283,381,820 761,075,153 1,044,456,973 Intangible assets right-to-use, net of accumulated amortization 2,176,951 465,640 2,642,591 Total assets 885,057,854 1,209,300,414 2,094,358,268

DEFERRED OUTFLOWS OF RESOURCES
Deferred OPEB 4,000,845 1,124,890 5,125,735
Deferred pensions 99,117,408 19,860,736 118,978,144
Loss on refunding - 398,162 398,162
Accumulated decrease in fair value of hedging derivatives 2,081,033 11,877,745 13,958,778 Total deferred outflows of resources 105,199,286 33,261,533 138,460,819 Total assets and deferred outflows of resources 990,257,140 1,242,561,947 2,232,819,087

LIABILITIES
Accounts payable 14,713,889 8,619,565 23,333,454
Accrued salaries and benefits 3,849,089 1,082,829 4,931,918 Approved loans payable 627,564 - 627,564
Interest payable 18,220 516,429 534,649
Unearned revenue 2,893,285 2,329,130 5,222,415
Refundable deposits 7,920,369 2,273,706 10,194,075
Derivative instrument - interest swap 2,081,033 11,877,745 13,958,778 Pollution remediation liability - 11,503,992 11,503,992 Long-term liabilities:

Due within one year 12,407,800 14,827,576 27,235,376
Due in more than one year 75,766,829 254,664,109 330,430,938 Net OPEB liability 14,368,920 4,569,182 18,938,102
Net pension liability 349,656,339 66,397,647 416,053,986 Total liabilities 484,303,337 378,661,910 862,965,247

DEFERRED INFLOWS OF RESOURCES
Deferred OPEB 5,880,808 1,590,700 7,471,508
Deferred pensions 2,798,309 299,936 3,098,245
Deferred leases 7,840,985 14,280,612 22,121,597
Total deferred inflows of resources 16,520,102 16,171,248 32,691,350 Total liabilities and deferred inflows of resources 500,823,439 394,833,158 895,656,597

NET POSITION
Net investment in capital assets 468,002,326 589,299,184 1,057,301,510 Restricted for:

Capital projects 97,328,868 - 97,328,868
Housing and community development 69,935,169 - 69,935,169 Pollution remediation - 14,515,236 14,515,236
Health and human services 7,915,493 - 7,915,493
Public safety 3,671,213 - 3,671,213
Refundable deposits 7,920,369 2,273,706 10,194,075
General government and support services 21,701,456 - 21,701,456 Unrestricted (187,041,193) 241,640,663 54,599,470
Total net position $ 489,433,701 $ 847,728,789 $ 1,337,162,490 See Notes to Basic Financial Statements
19 #15..
- 793 -

CITY OF MODESTO

STATEMENT OF ACTIVITIES
FISCAL YEAR ENDED JUNE 30, 2023
Operating Capital
Charges for Grants and Grants and
Expenses Services Contributions Contributions
FUNCTIONS/PROGRAMS:

Governmental activities:

General government $ 16,573,945 $ 5,945,470 $ 713,700 $ 132,476 Community development 28,589,701 16,094,070 6,353,381 11,071 Highways and streets 27,337,181 1,077,458 - 3,664,487
Public works 7,795,895 3,780,309 3,237,341 171,908
Parks and recreation 16,227,064 2,507,683 621,371 194,072 Public safety 147,700,874 6,993,295 8,613,561 -
Interest on long-term debt 1,719,479 - - -
Total governmental activities 245,944,139 36,398,285 19,539,354 4,174,014 Business-type activities:

Water 77,533,248 81,863,397 334,720 42,419
Sewer 48,558,199 64,518,164 318,169 3,267,722
Parking 2,026,547 1,606,145 - -
Storm drain 6,767,327 6,288,237 - -
Compost 11,902,440 15,621,445 267,196 -
Airport 2,130,694 1,008,052 343,179 -
Golf 3,238,111 3,099,845 - -
Community center 1,899,017 247,351 - -
Abatement and public nuisance 137,992 1,000,799 - -
Total business-type activities 154,193,575 175,253,435 1,263,264 3,310,141 Total $ 400,137,714 $ 211,651,720 $ 20,802,618 $ 7,484,155 General revenues:

Taxes:

Utility users tax
Property taxes, levied for general purposes
Property taxes, generated by and allocated to the airport Transient occupancy tax
Franchise tax
Cannabis tax
Business license tax, levied for general purposes
Business license tax, levied for downtown improvement district Intergovernmental revenue:

Sales tax (state appropriation)
Sales tax Measure H
Motor vehicle license fee
Transportation tax funding
Special assessments, levied
Other
Unrestricted investment earnings
Miscellaneous
Transfers, net
Total general revenues and transfers
Changes in net position
Net position, July 1
Prior year adjustments
Net position, June 30
Program Revenues
The notes to basic financial statements are an integral part of this statement. 20 #15..
- 794 -
Governmental Business-type
Activities Activities Total
$ (9,782,299) $ $ (9,782,299) -
(6,131,179) - (6,131,179)
(22,595,236) (22,595,236) -
(606,337) - (606,337)
(12,903,938) (12,903,938) -
(132,094,018) (132,094,018) -
(1,719,479) - (1,719,479)
(185,832,486) (185,832,486) -
- 4,707,288 4,707,288
19,545,856 19,545,856 -
- (420,402) (420,402)
- (479,090) (479,090)
- 3,986,201 3,986,201
- (779,463) (779,463)
- (138,266) (138,266)
- (1,651,666) (1,651,666)
- 862,807 862,807
25,633,265 25,633,265 -
(185,832,486) 25,633,265 (160,199,221)
22,363,013 22,363,013 -
21,893,830 21,893,830 -
- 291,711 291,711
3,513,477 - 3,513,477
8,569,338 - 8,569,338
3,185,203 - 3,185,203
15,306,957 15,306,957 -
211,645 - 211,645
39,611,849 39,611,849 -
11,116,219 11,116,219 -
21,194,886 21,194,886 -
23,171,728 23,171,728 -
4,900,860 - 4,900,860
35,769,198 35,769,198 -
3,403,539 2,562,708 5,966,247
923,411 1,707,204 2,630,615
66,244 (66,244) -
215,201,397 4,495,379 219,696,776
29,368,911 30,128,644 59,497,555
463,506,357 819,305,292 1,282,811,649
(3,441,567) (1,705,147) (5,146,714)
$ 489,433,701 $ 847,728,789 $ 1,337,162,490
Net (Expense) Revenue and
Changes in Net Position
21 #15..
- 795 -
Housing and
Operating Community Capital Other Total
General Grants Development Grants Governmental Governmental ASSETS
Cash and cash equivalents $ 14,882,926 $ 26,255,569 $ 3,537,256 $ $ 52,682,234 50,797 $ 97,408,782 Receivables:

Accounts, net 1,745,022 79,998 37,593 42,142 1,054,970 2,959,725 Interest 458,430 7,911 - - 312,735 779,076
Utilities, net 2,267,253 - - - - 2,267,253
Taxes 23,236,985 1,497 - - 139,610 23,378,092
Leases 6,663,860 - - - 1,498,882 8,162,742
Due from governments 473,935 2,224,857 5,509,611 21,741,743 6,621,771 36,571,917 Due from other funds 14,641,812 - - - 14,641,812
Prepaid expenditures 108,753 3,949 2,775 - 21,104 136,581 Restricted assets:

Cash and cash equivalents 4,387,496 3,997,660 - - 71,932,691 80,317,847 Cash and cash equivalents with
fiscal agent 4,098,565 733,784 - 2,223,199 5,210,527 12,266,075 Due from governments - - - - 4,871,631 4,871,631
Notes receivable, net - - 55,376,344 - 2,211,000 57,587,344 Leases receivable - - - - 4,477 4,477
Advances to other funds 1,983,338 - - - - 1,983,338
Total assets $ 74,948,375 $ 33,305,225 $ 64,463,579 $ 24,057,881 $ 146,561,632 $ 343,336,692

LIABILITIES, DEFERRED INFLOWS OF

RESOURCES, AND FUND BALANCES
Liabilities:

Accounts payable $ 3,134,006 $ 713,805 $ 1,146,936 $ 3,153,646 $ 3,258,812 $ 11,407,205 Accrued salaries and benefits 3,121,600 178,209 27,181 - 196,737 3,523,727 Accrued interest payable - - 10,196 - 284 10,480
Approved loans payable - - 627,564 - - 627,564
Due to other funds - - - 14,486,374 155,438 14,641,812
Unearned revenue 373,986 - - - 2,479,479 2,853,465
Refundable deposits 7,821,104 - - - 99,265 7,920,369
Advances from other funds 330,973 - - - 946,013 1,276,986 Total liabilities 14,781,669 892,014 1,811,877 17,640,020 7,136,028 42,261,608 Deferred inflows of resources:

Unavailable revenue 197,533 27,681,767 28,880,239 11,169,068 1,399,600 69,328,207 Leases 6,398,605 - - - 1,442,380 7,840,985
Total deferred inflows of resources 6,596,138 27,681,767 28,880,239 11,169,068 2,841,980 77,169,192 Fund balances:

Nonspendable 2,092,091 3,949 2,775 - 21,104 2,119,919
Restricted 8,486,061 4,731,444 33,768,688 2,223,199 84,230,326 133,439,718 Committed 18,397,817 - - - - 18,397,817
Assigned 1,149,259 - - - 52,426,693 53,575,952
Unassigned 23,445,340 (3,949) - (6,974,406) (94,499) 16,372,486 - Total fund balances 53,570,568 4,731,444 33,771,463 (4,751,207) 136,583,624 223,905,892 Total liabilities, deferred inflows of
resources, and fund balances $ 74,948,375 $ 33,305,225 $ 64,463,579 $ 24,057,881 $ 146,561,632 $ 343,336,692 The notes to basic financial statements are an integral part of this statement.

JUNE 30, 2023

BALANCE SHEET - GOVERNMENTAL FUNDS

CITY OF MODESTO
22 #15..
- 796 -

CITY OF MODESTO

RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS

TO THE STATEMENT OF NET POSITION - GOVERNMENTAL ACTIVITIES JUNE 30, 2023
Total fund balances - governmental funds $ 223,905,892
Amounts reported for governmental activities in the statement of net position are different because:

Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the governmental funds.

General capital assets:

Nondepreciable $ 210,715,050
Depreciable 183,275,472
Accumulated depreciation on general capital assets (120,566,319) Lease assets and SBITAS - right to use 2,677,796
Accumulated amortization on lease assets, right to use (946,012) Infrastructure:

Depreciable 585,037,338
Accumulated depreciation on infrastructure (400,379,689) 459,813,636 Other long-term assets are not available to pay for current-period expenditures and, therefore, are not reported in the governmental funds;
Deferred in the governmental funds $ 69,328,207
Reimbursement agreement with Successor Agency 12,113,300 Investments in joint ventures 6,408,759 87,850,266
Derivative instruments:

Rate swaps are not reported in governmental funds. $ (2,081,033) Deferred outflows of resources used to accumulate decreases in fair value of hedging derivatives also are not reported in governmental funds. 2,081,033 - Internal service funds are used by management to charge the costs of activities to individual funds. The assets, deferred outlows of resources, liabilities, and deferred inflows of recources of internal service funds are included in governmental activities in the statement of net position. 23,992,255
Deferred outflows and inflows of resources for pension items in governmental activities are not financial resources and, therefore, are not reported in the governmental funds.

Deferred outflows of resources $ 93,388,448
Deferred inflows of resources (2,711,791) 90,676,657
Deferred outflows and inflows of resources for net OPEB items in governmental activities are not financial resources and, therefore, are not reported in the governmental funds.

Deferred outflows of resources $ 3,705,494
Deferred inflows of resources (5,387,076) (1,681,582)
Some liabilities, are not due and payable in the current period and therefore are not reported in the funds.

Net pension liability $ (330,503,501)
Net OPEB liability (13,249,139)
Bonds payable, and other long-term debt (51,363,043)
Accrued interest (7,740) (395,123,423)
Net position - governmental activities $ 489,433,701
The notes to basic financial statements are an integral part of this statement. 23 #15..
- 797 -
Housing and
Operating Community Capital Other Total
General Grants Development Grants Governmental Governmental REVENUES:

Taxes $ 72,414,662 $ 328,586 $ $ - $ 2,300,215 - $ 75,043,463 Licenses and permits 353,880 52,665 - - 2,537 409,082
Intergovernmental 93,426,279 17,360,413 8,278,335 19,511,565 29,868,173 168,444,765 Charges for services 16,692,420 5,964,360 1,304,727 - 6,246,584 30,208,091 Special assessments levied 385,194 78,459 - - 4,437,207 4,900,860 Interest and rent 434,973 1,333,330 2,229 32,478 2,310,643 4,113,653 Net (decrease) in fair value of investments 496,980 (15,665) 4,035 - (973,077) (487,727) Fines and forfeits 679,529 - - - 200,723 880,252
Miscellaneous 637,579 202,229 10,000 - 77,717 927,525
Total revenues 185,521,496 25,304,377 9,599,326 19,544,043 44,470,722 284,439,964 EXPENDITURES:

Current:

General government 14,404,534 1,078,537 - - - 15,483,071 Community development 6,608,633 5,376,691 8,645,854 1,468,934 4,778,841 26,878,953 Highways and streets - - - 746,264 13,948,367 14,694,631 Public works 498,271 6,861,120 - - - 7,359,391
Parks and recreation 14,547,130 500,825 - 78,252 120,959 15,247,166 Public safety 128,008,782 10,082,686 - - 1,358,983 139,450,451 Capital outlay 764,870 103,916 19,942,259 - 9,729,762 30,540,807 Debt service:

Principal retirement 1,258,752 - 312,000 - 2,639,503 4,210,255 Interest 133,168 13,103 22,838 - 1,440,106 1,609,215
Other - 474 289 - 112,870 113,633
Total expenditures 166,224,140 24,017,352 8,980,981 22,235,709 34,129,391 255,587,573

EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES 19,297,356 1,287,025 618,345 (2,691,666) 10,341,331 28,852,391

OTHER FINANCING SOURCES
(USES):

Transfers in 853,578 1,143,564 - 1,531,541 13,879,436 17,408,119 Transfers out (7,471,109) (203,872) (651,039) (1,408,966) (9,394,535) (19,129,521) Other financing proceeds 1,471,618 26,390 - - 274,037 1,772,045 Sale of assets - - - - 10,540 10,540

TOTAL OTHER FINANCING
SOURCES (USES) (5,145,913) 966,082 (651,039) 122,575 4,769,478 61,183 CHANGES IN FUND BALANCES 14,151,443 2,253,107 (32,694) (2,569,091) 15,110,809 28,913,574 FUND BALANCES, JULY 1 39,419,125 2,478,337 33,813,927 (2,182,116) 121,472,815 195,002,088 PRIOR PERIOD ADJUSTMENTS - - (9,770) - - (9,770)
FUND BALANCES, JUNE 30 $ 53,570,568 $ 4,731,444 $ 33,771,463 $ (4,751,207) $ 136,583,624 $ 223,905,892 The notes to basic financial statements are an integral part of this statement.

FISCAL YEAR ENDED JUNE 30, 2023

IN FUND BALANCES - GOVERNMENTAL FUNDS

STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES

CITY OF MODESTO
24 #15..
- 798 -

CITY OF MODESTO

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

BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES - GOVERNMENTAL ACTIVITIES FISCAL YEAR ENDED JUNE 30, 2023
Net change in fund balances - governmental funds $ 28,913,574 Amounts reported for governmental activities in the statement of activities are different because:

Governmental funds report capital outlay as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense.

Capital outlay $ 30,540,807
Depreciation and amortization expense (19,470,158) 11,070,649 In the statement of activities, only the gain or loss on the sales and transfer of capital assets is reported, whereas in the governmental funds, the proceeds from such sales or transfer increase financial resources. Thus, the change in net position differs from the change in fund balances by the cost of the assets sold. 1,712,468 Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds.

Change in unearned revenues $ (8,159,007)
Change in investments in joint ventures (729,717) (8,888,724) Recognition of Successor Agency annual payment for their Reimbursement Agreement receivable associated with long-term debt. (807,650)
The issuance of long-term debt provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position.

Principal retirement 4,210,255
Proceeds of long-term debt (1,772,045)
2,438,210
Some expenses reported in the statement of activities require the use of current financial resources and therefore are not reported as expenditures in governmental funds.

Change in accrued interest $ 3,374
OPEB expense associated with net OPEB liability 7,063,981 Pension expense associated with net pension liability (12,374,201) (5,306,846) Internal service funds are used by management to charge the costs of certain activities to individual funds. The net revenue (expense) of internal service funds is reported with governmental activities. 237,230 Change in net position - governmental activities $ 29,368,911 The notes to basic financial statements are an integral part of this statement. 25 #15..
- 799 -
Other Total Internal
Water Sewer Enterprise Enterprise Service
ASSETS
Current assets:

Cash and cash equivalents $ 145,781,887 $ 123,767,173 $ 20,120,541 $ 289,669,601 $ 23,580,436 Receivables:

Accounts, net 30,332 410,584 3,931,913 4,372,829 130,060 Interest 411,004 365,875 56,452 833,331 82,829
Taxes - 1,889 1,889 -
Utilities, net 10,550,454 6,574,693 1,327,421 18,452,568 - Leases 18,803 475,819 276,653 771,275 -
Prepaid expenses 2,168,919 11,642 158,163 2,338,724 1,202,527 Due from governments 834,483 1,109,517 912,641 2,856,641 1,541,715 Due from other funds 1,467,637 - - 1,467,637 -
Inventories 35,435 - 54,239 89,674 4,331,375
Total current assets 161,298,954 132,715,303 26,839,912 320,854,169 30,868,942 Noncurrent assets:

Advances to other funds 3,100,000 1,196,591 105,761 4,402,352 - Restricted cash and cash equivalents 4,796,456 9,718,780 - 14,515,236 6,309,526 Restricted cash and cash equivalents with fiscal agent 2,293,900 473,859 551,077 3,318,836 747,298 Leases receivable 1,720,182 484,729 11,999,077 14,203,988 - Land and construction in progress 26,208,034 58,344,207 11,346,162 95,898,403 6,061,292 Other capital assets, net of accumulated depreciation 389,744,219 343,779,260 27,551,674 761,075,153 36,015,018 Intangible assets right-to-use, net of accumulated amortization 353,814 82,815 29,011 465,640 445,167 Total noncurrent assets 428,216,605 414,080,241 51,582,762 893,879,608 49,578,301 Total assets 589,515,559 546,795,544 78,422,674 1,214,733,777 80,447,243 Deferred OPEB 518,726 358,583 247,581 1,124,890 295,351 Deferred pensions 7,538,679 8,035,236 4,286,821 19,860,736 5,728,960 Loss on refunding 309,298 88,864 - 398,162 -
Accumulated decrease in fair value of hedging derivatives 11,877,745 - - 11,877,745 - Total deferred outflows of resources 20,244,448 8,482,683 4,534,402 33,261,533 6,024,311 Total assets and deferred outflows of resources $ 609,760,007 $ 555,278,227 $ 82,957,076 $ 1,247,995,310 $ 86,471,554

LIABILITIES
Current liabilities:

Accounts payable $ 2,527,801 $ 5,210,110 $ 881,654 $ 8,619,565 $ 3,306,684 Accrued salaries and benefits 412,240 389,535 281,054 1,082,829 325,362 Interest payable 2,425 504,369 9,635 516,429 -
Due to other funds - - - - 1,467,637
Current portion - compensated absences - - - - 1,070,824 Current portion - claims liability - - - - 6,660,398
Current portion - long-term debt 6,604,195 7,214,715 481,001 14,299,911 - Current portion - developer advances 88,330 - - 88,330 - Current portion - leases and SBITAS 198,919 15,700 5,500 220,119 144,635 Unearned revenue - 1,472,034 857,096 2,329,130 39,820
Total current liabilities 9,833,910 14,806,463 2,515,940 27,156,313 13,015,360 Noncurrent liabilities:

Payable from restricted assets -
refundable deposits 1,290,103 983,603 - 2,273,706 -
Advances from other funds - - 5,108,704 5,108,704 -
Compensated absences - - - - 10,848,329
Claims liability - - - - 20,378,516
Derivative instrument - interest swap 11,877,745 - - 11,877,745 - Pollution remediation liability 3,855,856 6,541,398 1,106,738 11,503,992 - Long-term debt:

Reimbursement agreement related to MID debt 88,915,000 - - 88,915,000 - Revenue bonds payable - 98,006,374 - 98,006,374 -
Loans payable 261,631 24,526,136 - 24,787,767 -
Certificates of participation 40,018,534 - - 40,018,534 - Developer advances 494,623 - - 494,623 -
Leases and SBITAS payable 147,023 54,767 19,185 220,975 148,936 Net OPEB liability 1,748,008 1,537,282 1,283,892 4,569,182 1,119,781 Net pension liability 25,203,020 26,863,092 14,331,535 66,397,647 19,152,838 Total noncurrent liabilities 173,811,543 158,512,652 21,850,054 354,174,249 51,648,400 Total liabilities 183,645,453 173,319,115 24,365,994 381,330,562 64,663,760 Deferred OPEB 817,514 442,988 330,198 1,590,700 493,732 Deferred pensions 113,848 121,347 64,741 299,936 86,518 Deferred leases 1,661,120 805,855 11,813,637 14,280,612 - Total deferred inflows of resources 2,592,482 1,370,190 12,208,576 16,171,248 580,250

NET POSITION
Net investment in capital assets 279,585,810 271,292,213 38,421,161 589,299,184 42,227,906 Restricted for pollution remediation 4,796,456 9,718,780 - 14,515,236 - Restricted refundable deposits 1,290,103 983,603 - 2,273,706 7,056,824 Unrestricted 137,849,703 98,594,326 7,961,345 244,405,374 (28,057,186) Total net position 423,522,072 380,588,922 46,382,506 850,493,500 21,227,544 Total liabilities, deferred inflows of resources, and net position $ 609,760,007 $ 555,278,227 $ 82,957,076 $ 86,471,554 Adjustment to reflect the consolidation of internal service fund activities (2,764,711) Net position of business-type activities $ 847,728,789
The notes to basic financial statements are an integral part of this statement.

DEFERRED OUTFLOWS OF RESOURCES

DEFERRED INFLOWS OF RESOURCES

CITY OF MODESTO

STATEMENT OF NET POSITION - PROPRIETARY FUNDS
JUNE 30, 2023
Enterprise
26 #15..
- 800 -
Other Total Internal
Water Sewer Enterprise Enterprise Service
OPERATING REVENUES:

Charges for services $ 81,376,371 $ 63,771,474 $ 28,029,139 $ 173,176,984 $ 104,290,487 Miscellaneous 487,026 42,451 842,735 1,372,212 619,890
Total operating revenues 81,863,397 63,813,925 28,871,874 174,549,196 104,910,377 OPERATING EXPENSES:

Salaries and wages 9,943,716 9,566,064 5,837,511 25,347,291 8,466,079 Cost of goods sold - - - - 3,968,810
Contractual services 8,251,417 4,615,055 5,986,326 18,852,798 5,227,411 Utilities 2,437,125 3,206,135 644,784 6,288,044 575,221 Maintenance and supplies 9,068,206 4,800,271 5,427,007 19,295,484 11,441,236 Water purchases 13,552,347 - - 13,552,347 -
Insurance 611,672 1,313,925 816,358 2,741,955 22,508,142 Claims - - - - 11,043,481
Employee benefits 5,070,457 5,134,334 3,521,996 13,726,787 38,094,286 Administration services 1,647,722 2,431,814 4,015,492 8,095,028 1,167,915 Allocated indirect administrative costs 1,374,635 795,139 516,301 2,686,075 220,610 Depreciation 21,173,647 14,692,884 1,710,082 37,576,613 4,319,142 Total operating expenses 73,130,944 46,555,621 28,475,857 148,162,422 107,032,333 OPERATING INCOME (LOSS) 8,732,453 17,258,304 396,017 26,386,774 (2,121,956)

NONOPERATING REVENUES (EXPENSES)
Operating grants 334,720 318,169 610,375 1,263,264 -
Gain (loss) on disposition of capital assets (31,342) 16,348 165,404 150,410 (11,324) Tax revenue - - 291,711 291,711 -
Tax expense (97,742) (68,942) (29) (166,713) (16,073)
Interest income 2,490,645 2,125,535 544,969 5,161,149 564,112 Net (decrease) in fair value of investments (1,301,914) (1,162,502) (134,025) (2,598,441) (56,782) Connection fees - 704,239 - 704,239 -
Rental income 52,090 476,095 1,179,016 1,707,201 93,950 Interest expense and amortization (4,898,294) (2,330,622) (31,707) (7,260,623) (2,600) Trustee and letter of credit fees (1,596) (5,000) (581) (7,177) - Total nonoperating revenues (expenses) (3,453,433) 73,320 2,625,133 (754,980) 571,283

INCOME (LOSS) BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS 5,279,020 17,331,624 3,021,150 25,631,794 (1,550,673) Capital contributions 42,419 3,267,722 - 3,310,141 1,253,210 Transfers in 50,964 4,670,581 2,494,510 7,216,055 1,961,950 Transfers out (6,051,416) (332,794) (898,089) (7,282,299) (174,304) Total contributions and transfers (5,958,033) 7,605,509 1,596,421 3,243,897 3,040,856 CHANGES IN NET POSITION (679,013) 24,937,133 4,617,571 28,875,691 1,490,183 NET POSITION, JULY 1 422,449,809 359,108,212 41,764,935 18,491,239 PRIOR YEAR ADJUSTMENTS 1,751,276 (3,456,423) - 1,246,122 NET POSITION, JUNE 30 $ 423,522,072 $ 380,588,922 $ 46,382,506 $ 21,227,544 Adjustment to reflect the consolidation of internal service funds 1,252,953 Change in net position of business-type activities $ 30,128,644

CITY OF MODESTO
Enterprise
The notes to basic financial statements are an integral part of this statement.

FISCAL YEAR ENDED JUNE 30, 2023

IN NET POSITION - PROPRIETARY FUNDS

STATEMENT OF REVENUES, EXPENSES, AND CHANGES
27 #15..
- 801 -
Other Total Internal
Water Sewer Enterprise Enterprise Service
CASH FLOWS FROM OPERATING ACTIVITIES:

Receipts from customers and users $ 82,570,267 $ 63,764,919 $ 26,881,814 $ 173,217,000 $ 958,359 Receipts from interfund services provided 248,172 7,176 - 255,348 104,313,931 Payments to suppliers (33,559,984) (8,526,223) (6,772,599) (48,858,806) (46,535,154) Payment of insurance claims - - - - (10,865,564)
Payments to employees (14,940,712) (14,769,605) (8,948,973) (38,659,290) (45,788,792) Payments for interfund services used (6,681,444) (6,078,823) (10,116,132) (22,876,399) (1,915,691) Net cash provided (used) by operating activities 27,636,299 34,397,444 1,044,110 63,077,853 167,089

CASH FLOWS FROM NONCAPITAL FINANCING
ACTIVITIES:

Operating grants received 334,720 318,169 610,375 1,263,264 - Taxes received - - 291,711 291,711 -
Transfers in 50,964 4,670,581 2,494,510 7,216,055 1,961,950 Transfers out (6,051,416) (332,794) (898,089) (7,282,299) (174,304) Advances from/to other funds 620,000 502,385 (601,319) 521,066 - Net cash provided (used) by noncapital financing
activities (5,045,732) 5,158,341 1,897,188 2,009,797 1,787,646

CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:

Acquisition and construction of capital assets (6,685,852) (28,342,397) (341,663) (35,369,912) (2,071,898) Proceeds from sale of capital assets 39,658 4,950 164,415 209,023 37,436 Principal repayments (6,273,478) (9,012,669) (462,352) (15,748,499) (2,600) Interest paid (4,898,532) (2,945,784) (30,234) (7,874,550) (139,950) Trustee and letter of credit fees (1,596) (5,000) (581) (7,177) - Capital contributions 42,419 3,267,722 - 3,310,141 -
Connection fees for capital purposes - 704,239 - 704,239 - Net cash provided (used) by capital and related
financing activities (17,777,381) (36,328,939) (670,415) (54,776,735) (2,177,012) CASH FLOWS FROM INVESTING ACTIVITIES:

Interest received 2,393,431 1,782,220 526,066 4,701,717 574,499 Net (decrease) in the fair value of investments (1,301,914) (1,162,502) (134,025) (2,598,441) (56,782) Rental income received 52,090 476,095 1,179,017 1,707,202 93,950 Net cash provided (used) by investing activities 1,143,607 1,095,813 1,571,058 3,810,478 611,667 Net increase in cash and cash equivalents 5,956,793 4,322,659 3,841,941 14,121,393 389,390 CASH AND CASH EQUIVALENTS, JULY 1 146,915,450 129,637,153 16,829,677 293,382,280 30,247,870 CASH AND CASH EQUIVALENTS, JUNE 30 $ 152,872,243 $ 133,959,812 $ 20,671,618 $ 307,503,673 $ 30,637,260 RECONCILIATION TO STATEMENT OF NET POSITION:

Cash and cash equivalents $ 145,781,887 $ 123,767,173 $ 20,120,541 $ 289,669,601 $ 23,580,436 Restricted cash and cash equivalents 4,796,456 9,718,780 - 14,515,236 6,309,526 Restricted cash and cash equivalents with fiscal agent 2,293,900 473,859 551,077 3,318,836 747,298 TOTAL CASH AND CASH EQUIVALENTS $ 152,872,243 $ 133,959,812 $ 20,671,618 $ 307,503,673 $ 30,637,260 (continued)
The notes to basic financial statements are an integral part of this statement.

CITY OF MODESTO

STATEMENT OF CASH FLOWS - PROPRIETARY FUNDS
FISCAL YEAR ENDED JUNE 30, 2023
Enterprise
28 #15..
- 802 -
Other Total Internal
Water Sewer Enterprise Enterprise Service

RECONCILIATION OF OPERATING INCOME (LOSS)

TO NET CASH PROVIDED (USED) BY OPERATING
ACTIVITIES:

Operating income (loss) $ 8,732,453 $ 17,258,304 $ 396,017 $ 26,386,774 $ (2,121,956) Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:

Depreciation 21,173,647 14,692,884 1,710,082 37,576,613 4,319,142 Taxes paid (97,742) (68,942) (29) (166,713) (16,073)
Change in assets, liabilities, and deferred resources:
(Increase) decrease in accounts receivable 24,857 420,972 (1,127,505) (681,676) 379,784 (Increase) in taxes receivable - - (1,889) (1,889) -
(Increase) decrease in utilities receivable 578,344 1,031,899 (208,644) 1,401,599 - (Increase) decrease in due from governments 724,939 (458,976) 625,443 891,406 (78,683) (Increase) decrease in prepaid expenses 131,023 54,642 (154,075) 31,590 (1,116,973) (Increase) in inventories - - (71) (2,522,907) (71)
Increase (decrease) in accounts payable (802,731) 2,605,901 (25,983) 1,777,187 (1,311,129) Increase in accrued salaries and benefits 93,694 68,174 69,257 231,125 69,584 (Decrease) in compensated absences - - - - (42,920)
(Decrease) in net OPEB liability and deferred resources (151,089) (47,860) (43,344) (242,293) (78,684) Increase (decrease) in net pension liability and deferred resources 130,856 (77,514) 387,200 440,542 823,595 Increase in claims liability - - - - 180,616
Increase (decrease) in pollution remediation liability (1,393,029) (46,315) 150,687 (1,288,657) - (Increase) in due from other funds (1,467,637) - (1,467,637) - - Increase in due to other funds - - - - 1,467,637
(Decrease) in unearned revenue (39,171) (822,163) (393,849) (1,255,183) (33,846) (Increase) decrease in lease receivable 73,559 - (320,633) (247,074) - Increase (decrease) in lease/SBITA payable - (148,064) (18,554) (166,618) 249,902 (Decrease) in refundable deposits (75,674) (65,498) - (141,172) - Total adjustments 18,903,846 17,139,140 36,691,079 648,093 2,289,045 Net cash provided (used) by operating activities $ 27,636,299 $ 34,397,444 1,044,110 $ 63,077,853 $ 167,089

NONCASH INVESTING, CAPITAL AND FINANCING
ACTIVITIES:

Intangible assets right-to-use - SBITAS $ 87,191 $ 86,970 $ 58,022 $ 232,183 $ 582,510 TOTAL NONCASH INVESTING, CAPITAL AND FINANCING ACTIVITIES $ 87,191 $ 86,970 $ 58,022 $ 232,183 $ 582,510 The notes to basic financial statements are an integral part of this statement.

FISCAL YEAR ENDED JUNE 30, 2023
STATEMENT OF CASH FLOWS - PROPRIETARY FUNDS (Continued)

CITY OF MODESTO
Enterprise
29 #15..
- 803 -
Private Purpose Investment
Trust Funds Trust Funds
ASSETS
Cash and cash equivalents $ 1,950,384 $ 3,891,281
Cash and cash equivalents held with fiscal agent 5,273,521 - Interest receivable 6,054 1,970
Taxes receivable 70,097 26,534
Assessments receivable 26,880,000 -
Prepaids 2,966 1,086
Leases receivable - 1,185,368
Due from governments - 133,659
Land and construction in progress - 2,946,745
Other assets Other capital assets, net of accumulated depreciation -- 3,683,597 - Total assets 34,183,022 11,870,240
Deferred outflows of resources:

Loss on refunding 904,920 -
Total assets and deferred outflows of resources 35,087,942 11,870,240

LIABILITIES
Accounts payables and other liabilities 20,666 480,592
Due to local governments 1,192,004 -
Interest payable 413,730 -
Long-term liabilities:

Due within one year 3,527,650 -
Due in more than one year 38,358,328 - -
Total liabilities 43,512,378 480,592
Deferred inflows of resources
Leases - 1,135,392
Unavailable revenues 706,169 -
Total deferred inflows of resources 706,169 1,135,392

NET POSITION
Net invested in capital assets - 6,630,342
Restricted 5,273,521 -
Unrestricted (14,404,126) 3,623,914
Total net position (deficit) $ (9,130,605) $ 10,254,256

CITY OF MODESTO

STATEMENT OF FIDUCIARY NET POSITION
JUNE 30, 2023
The notes to basic financial statements are an integral part of this statement. 30 #15..
- 804 -
Private Purpose Investment
Trust Funds Trust Funds
ADDITIONS:

Contributions:

Members investment pool $ $ - 625,183
Total contributions
Collections on behalf of other governments:

Special assessments 1,519,095 291,148
Property taxes 1,619,627 393,710
Grants - 235,203
Other - 3,000
Insurance recoveries - 3,316,441
Total collections on behalf of other governments 3,138,722 4,239,502 Interest and investment earnings:

Interest earnings 285,463 138,661
Net increase (decrease) in fair value of investments 3,053 (8,242) Total interest and investment earnings 288,516 130,419
Total additions 3,427,238 4,995,104
DEDUCTIONS:

Distribution of property taxes to other taxing entities 369,593 674,844 Obligation retirements:

Interest expense 1,319,946 -
Trustee fees 3,760 -
City administrative expenses 120,054 152,049
Other expenses 78,321 8,032
Depreciation expense - 438,048
Insurance expenses - 1,177
Operating expenses - 978,126
Total deductions 1,891,674 2,252,276
Net increase in fiduciary net position 1,535,564 2,742,828 Net position, July 1 (10,666,169) 7,511,428
Net position (deficit), June 30 $ (9,130,605) $ 10,254,256

CITY OF MODESTO

STATEMENT OF CHANGES IN FIDUCIARY NET POSITION -

FIDUCIARY FUNDS
FISCAL YEAR ENDED JUNE 30, 2023
The notes to basic financial statements are an integral part of this statement. 31 #15..
- 805 -

CITY OF MODESTO

NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED JUNE 30, 2023
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. THE FINANCIAL REPORTING ENTITY
The City of Modesto (the City) was incorporated in 1884 and operates under a Council-Manager form of government as authorized by its charter adopted in 1951. The City Council consists of seven elected members. The following services are provided by the City to its citizens: public safety (fire and police), highways and streets, drinking water, wastewater collection and treatment, storm drainage, recreation, public improvements, community development, planning and zoning, and general administrative services.

These financial statements present the financial status of the City and its component units. The component units discussed in the following paragraphs are included in the City's reporting entity because the City is financially accountable for their operations.

1. The MPFA (Modesto Public Financing Authority) was established as a separate legal entity whose sole purpose is to provide financing for various City capital projects.

2. The City of Modesto has established several Community Facilities (The Districts) to provide funding and reimbursement mechanisms for public facilities and services required by each District Specific Plan. These Districts are the vehicles used to ensure that all landowners in the Districts contribute to the cost of public improvements.

There are currently thirteen active Districts, which are combined for presentation in these financial statements.

Individual component unit financial statements are prepared for each District.

Although these component units are legally separate from the City, they are reported on a blended basis as part of the primary government because their boards consist of all seven members of the City Council and operational responsibility. There is an operational responsibility for the City related to these component units and for the MPFA it provides services solely for the City. Component unit financial statements may be obtained from the City's Finance Department.

The Redevelopment Successor Agency (Successor Agency) operates under the auspices of a legislatively formed Oversight Board comprised of representatives of the local agencies that serve the development project area. The Oversight Board, in its fiduciary capacity, has authority over the operations and the timely dissolution of the former Redevelopment Agency (RDA). It is tasked with fulfilling the obligations of the former RDA, and is also responsible for revenue collection, maintaining necessary loan reserves and disposing of excess property. This agency is reported as a private-purpose trust fund based on the generally accepted accounting standards requirement.

The joint ventures and jointly governed organizations described in Note III-E are not considered part of the reporting entity because the City is not financially accountable for their operations.

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 non-fiduciary activities of the primary government and its component units. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support.

The statement of activities demonstrates the degree to which the direct expenses of a given function or segment, are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment.

Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions 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. 32 #15..
- 806 -
Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements.

C. BASIS OF PRESENTATION, BASIS OF ACCOUNTING, AND MEASUREMENT FOCUS The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund statements. 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. Agency funds have no measurement focus. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows.

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 City considers revenues to be available if they are collected within 60 days after the end of the current fiscal period. For grant revenues, the City considers this type of revenue to be available if collected within 180 days. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, principal and interest, compensated absences, claims and judgement expenditures are recorded as fund liabilities when due or when amounts have been accumulated in the debt service funds for payments to be made early in the following year.

Substantially all property taxes, taxpayer-assessed taxes (such as sales and use, utility users, business license, transient occupancy, franchise fees, and gas taxes), interest, special assessments levied, state and federal grants, and charges for current services are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Revenues from licenses, permits, and fines and forfeits are considered to be measurable and available only when cash is received by the City.

The City reports the following major governmental funds:

The General Fund is the City’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund.

The Operating Grants Fund to account for a variety of governmental fund operating grants, including law enforcement grants.

The Housing and Community Development Fund to account for various grant funds received from Federal Community Development Block grants to be used for a variety of housing related programs primarily targeted at low-income housing. Additionally, this fund accounts for the City’s revolving fund, which provides housing loans to low-income individuals and accounts for emergency shelter grant revenue received from the Housing and Urban Development Department.

The Capital Grants Fund to account for receipts and disbursements of a variety of Governmental Fund capital grants.

The City reports the following major proprietary funds:

The Water Fund accounts for all revenues collected by the City for the purpose of financing the construction, operation, and maintenance of the City water distribution system. Revenues are derived from water service charges and various installation fees.

The Sewer Fund accounts for revenues collected by the City for the purpose of financing the construction, operation, and maintenance of the City sewer system. Revenues include, but are not limited to, sewer service charges and sewer lateral charges.

Additionally, the City reports the following fund types:

Private-purpose Trust Fund accounts as the fiduciary fund type used by the City to report trust arrangements underwhich principal and income benefit other governments. The fund reports the assets, liabilities, and net position 33 #15..
- 807 -
of the Successor Agency. Additionally, the fund also reports the assets, primarily cash and investment, and related liabilities and net position of Special Districts which are used to account for collection of special assessment from property owners which are collected and forwarded to trustees for payment to bondholders.

Investment Trust Funds accounts for the assets and investments in the City’s investment pool, of legally separate entities held by the City as an agent of various assessment districts, governmental entities and non-profit organizations.

Internal service funds account for fleet management, central services, information and technology services, insurance, employee benefits management, and building services provided to other departments or agencies of the City on a cost-reimbursement basis.

As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements.

Exceptions to this general rule are exchange or exchange-like transactions between functions of the government.

Eliminations of these charges would distort the direct costs and program revenues reported for the various functions concerned.

Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the enterprise and internal service funds are charges to customers for sales and services. The Sewer Fund also recognize as non-operating revenue the portion of tap fees intended to recover the cost of connecting new customers to the systems. Operating expenses for enterprise and internal service funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses.

When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, then unrestricted resources as they are needed.

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. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period including the note disclosures. Actual results could differ from those estimates.

D. ASSETS, DEFERRED OUTFLOWS OF RESOURCES, LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND

NET POSITION/FUND BALANCE

1. Cash and Cash Equivalents
Cash and investments (including restricted assets) held in the City's investment pool are reported as cash and cash equivalents on the statement of net position and balance sheet because funds can spend cash at any time without prior notice or penalty. All investments with fiscal agents are also considered cash equivalents because they are highly liquid and have maturities of 3 months or less at the time of purchase. Investments are stated at fair value.

Valuations are obtained based on various levels identified further under Note II-A – Fair value measurements.

2. Restricted Assets - Cash and Cash Equivalents
Refundable deposits which reside in the Trust Deposits of the General Fund are classified as restricted assets – cash and cash equivalents on the governmental funds balance sheet because their use is restricted for repayment of those refundable deposits. Legal or contractual obligations associated with the nonmajor governmental funds have been reported as restricted assets due to the restrictions identified on the revenue sources generated from these funds. Refundable deposits in the Water and Sewer funds are also reported as restricted assets on the proprietary funds statement of net position. In addition, certain proceeds of Water certificates of participation and Sewer revenue bonds are considered restricted assets because their use is limited by applicable debt covenants.

These proceeds are reported as part of “restricted assets – cash and cash equivalents” on the proprietary funds statement of net position. The Employee Benefits Management Fund collects funds which are restricted for future payouts for leave balances due to employees who terminate or retire from the City as well as any severance payouts. These assets are restricted due to management’s designation of assets for future payments for employee uses.
34 #15..
- 808 -

3. Receivables and Payables
All property taxes are collected and allocated by the County of Stanislaus to the various taxing entities. Property taxes are determined annually as of March 1 and attach as an enforceable lien on real property as of January 1.

Taxes are due November 1 and February 1 and are delinquent if not paid by December 10 and April 10, respectively.

The City participates in the County "Teeter Plan" method of property tax distribution. Under the Teeter Plan, the County remits property taxes to the City based on assessments, not on collections, according to the following schedule: 55 percent in December, 40 percent in April, and 5 percent at the end of the fiscal year. Property taxes are recognized in governmental funds when it is available and measurable. The City considers property tax as available if it is received within 60 days after year-end.

Revenue from taxpayer-assessed taxes (sales and use, business license, transient occupancy, utility users, gas, and franchise fees) are accrued in the governmental funds when they are both measurable and available. The City considers these revenues available if they are received during the period when settlement of prior fiscal year accounts payable occurs. Historically, the majority of these taxes are received within 60 days after the fiscal year end; therefore, revenue from taxpayer-assessed taxes is accrued if it is received by August 31.

Grant and entitlement revenues are recorded as receivables in the funds when they are susceptible to accrual (i.e., when all eligibility requirements have been met). The corresponding governmental fund revenues are recorded when they become available, with the differences recorded as deferred inflows of resources. The corresponding proprietary fund revenues are recorded as nonoperating revenues when the receivables are recorded. Some grant and entitlement revenues are not susceptible to accrual, in which case the corresponding revenues are recorded when received. The total amount due from governments for grants, entitlements, and shared receivables and revenues at June 30, 2023 is $45,841,904.

Utility service accounts receivable are $20,719,821 net of an allowance for doubtful collections of $1,764,240 and include unbilled receivables using actual amounts billed in July for June services for all City funds. City accounts receivable of $7,462,614 are reported net of an allowance for doubtful collections of $874,754 and are based on miscellaneous receivables from the City’s invoice system as well as other receivables accrued at year-end.

The City is a lessee for noncancelable leases of land, buildings, office space, and equipment and recognizes the liability and an intangible right-to-use lease asset at the inception of the lease agreement at the current present value of future payments, in the government-wide and proprietary fund financial statements.

The City is a lessor for noncancelable leases of buildings, hangers, office space and land use and parking spaces.

The City recognizes a lease receivable and a deferred inflow of resources in the government-wide, proprietary fund and governmental fund financial statements at the inception of the lease agreement at current present value of all future payments.

The City has Information Technology software contract agreements also known as Subscription Based Information Technology Arrangements (SBITAs) in which the contract conveys control of the right to use another party’s IT software, alone or in combination with a tangible capital asset for a defined period of time in an exchange or exchange like transaction. The City recognizes the liability and non-cancellable right to use of the IT software asset at the inception of the agreement in the government-wide and proprietary fund financial statements.

4. Inventories and Prepaid Expenses/Expenditures
Inventories of material and supplies held by governmental and proprietary funds are stated at average cost. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid expenses/expenditures. The consumption method is used to record the prepaid expenses/expenditures.

5. Interfund Balances
Balances representing lending/borrowing transactions between funds outstanding at the end of the fiscal year are reported as either "due from/due to other funds" (amounts due within one year), or "advances to/from other funds" (non-current portions of interfund lending/borrowing transactions). Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as “internal balances.” Advances to other funds and prepaid items are offset by a nonspendable fund balance in applicable governmental funds to indicate they are not available for appropriation and are not expendable available 35 #15..
- 809 -
financial resources to indicate that they are not in spendable form.

6. Capital Assets
Capital assets, which include property, plant and equipment, intangible assets and infrastructure assets (e.g., streets, bridges, sidewalks, and similar items), are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Capital assets are defined by the government as assets with an initial, individual cost of more than $5,000 and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets received in a service concession agreement and all other types are recorded at acquisition value as of the date of donation.

In the case of the initial capitalization of infrastructure assets reported by governmental activities, the City chose to include them regardless of their acquisition date or amount. Historical values were estimated.

The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized.

Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business-type activities and enterprise funds are not included as part of the capitalized value of the assets constructed.

Depreciation is recorded using the straight line method over the estimated useful lives of the assets, which are 75 years for pipelines, 30 years for buildings, 20 years for improvements, 3 to 10 years for buses, 3 to 10 years for furnishings and equipment, 3 to 10 years for vehicles, 3 to 5 years for intangible assets, 30 to 50 years for streets, 20 years for signalization, 30 years for water rights, 5 years for service animals, and 50 years for bridges. Operating expenses include depreciation on all depreciable capital assets.

Leases are recorded as an asset and an obligation at an amount equal to the present value at the beginning of the lease term of minimum lease payments during the lease term. Non-cancellable lease agreements exceeding a 12- month term are recorded as an intangible right-to-use asset with an amortization calculated based on the term of the lease agreement.

Subscription Based Information Technology Arrangements (SBITAs) are recorded as an asset and an obligation at an amount equal to the present value at the beginning of the arrangement term of minimum arrangement payments during the arrangement term. Non-cancellable agreements exceeding a 12-month term are recorded as an intangible right-to-use asset with an amortization calculated based on the term of the agreement.

7. Deferred Outflows and Inflows of Resources
The Governmental Accounting Standards Board (GASB) establishes criteria for recognizing deferred outflows and inflows of resources. A deferred outflow of resources is defined as a consumption of net assets by the government that is applicable to a future reporting period. A deferred inflow of resources is defined as an acquisition of net assets by the government that is applicable to a future reporting period. Refer to Note II for a detail listing of the deferred outflows and inflows of resources the City has recognized.

8. Compensated Absences
All earned vacation, holiday, management leave, bilingual leave and compensating time off, as well as a portion of accumulated sick leave payable upon termination or retirement, are accrued in the Employee Benefits Management Internal Service Fund as compensated absences. Estimated sick leave termination payments have been calculated using the GASB Statement 16 vesting method. Under this method, a liability is accrued for a portion of the sick leave balances of all employees who are currently eligible, or are assumed to become eligible in the future, to receive a payment for sick leave upon termination. As of June 30, 2023, the total estimated liability for all compensated absences, including vacation and sick leave, is $11,919,153.

9. Fund Balance
In the fund financial statements, governmental funds report fund balance as nonspendable, restricted, committed, 36 #15..
- 810 -
assigned or unassigned based primarily on the extent to which the City is bound to honor constraints on how specific amounts can be spent.
 Nonspendable fund balance – amounts that cannot be spent because they are either (a) not spendable in form or (b) legally or contractually required to be maintained intact.  Restricted fund balance – amounts with constraints placed on their use that are either (a) externally imposed by creditors, grantors, contributors, or laws or regulations of other governments; or (b) imposed by law through constitutional provisions or enabling legislation.  Committed fund balance – amounts that can only be used for specific purposes determined by formal action of the City’s highest level of decision-making authority (City Council) and that remain binding unless removed in the same manner. The underlying action that imposed the limitation needs to occur no later than the close of the reporting period.
 Assigned fund balance – amounts that are constrained by the City’s intent to be used for specific purposes. The intent can be established at either the highest level of decision making, which includes City Council or by an official designated such as the City Manager for such purpose.  Unassigned fund balance – the residual classification for the City’s General Fund that includes amounts not contained in other classifications. In other funds, the unassigned classification is used only if expenditures incurred for specific purposes exceed the amounts restricted, committed or assigned to those purposes.

The City establishes and modifies or rescinds fund balance commitments by passage of an ordinance. This is typically done through adoption and amendment of the budget. A fund balance commitment is further indicated in the budget as a commitment of the fund, such as approved construction contracts. Assigned fund balance is established by the City through adoption or amendment of the budget or future year budget plan as intended for a specific purpose.

When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, followed by the unrestricted committed, assigned, and unassigned resources as they are needed.

10. Fund Balance Policy
The City believes that sound financial management principles require that sufficient funds be retained by the City to provide a stable financial base at all times. To retain this stable financial base, the City needs to maintain unrestricted fund balance in its City funds sufficient to fund cash flows of the City and to provide financial reserves for unanticipated expenditures and/or revenue shortfalls of an emergency nature. Committed, assigned and unassigned fund balances are considered unrestricted.

The purpose of the City’s fund balance policy is to maintain a prudent level of financial resources to protect against reducing service levels or raising taxes and fees because of temporary revenue shortfalls or unpredicted one-time expenditures.

The City has adopted a policy to achieve and maintain a General Fund reserve at a minimum level of no less than the average of two months of regular General Fund operating expenditures.

11. Net Position
The governmental and business-type activities in the government-wide financial statements and the proprietary funds in the fund financial statements utilize a net position presentation. Net position is classified in the following categories:
 Net Investment in Capital Assets – This amount consists of capital assets net of accumulated depreciation and reduced by outstanding debt (including premiums) and any other capital related liabilities that are debt (including premiums) and any other capital related liabilities that are attributed to the acquisition, construction, or improvement of assets. 37 #15..
- 811 -
 Restricted Net Position – This amount is restricted by external creditors, grants, contributors, or laws or regulations of other governments.
 Unrestricted Net Position – This amount is all net position that does not meet the definition of “net investment in capital assets” or “restricted net position”.

E. OTHER SIGNIFICANT ACCOUNTING POLICIES

1. Employee Benefits
The City established the Employee Benefits Management Internal Service Fund to account for all compensated absences and non-insurance benefits. Insurance benefits for current employees are paid from the Insurance Internal Service Fund. The Employee Benefits Management Fund is reimbursed based on actual benefits paid and leave taken, through payroll charges to the City's operating funds. Leave earned but not taken is being funded over a reasonable period of time.

2. Pensions
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the California Public Employees’ Retirement System (CalPERS) Safety (police and fire) and Miscellaneous (all other) Plans and additions to/deductions from the Plans’ fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this purpose, the benefit payments (including refunds of employee contributions) are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value. GASB 68 requires that the reported results must pertain to the liability and asset information within certain defined timeframes. For this report, the following:

Valuation Date: June 30, 2021
Measurement Date: June 30, 2022
Measurement Period: July 1, 2021 to June 30, 2022

3. Other Postemployment Benefits (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the net position of the City’s plan (OPEB Plan) and additions to/deductions from the OPEB Plan’s net position have been determined on the same measurement basis.

For this purpose, benefit payments are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value.

GASB 75 requires that the reported results must pertain to liability information within certain defined timeframes.

For this report, the following timeframes are used:

Valuation Date: June 30, 2022
Measurement Date: June 30, 2022
Measurement Period: June 30, 2021, to June 30, 2022

4. Interfund Transactions
The City transfers resources among funds in the course of normal operations. Interfund services provided and used, such as equipment pool rental, are accounted for as revenues and expenditures or expenses. Transactions to reimburse a fund for expenditures/expenses initially made from it that are applicable to another fund are recorded as expenditures/expenses in the correct fund and as reductions of expenditures/expenses in the original fund. All other interfund transactions are reported as transfers.

5. Change in Accounting Principles
During the fiscal year ended June 30, 2023, the City adopted new accounting guidance by implementing the provisions of GASB Statement No. 96, Subscription-Based Information Technology Arrangements (SBITAs) which establishes a definition for SBITAs and provides uniform guidance for accounting and financial reporting for transactions that meet that definition. A SBITA is a contract that conveys control of the right to use another party’s (a SBITA vendor’s) IT software, alone or in combination with tangible capital assets (the underlying IT assets), as 38 #15..
- 812 -
specified in the contract for a period of time in an exchange or exchange-like transaction. The implementation of this statement has resulted in changing the presentation of the entity wide and proprietary financial statements as a restatement of the capital assets, intangible assets right-to-use, net of accumulated amortization.

F. NEW ACCOUNTING STANDARDS
During the fiscal year ended June 30, 2023, the City implemented the following GASB Standards with no impact on the City’s financial statement, except for GASB 96:

GASB Statement No. 93 – Replacement of Interbank Offered Rates. The requirements of this statements are effective for reporting periods beginning after June 15, 2021. Subsequent to issuance, GASB Statement No. 95 postponed the requirements of this statement to reporting periods beginning after June 15, 2022.

GASB Statement No. 94 – Public-Private and Public-Public Partnerships and Availability Payment Arrangements. The requirements of this statement are effective for reporting periods beginning after June 15, 2022.

GASB Statement No. 96 – Subscription-Based Information Technology Arrangements. The Requirements of this statement are effective for reporting periods beginning after June 15, 2022.

GASB Statement No. 99 – Omnibus 2022. The requirements of this statement related to leases, PPPs, and SBITAs are effective for reporting periods beginning after June 15, 2022.

Released GASB Statements to be implemented in future financial statements are as follows:

GASB Statement No. 100 – Accounting Changes and Error Corrections. The requirements of this statement are effective for periods beginning after June 15, 2023.

GASB Statement No. 101 – Compensated Absences. The requirements of this statement are effective for reporting periods beginning after December 15, 2023.

II. DETAILED NOTES
A. CASH AND INVESTMENTS
The City maintains a cash and investment pool that is used by all funds. Each fund’s portion of the City’s cash and investment pool is displayed on the balance sheet and proprietary and fiduciary fund statements of net position as “cash and cash equivalents.” Each fund is allocated interest on average monthly cash balances held by the funds throughout the year. Certain deposits held in trust are displayed on the governmental funds balance sheet and the proprietary funds statement of net position as “restricted assets – cash and cash equivalents.” The City also maintains “cash and cash equivalents with fiscal agent”, which represent monies held by fiscal agents for payment of various City debt and capital projects costs.

The City’s cash and investments are reported as follows:

Primary Government:

Cash and cash equivalents $ 410,658,819
Restricted cash and cash equivalents 101,142,609
Cash and cash equivalents held with fiscal agent 16,332,209

Successor Agency Private-Purpose Trust Fund
Cash and cash equivalents 1,950,384
Cash and cash equivalents held with fiscal agent 5,273,521

Private Purpose and Investment Trust Funds
Cash and cash equivalents 3,891,281

Total cash and investments $ 539,248,823
39 #15..
- 813 -
Investments Authorized by the California Government Code and the City’s Investment Policy The City’s investment policy and the California Government Code allow the City to invest in the following types of instruments, and the table also identifies certain provisions of the California Government Code, or the City’s investment policy where it is more restrictive:

Investment Instrument Summary
Security Type Maximum
Maturity
Min Credit
Quality
Authorized
Investment
Limit
Per Issuer
Limit
City Issued Bonds 5 Years None None None
US Treasury Notes/ Bills 5 Years None None None
State of California Securities 5 Years “A” None None
California Municipal Securities 5 Years “A” None None
Other 49 State Municipal Securities 5 Years “A” None None Federal Agencies 5 Years None None None
Banker’s Acceptance (BA) 180 days “A-1” 40% 5%
Commercial Paper 270 days “A-1”/ “A” 40% 5%
Certificates of Deposit 1 Year FDIC Insured or
Collateralized 20% 5%
Negotiable Certificates of Deposit 5 Years “A” 30% 5%
Repurchase Agreements 90 Days None None 20%
Reverse Repurchase Agreements 92 Days None 20% 5%
Medium Term Notes (MTN) 5 Years “A” 30% 5%
Money Market Fund None “AAAm” 20% 10%
LAIF None None None None
Mortgage and Asset-Backed
Securities 5 Year “AA” 20% 5%
CAMP None None None None
Supranationals 5 Years “AA” 30% 5%
The City is a voluntary participant in the California Asset Management Program (CAMP). CAMP is an investment pool offered by the California Asset Management Trust (the Trust). The Trust is a joint powers authority and public agency created by the Declaration of Trust and established under the provisions of the California Joint Exercise of Powers Act (California Government Code Sections 6500 et seq., or the “Act”) for the purpose of exercising the common power of its participants to invest certain proceeds of debt issues and surplus funds. The Pool’s investments are limited to investments permitted by subdivisions (a) to (n), inclusive, of Section 53601 of the California Government Code. Security types prohibited include but are not limited to: Investments in inverse floaters, range notes, or interest only strips that are derived from a pool of mortgages. At June 30, 2023, the fair value approximated the City’s cost. At June 30, 2023, these investments range from a maximum maturity of 5 years to some maturity limits of 270 days or less. The City reports its investments in CAMP at the fair value amounts provided by CAMP.

Investments Authorized by Debt Agreements
The City must maintain required amounts of cash and investments with trustees or fiscal agents under the terms of certain debt issues. These funds are unexpended bond proceeds or are pledged as reserves to be used if the City fails to meet its obligations under these debt issues. The California Government Code requires these funds to be invested in accordance with City ordinance, bond indentures or State statute. 40 #15..
- 814 -
Custodial Credit Risk – Deposits
The Custodial Credit Risk for Deposits is the risk that, in the event of the failure of a depository financial institution, the City 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 City does not, currently, have a Custodial Credit Risk – Deposits Policy. Under California Government Code Section 53651, depending on specific types of eligible securities, a bank must deposit eligible securities posted as collateral with its Agent having a fair value of 110% to 150% of the City’s cash on deposit. All of the City’s deposits are either insured by the Federal Depository Insurance Corporation (FDIC), collateralized with pledged securities held by Wells Fargo Bank, or by Letters of Credit from the Federal Home Loan Bank of San Francisco.

The City of Modesto has 8 deposit accounts at Bank of the West that are monitored for deposit collateral purposes. As per the CA Government Code, the bank must provide collateral for the collected deposit balances at 110% for securities and 105% for letters of credit coverage. As of June 30, 2023, the City had collected deposit balances of $10,087,007. On this amount, the FDIC insurance coverage was $250,000.

For further information, as of June 30, 2023, Bank of the West has over $6.42 billion in public fund deposits and over 3,200 accounts that are collateralized in accordance with the state’s government codes and other applicable laws. Of the total $6.42 billion public fund deposits, the minimum collateral required is $5.65 billion and the market value of pledged securities (aka related collateral) is $7.91 billion.

Custodial Credit Risk – Investments
The Custodial Credit Risk for Investments is the risk that, in the event of the failure of the counterparty (e.g. broker-dealer) to a transaction, the City 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 policy limits its exposure to custodial credit risk by requiring that all security transactions entered into by the City, including collateral for repurchase agreements, be conducted on a delivery-versuspayment basis. Securities are to be held by a third-party custodian.

The City’s investments consist of pooled investments, dedicated investments, and other funds held by trustees. The dedicated investment funds represent restricted funds and relate to bond proceeds of the Water and Sewer Enterprise Funds, assessment districts (reported under Private Purpose Trust Funds) and the Successor Agency. The other funds held by trustees are made either in accordance with bond covenants and are pledged for payment of principal, interest, and specified capital improvements or in accordance with trust agreements. All investments held by a custodian are in the City’s name excluding the Successor Agency.

Interest Rate Risk
Interest Rate Risk is the risk that interest rates will rise and reduce the fair value of an investment. Long-term fixed-income securities have the greatest amount of interest rate risk, due to their duration, or sensitivity to interest rate changes, being greater.

As of June 30, 2023, the City owned eighteen callable bonds. Of the eighteen, seventeen were Corporate bonds, and one is a Municipal bond. Information on those bonds has been provided as follows:

Amount Maturity Date Call Date Call Terms
$2,817,580 2/5/2024 1/5/2024 Callable on and any time after 1/5/2024 3,382,838 3/15/2024 2/15/2024 Callable on and any time after 2/15/2024 3,900,032 7/8/2024 6/8/2024 Callable on and any time after 6/8/2024 1,388,628 9/16/2024 9/16/2023 Callable on 9/16/2023 and any time after if specific conditions are met
2,171,490 2/14/2025 1/14/2025 Callable on and any time after 1/14/2025 1,671,972 3/3/2025 2/3/2025 Callable on and any time after 2/3/2025 679,951 5/15/2025 4/15/2025 Callable on and any time after 4/15/2025 821,968 6/1/2025 6/1/2024 Callable on 6/1/2024 and any time after if specific conditions are met
41 #15..
- 815 -
Amount Maturity Date Call Date Call Terms
$2,022,655 11/13/2025 10/13/2025 Callable on and any time after 10/13/2025 3,078,167 1/28/2026 12/28/2025 Callable on and any time after 12/28/2025 1,940,468 4/2/2026 4/2/2025 Callable on 4/02/2025 and any time after if specific conditions are met
2,816,202 8/8/2026 5/8/2026 Callable on and any time after 5/8/2026 2,414,116 11/21/2026 8/21/2026 Callable on and any time after 8/21/2026 333,984 1/15/2027 12/15/2026 Callable on and any time after 12/15/2026 2,885,340 2/6/2027 11/6/2026 Callable on and any time after 11/6/2026 3,356,899 9/14/2027 6/14/2027 Callable on and any time after 6/14/2027 1,189,582 4/15/2028 3/15/2028 Callable on and any time after 3/15/2028 5,112,359 5/10/2028 4/10/2028 Callable on and any time after 4/10/2028 Disclosures Related to Credit Risk
Generally, Credit Risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment.

This is measured by the assignment of a rating by a nationally recognized statistical rating organization. The City may from time to time be invested in a security whose rating is downgraded subsequent to the date of purchase. In the event a rating drops below the minimum allowed rating category for that given investment type, the investment advisor shall notify the Finance Director and recommend a plan of action. The City will limit investments in any one non-government issuers, except investment pools to no more than 5% regardless of security type.

The following table summarizes the City’s various investments based on maturity dates and credit ratings:

Credit Rating Remaining Maturity (in Months)
Standard &
Poor's
Moody's
Investors
Service Total
12 Months or
Less
13 to 24
Months
25 to 60
Months
Investments Held by City
Foreign Government Bonds AAA Aaa $ 17,754,936 $ 1,754,486 $ 3,858,104 $ 12,142,346 Short-Term Fixed Deposits AAA Aaa 800,994 800,994 - -
US Treasury Bonds and Notes AA+ Aaa 238,486,710 33,411,744 32,143,534 172,931,432 US Agencies AA+ Aaa 28,374,891 4,861,336 23,513,555 -
REMIC and Other Government Paydowns AA+ Aaa 2,801,972 448,965 - 2,353,007 Commercial Paper A-1 P-1 30,952,660 30,952,660 - -
Corporate Bonds and Notes See Below See Below 54,736,845 11,241,921 18,325,738 25,169,186 Corporate Paydown Securities See Below See Below 3,365,747 12,649 345,196 3,007,902 Municipal Bonds See Below See Below 7,172,388 2,291,959 1,921,520 2,958,909 CAMP AAAm Not Rated 47,969,833 47,969,833 - -
Total Investments Held by City $ 432,416,976 $ 133,746,547 $ 80,107,647 $ 218,562,782

Investments Held by Fiscal Agent
Money Market Funds AAAm Aaa-mf $ 7,705,529 $ 7,705,529 $ - $ - CAMP AAAm Not Rated 9,801,635 9,801,635 - -
PARS – OPEB Not Rated Not Rated 1,481,519 1,481,519 - - PARS – Pension Not Rated Not Rated 2,617,047 2,617,047 - - Total Investments Held by Fiscal Agent $ 21,605,730 $ 21,605,730 $ - $ -

42 #15..
- 816 -
Credit Rating
Standard &
Poor's
Moody's
Investors
Service
Total
City of Modesto Banking Accts & Cash on
Hand A/A-1 A1/P1 $

89,729,621

Timing Differences for Deposit &
Electronic Vendor Payments

(4,503,504)

Total Cash and Investments $ 539,248,823
The following is a table indicating the credit ratings for the City’s investment in Corporate Bonds and Notes:

Amount Standard &
Poors
Moody's
Investors
Service
$ 5,700,421 AAA Aaa
5,115,500 AA+ Aaa
4,833,302 AA A1
5,091,031 AA Aa2
2,171,080 AA- A1
4,091,354 A+ Aa3
7,309,840 A+ A1
2,026,200 A+ A2
6,438,011 A A1
3,693,053 A A2
2,818,501 A A3
5,448,552 A- A1
$ 54,736,845
The following is a table indicating the credit ratings for the City’s investment in Corporate Paydown Securities:

Amount Standard &
Poors
Moody's
Investors
Service
$ 1,591,152 AAA Aaa
1,505,305 AAA Not Rated
269,290 Not Rated Aaa
$ 3,365,747

43 #15..
- 817 -
The following is a table indicating the credit ratings for the City's investment in Municipal Bonds:

Amount Standard &
Poors
Moody's
Investors
Service
$ 588,615 AAA Aaa
93,498 AAA Aa1
840,622 AA+ Aaa
675,827 AA Aa2
1,661,868 AA Aa3
2,855,539 AA- Aa2
456,419 AA- A1
$ 7,172,388
Concentration of Credit Risk
The City’s investment policy contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. Investments in any one issuer, other than U.S. Treasury securities, mutual funds, and external investment pools that represent 5% or more of total entity-wide investments are as follows at June 30, 2023:

Issuer Investment Type
Reported
Amount
Percent of
Portfolio
Fannie Mae (FNMA) Federal agency securities $28,961,065 6.36% Fair Value Measurement and Application
The Pool categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. These principles recognize a three-tiered fair value hierarchy, of which levels 1 & 2 apply to the City as follows:
 Level 1: Valuations are based on quoted prices in active markets for identical assets or liabilities. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgement. Examples would be securities with prices derived from the major exchanges.  Level 2: Valuations are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuations for which all significant assumptions are observable or can be corroborated by observable market data.

Examples would be securities with prices derived from market corroborated sources such as indices and yield curves; and matrix pricing, such as for most debt securities.

US Bank is the custodian of the City’s investments. Fair value is measured by using all assumptions utilized by marketplace participants, including risk assumptions considered by those participants. The measurement of fair value assumes an orderly, hypothetical transaction in the principal market for the asset or liability. However, if the volume and level of market activity for an asset or liability has significantly decreased, and transactions in a particular market are not orderly, other factors are considered in estimating fair value. Moreover, if no principal market exists, and there are multiple markets, then the most advantageous market is used.
44 #15..
- 818 -
The Pool has the following recurring fair value measurements as of June 30, 2023:

Fair Value Measurements Using

Investments Held by City
Quoted Prices in
Active Markets for
Identical Assets
Significant Other
Observable
Inputs
(Level 1) (Level 2)
Investments by Fair Value Level
US Treasury Bonds and Notes $ 238,486,710 $ 238,486,710 $ - US Agencies 28,374,891 - 28,374,891
REMICS and Other Government Paydowns 2,801,972 - 2,801,972 Foreign Government Bonds 17,754,936 - 17,754,936
Commercial Paper 30,952,660 - 30,952,660
Corporate Bonds and Notes 54,736,845 - 54,736,845
Corporate Paydown Securities 3,365,747 - 3,365,747
Municipal Bonds 7,172,388 - 7,172,388
Total Investments by Fair Value Level $ 383,646,149 $ 238,486,710 $ 145,159,439

Investments Not Subject to Fair Value Hierarchy
CAMP 47,969,833
Short-Term Fixed Deposits 800,994

Total Investments Held by City $ 432,416,976
Investments Held by Fiscal Agents
Investments Not Subject to Fair Value Hierarchy
Money Market Funds $ 7,705,529
CAMP 9,801,635
PARS – OPEB 1,481,519
PARS – Pension 2,617,047
Total Investments Held by Fiscal Agents 21,605,730
Grand Total of Investments $ 454,022,706

45 #15..
- 819 -
B. CAPITAL ASSETS
Capital asset activity for the fiscal year ended June 30, 2023 included the restatement of beginning balance of the capital asset notes as a result of the implementation of GASB 96 – SBITAS and was as follows:

Beginning Balance
Restated Additions Deletions Ending Balance
Governmental activities:

Capital assets, not being depreciated and amortized:

Land $ 33,774,611 $ 1,230,735 $ (10,000) $ 34,995,346
Construction in progress 170,696,297 27,600,769 (16,516,070) 181,780,996 Total capital assets, not being depreciated and amortized: 204,470,908 28,831,504 (16,526,070) 216,776,342 Capital assets being depreciated:

Buildings 57,003,366 - (2,085) 57,001,281
Improvements other than buildings 132,978,629 9,992,018 (30,082) 142,940,565 Furnishings & equipment 15,842,640 212,805 (72,701) 15,982,744 Buses and fareboxes 278,852 - - 278,852
Service animals 53,726 11,326 - 65,052
Intangible assets 7,974,303 - 7,974,303 -
Equipment pool 48,865,570 4,116,295 (2,220,582) 50,761,283 Infrastructure
Streets 518,406,717 3,803,957 522,210,674 -
Signals 25,329,952 - 25,329,952 -
Bridges 37,078,565 - 37,078,565 -
Pipeline 418,147 - - 418,147
Capital assets being amortized:

SBITA 2,372,661 - 2,372,661 -
Right-to-use Leases
Buildings 662,695 - 662,694 (1)
Equipment 17,287 - - 17,287
Land 224,950 - - 224,950
Total capital assets, being depreciated and amortized: 847,508,060 18,136,401 (2,325,451) 863,319,010 Less accumulated depreciation for:

Buildings (35,097,277) (1,641,984) (36,737,176) 2,085
Improvements (79,891,653) (5,193,023) 30,081 (85,054,595) Furnishings & equipment (12,872,856) (659,968) 67,445 (13,465,379) Buses and fareboxes (253,749) - - (253,749)
Service animals (28,970) (8,647) - (37,617)
Intangible assets (6,387,595) (408,158) (6,795,753) -
Equipment pool (32,741,114) (3,365,856) 2,171,330 (33,935,640) Infrastructure
Streets (358,189,295) (10,413,760) - (368,603,055)
Signals (19,355,027) (488,713) (19,843,740) -
Bridges (11,173,445) (741,571) (11,915,016) -
Pipelines (12,303) (5,575) - (17,878)
Less accumulated amortization for:

SBITA - (630,038) - (630,038)
Right-to-use Leases
Buildings (147,633) (147,633) - (295,266)
Equipment (8,643) (8,643) - (17,286)
Land (82,320) (75,731) - (158,051)
Total accumulated depreciation and amortization (556,241,880) (23,789,300) 2,270,941 (577,760,239) Total capital assets being depreciated and amortized, net 291,266,180 (5,652,899) (54,510) 285,558,771 Governmental activities capital assets, net $ 495,737,088 $ 23,178,605 $ (16,580,580) $ 502,335,113 46 #15..
- 820 -
Depreciation and amortization expenses were charged to functions/programs as follows:

Governmental activities:

General government $ 551,638
Community development 957,656
Highways and streets 12,173,166
Public works 273,095
Parks and recreation 543,280
Public safety 4,971,323
Capital assets held by the government’s internal service funds are charged to the various functions based on their usage of the assets 4,319,142 Total depreciation and amortization expense – Governmental activities $ 23,789,300 Beginning
Balance
Restated Additions Deletions Ending Balance
Business-type activities:

Capital assets not being depreciated and amortized:

Land $ 30,452,365 $ 194,804 $ 30,647,169 - $
Construction in progress 58,491,351 35,079,773 (28,319,890) 65,251,234 Total capital assets, not being depreciated and amortized: 88,943,716 35,274,577 (28,319,890) 95,898,403 Capital assets being depreciated:

Capitalized interest 19,496,181 - 19,496,181 -
Buildings 95,784,336 - (10,804) 95,773,532
Improvements other than buildings 484,193,770 18,069,746 (670,477) 501,593,039 Furnishings and equipment 13,032,934 198,602 (465,902) 12,765,634 Intangible assets 403,384 - - 403,384
Water rights 358,226,691 - 358,226,691 -
Pipelines 333,106,081 7,687,490 340,793,571 -
Capital assets being amortized:

SBITA 204,627 - - 204,627
Right-to-use Leases
Land 631,838 - - 631,838
Total capital assets, being depreciated and amortized: 1,305,079,842 25,955,838 (1,147,183) 1,329,888,497 Less accumulated depreciation for:

Capitalized interest (15,021,515) (504,786) (15,526,301) - Buildings (64,929,793) (1,737,768) (66,657,837) 9,724
Improvements other than buildings (241,101,751) (18,094,820) 651,383 (258,545,188) Furnishings and equipment (9,948,193) (658,627) 407,138 (10,199,682) Intangible assets (403,381) - (403,381) -
Water rights (143,290,679) (11,940,890) (155,231,569) - Pipelines (56,963,499) (4,449,422) (61,412,921) -
Less accumulated amortization for:

SBITA - (9,776) - (9,776)
Right-to-use Leases
Land (180,525) (180,524) (361,049) -
Total accumulated depreciation and amortization (531,839,336) (37,576,613) 1,068,245 (568,347,704) Total capital assets being depreciated and amortized, net 773,240,506 (11,620,775) (78,938) 761,540,793 Business-type activities capital assets, net $ 862,184,222 $ 23,653,802 $ (28,398,828) $ 857,439,196 47 #15..
- 821 -
Business-type activities:

Water $ 21,173,647
Sewer 14,692,884
Parking 385,570
Storm drain 439,863
Compost 60,954
Airport 729,074
Golf 36,859
Community center 57,762
Total depreciation and amortization expense – Business-type activities $ 37,576,613 C. LEASES RECEIVABLE
The City is a lessor for leases of buildings, hangers and office space, land use and parking spaces. The City uses the interest rate contained within the agreements as the discount rate except in cases when the interest rate charged is not provided; in those situations, the City uses the incremental borrowing rate as provided by the California State Controller’s Office or Debt Book.

Payment increases include flat percentage increases and the use of an index (such as the consumer price index). For those leases that have payment increases utilizing an index; they were initially calculated using the index at the measurement period.

The length of the lease period includes any noncancellable period of the lease as well as any extension options that are reasonably certain to be taken.

The City's lease receivable of $23,142,482 was composed of the following:

Governmental Activities
Building leases - annual payments totaling $72,400 plus interest at 1.5% and annual increases in base payments per CPI. Final payment dates range from 2023 through 2027.

Land use leases (including land use for cell towers) - annual payments totaling $320,105 plus interest at rates ranging from 0.2% to 1.5% and annual increases in base payments per CPI or flat increase.

Final payment dates range from 2023 through 2064.
$ 289,781
7,877,438
Total Principal Balances - Governmental Activities $ 8,167,219 Payments for the lease receivables are expected to be received in the following subsequent years:

Governmental Activities
Year Ending
June 30, Principal Interest
2024 $ 271,688 $ 120,817
2025 285,683 116,662
2026 291,372 112,281
2027 277,491 108,052
2028 233,277 103,902
2029 - 2033 1,224,062 466,143
2034 - 2038 1,300,854 372,140
2039 - 2043 1,506,034 266,269
48 #15..
- 822 -
Governmental Activities
Year Ending
June 30, Principal Interest
2044 - 2048 $ 1,094,336 $ 163,045
2049 - 2053 870,456 93,043
2054 - 2058 453,486 44,037
2059 - 2063 350,811 10,000
2064 7,669 63
Total $ 8,167,219 $ 1,976,454
Business-Type Activities
Buildings, hangers and office space leases - annual payments totaling $584,270 plus interest at rates ranging from 0.2% to 1.5% and annual increases in base payments per CPI or flat increase.

Final payment dates range from 2025 through 2053. $ 3,064,128 Land use leases (including land use for cell towers) - annual payments totaling $205,640 plus interest at rates ranging from 0.2% to 1.5% and annual increases in base payments per CPI or flat increase. Final payment dates range from 2023 through 2064.

Parking spaces lease - annual payments totaling $200,880 plus interest at a rate of 1.5% and annual increases in base payments per CPI or flat increase. Final payment date is 2053 6,996,869
4,914,266
Total Principal Balances – Business-Type Activities $ 14,975,263 Payments for the lease receivables are expected to be received in the following subsequent years:

Business Type Activities
Year Ending
June 30, Principal Interest
2024 $ 771,274 $ 219,516
2025 566,669 208,347
2026 324,210 202,286
2027 327,678 197,397
2028 307,559 192,661
2029 - 2033 1,692,233 889,987
2034 - 2038 1,816,961 758,692
2039 - 2043 2,141,760 610,825
2044 - 2048 2,233,427 443,635
2049 - 2053 2,306,674 276,625
2054 - 2058 1,352,149 133,919
2059 - 2063 1,065,655 36,527
2064 69,013 565
Total $ 14,975,263 $ 4,170,983
49 #15..
- 823 -
D. LONG-TERM DEBT
Loans Payable
Governmental Activities:

No-interest loan payable to the Stanislaus County Economic Development Bank loan program, to pay costs incurred by the City for the Kiernan Business Park East Project; loan intended to be repaid when the financing mechanism is established. As of June 30, 2023, no payments have been made to the Stanislaus County Economic Development Bank. According to the agreement, the Project will be completed as of the date the City first issues building permits within the Kiernan Business Park East area. To date, no building permits have been issued. Kiernan Business Park East project revenues, mainly CFD special taxes, have been pledged as collateral.

$ 500,000
Business-Type Activities:

Water Enterprise Fund:

Loan payable to State of California Department of Public Health, also known as ARRA Water Grant.

This Agreement constitutes funding in the form of a loan with forgiveness of principal made by the State under the provisions of California Safe Drinking Water State Revolving Fund Law of 1997, and the American Recovery and Reinvestment Act of 2009 (ARRA) Public Law 11 1-5. The purpose of the funding is to assist in financing construction of a project, which will enable the City to meet safe drinking water standards or to address other health concerns, herein referred to as the “Project”.

The total amount for the project was $1,136,656, of which 50% was to be repaid as a loan. This original loan amount of $568,328 has a payment term of 20 years at 2.5017% interest rate. Water Enterprise fund revenues have been pledged as collateral.

The following are significant terms that pertain to the ARRA Water Grant. Acceleration Clause: In event of default, State may declare the Supplier's obligations immediately due and payable. Events of Default: default allows State to alter principal forgiveness, accelerate, terminate further disbursements, file lawsuit. Termination Events: Any funds already disbursed to Supplier under the terms of this Agreement shall be an obligation immediately due and payable to State.

$ 290,830
Sewer Enterprise Fund:

Loan payable to California State Water Resources Control Board, State Revolving Fund. The Project, commonly known as North Valley Regional Recycled Water Program generally consists of constructing improvements to the City’s existing pump station. The City will then distribute the recycled water to the Del Puerto Water District for agricultural use increasing recycled water supplies by 5.4 billion gallons per year within the first 5 years of operation and 9.9 billion gallons per year at build out. Completion of construction date was established as June 30, 2018. Project completion date was established as December 31, 2018.

The City agrees to repay all project funds at an interest rate of zero percent (0%) per annum and an administrative service charge of one percent (1%) per annum. The total final loan amount was $29,747,008, including $68,857 of approved Construction Period Interest. The loan repayment term is 30 years (final payment due on June 30, 2048) and after an initial payment of $1,104,284, in the fiscal year ending June 30, 2019, the annual principal and interest payment is $1,152,162 beginning in the fiscal year ending June 30, 2020. Sewer Enterprise fund net revenues have been pledged as collateral.

The following are significant terms that pertain to the California State Water Resources Control Board, State Revolving Fund loan payable related to the North Valley Regional Recycled Water Program. Acceleration and Termination Events Clauses: the City immediately repays to the State Water Board an amount equal to Project Funds disbursed under the Installment Sale Agreement and Grant, accrued interest, penalty assessments, and Additional Payments. In the event of termination, 50 #15..
- 824 -
Annual debt service requirements to maturity for loans payable are as follows:

Governmental Activities Business-Type Activities
Year Ending
June 30, Principal Interest Principal Interest
2024 $ - $ - $ 927,116 $ 261,334
2025 500,000 - 936,830 251,620
2026 - - 946,653 241,798
2027 - - 956,584 231,865
2028 - - 966,628 221,823
2029-2033 - - 4,951,258 954,710
2034-2038 - - 5,059,500 701,309
2039-2043 - - 5,317,585 443,223
2044-2048 - - 5,652,729 171,971
Total $ 500,000 $ - $ 25,714,883 $ 3,479,653
Certificates of Participation:

Business-Type Activities:

Golf Enterprise Fund:
1993 Refunding Certificates of Participation issued to refund earlier certificates for the Creekside Golf Course capital project; issued with an aggregate principal of $8,130,000, with final maturity in 2023. Annual principal payments are due November 1st and beginning in 2010 range from $250,000 to $480,000, ending in 2023. The certificates are repayable from any source of available funds of the City. However, the City has elected to repay the certificates with revenues of the Golf Enterprise Fund.

The following are significant Events of Default terms that pertain to the 1993 Refunding COPs.

Trust Agreement: Upon the occurrence and continuance of an Event of Default or other occasion giving rise to a right in the Trustee to represent the Bondholders, the Trustee in its discretion may, upon written request of >25% of bondholders, initiate lawsuit; Lease Agreement: In an Event of Default under the Lease Agreement, the Authority at its option may terminate the Lease Agreement and re-lease all or any portion of the Project, and the City agrees to pay to the Authority all costs, loss or damages howsoever arising or occurring payable at the same time and in the same manner as provided in the Lease Agreement in the case of payment of Lease payments.

$ 480,000
Water Enterprise Fund:
2008 Water Refunding Revenue Certificates of Participation issued to refund the 2006 issue, to provide funding for construction of new downstream water facilities and various water distribution system improvements in connection with Modesto Irrigation District’s expansion of the regional water treatment plant; variable rate securities maturing October 1, 2036, with interest initially calculated weekly, fluctuating according to market conditions. The Certificates may be converted to a daily, term, flexible, or fixed rate.
interest shall accrue on all amounts due at the highest legal rate of interest from the date that notice of termination is mailed to the City to the date all monies due have been received by the State Water Board. Events of Default: default allows State Water Resources Control Board to terminate obligation, which results in acceleration. $ 25,424,053 Total Principal Balances – Business-Type Activities $ 25,714,883 51 #15..
- 825 -
While the 2008 COPs are in the Weekly Mode, they are subject to optional tender and mandatory tender for purchase. Funds for the payment of the purchase price of 2008 COPs that are tendered for purchase and that are not remarketed by the Remarketing Agent will be available (subject to certain conditions) under a Standby Certificate Purchase Agreement with BMO Bank N.A., dated June 8, 2023 (the “Alternate Liquidity Facility”). The Alternate Liquidity Facility does not support, secure or guarantee the payments of the principal or interest with respect to the 2008 COPs.

Subject to the terms and conditions of the Alternate Liquidity Facility, the Alternate Liquidity Facility Provider is to provide funds for the payment of the purchase price on each purchase of 2008 COPS up to $42,390,000 in principal amount (the “Available Principal Commitment”) and $487,776 an amount equal to 35 days’ interest on the Available Principal Commitment at an assumed rate of 12% and accrued interest on 2008 COPs subject to the Weekly Rate tendered or deemed tendered for purchase in the event that remarketing proceeds are not sufficient to pay the purchase price of such 2008 COPs.

The Alternate Liquidity Facility will not provide for the payment of principal and interest on any 2008 COPs other than with respect to the purchase price of the 2008 COPs tendered or deemed tendered and not remarketed. Barring an event of default, any such draws on the Alternate Liquidity Facility will be repaid under the terms of the Reimbursement Agreement. However, the entire balance of the amount drawn shall become due immediately if the 2008 COPs are cancelled or prepaid, are remarketed, or converted to bear interest at a rate other than a daily rate or weekly rate; an alternate credit facility is secured; or an event of default occurs. The Alternate Liquidity Facility expires June 8, 2026 and contains a commitment fee of 0.3%. This replaced a prior agreement with JP Morgan that contained a commitment fee of 0.575%;

The City entered into a 30-year interest rate swap agreement as discussed below. The combination of the variable rate 2008 COPs and the floating rate swap creates a synthetic fixed-rate debt for the City. The average synthetic fixed-rate was 2.719% for the fiscal year ending June 30, 2023.

The following are significant terms that pertain to the 2008 COPs. Acceleration Clauses: in the event of late payment, Authority shall accelerate bond payments; in the event of other default, Authority may choose to accelerate bond payments. Events of Default: in the event of nonpayment, insolvency, or loss of bond insurance, the obligation of the Letter of Credit provider shall terminate; in the event of nonpayment of Letter of Credit fees or downgrade of Bonds to below investment grade, the Letter of Credit provider may terminate the Letter of Credit. Termination Events: The termination of the Letter of Credit triggers mandatory tender; termination of swap triggers on-time termination payment. $ 42,390,000

Total Principal Balances – Business-Type Activities 42,870,000 Less:

Unamortized Bond Discount – 2008 Water Refunding Certificates of Participation

(71,466)
Total Business-Type Activities – Certificates of Participation $ 42,798,534

The City has pledged all Gross Revenues of the Water Utility System to repay the 2008 Certificates of Participation. The City has pledged future Golf Enterprise Fund revenues (net proceeds of the Certificates held in Escrow Fund and certain other moneys held under the Trust Agreement relating to the Golf Course Certificates) to pay the 1993 Certificates of Participation for the Golf Course Refinancing project. The Water and Golf Funds combined total principal and estimated total interest remaining to be paid on the certificates is $50,263,396. The Water Fund’s principal, interest and other debt service cost paid on certificates for the current year, along with payments for the ARRA loan payable and payments to Modesto Irrigation District under the Treatment and Delivery Agreement, totaled $11,277,573, and net operating revenues of the Fund were $34,517,748, which represented coverage of 306%. The Golf Fund’s principal and interest paid on certificates totaled $494,120, and net operating revenues of the Fund were $495,006, which represented coverage of 100.18%.
52 #15..
- 826 -
Annual debt service requirements to maturity for Certificates of Participation for 2008 Water and 1993 Golf are as follows:

Business-Type Activities
Year Ending
June 30, Principal Interest
2024 $ 2,780,000 $ 983,036
2025 2,410,000 899,755
2026 2,515,000 841,275
2027 2,595,000 780,766
2028 2,705,000 719,773
2029-2033 15,290,000 2,551,345
2034-2037 14,575,000 617,446
Total $ 42,870,000 $ 7,393,396
Lease Revenue Bonds:

Governmental Activities:

Regularly scheduled payments of principal and interest are supported by an irrevocable, direct pay Letter of Credit (the “Credit Facility”) issued by BMO Bank N.A. (previously known as Bank of the West) on June 13, 2019, which replaced a Letter of Credit previously issued by Bank of America, N.A. The Trustee can draw funds under the Credit Facility to pay the purchase price of tendered bonds that are not remarketed. Barring an event of default, any such draws on the Letter of Credit will be paid under the terms of the Reimbursement Agreement. Under the terms of the Reimbursement Agreement, the City will repay the amount drawn in equal quarterly installments of principal plus monthly interest, at the Bank Rate, over a three-year amortization period. However, the entire balance of the amount drawn shall become due immediately if the tendered bonds are remarketed or defeased, or an alternate credit facility is secured, or an event of default occurs. The Credit Facility and Reimbursement Agreement with Bank of the West was established with a commitment fee of 0.375%, this was extended on May 12, 2023 (now as BMO Bank N.A) with a commitment fee of 0.34%.

The combination of the variable rate 2008 bonds and the floating rate swap creates a synthetic fixed-rate debt for the City. The average synthetic fixed-rate was 3.201% for the fiscal year ending June 30, 2023.

The following are significant terms that pertain to the 2008 Lease Revenue Bonds. Acceleration Clauses: in the event of late payment, Trustee may accelerate bond payments; in the event of an Event of Default occurring under the Lease Agreement, the Trustee may take whatever action the Authority would be entitled to take, and shall take whatever action the Authority would be required to take, pursuant to the Lease Agreement in order to remedy the default. Events of Default: in Event of Default, Letter of Credit provider may declare all unpaid amounts drawn under the Letter of Credit and the corresponding Bank Bonds, together with all interest accrued and unpaid thereon, and all other amounts payable to the Letter of Credit provider under the Reimbursement Agreement to be immediately due and payable, without presentment, demand, protest or nay notice of any kind. Termination Events: the termination of Letter of Credit triggers mandatory tender; termination of swap triggers on-time termination payment; in the event that the City files a bankruptcy petition or the City makes a general assignment for the benefit of creditors, all amounts drawn under the Letter of Credit and the corresponding Bank Bonds, together with all interest accrued thereon and all other amounts owed to the Bank under the Reimbursement Agreement shall be immediately due and payable, without notice to the City or the Authority and without presentment, demand, protest or further notice of any kind.

$ 41,770,000
53 #15..
- 827 -
Annual debt service requirements to maturity for Lease Revenue Bonds are as follows:

Governmental Activities
Year Ending
June 30, Principal Interest
2024 $ 2,785,000 $ 625,367
2025 2,990,000 547,543
2026 3,240,000 499,580
2027 3,470,000 448,116
2028 3,730,000 393,879
2029-2033 20,810,000 1,060,578
2034 4,745,000 12,090
Total $ 41,770,000 $ 3,587,153
Revenue Bonds
Business-Type Activities:

Sewer Enterprise Fund:

Wastewater Revenue Refunding Bonds, Series 2020 A&B; interest payable on November 1 and May 1; principal is payable in annual installments on each November 1. Principal repayments for the 2020A federally taxable bonds commence November 1, 2021 and pause November 1, 2026, with interest rates from 0.38% to 1.2%. Principal repayments for the 2020B federally tax-exempt bonds commence November 1, 2027 and end November 1, 2030, with interest rates of 5%. Principal repayments for the 2020A federally taxable bonds recommence November 1, 2031 and end November 1, 2036 with interest rates from 2.079% to 2.479%. Payment of principal and interest on the Series 2020 A&B Bonds is secured by a pledge of Net Revenues of the Sewer Enterprise Fund.

The Series 2020 A&B Bonds constitute “Parity Debt” under the Indenture.

On October 27, 2020, the City issued the Series 2020 A&B Bonds as a Parity Debt to fully payoff the loan payable to California State Water Resources Control Board, State Revolving Fund. The proceeds were used to repay the loan and cost of issuance in connection with the financing. The loan payable has been fully paid off, the City will realize annual savings of around $510,000 in cash flow with an overall economic gain of 6.61% or $7,056,050 in present value savings.

The original loan was taken out in connection with the Tertiary Treatment Phase 1B Project, generally consisting of constructing a 12.6 million gallon per day tertiary treatment plant. Completion of construction date was established as June 1, 2016, and project completion date was established as December 1, 2016.

The following are significant terms that pertain to the Wastewater Revenue Refunding Bonds, Series 2020 A&B. Acceleration Clause: upon violation by the City of any material provision of the Project Finance Agreement, the State Water Board may terminate agreement by written notice during construction of the Project, or thereafter at any time prior to complete repayment by the City, upon which the City agrees, upon demand, to immediately repay to the State Water Board an amount equal to Installment Payments due under the Project Finance Agreement, including accrued interest, and all penalty assessments due. In the event of termination, interest shall accrue on all amounts due at the highest legal rate of interest from the date that notice of termination is mailed to the Recipient to the date of full repayment by the Recipient. Events of Default: upon violation by the City of any material provision, State Water Board may terminate agreement which triggers acceleration. Termination Events: upon termination of the agreement by the State Water Board, the City agrees to immediately repay to the State Water including accrued interest, and all penalty assessments due. In the event of termination, interest shall accrue on all amounts due at the highest legal rate of interest from the date that notice of termination is mailed to the Recipient to the date of full repayment by the City. $ 83,505,000
54 #15..
- 828 -
Wastewater Revenue Refunding Bonds, Series 2018A; interest payable on November 1 and May 1; principal is payable in annual installments on each November 1, commencing November 1, 2025 and ending November 1, 2036, with interest rates from 4% to 5%. Payment of principal and interest on the Series 2018A Bond is secured by a pledge of Net Revenues of the Sewer Enterprise Fund.

The Series 2018A Bond constitutes “Parity Debt” under the Indenture.

On April 19, 2018, the City issued the Series 2018A Bond as a Parity Debt to fully refund the 2006A Wastewater Revenue Bonds. The proceeds were used to refund the 2006A Wastewater Revenue Bonds and pay cost of issuance in connection with the financing. The Series 2006A has been fully redeemed, and the City will realize significant savings from the refunding of the 2006A bonds.

The following are significant terms that pertain to the Wastewater Revenue Refunding Bonds, Series 2018A. Acceleration Clause: in each and every such case during the continuance of an Event of Default (and subject to any rights granted to any insurer of the Bonds with respect to the enforcement of remedies upon an Event of Default pursuant to a Supplemental Indenture), the Owners of not less than a majority in aggregate amount of Bond Obligation of the Bonds at the time Outstanding shall be entitled, upon notice in writing to the City, to declare the principal of all of the bonds then Outstanding, and the interest accrued thereon, to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable, anything in the Indenture or in the Bonds contained to the contrary notwithstanding. Events of Default: upon the occurrence and continuance of an Event of Default or other occasion giving rise to a right in the Trustee to represent the Bondholders, the Trustee in its discretion may, and upon written request of the Owners of not less than 25% in aggregate amount of Bond Obligation of the Bonds then Outstanding, initiate a lawsuit.

Wastewater Revenue Refunding Bond Series 2015 - Direct Placement; interest payable on November 1 and May 1, commencing May 1, 2016. Principal is payable in annual installments on each November 1, commencing November 1, 2016 and ending November 1, 2024. The Series 2015 Bond shall bear interest at a rate equal to 2.42% per annum; The Series 2015 Bond constitutes “Parity Debt” under the Indenture; Payment of principal and interest on the Series 2015 Bond is secured by a pledge of Net Revenues of the Sewer Enterprise Fund (i.e., 1) all fees and charges received by the City for the services of the Enterprise; 2) all other income and revenue howsoever derived by the City from the ownership; 3) all sums deposited, or required under the Indenture to be deposited, in the Sewer Enterprise Fund; less the amount of Operating Expenses becoming payable during such period).

On October 30, 2015, the City issued the Series 2015 Bond, as a Parity Debt to fully refund the 2005A and partially refund the 2006A Wastewater Revenue Bonds. The proceeds were used to: 1) Refund the Wastewater Revenue Refunding Bonds, Series 2005A, which refinanced the acquisition and construction of improvements to the City’s wastewater enterprise, 2) refund a portion of the Wastewater Revenue Bonds, Series 2006A, and 3) pay cost of issuance in connection with the financing. The Series 2005A Bonds have been fully redeemed and the 2023 and 2024 maturities of Series 2006A Bonds were redeemed. The City will realize significant savings from the refunding of the 2005A and 2006A Bonds.

The following are significant terms that pertain to the Wastewater Revenue Refunding Bond Series 2015 - Direct Placement. Acceleration Clauses: in each and every such case during the continuance of an Event of Default (and subject to any rights granted to any insurer of the Bonds with respect to the enforcement of remedies upon an Event of Default pursuant to a Supplemental Indenture), the Owners of not less than a majority in the aggregate amount of Bond Obligation of the Bonds at the time Outstanding shall be entitled, upon notice in writing to the City, to declare the principal of all of the Bonds then Outstanding, and the interest accrued thereon, to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable, anything in the Indenture or in the Bonds contained to the contrary notwithstanding. Events of Default: upon the occurrence and continuance of an Event of Default or other occasion giving rise to a right in the Trustee to represent the Bondholders, the Trustee in its discretion may, upon written request of >25% of bondholders, initiate lawsuit. $ 11,340,000
1,774,562
55 #15..
- 829 -
Annual debt service requirements to maturity for the Wastewater Revenue Refunding Bond Series 2015 - Direct Placement are as follows:

Annual debt service requirements to maturity for total Revenue Bonds are as follows:

Business-Type Activities
Year Ending
June 30, Principal Interest
2024 $ 6,316,795 $ 2,883,412
2025 6,377,767 2,822,250
2026 6,240,000 2,743,524
2027 6,350,000 2,637,112
2028 6,570,000 2,411,436
2029-2033 37,850,000 7,062,999
2034-2037 26,915,000 1,268,138
Total $ 96,619,562 $ 21,828,871
Total Principal Balances – Business-Type Activities $ 96,619,562

Add: Unamortized Bond Premium – 2018A Wastewater Bonds
Unamortized Bond Premium – 2020B Wastewater Bonds
1,521,810
6,181,798
Total Business-Type Activities Revenue Bonds $ 104,323,170 Business-Type Activities
Year Ending
June 30, Principal Interest
2024 $ 876,795 $ 32,335
2025 897,767 10,862
Total $ 1,774,562 $ 43,197
Notes Payable
Governmental Activities:

On March 26, 2015, the City received notice of a public offering to refinance the existing HUD Section 108 Loan note, with an outstanding balance of $2,789,000. The City agreed to refinance the note, as it reduced the interest on the HUD Section 108 Loan, a net savings of approximately $502,908. The public offering date was May 28, 2015. The terms of the new promissory note include semi-annual payments in August and February through the maturity date of August 1, 2024. The interest rates range from 0.28% through 2.85%. No new security provisions were required, as the Contract for Fixed Rate Note incorporates the previous additional security provisions. Housing revenues are pledged as collateral.

The following are significant terms that pertain to the HUD Section 108 Loan. Acceleration Clause:
upon a Default or declaration of Default, the Secretary may accelerate the Note with respect to amounts subject to Optional Redemption. Events of Default: the Secretary may withhold the guarantee of any or all obligations not yet guaranteed on behalf of the Borrower under outstanding 56 #15..
- 830 -
Annual debt service requirements to maturity for this Notes Payable are as follows:

Governmental Activities
Year Ending
June 30, Principal Interest
2024 $ 328,000 $ 14,424
2025 345,000 4,916
Total $ 673,000 $ 19,340
Reimbursement Agreement
Business-Type Activities:

Water Enterprise Fund:

In 1992, the City entered into a treatment and delivery agreement with the Modesto Irrigation District (MID) and the Del Este Water Company (Del Este). The City assumed Del Este’s interest and obligations under the agreement when it acquired Del Este in July 1995. Under the agreement, MID built and operates a surface water treatment plant on the Tuolumne River for the purpose of providing a long-term source of domestic treated water for the City. MID is the sole owner of the project, and has all management and operations responsibility. In exchange for the treated water, the City has agreed to pay: all debt service on bonds issued by MID for the construction of the project; a raw water charge as set forth in the agreement; project operation, administration, and maintenance costs; and insurance on the project. Gross revenues of the City's Water Fund are irrevocably pledged for the punctual payment of the MID debt service and all obligations of the City under any parity debt. Current parity debt of the City consists of the 2008 Water Revenue Certificates of Participation and the California Safe Drinking Water Act loan (as described previously). The treatment plant completed all tests and began commercial operations on May 15, 1995, at which time the City began paying for raw water and operations.

The City and MID have agreed upon an expansion of the initial Domestic Water Project facilities beyond the existing design capacity of 36 million gallons per day (“mgd”) to a design capacity of 72 mgd. In June 2007, MID issued $93,190,000 Domestic Water Project revenue bonds pursuant to the terms of the existing treatment and delivery agreement. On August 14, 2013, Modesto Irrigation District Financing Authority refunded the 1998 D Bonds, with 2013 G Bonds. As of June 30, 2023, the 2013 G Bonds are fully repaid and $93,190,000 is outstanding for the 2007 F Bonds. For the 2007 F Bonds, the annual principal payments begin on September 1, 2023 and mature on September 1, 2037 in amounts from $4,275,000 to $11,870,000, with variable interest rates fluctuating according to market conditions.

The following are significant terms that pertain to the 2007 F Bonds. Acceleration Clause: in the event of late payment, Authority shall accelerate bond payments; in the event of other default, Authority may choose to accelerate bond payments.

In event of default, Trustee may, with consent of Bond Insurer, and shall, at the direction of Bond Insurer or the owners of >50% of the bonds (with consent of Bond Insurer) accelerate bond payments. Events of Default: in event of default, Trustee may, with consent of Bond Insurer, and shall, at the direction of Bond Insurer or the owners of >50% of the bonds (with consent of Bond Insurer) initiate a lawsuit. Termination Events: the termination of swap triggers a one-time termination payment.

The City has entered into interest-rate swap agreements for the 2007F bonds to synthetically fix the rates that the City pays at 4.378% and 4.44%. Refer to the Interest Rate Swap agreement section below with more information about the debt schedule.
commitments, and/or direct the Borrower's financial institution to: refuse to honor any instruments drawn upon, or withdrawals from, the Guaranteed Loan Funds Account or the Loan Repayment Account initiated by the Borrower, and/or refuse to release obligations and assignments by the Borrower from the Guaranteed Loan Funds Investment Account or the Loan Repayment Investment Account. $ 673,000
57 #15..
- 831 -
Annual debt service payments to maturity for the Reimbursement Agreement are as follows:

Business-Type Activities
Year Ending
June 30, Principal Interest
2024 $ 4,275,000 $ 3,799,241
2025 4,455,000 3,604,896
2026 4,650,000 3,417,717
2027 4,885,000 3,216,133
2028 5,105,000 3,009,245
2029-2033 29,250,000 11,467,839
2034-2038 40,570,000 4,327,884
Total $ 93,190,000 $ 32,842,955
Interest Rate Swap Agreements:

Objective of the swaps – The primary objective of the swaps is to mitigate the effect of fluctuations in variable interest rates by paying a fixed-rate and receiving a floating rate on the swap. Combining a pay-fixed receive-variable rate swap with variable debt results in what is termed “synthetic” fixed-rate debt. It is called synthetic because the economics are similar to fixed-rate debt, but another instrument is involved unlike regular fixed-rate debt. Each time the City created synthetic fixed-rate debt a comparison and determination were made that the fixed-rate on regular debt would have been higher than the synthetic fixed rate on the swap.

During fiscal year 2007, the City entered into an interest swap agreement in connection with the 2006 Water Revenue Certificates of Participation. This transaction was updated due to the refunding of the 2006 Certificates by the 2008 Water Refunding Revenue Certificates of Participation (COPs). The swap agreement allows the City to create a synthetic fixedrate on the COPs, protecting it against increases in short-term interest rates.

During fiscal year 2008, the City entered into an interest swap agreement in connection with the 2008 Lease Revenue Bonds. The swap agreement allows the City to create a synthetic fixed rate on the Lease Revenue Bonds, protecting it against increases in short-term interest rates. The terms, fair value and credit risk of these swap agreements are disclosed below.

Additionally, in May 2007, the City approved the issuance of revenue bonds by the Modesto Irrigation District Financing Authority related to the financing of Phase 2 of the Domestic Water Treatment and Delivery System of the Modesto Irrigation District. The MID Water Refunding Bonds were issued with an interest swap feature with Bear Sterns, which was subsequently acquired by JP Morgan. Under the agreement between MID and JP Morgan, the City must post collateral when the City’s negative position exceeds the Pledgor’s Threshold of $20 million. This negative position represents the present value of declining interest rates to date from issuance of bonds. In June 2010, the City Council authorized the City to post collateral up to $18 million, which would support a negative position of $38 million. In July 2010, the City Council increased the City’s authorization to post collateral from $18 million to up to $20 million. Due to the negative position of the revenue bonds being less than the Pledgor’s Threshold of $20 million, at the end of fiscal year 2023, the City did not have any collateral posted.

Terms – The terms, including the counterparty credit rating of the outstanding swaps, as of June 30, 2023 are shown in the table below. The swap agreements contain scheduled reductions to the outstanding notional amounts that are expected to follow scheduled principal reductions in the associated debt issues. 2008 Water
Refunding
Revenue COPs
2008 Lease Revenue
Refunding and Capital
Improvement Bonds
2007 MID Domestic
Water Revenue Bonds
Series 2007F
2007 MID Domestic
Water Revenue Bonds
Series 2007F
Current Notional
Amount $ 42,390,000 $ 41,770,000 $ 23,370,000 $ 69,820,000 Effective
Date 5/30/2008 8/28/2008 6/26/2007 6/26/2007
58 #15..
- 832 -
2008 Water
Refunding
Revenue COPs
2008 Lease Revenue
Refunding and Capital
Improvement Bonds
2007 MID Domestic
Water Revenue Bonds
Series 2007F
2007 MID Domestic
Water Revenue Bonds
Series 2007F
Counterparty Bank of America Bank of America JP Morgan Chase Bank JP Morgan Chase Bank Credit Rating
(S&P) A+ A+ A+ A+
Fixed Rate Paid 3.47% 3.61% 4.38% 4.44%
Variable Rate
Received

63.7% of (30-Day
Average SOFR +

0.11448%) +

0.154%

63.7% of (30-Day
Average SOFR +

0.11448%) + 0.154%
67% of 3-Month LIBOR
+ 0.58% till 9/1/23, then
67% of 3-Month CME
Term SOFR + 0.683%
67% of 3-Month LIBOR
+ 0.63% till 9/1/23, then
67% of 3-Month CME
Term SOFR + 0.7335%
Termination
Date 10/1/2036 9/1/2033 9/1/2027 9/1/2037
Based on the swap agreement the City owes interest calculated at a fixed rate to the counterparty (Bank of America and JP Morgan). In return, the counterparty owes the City interest based on the variable rate that approximates the rate required by the associated COPs and lease revenue bonds. Debt principal is not exchanged; it is only the basis on which the swap receipts and payments are calculated.

GASB Statement 53 (GASB 53) addresses the recognition measurement and disclosure of information regarding derivative instruments entered into by state and local governments. All derivatives are to be reported on the statement of net position at fair value and all hedges must be tested for effectiveness to qualify for hedge accounting. The tests are outlined in GASB 53. Depending on the test results, the changes in fair value are either reported on the statement of net position as a deferral or in the statement of activities as investment revenue or loss.

Fair value – Fair value takes into consideration the prevailing interest rate environment, the specific terms and conditions of each transaction and any upfront payments that may have been received. Fair value was estimated using the zerocoupon discounting method, which calculates the future payments required by the swap, assuming that the current forward rates implied by the LIBOR swap yield curve are the market’s best estimate of future spot interest rates. These payments are then discounted using the spot rates implied by the current yield curve for a hypothetical zero-coupon rate bond due on the date of each future net settlement on the swaps.

As of June 30, 2023, the fair value of the swaps was in favor of the counterparty as shown in the following table:

Bond Issue Fair Value
2008 Water Refunding Rev. Certificates of Participation $ (2,511,323) 2008 Lease Revenue Bonds $ (2,081,033)
2007 MID Domestic Water Revenue Bonds $ (9,366,422)
Credit risk - As of June 30, 2023, the City was not exposed to credit risk on the swaps because the swaps had negative fair value. However, if interest rates increase and the fair value becomes positive, the City would be exposed to credit risk.

The City will be exposed to interest rate risk only if the counterparty to the swap defaults or if the swap is terminated.

Basis risk - Basis risk is the risk that the interest rate paid by the City to the bondholders on the underlying variable rate bonds temporarily differs from the variable swap rates received from the counterparty. The swaps have basis risk since the City receives a percentage of the LIBOR Index to offset the actual variable bond rates the City pays on the underlying certificates of participation. The City is exposed to basis risk should the floating rate that it receives on the swap be less than the actual variable rate the City pays on the bonds. Depending on the magnitude and duration of any basis risk shortfall, the expected cost of the basis risk may vary.

A portion of this basis risk is tax risk. The City is exposed to tax risk when the relationship between the taxable LIBOR based swaps and tax-exempt variable rate bonds changes as a result of a reduction in federal and state income tax rates.

Should the relationship between LIBOR and the underlying tax-exempt variable rate bonds converge the City is exposed to this basis risk.
59 #15..
- 833 -
Termination risk - The City may terminate the swap contracts if the other party fails to perform under the terms of the contracts. The City will be exposed to variable rates if the counterparty defaults or if the swap contract is terminated. A termination of the swap contract may also result in the City’s making or receiving a termination payment based on market interest rates at the time of the termination. If at the time of termination, the swap has a negative fair value, the City would be liable to the counterparty for a payment equal to the swap’s fair value.

Swap payments and associated debt - Using rates as of June 30, 2023, debt service requirements of the 2008 Water Refunding Revenue Certificates of Participation, the 2008 Lease Revenue Refunding Bonds, and the 2007 MID Domestic Water Revenue Bonds, including net swap payments and broker fees, are as shown in the following table assuming current interest rates remain the same for their term. The bond interest payments and net swap payments will vary as interest rates vary.

Variable-Rate Bonds Net Swap Payments,
Letter of Credit, &
Remarketing Fees
Year Ending
June 30, Principal Interest Total
2024 $ 9,360,000 $ 5,395,645 $ 484,806 $ 15,240,451
2025 9,855,000 5,052,194 463,202 15,370,396
2026 10,405,000 4,758,572 429,456 15,593,028
2027 10,950,000 4,445,016 403,359 15,798,375
2028 11,540,000 4,122,897 374,662 16,037,559
2029-2033 65,350,000 15,079,763 1,421,358 81,851,121
2034-2038 59,890,000 4,957,420 722,315 65,569,735
Total $ 177,350,000 $ 43,811,507 $ 4,299,158 $225,460,665 Changes in Long-Term Obligations
Long-term obligations activity for the year ended June 30, 2023, was as follows:

Governmental Activities:

Beginning
Balance Additions Reductions Ending Balance
Due Within
One Year
Loans Payable $ 500,000 $ - $ - $ 500,000 $ -
Lease Revenue Bonds 44,355,000 - (2,585,000) 41,770,000 2,785,000 Notes Payable 985,000 - (312,000) 673,000 328,000
Leases Payable 672,053 - (229,241) 442,812 189,885
Finance Purchase Obligations 7,349,423 - (774,123) 6,575,300 788,154 SBITAs - 2,212,562 (517,060) 1,695,502 804,755
Total Governmental Activities $ 53,861,476 $ 2,212,562 $ (4,417,424) $ 51,656,614 $ 4,895,794 Business-Type Activities:

Loans Payable $ 26,632,391 $ - $ (917,508) $ 25,714,883 $ 927,116 Certificates of Participation 43,780,000 - (910,000) 42,870,000 2,780,000 Unamortized Discount (76,963) - 5,497 (71,466) -
Leases Payable 457,085 - (181,794) 275,291 183,178
Finance Purchase Obligations 3,350 - (2,349) 1,001 1,001 SBITAs - 204,632 (38,830) 165,802 36,940
MID Bonds 98,985,000 - (5,795,000) 93,190,000 4,275,000 Unamortized Premium 570,726 - (570,726) - -
Sewer Bonds 100,260,000 - (5,415,000) 94,845,000 5,440,000 Unamortized Premium 8,655,280 - (951,673) 7,703,607 -
Sewer Bonds – Direct Placement 4,483,201 - (2,708,639) 1,774,562 876,795 Developer Advances 699,342 - (116,389) 582,953 88,330
Total Business-Type Activities $ 284,449,412 $ 204,632 $ (17,602,411) $ 267,051,633 $ 14,608,360 60 #15..
- 834 -
Principal balances are reported on the government-wide and enterprise funds statements of net position, net of unamortized issuance discounts and premiums. Deferred losses on refunding are reported as deferred outflows of resources. Internal service funds predominantly serve the governmental funds. Accordingly, any long-term liabilities for the internal service funds are included as part of the above totals for governmental activities. At year-end, internal service funds obligations were zero under notes payable. In fiscal year 2023 the City adopted GASB Statement No. 96, Subscription-Based Information Technology Arrangements (SBITAs). Existing leases in effect July 1, 2022, were added to the table as additions.

E. CHANGES IN OTHER LONG-TERM LIABILITIES
Other long-term liability activity for the year ended June 30, 2023, was as follows:

Governmental Activities:

Beginning
Balance Additions Reductions
Ending
Balance
Due Within
One Year
Compensated Absences $ 9,560,977 $ 11,163,104 $ 11,244,981 $ 9,479,101 $ 851,608 Claims Liability 26,858,298 11,224,099 11,043,483 27,038,914 6,660,398 Total Governmental Activities $ 36,419,275 $ 22,387,203 $ 22,288,464 $ 36,518,015 $ 7,512,006 Business-Type Activities:

Compensated Absences $ 2,401,096 $ 3,977,482 $ 3,938,526 $ 2,440,052 $ 219,216 Total Business-Type Activities $ 2,401,096 $ 3,977,482 $ 3,938,526 $ 2,440,052 $ 219,216 The compensated absences and claims liability balances relate to the internal service funds, and as such they are liquidated by the internal service funds. The predominant contributors for these internal service funds include the General Fund, Water Fund, and Sewer Fund.

F. FINANCE PURCHASE OBLIGATIONS
Governmental Activities
As of June 30, 2023, the City has three governmental activities finance purchase obligations. Two with Pierce Manufacturing Inc. for the purchase of Velocity Pumpers and Velocity Tillers valued at $9,625,682, less accumulated depreciation of $3,215,916. The other with Turf Tank for the purchase of one Autonomous Robot valued at $39,204, less accumulated depreciation of $14,921.

The following is a schedule of the future minimum lease payments, as of June 30, 2023:

Year Ending
June 30, Amount
2024 $ 952,375
2025 952,375
2026 945,376
2027 945,376
2028 1,301,045
2029-2032 2,211,722
Total minimum payments 7,308,269
Less: amount representing interest (732,969)
Present value of minimum payments $ 6,575,300
61 #15..
- 835 -
Business-Type Activities
As of June 30, 2023, the City has one business-type activities active finance purchase obligation with Cushman for the purchase of the Hauler 800 Utility Golf Cart valued at $9,079, less accumulated depreciation of $3,252.

The following is a schedule of the future minimum payments, as of June 30, 2023:

Year Ending
June 30, Amount
2024 $ 1,009
Total minimum payments 1,009
Less: amount representing interest (8)
Present value of minimum payments $ 1,001
G. LEASES PAYABLE
The City is a lessee for leases of land, buildings and office space, and equipment. The City uses the interest rate charged by the lessor as the discount rate except in cases when the interest rate charged by the lessor is not provided; in those situations, the City uses the incremental borrowing rate as provided by the California State Controller’s Office or Debt Book.

The length of the lease period includes any noncancellable period of the lease as well as any extension options that are reasonably certain to be taken.

The City's lease payable of $ $718,103 was composed of the following:

Governmental Activities
Buildings and office space leases - annual payments totaling $147,980 plus interest at rates ranging from 0.2% to 0.9% and annual increases in base payments per CPI or flat increase. Final payment dates range from 2023 through 2026.

Land leases - annual payments totaling $41,905 plus interest at 0.9% and annual increases in base payments per CPI. Final payment date is 2025.
$ 376,423
66,389
Total Principal Balances - Governmental Activities $ 442,812 Annual debt service requirements to maturity for loans payable are as follows:

Governmental Activities
Year Ending
June 30, Principal Interest
2024 $ 189,885 $ 2,270
2025 175,996 1,207
2026 76,931 289
Total $ 442,812 $ 3,766
Business-Type Activities
Land leases - annual payments totaling $183,179 plus interest at 0.9% and annual increases in base payments per CPI or flat increase. Final payment dates are all in 2025. $ 275,291 62 #15..
- 836 -
Total Principal Balances – Business-Type Activities $ 275,291 Annual debt service requirements to maturity for loans payable are as follows:

Business-Type Activities
Year Ending
June 30, Principal Interest
2024 $ 183,178 $ 1,453
2025 92,113 204
Total $ 275,291 $ 1,657

H. SUBSCRIPTION-BASED INFORMATION TECHNOLOGY ARRANGEMENTS (SBITAs) As of June 30, 2023, the financial statements include the adoption of GASB Statement No. 96, Subscription-Based Information Technology Arrangements. The primary objective of this statement is to enhance the relevance and consistency of information about governments' subscription activities. This statement establishes a single model for subscription accounting based on the principle that subscriptions are financings of the right to use an underlying asset. Under this Statement, an organization is required to recognize a subscription liability and an intangible right-to-use subscription asset.

The City uses the interest rate charged by the lessor as the discount rate except in cases when the interest rate charged by the lessor is not provided; in those situations, the City uses the incremental borrowing rate as provided by the Debt Book.

The City's subscription liability of $1,861,304 was composed of the following:

Governmental Activities
Annual payments range from $60,067 to $842,610 with interest at rates ranging from of 2.02% -

2.68% and increases based on CPI or flat dollar increases. The value of the right to use assets is $1,742,623 net of 2,372,661 with accumulated amortization of $630,038. Final payment dates range from 2024 through 2027. $ 1,695,502
Governmental Activities
Year Ending
June 30, Principal Interest
2024 $ 804,755 $ 37,855
2025 704,211 20,220
2026 128,015 4,600
2027 58,521 1,546
Total $ 1,695,502 $ 64,221
Business-Type Activities
Annual payments range from $40,770 to $47,200 with interest at rates ranging from of 2.02% - 2.68% and increases based on CPI or flat dollar increases. The value of the right to use assets is $194,851 net of 204,627 with accumulated amortization of $9,776. Final payment dates range from 2023 through 2027. $ 165,802
Business-Type Activities
Year Ending
June 30, Principal Interest
2024 $ 36,940 $ 3,830
2025 39,834 2,977
2026 42,894 2,057
2027 46,134 1,066
Total $ 165,802 $ 9,930
63 #15..
- 837 -
I. DEVELOPER ADVANCES
The Del Este Water Company (Del Este) entered into various agreements with developers under which infrastructure components were either constructed on behalf of Del Este or cash was advanced to the company to construct the infrastructure. Agreements in existence at the time of the City’s acquisition of Del Este were assumed by the City. The terms of repayment call for no interest, with principal paid over a 40-year period. As of June 30, 2023, the total outstanding balance due under the agreements is $582,953. The total annual payments fluctuate depending on the ending date of each agreement. At June 30, 2023, the amount of $88,330 due during fiscal year 2024 has been reported as “current portion-developer advances” on the Water Enterprise Fund statement of net position. The remaining $494,623 of outstanding principal has been reported under noncurrent liabilities, as “developer advances.” J. INTERFUND BALANCES
Interfund balances as of June 30, 2023 consist of the following:

All balances reported as “due to/due from” are short-term loans to cover temporary fund cash shortages as of June 30, 2023 and were repaid early in fiscal year 2024.

Balances reported as “advance to/from” were for capital projects expenditures and are either in the process of being repaid, or have scheduled repayments in future years.

Due to General Fund:

Capital Grants Funds $14,486,374
Other governmental funds 155,438
Total Due to General Fund 14,641,812
Due to Water Fund:

Internal Service funds 1,467,637
Total Due to/Due From: $16,109,449
Advances from General Fund to:

Other governmental funds $ 658,634
Other enterprise funds 1,324,704
Advances from General Fund 1,983,338
Advances from Water Fund to other enterprise funds 3,100,000 Advances from Sewer Fund to:

General Fund 330,973
Other governmental funds 181,618
Other enterprise funds 684,000
Advances from Sewer Fund 1,196,591
Advances from other enterprise funds to other governmental funds 105,761 Total Advances from/Advances to $ 6,385,690
64 #15..
- 838 -
K. FUND BALANCE
Detailed classifications of the City’s Fund Balances, as of June 30, 2023, are provided below:

L. DEFICIT FUND EQUITY
The Capital Grants Fund has a fund balance deficit of $4,751,207, which will be recovered through future grant revenues and local matches covered through the General Fund or other City funds.

The Central Services Fund has a net position deficit of $494,023, which will be recovered through future overhead charges.

The Employee Benefits Management Fund has a net position deficit of $11,975,925. It exists partially because the total compensated absences and other post-employment benefit balance for the employees which reside in this fund previously classified as debt of the governmental funds was included in this fund at its inception several years ago and has never been fully funded. The City is continuing to charge a higher benefit rate to help reduce this deficit. In addition, one-time revenues having to do with employee benefits are deposited to this fund.

The Insurance Fund has a net position deficit of $5,869,426 due mainly to the recognition of settlements that were reached both in the current and prior fiscal year which have been reported as liabilities of the Liability Insurance Fund. Both settlements involved matters that represented city-wide policies and practices and therefore are allocable to all of the funds that make annual contributions to the liability insurance program. The liability insurance program will recover the full amount of the settlement from charges to the funds that participate in the liability insurance program over a period of 5 years based on this methodology being factored into the Internal Service Fund allocation that is distributed to City departments.

The Compost Fund has a net position deficit of $3,886,142, due mainly to other post-employment benefit liability and net pension liability for the employees which reside in this fund, in addition to the pollution remediation liability reported for the Carpenter Landfill and Geer Road Landfill. The remediation funding has been incorporated into the utility fees related to garbage rates to cover the anticipated costs.

Housing and Total
General Operating Community Capital Other Governmental
Fund Grants Development Grants Governmental Funds
Nonspendable
Advances to other funds $ 1,983,338 $ - $ - $ - $ - $ 1,983,338 Prepaid Items 108,753 3,949 2,775 - 21,104 136,581
Total Nonspendable Fund Balance 2,092,091 3,949 2,775 - 21,104 2,119,919 Restricted
Capital Facility Fees - - - - 46,733,934 46,733,934
Cash with Fiscal Agent 4,098,565 733,784 - 2,223,199 5,210,527 12,266,075 Community Facilities District - - - - 23,038,505 23,038,505 Grants and Donations - 3,997,660 - - 5,542,567 9,540,227 Notes Receivable - - 33,768,688 - 33,580 33,802,268
Deposits 4,387,496 - - - - 4,387,496
Traffic Fines - - - - 3,671,213 3,671,213
Total Restricted Fund Balance 8,486,061 4,731,444 33,768,688 2,223,199 84,230,326 133,439,718 Committed
General Fund Set-Aside 18,397,817 - - - - 18,397,817
Total Committed Fund Balance 18,397,817 - - - - 18,397,817 Assigned
Encumbrances - Vendor Contracts 1,149,259 - - - - 1,149,259 Downtown Improvement District - - - - 1,676 1,676
Successor Redevelopment Housing Agency - - - - 942,695 942,695 Transportation Tax Funding - - - - 49,198,117 49,198,117 Strategic Planning and Development - - - - 2,284,205 2,284,205 Total Assigned Fund Balance 1,149,259 - - - 52,426,693 53,575,952 Unassigned - General Fund 23,445,340 - - - - 23,445,340 Unassigned - Special Revenue Funds - (3,949) - - (20,983) (24,932) Unassigned - Capital Project Funds - - - (6,974,406) - (6,974,406) Unassigned - Debt Service Funds - - - - (73,516) (73,516) Total Unassigned Fund Balance 23,445,340 (3,949) - (6,974,406) (94,499) 16,372,486 Total Fund Balance $ 53,570,568 $ 4,731,444 $ 33,771,463 $ (4,751,207) $ 136,583,624 $ 223,905,892 65 #15..
- 839 -
M. INTERFUND TRANSFERS
The following is a schedule of interfund transfers.

In general, the City uses interfund transfers to (1) move revenues from the funds that collect them to the funds that statute or budget requires to expend them, (2) use unrestricted revenues collected in the General Fund to help finance various programs and capital projects accounted for in other funds in accordance with budgetary authorization, and (3) move cash to debt service funds from the funds responsible for payment as debt service payments become due.

N. SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 (Bill) that provides for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City that previously had reported a redevelopment agency blended component unit. The Bill provides that upon dissolution of a redevelopment agency, either the City or another unit of local government will agree to serve as the “successor agency” to hold the assets until they are distributed to other units of state and local government. On January 24, 2012, the City Council elected to become the Successor Agency for the former Redevelopment Agency (RDA) in accordance with the Bill as part of County Resolution number 12-7.

After enactment of the law, which occurred on June 28, 2011, redevelopment agencies in the State of California cannot enter into new projects, obligations or commitments. Subject to the control of a newly established oversight board, remaining assets can only be used to pay enforceable obligations in existence at the date of dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments).

In future fiscal years, successor agencies will only be allocated revenue in the amount that is necessary to pay the estimated annual installment payments on enforceable obligations of the former redevelopment agency until all enforceable obligations of the prior redevelopment agency have been paid in full and all assets have been liquidated.

The Bill directs the State Controller to review the propriety of any transfers of assets between redevelopment agencies and other public bodies that occurred after January 1, 2011. If the public body that received such transfers is not contractually committed to a third party for the expenditure or encumbrance of those assets, the State Controller is required to order the available assets to be transferred to the public body designated as the successor agency by the Bill.

Management believes, in consultation with legal counsel, that the obligations of the former RDA due to the City are valid enforceable obligations payable by the Successor Agency trust under the requirements of the Bill.

In accordance with the timeline set forth in the Bill (as modified by the California Supreme Court on December 29, 2011), all redevelopment agencies in the State of California were dissolved and ceased to operate as a legal entity as of February 1, 2012.

After the date of dissolution, as allowed under Section 34176(a) of the Bill, the City elected to retain the housing assets and functions previously performed by the former RDA. The assets and activities for the Successor Agency Housing fund continue to be reported in the City’s governmental fund financial statements. The remaining assets, liabilities, and activities of the dissolved RDA, are reported in the Successor Agency fiduciary fund (private-purpose trust fund) in the financial statements of the City.

Housing Other Other
General Operating and Urban Capital Govern- Enterprise Internal Transfers (in) to: Fund Grants Development Grants mental Water Sewer Funds Service Total General Fund $ - $ - $ - $ - $ 719,938 $ 65,000 $ 68,640 $ - $ - $ 853,578 Capi tal Grants - - 348,556 - 1,182,985 - - - - 1,531,541 Operating Grants 561,250 - 302,483 - - - - 138,443 141,388 1,143,564 Other Governmental 5,117,405 203,872 - 1,408,966 7,149,193 - - - - 13,879,436 Water - - - - - - - 50,964 - 50,964
Sewer - - - - 3,723 4,657,019 - 9,839 - 4,670,581
Other Enterprise 1,792,337 - - - 2,173 700,000 - - - 2,494,510 Internal Service 117 - - - 336,523 629,397 264,154 698,843 32,916 1,961,950 Grand Total $ 7,471,109 $ 203,872 $ 651,039 $ 1,408,966 $ 9,394,535 $ 6,051,416 $ 332,794 $ 898,089 $ 174,304 $ 26,586,124 Transfers from (out):
66 #15..
- 840 -
State Senate Bill (SB) 107 was then passed in 2015. This bill included many significant changes to the operation of the Successor Agencies. Among these changes were the Annual Recognized Obligation Payment Schedule (ROPS), the Last and Final ROPS, a single Countywide Oversight Board, and the requirement for the County Auditor-Controller to review the obligation payments made by the Successor Agency. Some of these changes like the County Oversight Board and the requirement for the County Auditor-Controller to review the obligation payments made by the Successor Agency become effective July 1, 2018. The Modesto RDA Successor Agency has complied with all aspects of the changes that are specified in SB 107 and all ROPS starting with the ROPS submitted for the Fiscal Year 2019-20 period will now be submitted for approval by the Stanislaus Countywide Successor Agency Oversight Board.

As of June 30, 2023, one of the obligations under the Successor Agency trust is associated with the 10th Street Place Project:

Reimbursement agreement with the City totaling $19,566,862. The original loan is from the City’s 1998 Lease Revenue Bonds and the 2007 Lease Revenue Bonds that pertain to the Successor Agency. On August 28, 2008, the City refinanced the entire outstanding balance of the City’s 1998 Lease Revenue Bonds and the 2007 Lease Revenue Bonds with variable rate 2008 Lease Revenue Bonds. The new balance has been provided as of June 30, 2023 that pertains to the Successor Agency. Additional information related to the 2008 Lease Revenue bonds is provided in Note II-C under the Lease Revenue Bonds – Governmental Activities section.

$ 12,113,300
Annual debt service requirements to maturity are as follows:

Year Ending
June 30, Principal Interest Total
2024 $ 807,650 $ 181,356 $ 989,006
2025 867,100 158,788 1,025,888
2026 939,600 144,878 1,084,478
2027 1,006,300 129,954 1,136,254
2028 1,081,700 114,225 1,195,925
2029-2033 6,034,900 307,568 6,342,468
2034 1,376,050 3,506 1,379,556
Total $ 12,113,300 $ 1,040,275 $ 13,153,575
The reserves for the Reimbursement Agreement are recorded in the Public Financing Authority debt service fund for the City.

No-interest loan payable to the Stanislaus County Economic Development Bank loan program, for the purpose of funding the Kansas Avenue Business Park Project’s Master Plan costs. The Agency has no obligation to begin repayment until the Project is completed and revenues begin.

Future debt service requirements to maturity for loans payable, as of June 30, 2023, are as follows:

Year Ending
June 30, Principal Total
2024 $ - $ -
2025 - -
2026 405,000 405,000
Total $ 405,000 $ 405,000
67 #15..
- 841 -
As of June 30, 2023, the Successor Agency was obligated for the following long-term debt in conjunction with the Community Center Project:
1993 Refunding Certificates of Participation; serial certificates with annual payments on November 1 in amounts ranging from $1,090,000 to $1,610,000 beginning in 2011 with a final maturity in November 2023. $ 1,610,000 Future debt service requirements to maturity for the Certificates of Participation, as of June 30, 2023, are as follows:

Year Ending
June 30, Principal Interest Total
2024 $ 1,610,000 $ 40,250 $ 1,650,250
Total $ 1,610,000 $ 40,250 $ 1,650,250
The former RDA also has a few outstanding obligations related to reimbursements for parking expenses with Westland Development Company and payments to the Tenth Street Joint Power Agency for maintenance for common areas in the Tenth Street Place. These amounts are all reported in the Successor Agency in the Fiduciary financial statements under the Private-Purpose Trust Fund.

O. NOTES AND LOANS RECEIVABLE
The notes receivable in the Housing and Community Development Fund and Other Governmental Funds of $57,587,344 net of $84,883 allowance for doubtful accounts, consist of loans made for low-income housing rehabilitation, first-time homebuyers, property improvement and small business origination. The loans are collateralized by deeds of trust on the improved properties or business assets, and are generally bearing annual interest at 3 or 5 percent. Some direct loans may be subject to forgiveness, some are interest free and require no repayment of principal until the loans reach maturity, and some are subject to residual receipt payment agreements. Loan terms range from 5 to 55 years.

P. APPROVED LOANS PAYABLE
The approved loans payable in the Housing and Community Development Special Revenue Fund in the amount of $627,564 consists of amounts being held for housing projects using funds provided by federal grants and state grants.

Q. POLLUTION REMEDIATION LIABILITY
The City reported a liability in the Water and Sewer Enterprise funds, which represents the recoveries the City has collected less any remediation and legal costs incurred in pursuit of mitigating damages from the manufacturers of perchlorethylene, or PCE, a common chemical used in the dry-cleaning industry. This chemical has seeped into the groundwater through sewer lines when improperly disposed, and threatens the City’s groundwater supplies. Modesto has been proactive in attempting to recover damages and future cleanup costs from the dry cleaners and their insurers, and has also initiated litigation with the manufacturers. As of June 30, 2023, the City reported a pollution remediation liability from the Water and Sewer funds in the amount of $3,855,856 and $6,541,398, respectively.

The City also records a liability for two landfill pollution remediation efforts. For the Carpenter Road Landfill Fund, a liability was reported related to the Carpenter Road Landfill which is a 39-acre City owned landfill, located on both the east and west sides of Carpenter Road between Kenneth and Robertson Roads and the Tuolumne River, which was in operation from 1956 to 1968. This landfill precedes Subtitle-D and had no liner or leachate collection or removal system. In 1993, six methane gas monitoring wells were installed. In December 2005, there was a spike in the methane gas level at the landfill’s Northern boundary. The State required the City to determine the cause and develop a mitigation and monitoring plan to ensure the landfill remained in compliance with the state statutes. In November of 2010, a Corrective Action Plan was proposed for the landfill involving a hydrogen releasing compound injection. In October 2014, a revised Corrective Action Plan and post closure maintenance plan was submitted to the Central Valley Regional Water Quality Control Board (CVRWQCB). In March 2015, a Cleanup and Abatement Order was issued to the City of Modesto for the Carpenter Road Landfill by the California Regional Water Quality Control Board to complete the clean closure correction action plan by January 15, 2017. Construction was to begin in Spring of 2017, however, due to flooding during the Winter of 2016, the 68 #15..
- 842 -
groundwater level increased to a level too high to begin construction. The City submitted a request to the CVRWQCB to delay the project until Spring of 2018. The waters receded, the project went out to bid, and was awarded to Pacific States Environmental Contractors in August 2018. A permitting delay pushed the project start but as of September 2021, all waste has been moved from the eastern fill to the western fill, a storm water retention basin is complete, and final, small or cosmetic work is being completed. The City will submit completion and permitting paperwork when the project is complete.

Monitoring continued throughout the project on functional gas and groundwater wells. As of June 30, 2023, the City reported a pollution remediation liability from Carpenter Road Landfill Fund in the amount of $241,461. Staff is hiring HDR Engineering to complete the required reporting and complete the construction that is required by CVRWQCB. Work is planned to be started by the end of 2023.

For the Geer Road Landfill Mitigation Costs Fund, a liability was reported related to the Geer Road Landfill which is located in Stanislaus County, 8 miles southeast of the City of Modesto on the Tuolumne River. The site is jointly owned by Stanislaus County and the City of Modesto, but was formerly operated by Stanislaus County Department of Environmental Resources. It consists of 168 acres and accepted an estimated 4.5 million tons of waste from 1970 until July of 1990. This landfill precedes Subtitle-D and had no liner or leachate collection or removal system. The landfill closed in 1995 and a geomembrane liner was overlain by vegetative soil. Closure was approved in July 1996, and post closure and correction action requirements, as well as requirements to maintain financial assurances and conduct monitoring, were prescribed in the Waste Discharge Requirements (WDR’s). Pollution was first identified in 1985 and since that time, several investigations were completed. In 1993, a groundwater extraction and treatment system of 12 extraction wells that pump water to a treatment plant, as well as 34 monitoring wells were installed. The treated water was then released to a leach field where it was recharged to groundwater. The landfill methane gas was monitored by 83 gas probes in and around the landfill connected to a landfill gas flare facility. To cover the potential liability, the City of Modesto established a fee within the Solid Waste rates to collect around $1,100,000 annually. As of June 30, 2023, the City reported a pollution remediation liability from the Geer Road Landfill Mitigation Costs Fund in the amount of $865,277.

R. DEFERRED INFLOWS/OUTFLOWS OF RESOURCES
Pursuant to GASB Statement No. 63, “Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position”, the City recognized deferred outflows and inflows of resources in the entity-wide and governmental fund statements. These items are consumption and acquisition of net assets that are applicable to a future reporting period. The General Fund, Operating Grants, Housing and Community Development, Capital Grants and other governmental funds reported deferred inflows of resources in the amount of $6,596,138, $27,681,767, $28,880,239 $11,169,068, and $2,841,980 for unavailable resources related to note, grant receivables and lease receivables not meeting the period of availability. Previous financial reporting standards do not include guidance for reporting these in the financial statements, which are distinct from assets and liabilities. The items relate to outflows and inflows for net pension liability (Note III-G), OPEB liability (Note III-F), swap hedging (Note II-D) and loss on refunding.

III. OTHER INFORMATION
A. RISK MANAGEMENT
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to and illnesses of employees; and natural disasters. The City maintains the Insurance Internal Service Fund to account for and finance its risks of loss. Under this program, the City is self-insured for the following risks up to the maximum amount per claim/occurrence as follows: workers' compensation $750,000; liability $1,000,000. The City purchases commercial insurance for property loss, airport liability, miscellaneous coverage, and for claims in excess of the preceding self-insured limits.

For liability claims, the City is one of thirteen members of the Authority for California Cities Excess Liability (ACCEL) risk pool. This pool covers City claims between $1,000,000 and $10,000,000. The purpose of the pool is to spread the adverse effect of losses among the member agencies and leverages buying power in the commercial insurance market for excess coverage. The City contributes its pro rata share of anticipated losses to the pool. Should actual losses among participants be greater than anticipated, the City will be assessed its pro rata share of that deficiency. Conversely, if the actual losses are less than anticipated, the City will be refunded its pro rata share of the excess subject to the board approval and current conditions. Commercial insurance, covers claims over $10,000,000 in several excess layers for a total coverage of $55,000,000 per claim. Settled claims have not exceeded this commercial coverage in any of the past five fiscal years.

General liability claims are handled by the City’s third-party administrator George Hills Company of Rancho Cordova, CA. and risk management. Litigated claims are defended by the City Attorney. 69 #15..
- 843 -
All operating funds participate in the program and make payments to the Insurance Fund based on historical cost and/or actuarial estimates of the amounts needed to pay prior and current year claims, and to allow accrual of estimated incurred but not reported claims and allocated loss adjustment expenses. Insurance premiums to commercial insurers are also processed through the Insurance Fund. The total claims liability at June 30, 2023 is $27,038,914 consisting of $18,792,277 workers' compensation, $7,991,263 general liability, $214,001 dental, and $41,373 vision. Workers’ compensation and general liability claims liabilities are estimated on an actuarial basis, and are reported at their net present value using an expected future investment yield assumption of 3% (general liability) and 3% (workers’ compensation). The undiscounted workers’ compensation and liability claims totaled $22,118,971 and $8,459,163 respectively. The actuarial liability for workers’ compensation and general liability were based on 2023 actuarial reports.

The current portion of the total liability claims, is estimated to be $6,660,398 and the balance of $20,378,516 is reported as a long-term liability on the statement of net position. Changes in the Insurance Fund claims liability during the fiscal years ended June 30, 20222 through June 30, 2023 were:

Claims Liability
July 1
Current-Year Claims
and Changes in
Estimates
Current-Year
Claim Payments
Claims liability
June 30
2021-22 $ 28,752,857 $ 6,751,885 $ (8,646,444) $ 26,858,298 2022-23 26,858,298 11,222,656 (11,042,040) 27,038,914
B. COMMUNITY FACILITIES DEBT WITHOUT CITY COMMITMENT
Special assessment and community facilities districts have been established in various areas of the City to provide improvements to properties located in those districts. Properties are assessed for the cost of the improvements; these assessments are payable solely by the property owners over the term of the debt issued to finance the improvements. The City is not legally obligated to pay these debts or be the purchaser of last resort of foreclosed properties in the special assessment districts, nor is it obligated to advance City funds to repay this debt in the event of default by any property owners. The City functions as an agent for the property owners by collecting assessments and forwarding collections to trustees for payment to bond holders.

At June 30, 2023, the balance of these districts’ outstanding debt was as follows:

Debt Issued Outstanding Amount
Village One #2 Community Facilities District $ 23,485,000 Fairview Village Community Facilities District $ 3,395,000

C. CONDUIT DEBT OBLIGATIONS
From time to time, the City has issued revenue bonds to provide financial assistance to private-sector entities for the acquisition and construction of industrial, commercial, health care, and multiple-family housing facilities deemed to be in the public interest. The bonds are secured by the property financed and are payable solely from developer payments on the underlying mortgage loans. Upon repayment of the bonds, ownership of the acquired facilities transfers to the privatesector entity served by the bond issuance. Neither the City, the State, nor any political subdivision thereof is obligated in any manner for repayment of the bonds. Accordingly, the bonds are considered conduit debt obligations and are not reported as liabilities in the accompanying financial statements.

As of June 30, 2023, there was one series of conduit revenue bonds outstanding. The aggregate principal amount payable for these multiple-family housing bond issues, issued in 2002, was $2,800,000.

D. COMMITMENTS AND CONTINGENCIES
The City is involved in litigation relating to tort claims, workers' compensation claims and other claims such as contract actions and inverse condemnation actions for which the City is self-insured, as disclosed in Note III-A. The City is a defendant in various matters of litigation.

The City receives funding from a number of federal, state and local grant programs, principally the Federal Highway Administration, Community Development Block Grants, and Federal Transit Administration grants. These programs are 70 #15..
- 844 -
subject to financial and compliance review by the grantors. Accordingly, the City's compliance with applicable grant requirements will be determined at some future date. Expenditures, if any, which may be disallowed by the granting agencies, cannot be determined at this time. The City does not expect the undeterminable amounts of disallowed expenditures, if any, to materially affect the basic financial statements. Receipt of these federal, state and local grant revenues is not assured in the future.

The City has both operating and capital commitments of $26,803,093 for the City’s governmental funds as of June 30, 2023 for contracts awarded but not completed and other outstanding purchase requisitions and orders. This amount consists of $1,149,259 in the General Fund, $562,635 in the Operating Grants Fund, $44,849 in the Housing and Community Development, and $861,542 in the Capital Grants Fund, and $24,184,808 in other governmental funds.

Commitments of the governmental funds are recorded in one of the classifications of fund balance based on the various funding restrictions on the balance sheet. As of June 30, 2023, there are major contracts for Briggsmore Avenue Payment Rehabilitation, McHenry Avenue to Oakdale Avenue (United Pavement Maintenance $4,046,713) and Fleet Management (VAC-ON INC. $1,308,860 and Towne Ford Sales $667,062).

In the process of completing the work mandated by the Regional Water Control Board, additional waste was discovered in the southern wall of the bank of the Tuolumne River. The City provided this information to the Regional Water Control Board in May of 2021, they asked the City to submit a general plan and schedule to investigate and ultimately address the residual waste materials that were found in the area and appear to be on Army Corps lands. The State completed a review of the report into the additional waste during calendar year 2022 and asked the City to remove the waste. On September 12, 2023, with Resolution number 2023-412, Council approved the City to hire HDR engineering to complete all the required work by the state. HDR will be starting their work on November 8, 2023.

A feasibility study will be undertaken to provide guidance to City staff in order to make informed decisions on the future of the City’s composting operations and compliance with SB1383. Necessary improvements are required to ensure compliance with violations received from the regional water board and other areas of concern notifications received from CalRecycle. A consultant will assess what improvements are needed and the City will hire an engineering firm to complete the necessary work. HDR Engineers completed the feasibility study and it was approved by the Council on October 24, 2023. Staff is working on reaching out to engineering firms to start conducting the work.

E. JOINT VENTURES AND JOINTLY GOVERNED ORGANIZATION
Tuolumne River Regional Park
The City participates with Stanislaus County and the City of Ceres in the operation and development of the Tuolumne River Regional Park (TRRP). The governing body consists of 2 members from the County Board of Supervisors, 2 members from the Modesto City Council, and 1 member from the Ceres City Council. The TRRP board prepares the annual budget, which must be approved by both cities' councils and the board of supervisors. Each participant has an equity interest in the capital assets of TRRP based on the percentage of cumulative contributions paid. The City's contribution to TRRP was $260,670 for the fiscal year ended June 30, 2023. As of June 30, 2023, the City's investment in this joint venture was $1,336,986, and is included in governmental activities on the statement of net position. Financial statements for TRRP are prepared by the City of Modesto Finance Department.

City-County Capital Improvements and Financing Agency
The City and Stanislaus County formed the City-County Capital Improvements and Financing Agency (Agency) to provide for the design, construction, ownership, operation, management and financing of a City-County administration center located in Modesto’s downtown redevelopment area. The governing body is a commission consisting of two (2) members of the City Council, two (2) members of the County Board of Supervisors, the County Chief Executive Officer, and the City Manager. The commission is responsible for developing an annual budget and determining the annual contribution rates, subject to approval by both the City and the County. The Stanislaus County Auditor Controller was the fiscal administrator during the construction phase, which was final at the end of June 2003. Starting in July 1, 2010 the County Auditor Controller became the fiscal administrator. For the fiscal year ended June 30, 2023, the City’s payments to the Agency were $1,305,736 for operations and capital reserve. The City’s equity interest in the Agency is $5,071,773, equal to its capital asset contributions to date net of depreciation and is reported in governmental activities as investments in joint ventures in the statement of net position. Financial statements of the Agency are prepared by the Stanislaus County Auditor Controller office.
71 #15..
- 845 -
Stanislaus Waste-to-Energy Financing Agency
The City participates with Stanislaus County in the Stanislaus Waste-to-Energy Financing Agency (Agency). The Agency was created to provide financing for a facility that generates power from solid waste. The costs of operating the Agency, if any, are shared equally by the participants. The governing body consists of 2 members each from the County Board of Supervisors and the Modesto City Council. As of June 30, 2023, the City has no equity interest. Stanislaus County Treasurer's office prepares the Agency's financial statements.

Consolidated Emergency Dispatch Agency
The Modesto/Stanislaus Consolidated Emergency Dispatch Agency (the MSCEDA) was created on September 1, 1999, pursuant to a joint exercise of powers agreement between the City of Modesto and the County of Stanislaus. The MSCEDA is administered by a seven-member commission consisting of one member of the City Council, one member of the County Board of Supervisors, the County Chief Executive Officer, the City Manager, two members from the Dispatch Advisory Board, and one member from the City of Ceres’ City Council or one member selected by the City Council of another participating City. The purpose of the MSCEDA is to consolidate the public safety communications system. The responsibilities of the agency include approval of annual budget, claims, liabilities, and the use of MSCEDA property as collateral. Each participant will contribute sufficient funds to pay for all costs and expenses associated with providing Emergency Dispatch Services. Upon termination of the agreement, assets will be distributed equally to the City and County, unless otherwise approved. The financial statements may be obtained by writing to the Modesto/Stanislaus Consolidated Emergency Dispatch, Office Manager, 3705 Oakdale Road, Modesto, California 95357.

On August 23, 2016, the City of Modesto City Council and County of Stanislaus Board of Supervisors approved to amend section 6.1 of the JPA agreement, allowing for any member of the JPA to terminate the agreement by providing a written notice of intent to terminate to the Commission and all members at least twenty-found (24) months in advance of the desired termination date. On October 12, 2021, Modesto City Council authorized the City Manager to provide the Consolidated Emergency Dispatch Agency Commission with a written notice of intent to terminate the Joint Exercise of Powers Agreement between the City of Modesto and the County of Stanislaus for Emergency Dispatch Services effective January 1, 2024. The City and County are currently evaluating the best options for the dissolution of the Consolidated Emergency Dispatch Agency.

North County Corridor Transportation Expressway Authority On April 1, 2008, the City Council approved the establishment of a Joint Powers Authority between the County and the cities of Modesto, Oakdale and Riverbank to create the North County Corridor Transportation Expressway Authority (NCCTEA). The purpose of the Authority is to prepare, identify, and adopt a precise alignment, and prepare and certify environmental documents for a route to improve east/west traffic circulation in the County.

The intent of the NCCTEA is to provide a high -capacity high speed east-west roadway to accommodate anticipated traffic growth, alleviate traffic on parallel roads, and to accommodate multi-modal travel. Under the terms of the agreement, the County will incur 40% of the costs of the project while each of the participating cities will be contributing 20%. The preliminary project development costs will be funded by State Transportation Program and Public Facility Fees. The NCCTEA Board of Directors will be comprised of two directors appointed by the County, and one director from each participating city. The board acts autonomously from the respective member agencies. The County of Stanislaus Public Works Director is designated as the NCCTEA’s manager. Upon completion of the agreement, all assets will be distributed to the respective parties of the agreement as determined by the Board of Directors of the Authority. Financial statements may be obtained by writing to the County of Stanislaus, Public Works Department, 1716 Morgan Road, Modesto, CA 95358.

Stanislaus Animal Services Agency
The Stanislaus Animal Services Agency (SASA) was created October 27, 2009, pursuant to a joint power’s agreement among the cities of Ceres, Hughson, Modesto, Patterson, Waterford, and the County of Stanislaus. SASA is administered by a six-member board comprised of the City Manager of each partner agency, and the Chief Executive Officer of the County. The purpose of SASA is to operate a regional agency providing animal services to their respective communities.

The SASA Executive Director is responsible for the annual budget which must be approved by the SASA Board of Directors.

Each partner agency will contribute sufficient funds to pay for all costs approved in the budget to provide animal services.

Upon termination of the agreement, assets will be distributed in accordance with the joint power’s agreement. The financial statements may be obtained by writing to the Stanislaus Animal Services Agency, Executive Director, 3647 Cornucopia Way, Modesto, CA 95358.
72 #15..
- 846 -
Regional Fire Training Center
The City has entered into an agreement with the Yosemite Community College District (YCCD) and Stanislaus County for the use and management of the regional fire training center at Modesto Junior College. The executive board consists of the YCCD Chancellor, the President of Modesto Junior College, the City Manager of the City of Modesto, and the Chief Executive Officer of Stanislaus County. The YCCD is responsible for accounting and for monitoring the center's budget.

All three entities share in the operating costs. Initial construction costs were paid by the YCCD from borrowed funds, with the City and County reimbursing a portion of these costs in exchange for future use of the center. The City has paid its share of the construction costs in full. Title to the constructed asset is held by the YCCD; therefore, the City has no equity interest.

North Valley Regional Recycled Water Program (NVRRWP)
The City participates in the NVRRWP, which was established by the City of Modesto and Del Puerto Water District in November 2014. The purpose of this agreement is to develop, construct, operate and maintain water supply facilities and service. Through this agreement all partner agencies will cooperate and collaborate to use their best efforts regarding the submission of grants, loans and other funding resources to cover future cost related to the design and construction on future projects. At the end of the fiscal year June 30, 2023, the City has no equity interest.

F. OTHER POSTEMPLOYMENT BENEFITS (OPEB)
I. Plan Description
In addition to the pension benefits described below in Note III-G, the City provides health care benefits to employees who retire from the City based on certain criteria related to their hired and retirement dates, their employee bargaining unit, and their grandfathered sick leave at retirement.

For employees that retire from the Modesto City Firefighters Association (MCFFA) bargaining unit, the City contributes toward the cost of retiree medical coverage for the retiree's lifetime or until coverage is discontinued. MCFFA is covered by a 1995 resolution with the California Public Employees' Retirement System defining the level of the City's contribution toward the cost of medical plan premiums for employees and retirees to be the minimum employer contribution (MEC). The MEC is $151 in 2023, and $157 in 2024.

All other full-time employees hired before January 1, 2011, are eligible to convert their accumulated grandfathered sick leave towards a contribution for future health care costs at retirement (sick leave conversion). The City has no obligation to pay health insurance allowance for retirees with no grandfathered sick leave. Any employee who retires after January 1, 2017, or retirees who elect the buy-out option, receive a contribution to a Retiree Health Savings Account. Those employees are then removed from the City’s medical plan and ineligible to re-enroll.

II. Employees Covered
As of June 30, 2022, actuarial valuation, the following current and former City employees were covered by the OPEB plan membership:

Active employees 417
Inactive employees 340
Inactive plan members entitled to but not receiving benefits 65 Total 822
III. Contributions
The OPEB plan and its contribution requirements are established by Memoranda of Understanding with the applicable employee bargaining units and may be amended by the agreements between the City and the bargaining units. The annual contribution is based on the actuarially determined contribution. For the fiscal year ended June 30, 2023, the City’s cash contributions were $2,487,735 in payments made by the employer and no estimated subsidy was determined.

The liability for all OPEB activities is primarily liquidated from the Employee Benefits Fund. 73 #15..
- 847 -
IV. Total OPEB Liability
The City’s total OPEB liability was measured as of June 30, 2022 and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation dated June 30, 2022, based on the following actuarial methods and assumptions:

Actuarial Assumptions:

Discount Rate 5.45% at June 30, 2022. 2.16% at June 30, 2021 (Bond Buyer 20-Bond Index) General Inflation 2.5% annually
Salary Increases 3%
Medical Trend Average actual increase for 2024, 6.2% in 2025, decreasing to 3.9% by 2075 Mortality, Retirement,
Disability, Termination CalPERS 2021 Experience Study
Mortality Improvement MacLeod Watts Scale 2022 applied generationally from 2017 V. Discount Rate
The discount rate used to measure the total OPEB liability was 5.45 percent. The projection of the cash flows used to determine the discount rate assumed that the City contributions will be made at rates equal to the actuarially determined contribution rates. Based on these assumptions, the OPEB City’s fiduciary net position was projected to be available to make all projected OPEB payments for current active and inactive employees and beneficiaries based on the ‘pay as you go’ annual contributions.

VI. Changes in the Net OPEB Liability
The change in the Net OPEB Liability is as follows:

Total Net OPEB
Liability
Balance at June 30, 2022 (Measurement Date June 30, 2021) $ 29,551,870 Changes recognized for the measurement period:

Service cost 1,244,957
Interest 635,756
Changes of Assumptions (7,477,125)
Change Due to Plan Experience (902,717)
Contributions to Section 115 Trust (1,387,315)
Benefit Payments (2,727,324)
Net Changes (10,613,768)
Balance at June 30, 2023 (Measurement Date June 30, 2022) $ 18,938,102 VII. Sensitivity of the Net OPEB Liability to Changes in the Discount Rate The following presents the Net OPEB liability of the Plan as of the measurement date, calculated using the discount rate of 5.45 percent, as well as what the Net OPEB liability would be if it were calculated using a discount rate that is 1 percentage-point lower (4.45 percent) or 1 percentage-point higher (6.45 percent) than the current rate:

1% Decrease
Current
Discount Rate 1% Increase

4.45% 5.45% 6.45%
Net OPEB Liability $ 20,443,509 $ 18,938,102 $ 17,623,573 74 #15..
- 848 -
VIII. Sensitivity of the Net OPEB Liability to Changes in the Health Care Cost Trend Rates The following presents the Net OPEB liability of the Plan if it were calculated using health care cost trend rates that are one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2022:

IX. OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB As of the start of the measurement period (June 30, 2021), the OPEB liability was $29,551,870.

For the measurement period ended June 30, 2022 (the measurement date), the City incurred an OPEB expense of $1,144,595.

Components of OPEB Expense
Service cost $ 1,244,957
Interest 635,756
Expensed portion of current-period changes of assumptions or other inputs (736,118) OPEB Expense $ 1,144,595
As of June 30, 2023, the City has deferred outflows and deferred inflows of resources related to the Net OPEB liability as follows:

Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Contributions subsequent to measurement period $ 2,487,735 $ - Changes of assumptions or other inputs 1,847,022 (6,615,607) Difference between actual and expected experience 767,035 (855,901) Net difference between projected and actual earnings on investments 23,943 - Total $ 5,125,735 $ (7,471,508)
The amounts above are net of outflows and inflows recognized in the 2021-2022 measurement period expense. The amounts above are net of outflows and inflows recognized expense in the 2021-2022 measurement period. The amounts above reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ending June 30, 2024.

Other amounts reported as 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 related to
OPEB expense
2024 $ (466,979)
2025 (214,343)
2026 (889,165)
2027 (1,260,534)
2028 (1,275,471)
Thereafter $ (727,016)
X. Payable to the OPEB Plan
At June 30, 2023, the City had no outstanding amount of contributions to the OPEB plan required for the year ended June 30, 2023.
1% Decrease Current Trend 1% Increase
Net OPEB Liability $ 17,922,880 $ 18,938,102 $ 20,176,984 75 #15..
- 849 -
G. PENSION PLANS
I. Plan Description
All City of Modesto qualified employees are eligible to participate in the City of Modesto separate Safety (police and fire) and Miscellaneous (all other) Plans, agent multi-employer defined benefit pension plans administered by the California Public Employees’ Retirement System (CalPERS), which acts as a common investment and administrative agent for its participating member employers. Benefit provisions under the Plans are established by the State statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website. This report is available online at www.calpers.ca.gov.

The California Legislature passed and the Governor signed the “Public Employees’ Pension Reform Act of 2013” (PEPRA) on September 12, 2012. PEPRA contained a number of provisions intended to reduce future pension obligations. PEPRA primarily affects new pension plan members who are enrolled for the first time after December 2012. Benefit provisions and other requirements are established by State statute.

II. Benefits Provided
The benefits for the Plans are based on members’ years of service, age, final compensation, and benefit formula. Benefits are provided for disability, death, and survivors of eligible members or beneficiaries. Members become fully vested in their retirement benefits earned to date after five years of credited service.

The Plans’ provisions and benefits in effect at June 30, 2023 are summarized as follows:

Miscellaneous Plan:

Hire date
Prior to
January 17, 2012
January 17, 2012 to
December 31, 2012
On or after
January 1, 2013
Benefit formula 2% @ 55 2% @ 60 2% @ 62
Benefit vesting schedule 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 to 67 50 to 67 52 to 67
Monthly benefits, as a % of eligible compensation 1.426 to 2.418% 1.092 to 2.418% 1.0 to 2.5% Safety Plan:

Hire date
Prior to
September 11,
2012
September 11, 2012
to December 31, 2012
On or after
January 1,
2013
Benefit formula 3% @ 50 3% @ 55 2.7% @ 57
Benefit vesting schedule 5 years service 5 years service 5 years service Benefit payments monthly for life monthly for life monthly for life Retirement age 50 to 55 50 to 55 50 to 57
Monthly benefits, as a % of eligible compensation 3.0% 2.4 to 3.0% 2.0 to 2.7% III. Contributions
Section 20814(c) of the California Public Employees Retirement Law (PERL) requires that the employer contribution rates for all public employers be 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 the CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.

For the measurement period ended June 30, 2022 (the measurement date) for the Plans, the average active employee contribution rate was 7.00% of annual pay for Miscellaneous and 10.14% for Safety and the employer’s contribution rate is 8.13% of annual payroll for Miscellaneous and 20.45% for Safety. The employee and employer contributions made for fiscal year June 30, 2023 was $20.63 million for the Miscellaneous plan and $32.3 million for the Safety plan. Employer contribution rates may change if plan contracts are amended.

The liability for all governmental activities is primarily liquidated from the general fund while the liability for business-type 76 #15..
- 850 -
activities is liquidated from the enterprise funds.

IV. Net Pension Liability
The City’s net pension liability for each Plan is measured as the total pension liability, less the pension plan’s fiduciary net position. The net pension liability of each of the Plans is measured as of June 30, 2022, using an annual actuarial valuation as of June 30, 2021 rolled forward to June 30, 2022 using standard update procedures.

A summary of principal assumptions and methods used to determine the net pension liability is shown below:

Miscellaneous and Safety Plans
Actuarial Cost Method Entry-Age Actuarial Cost Method
Actuarial Assumptions:

Discount Rate 6.9%
Inflation 2.3%
Salary Increases Varies by Entry Age and Service
Mortality (1) Derived using CalPERS’ membership data for all funds Post Retirement Benefit Increase
The lesser of contract COLA or 2.30% until Purchasing Power Protection Allowance floor on purchasing power applies, 2.30% thereafter (1) The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study for the period from 2001 to 2019. Pre-retirement and Post-retirement mortality rates include generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries. For more details on this table, please refer to the CalPERS Experience Study and Review of Actuarial Assumptions report from November 2021 that can be found on the CalPERS website.

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

The table below reflects long-term real rate of return by asset class as of the target allocation for the June 30, 2022 measurement date. These geometric rates of return are net of administrative expenses.

Asset Class Assumed
asset
allocation
Real return (1),
(2)
Global Equity - Cap-weighted 30.00 % 4.54 %
Global Equity - Non-Cap-weighted 12.00 3.84
Private Equity 13.00 7.28
Treasury 5.00 0.27
Mortgage-backed Securities 5.00 0.50
Investment Grade Corporates 10.00 1.56
High Yield 5.00 2.27
Emerging Market Debt 5.00 2.48
Private Debt 5.00 3.57
Real Assets 15.00 3.21
Leverage (5.00) (0.59)
(1) An expected inflation of 2.30% used for this period. (2) Figures are based on the 2021 Asset Liability Management study.

On July 12, 2021, CalPERS reported a preliminary 21.3% net return on investments for fiscal year 2020-21. Based on the thresholds specified in CalPERS Funding Risk Mitigation policy, the excess return of 14.3% prescribes a reduction in investment volatility that corresponds to a reduction in the discount rate used for funding purposes of 0.20%, from 7.00% to

6.80%. Since CalPERS was in the final stages of the four-year Asset Liability Management (ALM) cycle, the board elected 77 #15..
- 851 -
to defer any changes to the asset allocation until the ALM process concluded, and the board could make its final decision on the asset allocation in November 2021.

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

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

VI. Changes in the Net Pension Liability
The changes in the Net Pension Liability for each Plan follows:

Miscellaneous Plan Increase (Decrease)
Total Pension
Liability (a)
Plan Fiduciary
Net Position
(b)
Net Pension
Liability/(Asset)
(c) = (a) - (b)
Balance at June 30, 2021 (1) $ 514,270,745 $ 428,401,044 $ 85,869,701 Changes Recognized for the Measurement Period:

Service Cost 8,879,438 - 8,879,438
Interest on the Total Pension Liability 35,812,577 - 35,812,577 Changes of Assumptions 16,213,922 - 16,213,922
Differences between Expected and Actual Experience (1,014,629) - (1,014,629) Contributions - Employer - 14,557,323 (14,557,323)
Contributions - Employees - 3,811,839 (3,811,839)
Net Investment Income - (32,153,027) 32,153,027
Benefit Payments, including Refunds of Employee
Contributions (29,773,825) (29,773,825) -
Administrative Expense - (266,868) 266,868
Net Change during 2021-22 30,117,483 (43,824,558)

73,942,041
Balance at June 30, 2022 (1) $ 544,388,228 $ 384,576,486 $ 159,811,742 Safety Plan Increase (Decrease)
Total Pension
Liability (a)
Plan Fiduciary
Net Position
(b)
Net Pension
Liability/(Asset)
(c) = (a) - (b)
Balance at June 30, 2021 (1) $ 680,374,643 $ 516,440,628 $ 163,934,015 Changes Recognized for the Measurement Period:

Service Cost 11,971,941 - 11,971,941
Interest on the Total Pension Liability 47,646,679 - 47,646,679 Differences between Expected and Actual Experience (3,225,026) - (3,225,026) Changes of Assumptions 25,596,849 - 25,596,849
Contributions - Employer - 25,211,361 (25,211,361)
Contributions - Employees - 4,262,417 (4,262,417)
Net Investment Income - (39,469,852) 39,469,852
Benefit Payments, including Refunds of Employee
Contributions (36,401,697) (36,401,697) -
Administrative Expense - (321,712) 321,712
Net Change during 2021-22 45,588,746 (46,719,483) 92,308,229 Balance at June 30, 2022 (1) $ 725,963,389 $ 469,721,145 $ 256,242,244 (1) The fiduciary net position includes receivables for employee service buybacks, deficiency reserves, fiduciary self-insurance and OPEB expense. This may differ from the plan assets reported in the funding actuarial valuation report. 78 #15..
- 852 -
VII. Sensitivity of the Net Pension Liability to Changes in the Discount Rate

The following presents the net pension liability of the Plan as of the measurement date, calculated using the discount rate of 6.90 percent, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower (5.90 percent) or 1 percentage-point higher (7.90 percent) than the current rate:

VIII. Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions For the measurement period ended June 30, 2022 (the measurement date), the City incurred an aggregate pension expense of $52,868,457.

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

Miscellaneous Plan Deferred Outflows
of Resources
Deferred Inflows
of Resources
Changes of Assumptions $ 11,445,121 $ -
Differences between Expected and Actual Experiences 797,099 (721,910) Net Difference Between Projected and Actual Earnings
on Pension Plan Investments 19,185,000 -
Contributions subsequent to the measurement date 16,375,360 - Total $ 47,802,580 $ (721,910)
Safety Plan Deferred Outflows
of Resources
Deferred Inflows
of Resources
Change of Assumptions $ 18,860,836 $ -
Differences between Expected and Actual Experiences 2,141,756 - Net Difference Between Projected and Actual Earnings
on Pension Plan Investments 23,577,700 (2,376,335)
Contributions subsequent to the measurement date 26,595,272 - Total $ 71,175,564 $ (2,376,335)
The amounts above are net of outflows and inflows recognized expense in the 2021-2022 measurement period. The amounts above reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ending June 30, 2024.

Other amounts reported as deferred inflows and outflows of resources related to pensions will be recognized in future pension expense (not including contributions subsequent to the measurement date) as follows:

Fiscal Year
Ended June 30
Miscellaneous
Plan
Safety Plan
2023 $ 8,053,860 $ 10,863,023
2024 7,383,584 10,074,855
2025 3,010,839 6,301,711
2026 12,257,027 14,964,368
Total $ 30,705,310 $ 42,203,957
Mis Miscellaneous Plan Discount Rate -
1% (5.90%)
Current Discount
Rate (6.90%)
Discount Rate
+1% (7.90%)
Plan’s Net Pension Liability/(Asset) $ 229,477,193 $ 159,811,742 $ 102,112,130 Mis Safety Plan Discount Rate -
1% (5.90%)
Current Discount
Rate (6.90%)
Discount Rate
+1% (7.90%)
Plan’s Net Pension Liability/(Asset) $ 356,561,903 $ 256,242,244 $ 174,402,761 79 #15..
- 853 -
IX. Payable to the Pension Plan
At June 30, 2023, the City had no outstanding amount of contributions to the pension plan required for the year ended June 30, 2023.

H. DEFERRED COMPENSATION
The City has established a deferred compensation plan for all employees. Participation in the plan is voluntary and the Memorandums of Understanding approved by the City Council are the authority for establishing or amending the plans' provisions. Generally, the amount of compensation subject to deferral until retirement, disability, or other termination by a participant may not exceed the legal limits set by the Internal Revenue Code. Amounts withheld by the City under this plan are deposited into a trust account on a pay period basis. Mission Square Retirement (Formerly ICMA-RC) in accordance with Internal Revenue Code Section 457(b) administers the Deferred Compensation Defined Contribution plans for the City.

The City is obligated to match a percentage of employee contributions based on their years of service as set out in the applicable Memorandum of Association. Matching amounts total 2.5% of the annual salary per participant, per year. As of June 30, 2023, the deferred compensation plan assets were held in a trust account for the sole benefit of the employees and their beneficiaries and, accordingly, have been excluded from the City's reported assets. The value of the plan as of June 30, 2023 was $155,060,010.

I. DEFICIENCY OF EXPENDITURES OVER APPROPRATIONS
For the fiscal year ended June 30, 2023, expenditures exceeded appropriations as follows:

General Fund
Expenditures Amount
Parks and recreations – Administration $30,467

Operating Grants Special Revenue Fund
Expenditures Amount
General government $827,548
Local Transportation Special Revenue Fund
Expenditures Amount
Parks and recreation $65,693
Transportation Special Tax Revenue Fund
Expenditures Amount
Community development $25,242
Strategic Planning and Development Special Revenue Fund Expenditures Amount
Community development $61,543
Transfers out 2,173

J. PRIOR YEAR ADJUSTMENTS
Governmental Activities
A prior year adjustment was made to the Governmental Activities to decrease the net position in the amount of $4,677,919 to account for the correction to Construction Work In Progress (CWIP) from prior years.

Prior period adjustments were made to the Housing and Community Development to decrease fund balance in the amount of $9,770 to correct loans booked in the prior years.
80 #15..
- 854 -
A prior year adjustment was made to the Fleet Management Fund to increase the net position in the amount of $1,246,122 to account for the correction to Inventory from prior years.

Total Governmental Activities prior year adjustments: ($3,441,567) Business-type Activities
A prior year adjustment was made to the Water Fund to decrease the net position in the amount of $429,646 to account for the correction to Construction Work In Progress (CWIP) from prior years.

A prior year adjustment was made to the Water fund to increase the net position in the amount of $2,180,922 to account for reimbursement from Modesto Irrigation District Domestic Water True-up from prior years.

A prior year adjustment was made to the Sewer Fund to decrease the net position in the amount of $3,456,423 to account for the correction to Construction Work In Progress (CWIP) from prior years. .

Total Business-type Activities prior year adjustments: ($1,705,147)

Total prior year adjustments: ($5,146,714)

K. SUBSEQUENT EVENTS
On September 12, 2023 the City Council authorized the acceptance of a joint award for the City of Modesto and Visionary Home Builders of California, Inc. for a State of California’s Affordable Housing and Sustainability Grant in the collective amount of $33 million for the development of Seventh Street Village on the properties located on 7th Street between J Street and I street. This project will help in addressing the shortage of Affordable Housing in the City. The Seventh Street Village Development will sit on four parcels totaling .88 acres. The project is comprised of 79 housing units with a mix of 1-bedroom one bath, 2-bedroom one-bath, and three-bedrooms 2-bath units.

On October 24, 2023, the City Council accepted the plans and specifications for J.M. Pike Park stormwater to sanitary sewer cross connection removal and water main project and awarded a construction contract to Mozingo Construction, Inc., in the amount of $34 million. In addition to the stormwater and wastewater benefits, this project will also strengthen and replace the water infrastructure in the area.

On September 20, 2022, trial began in a case brought by the City against the Dow Chemical Company and PPG involving PCE, a chemical manufactured by Dow and PPG for use in dry cleaning. The complaints in the case were originally filed in 1998 and the case has been through multiple trials and appeals over the last 24 years. The current trial involves more than fifteen (15) dry cleaning sites, each of which will be tried separately. It will take several years to try all sites, and no final judgment will be entered until all sites have been tried. The first site to be tried involved the former Vogue Cleaners location. The jury awarded the City $4 million in compensatory damages and $56,300,000 in punitive damages. The Court subsequently reduced those punitive damages to $16 million. The second site to be tried, which was selected by Defendants, involved the former Acme Cleaners location. Trial started on October 2, 2023. The jury found that both Dow and PPG were negligent and that PCE was a defective product. The jury also found that Dow and PPG failed to properly warn of the risks of PCE, that consumers would not have expected the risks created by PCE and that the risks of PCE outweighed any benefits. The jury, however, did not award any damages to the City for the Acme location. Awards are subject to challenge and will not in any event become final until after the rest of the case is tried. 81 #15..
- 855 -
This page is intentionally left blank.
#15..
- 856 -

REQUIRED SUPPLEMENTARY INFORMATION TAB
#15..
- 857 -
#15..
- 858 -

REQUIRED SUPPLEMENTARY INFORMATION
82 #15..
- 859 -
This page is intentionally left blank.
83 #15..
- 860 -
Miscellaneous Plan
Measurement Period 2021-2022 2020-2021 (4) 2019-2020 (4) 2018-2019 2017-2018 2016-2017 2015-2016 2014-2015 2013-2014

TOTAL PENSION LIABILITY
Service Cost $ 8,879,438 $ 7,916,536 $ 7,723,070 $ 7,583,252 $ 7,365,767 $ 6,992,542 $ 6,092,179 $ 5,768,082 $ 6,400,912 Interest on Total Pension Liability 35,812,577 34,981,202 33,802,792 32,749,831 31,433,420 30,399,913 29,752,178 28,873,755 28,037,915 Changes of Assumptions 16,213,922 - - (2,477,241) - 24,124,929 (6,709,358) - - Difference Between Expected and Actual Experience (1,014,629) 1,935,811 (39,916) 3,777,379 2,514,973 (1,956,450) (2,005,545) (3,177,191) - Benefit Payments, Including Refunds of Employee Contributions (29,773,825) (27,832,629) (26,321,649) (24,951,032) (23,596,900) (22,727,426) (21,686,131) (20,945,229) (20,334,821) Net Change in Total Pension Liability 30,117,483 17,000,920 15,164,297 19,159,430 15,240,019 36,833,508 12,152,681 3,810,059 14,104,006 Total Pension Liability – Beginning 514,270,745 497,269,825 482,105,528 462,946,098 447,706,079 410,872,571 398,719,890 394,909,831 380,805,825 Total Pension Liability – Ending (a) $ 544,388,228 $ 514,270,745 $ 497,269,825 $ 482,105,528 $ 462,946,098 $ 447,706,079 $ 410,872,571 $ 398,719,890 $ 394,909,831

PLAN FIDUCIARY NET POSITION
Contributions – Employer $ 14,557,323 $ 13,607,488 $ 11,857,136 $ 10,158,019 $ 8,553,955 $ 8,382,192 $ 6,920,358 $ 5,632,179 $ 4,654,055 Contributions – Employee 3,811,839 3,732,886 3,522,762 3,479,149 3,393,722 3,396,338 3,349,400 3,061,157 2,853,492 Net Investment Income (32,153,027) 80,411,612 17,470,077 22,333,423 27,586,156 33,859,910 1,667,540 7,093,159 48,702,803 Benefit Payments, Including Refunds of Employee Contributions (29,773,825) (27,832,629) (26,321,649) (24,951,032) (23,596,900) (22,727,426) (21,686,131) (20,945,229) (20,334,821) Plan to Plan Resource Movement - - - - (181) 505 (1,118) (188) - Administrative Expense (266,868) (358,459) (497,374) (244,082) (510,454) (450,482) (192,011) (355,544) - Other Miscellaneous Income/(Expense) (1) - - - 796 (969,360) - - - - Net Change in Fiduciary Net Position (43,824,558) 69,560,898 6,030,952 10,776,273 14,456,938 22,461,037 (9,941,962) (5,514,466) 35,875,529 Plan Fiduciary Net Position – Beginning (2) 428,401,044 358,840,146 352,809,194 342,032,921 327,575,983 305,114,946 315,056,908 320,571,374 284,695,845 Plan Fiduciary Net Position – Ending (b) 384,576,486 428,401,044 358,840,146 352,809,194 342,032,921 327,575,983 305,114,946 315,056,908 320,571,374 Plan Net Pension Liability – Ending (a) - (b) $ 159,811,742 $ 85,869,701 $ 138,429,679 $ 129,296,334 $ 120,913,177 $ 120,130,096 $ 105,757,625 $ 83,662,982 $ 74,338,457 Plan Fiduciary Net Position as a Percentage of the Total Pension Liability 70.64% 83.30% 72.16% 73.18% 73.88% 73.17% 74.26% 79.02% 81.18% Covered Payroll(3) $ 53,912,800 $ 54,111,658 $ 52,112,485 $ 50,907,972 $ 49,812,447 $ 46,735,345 $ 45,207,621 $ 41,562,776 $ 44,125,963 Plan Net Pension Liability as a Percentage of Covered Payroll(3) 296.43% 158.69% 265.64% 253.98% 242.74% 257.04% 233.94% 201.29% 168.47% NOTE: There are no assets accumulated in a trust to pay related benefits for the pension plan. (1)
(2) Includes any beginning of year adjustment.
(3)
(4) Covered Payroll and Plan Net Pension Liability as a Percentage of Covered Payroll were incorrectly reported for 2019-2020 and 2020-2021. In fiscal year 2023 the error was noticed and the amounts undated accordingly. * The pension schedules are required to show ten years of data and the additional years’ information will be displayed as it becomes available.

Includes one year’s payroll growth using 2.75% payroll growth assumption for fiscal years ended June 30, 2018-19; 3% payroll growth assumption for fiscal years ended June 30, 2014-17.

During fiscal year 2017-18, as a result of Governmental Accounting Standards Board Statement (GASB) No. 75, Accounting and Financial Reporting for Postemployment Benefit Plans Other than Pensions (GASB 75), CalPERS reported its proportionate share of activity related to postemployment benefits for participation in the State of California’s agent OPEB plan. Accordingly, CalPERS recorded a one-time expense as a result of the adoption of GASB 75. Additionally, CalPERS employees participate in various State of California agent pension plans and during fiscal year 2017-18, CalPERS recorded a correction to previously reported financial statements to properly reflect its proportionate share of activity related to pensions in accordance with GASB Statement No. 68, Accounting and Financial Reporting for Pensions (GASB 68).

City of Modesto
Schedule of Changes in the Net Pension Liability and Related Ratios For the Year Ended June 30th
Last Ten Fiscal Years *
84 #15..
- 861 -
Safety Plan
Measurement Period 2021-2022 2020-2021 (4) 2019-2020 (4) 2018-2019 2017-2018 2016-2017 2015-2016 2014-2015 2013-2014

TOTAL PENSION LIABILITY
Service Cost $ 11,971,941 $ 11,100,896 $ 10,961,188 $ 9,984,949 $ 9,648,518 $ 9,298,519 $ 8,193,455 $ 8,633,865 $ 8,970,868 Interest on Total Pension Liability 47,646,679 46,176,343 44,407,891 42,759,837 40,490,329 39,048,366 38,004,835 36,721,112 35,310,732 Changes of Assumptions 25,596,849 - - (2,434,317) - 33,217,275 (9,188,394) - - Difference Between Expected and Actual Experience (3,225,026) 3,056,480 2,147,305 12,017,379 2,992,729 (3,102,753) (2,184,871) (849,707) - Benefit Payments, Including Refunds of Employee Contributions (36,401,697) (34,350,284) (33,173,358) (31,487,589) (29,678,588) (28,147,381) (26,911,771) (25,426,619) (24,313,823) Net Change in Total Pension Liability 45,588,746 25,983,435 24,343,026 33,274,576 21,018,671 50,314,026 17,101,648 9,890,257 19,967,777 Total Pension Liability – Beginning 680,374,643 654,391,208 630,048,182 596,773,606 575,754,935 525,440,909 508,339,261 498,449,004 478,481,227 Total Pension Liability – Ending (a) $ 725,963,389 $ 680,374,643 $ 654,391,208 $ 630,048,182 $ 596,773,606 $ 575,754,935 $ 525,440,909 $ 508,339,261 $ 498,449,004

PLAN FIDUCIARY NET POSITION
Contributions – Employer $ 25,211,361 $ 21,650,057 $ 20,241,960 $ 16,758,148 $ 14,809,730 $ 12,812,060 $ 11,137,899 $ 10,210,101 $ 8,963,542 Contributions – Employee 4,262,417 3,864,069 3,770,808 3,402,676 3,400,369 3,165,011 2,962,566 2,800,626 2,939,117 Net Investment Income (39,469,852) 97,134,657 20,809,917 26,427,421 32,428,941 39,443,735 1,898,536 8,215,387 56,385,743 Benefit Payments, Including Refunds of Employee Contributions (36,401,697) (34,350,284) (33,173,358) (31,487,589) (29,678,588) (28,147,381) (26,911,771) (25,426,619) (24,313,823) Plan to Plan Resource Movement - - - - (1,551) (505) 1,118 211 - Administrative Expense (321,712) (428,116) (588,586) (287,372) (597,550) (526,677) (224,190) (414,089) - Other Miscellaneous Income/(Expense) (1) - - - (1,134,757) 936 - - - - Net Change in Fiduciary Net Position (46,719,483) 87,870,383 11,060,741 14,814,220 19,226,594 26,746,243 (11,135,842) (4,614,383) 43,974,579 Plan Fiduciary Net Position – Beginning (2) 516,440,628 428,570,245 417,509,504 402,695,284 383,468,690 356,722,447 367,858,289 372,472,672 328,498,093 Plan Fiduciary Net Position – Ending (b) 469,721,145 516,440,628 428,570,245 417,509,504 402,695,284 383,468,690 356,722,447 367,858,289 372,472,672 Plan Net Pension Liability – Ending (a) - (b) $ 256,242,244 $ 163,934,015 $ 225,820,963 $ 212,538,678 $ 194,078,322 $ 192,286,245 $ 168,718,462 $ 140,480,972 $ 125,976,332 Plan Fiduciary Net Position as a Percentage of the Total Pension Liability 64.70% 75.91% 65.49% 66.27% 67.48% 66.60% 67.89% 72.36% 74.73% Covered Payroll(3) $ 36,422,089 $ 37,591,927 $ 36,906,356 $ 33,819,770 $ 32,259,582 $ 30,608,378 $ 30,022,552 $ 31,202,983 $ 31,090,551 Plan Net Pension Liability as a Percentage of Covered Payroll(3) 703.54% 436.09% 611.88% 628.45% 601.61% 628.21% 561.97% 450.22% 405.19% NOTE: There are no assets accumulated in a trust to pay related benefits for the pension plan. (1)
(2) Includes any beginning of year adjustment.
(3)
(4) Covered Payroll and Plan Net Pension Liability as a Percentage of Covered Payroll were incorrectly reported for 2019-2020 and 2020-2021. In fiscal year 2023 the error was noticed and the amounts undated accordingly. * The pension schedules are required to show ten years of data and the additional years’ information will be displayed as it becomes available.

Includes one year’s payroll growth using 2.75% payroll growth assumption for fiscal year ended 2018-19; 3% payroll growth assumption for fiscal years ended June 30, 2014-17.

City of Modesto
Schedule of Changes in the Net Pension Liability and Related Ratios (continued) For the Year Ended June 30th
Last Ten Fiscal Years *
During fiscal year 2017-18, as a result of Governmental Accounting Standards Board Statement (GASB) No. 75, Accounting and Financial Reporting for Postemployment Benefit Plans Other than Pensions (GASB 75), CalPERS reported its proportionate share of activity related to postemployment benefits for participation in the State of California’s agent OPEB plan. Accordingly, CalPERS recorded a one-time expense as a result of the adoption of GASB 75. Additionally, CalPERS employees participate in various State of California agent pension plans and during fiscal year 2017-18, CalPERS recorded a correction to previously reported financial statements to properly reflect its proportionate share of activity related to pensions in accordance with GASB Statement No. 68, Accounting and Financial Reporting for Pensions (GASB 68). 85 #15..
- 862 -
Miscellaneous Plan
Fiscal Year 2022-2023 2021-2022 2020-2021 (4) 2019-2020 (4) 2018-2019 2017-2018 2016-2017 2015-2016 2014-2015 Actuarially Determined Contribution (2) $ 16,375,360 $ 14,288,254 $ 13,302,558 $ 11,857,136 $ 10,158,019 $ 8,553,955 $ 8,382,192 $ 6,920,358 $ 5,632,179 Contributions in Relation to the Actuarially Determined Contribution (2) (16,375,360) (14,557,323) (13,607,488) (11,857,136) (10,158,019) (8,553,955) (8,382,192) (6,920,358) (5,632,179) Contribution Deficiency (Excess) $ - $ (269,069) $ (304,930) $ - $ - $ - $ - $ - $ - Covered Payroll (3) $ 56,836,794 $ 53,912,800 $ 54,111,658 $ 52,112,485 $ 50,907,972 $ 49,812,447 $ 46,735,345 $ 45,207,621 $ 41,562,776 Contributions as a Percentage of Covered Payroll (3) 28.81% 27.00% 25.15% 22.75% 19.95% 17.17% 17.94% 15.31% 13.55% $ -
Safety Plan
Fiscal Year 2022-2023 2021-2022 2020-2021 (4) 2019-2020 (4) 2018-2019 2017-2018 2016-2017 2015-2016 2014-2015 Actuarially Determined Contribution (2) $ 26,595,272 $ 24,116,232 $ 21,472,516 $ 19,749,458 $ 16,758,148 $ 14,809,730 $ 12,812,060 $ 11,137,889 $ 10,210,101 Contributions in Relation to the Actuarially Determined Contribution (2) (26,595,272) (25,211,361) (21,650,057) (20,241,960) (16,758,148) (14,809,730) (12,812,060) (11,137,889) (10,210,101) Contribution Deficiency (Excess) $ - $ (1,095,129) $ (177,541) $ (492,502) $ - $ - $ - $ - $ - Covered Payroll (3) $ 43,253,365 $ 36,422,089 $ 37,591,927 $ 36,906,356 $ 33,819,770 $ 32,259,582 $ 30,608,378 $ 30,022,552 $ 31,202,983 Contributions as a Percentage of Covered Payroll (3) 61.49% 69.22% 57.59% 54.85% 49.55% 45.91% 41.86% 37.10% 32.72% NOTE: There are no assets accumulated in a trust to pay related benefits for the pension plan. (1)
(2)
(3)
(4) Covered Payroll and Contributions as a Percentage of Covered Payroll were incorrectly reported for 2019-2020 and 2020-2021. In fiscal year 2023 the error was noticed and the amounts undated accordingly.

City of Modesto
Schedule of Plan Contributions (1)
Last Ten Fiscal Years*
* The pension schedules are required to show ten years of data and the additional years’ information will be displayed as it becomes available.

Includes one year’s payroll growth using 2.75% payroll assumption for fiscal year 2017- 18; 3% payroll assumption for fiscal years ended June 30, 2014-17.

Historical information is required only for fiscal year for which GASB 68 is applicable. As prescribed in GASB 68, paragraph 46, the information presented in the Schedule of Plan Contributions should also be determined as of the employer’s most recent fiscal year-end. The employer is responsible for determining this information as prescribed by the standard as this data is not available to CalPERS.

Employers are assumed to make contributions equal to the actuarially determined contributions. However, some employers may choose to make additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially determined contributions.
86 #15..
- 863 -
FY 2022-2023 FY 2021-2022 FY 2020-2021 FY 2019-2020 FY 2018-2019 FY 2017-2018 Measurement Period June 30, 2022 June 30, 2021 June 30, 2020 June 30, 2019 June 30, 2018 June 30, 2017 Total OPEB liability
Service cost $ 1,244,957 $ 1,196,410 $ 836,292 $ 811,934 $ 963,490 $ 935,427 Interest 635,756 667,183 903,896 1,013,863 1,038,035 892,669 Differences between expected and actual experience (902,717) - 1,737,964 - (468,009) - Changes of assumptions (7,477,125) 129,927 3,430,611 754,247 (1,306,633) (1,600,635) Benefit payments (2,727,324) (2,869,050) (2,941,351) (3,012,214) (2,733,246) (2,430,468) Net change in total OPEB liability (9,226,453) (875,530) 3,967,412 (432,170) (2,506,363) (2,203,007) Total OPEB liability ‐ beginning 29,551,870 30,427,400 26,459,988 26,892,158 29,398,521 31,601,528 Net change in plan fiduciary net position (1,387,315) - - - - - Total OPEB liability ‐ ending (a) $ 18,938,102 $ 29,551,870 $ 30,427,400 $ 26,459,988 $ 26,892,158 $ 29,398,521 Covered-Employee Payroll $ 52,727,185 $ 52,545,565 $ 54,106,179 $ 50,879,818 $ 49,647,245 $ 55,637,076 Total OPEB liablity as a Percentage of Covered-Employee Payroll 35.92% 56.24% 56.24% 52.00% 54.17% 52.84% Notes to Schedule:
*There are no assets accumulated in a trust to pay related benefits for the OPEB plan. *Amounts presented above were determined as of June 30th. Additional years will be presented as they become available. *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.

City of Modesto
Schedule of Changes in the OPEB Liability and Related Ratios Last Ten Fiscal Years*
87 #15..
- 864 -
Fiscal Year 2022-2023 2021-2022 2020-2021 2019-2020 2018-2019 2017-2018 2016-2017 Actuarially Determined Contribution (ADC) $ 2,487,735 $ 4,114,604 $ 2,869,050 $ 3,569,890 $ 3,012,214 $ 2,733,246 $ 2,430,468 Contributions in Relation to the ADC (2,487,735) (4,114,604) (2,869,050) (3,569,890) (3,012,214) (2,733,246) (2,430,468) Contribution Deficiency (Excess) $ - $ - $ - $ - $ - $ - $ - Covered-Employee Payroll $ 54,018,720 $ 52,727,185 $ 52,545,565 $ 54,106,179 $ 50,879,818 $ 49,647,245 $ 55,637,076 Contributions as a Percentage of Covered-Employee Payroll 4.61% 7.80% 5.46% 6.60% 5.92% 5.51% 4.37% Notes to schedule:

The actuarial methods and assumptions used to set the actuarially determined contributions for fiscal year 2019-20 were as follows for June 30, 2019 measurement date actuarial valuations.

Actuarial Cost Method Entry Age Normal
Discount Rate 5.45% at June 30, 2022 (Bond Buyer 20-Bond Index).

2.16% at June 30, 2021 (Bond Buyer 20-Bond Index).

Asset Valuation Method N/A – Couldn’t find this in the 2022 report General Inflation 2.5% annually
Salary Increases 3%
Trend 6.2% for 2025, fluctuating to an ultimate rate of 3.9% in 2075 Retirement Age CalPERS 2021 Experience Study
Mortality CalPERS 2021 Experience Study
Fully generational MW Scale 2022
*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.

City of Modesto
Schedule of Contributions
Last Ten Fiscal Years *
88 #15..
- 865 -
Variance with
Original Final Actual Final Budget
TAXES
Utility users tax $ 20,950,000 $ 20,950,000 $ 22,363,013 $ 1,413,013 Property tax 20,804,000 21,189,000 21,893,830 704,830
Transient occupancy tax 3,338,441 3,578,443 3,513,477 (64,966) Franchise tax 5,333,800 5,333,800 6,152,182 818,382
Cannabis tax 5,000,000 3,750,000 3,185,203 (564,797)
Business license tax 14,250,000 15,650,000 15,306,957 (343,043) Total taxes 69,676,241 70,451,243 72,414,662 1,963,419
LICENSES AND PERMITS 438,036 438,036 353,880 (84,156)

INTERGOVERNMENTAL
Sales tax 39,270,900 41,160,900 39,611,849 (1,549,051)
Sales tax Measure H - 4,447,003 11,116,219 6,669,216
Motor vehicle license fees 20,529,000 21,179,000 21,194,886 15,886 State 975,000 975,000 1,408,300 433,300
County 50,710 133,712 175,046 41,334
Other intergovernmental 17,856,240 18,155,392 19,919,979 1,764,587 Total intergovernmental 78,681,850 86,051,007 93,426,279 7,375,272

CHARGES FOR SERVICES
General government 2,953,320 2,793,598 2,654,863 (138,735) Community development 3,225,127 3,238,220 2,823,923 (414,297) Parks and recreation 2,977,642 2,977,642 2,115,980 (861,662) Public safety 3,375,186 4,685,219 5,822,863 1,137,644
Indirect cost recovery 3,280,748 3,274,791 3,274,791 -
Total charges for services 15,812,023 16,969,470 16,692,420 (277,050) SPECIAL ASSESSMENT 341,000 390,557 385,194 (5,363)
INTEREST AND RENT 701,050 701,050 434,973 (266,077)

NET INCREASE IN FAIR VALUE
OF INVESTMENTS - - 496,980 496,980
FINES AND FORFEITS 626,966 626,966 679,529 52,563

MISCELLANEOUS
Mandated cost recovery 90,000 90,000 117,931 27,931
Other 762,679 763,713 519,648 (244,065)
Total miscellaneous 852,679 853,713 637,579 (216,134)
Total revenues $ 167,129,845 $ 176,482,042 $ 185,521,496 $ 9,039,454 Budget
See Notes to Required Supllementary Information

SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE -

CITY OF MODESTO
FISCAL YEAR ENDED JUNE 30, 2023

BUDGET (GAAP BASIS) AND ACTUAL - GENERAL FUND
89 #15..
- 866 -
Variance with
Original Final Actual Final Budget
General government:

City council $ 502,788 $ 528,071 $ 502,805 $ 25,266
Human resources 1,795,654 1,907,871 1,869,738 38,133
City manager 3,089,403 3,329,673 2,999,997 329,676
City attorney 1,795,808 1,807,660 1,660,662 146,998
City clerk/auditor 1,941,664 1,925,362 1,208,421 716,941 Finance 6,088,252 6,141,763 5,765,838 375,925
Other 473,400 473,400 409,873 63,527
Total general government 15,686,969 16,113,800 14,417,334 1,696,466 Community development: 6,984,275 6,932,158 6,608,633 323,525 Public works:

Operations and maintenance dept: - 1,873,960 498,271 1,375,689 Total public works - 1,873,960 498,271 1,375,689
Parks and recreation:

Administration 798,021 752,709 783,176 (30,467)
Planning and development 1,378,982 1,381,056 860,565 520,491 Convention visitors bureau 786,015 880,571 852,698 27,873 Operations service and maintenance 6,763,652 6,919,969 6,854,896 65,073 Facilities 1,716,010 1,707,137 1,408,074 299,063
Recreation division 4,680,925 4,678,862 3,787,721 891,141 Total parks and recreation 16,123,605 16,320,304 14,547,130 1,773,174 Public safety:

Fire protection 56,518,122 60,552,549 59,192,664 1,359,885 Police protection 75,515,295 75,250,178 69,568,188 5,681,990 Total public safety 132,033,417 135,802,727 128,760,852 7,041,875 Debt service:

Principal retirement 774,209 1,224,072 1,258,752 (34,680) Interest expenditures 178,300 195,230 133,168 62,062
Total debt service 952,509 1,419,302 1,391,920 27,382
Total expenditures 171,780,775 176,588,291 166,224,140 10,862,422 (4,650,930) (106,249) 19,297,356 19,403,605

OTHER FINANCING SOURCES AND (USES)
Transfers in 628,640 1,322,750 853,578 (469,172)
Transfers out (7,850,566) (10,014,646) (7,471,109) 2,543,537 Other financing proceeds - - 1,471,618 1,471,618
TOTAL OTHER FINANCING SOURCES(USES) (7,221,926) (8,691,896) (5,145,913) 3,545,983 CHANGES IN FUND BALANCE (11,872,856) (8,798,145) 14,151,443 22,949,588 FUND BALANCE, JULY 1 39,419,125 39,419,125 39,419,125 - FUND BALANCE, JUNE 30 $ 27,546,269 $ 30,620,980 $ 53,570,568 $ 22,949,588 The notes to required supplementary information are an integral part of this schedule.

Budget

CITY OF MODESTO

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - FISCAL YEAR ENDED JUNE 30, 2023
NOTE: The expenditures by function amounts listed above include the capital outlay expenditures within each department.

BUDGET (GAAP BASIS) AND ACTUAL - GENERAL FUND

EXCESS (DEFICIT) OF REVENUES OVER
(UNDER) EXPENDITURES
90 #15..
- 867 -
Variance with
Original Final Actual Final Budget
REVENUES:

Taxes $ 380,000 $ 380,000 $ 328,586 $ (51,414)
Licenses and permits 50,000 50,000 52,665 2,665
Intergovernmental 12,639,593 26,149,723 17,360,413 (8,789,310) Charges for services 6,065,601 6,065,601 5,964,360 (101,241) Special assessments 70,974 70,974 78,459 7,485
Interest and rent 42,241 87,454 1,333,330 1,245,876
Net (decrease) in fair value of investments - - (15,665) (15,665) Miscellaneous 471,366 479,866 202,229 (277,637)
Total revenues 19,719,775 33,283,618 25,304,377 (7,979,241) EXPENDITURES:

General government 283,725 284,224 1,111,772 (827,548)
Community development 3,817,731 11,591,010 5,376,691 6,214,319 Highways and streets 16,853 - - -
Public works 4,234,650 8,023,441 6,874,697 1,148,744
Parks and recreation 884,749 4,886,251 500,951 4,385,300 Public safety 9,126,725 13,746,770 10,153,241 3,593,529 Total expenditures 18,364,433 38,531,696 24,017,352 14,514,344

EXCESS (DEFICIT) OF REVENUES OVER
(UNDER) EXPENDITURES 1,355,342 (5,248,078) 1,287,025 6,535,103 OTHER FINANCING SOURCES (USES):

Transfers in 375,941 2,860,353 1,143,564 (1,716,789)
Transfers out (1,819,544) (1,819,544) (203,872) 1,615,672 Other financing proceeds - - 26,390 26,390
TOTAL OTHER FINANCING SOURCES (USES) (1,443,603) 1,040,809 966,082 (74,727) CHANGES IN FUND BALANCE (88,261) (4,207,269) 2,253,107 6,460,376 FUND BALANCE, JULY 1 2,478,337 2,478,337 2,478,337 -
FUND BALANCE, JUNE 30 $ 2,390,076 $ (1,728,932) $ 4,731,444 $ 6,460,376

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE -

CITY OF MODESTO
FISCAL YEAR ENDED JUNE 30, 2023

BUDGET (GAAP BASIS) AND ACTUAL - OPERATING GRANTS SPECIAL REVENUE FUND Budget
The notes to required supplementary information are an integral part of this schedule.

NOTE: The expenditures by function amounts listed above include the capital outlay expenditures within each department. 91 #15..
- 868 -
Variance with
Original Final Actual Final Budget
REVENUES:

Intergovernmental - federal grants $ 17,464,440 $ 11,140,326 $ 8,278,335 $ (2,861,991) Charges for services 1,093,372 1,093,372 1,304,727 211,355 Interest and rent - - 2,229 2,229
Net increase in fair value of investments - - 4,035 4,035 Miscellaneous - - 10,000 10,000
Total revenues 18,557,812 12,233,698 9,599,326 (2,634,372) EXPENDITURES:

Community development 16,213,424 9,879,310 8,645,854 1,233,456 Debt service:

Principal retirement 312,000 312,000 312,000 -
Interest 23,000 23,000 22,838 162
Other 1,000 1,000 289 711
Total expenditures 16,549,424 10,215,310 8,980,981 1,234,329

EXCESS (DEFICIT) OF REVENUES OVER
(UNDER) EXPENDITURES 2,008,388 2,018,388 618,345 (1,400,043) OTHER FINANCING SOURCES (USES):

Transfers out (1,586,226) (1,596,226) (651,039) 945,187 TOTAL OTHER FINANCING SOURCES (USES) (1,586,226) (1,596,226) (651,039) 945,187 CHANGES IN FUND BALANCE 422,162 422,162 (32,694) (454,856) FUND BALANCE, JULY 1 33,813,927 33,813,927 33,813,927 - PRIOR PERIOD ADJUSTMENT - - (9,770) (9,770)
FUND BALANCE, JUNE 30 $ 34,236,089 $ 34,236,089 $ 33,771,463 $ (464,626) FISCAL YEAR ENDED JUNE 30, 2023

AND COMMUNITY DEVELOPMENT SPECIAL REVENUE FUND

FUND BALANCE - BUDGET (GAAP BASIS) AND ACTUAL - HOUSING

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN

CITY OF MODESTO
Budget
NOTE: The expenditures by function amounts listed above include the capital outlay expenditures within each department. 92 #15..
- 869 -
This page is intentionally left blank.
93 #15..
- 870 -

CITY OF MODESTO

NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
FISCAL YEAR ENDED JUNE 30, 2023
BUDGETARY INFORMATION - The City follows these procedures annually in establishing the budgetary data reflected in the budgetary comparison schedules for operating, non-capital multi-year, and capital budgets:

1. The City Manager submits to the City Council a proposed budget for the fiscal year commencing the following July 1. The budget includes proposed expenditures and the means of financing them for operating, non-capital multi-year and capital projects.

2. The City Council reviews the proposed budget at specially scheduled sessions, which are open to the public. The Council also conducts a public hearing on all proposed budgets to obtain comments from interested persons.

3. Prior to July 1, the budget is legally adopted through adoption of a resolution. This budget is reported as the Original Budget in the budgetary comparison schedules.

4. During the fiscal year, changes to the Adopted Budget may be authorized, as follows:
a. Authority to approve any adjustment in the amount of $25,000 or less is delegated to the Budget Manager.
b. Authority to approve any adjustment in an amount between $25,000 and $50,000 is delegated to the City Manager.
c. Authority for any budget adjustment more than $50,000 is delegated to the parties described below:
a. Items requiring City Council Action – appropriation of undesignated reserves; appropriation of new revenues; transfers of appropriations between funds (inter-fund transfers); creation of inter-fund loans; creation of, or increase in, any multi-year appropriation. b. Items delegated to the City Manager – transfer appropriations between departments within a fund; changing any capital equipment appropriation; appropriation of reserves for litigation on a case-by-case basis; appropriation of developer payments not previously budgeted. c. Items delegated to the Budget Manager – appropriation of grant interest; revise the allocation of Internal Service Fund charges between departments provided that the total allocated amount does not increase; changing any capital improvement budget line item appropriation; make technical budget corrections to implement the intent of Council approved actions and resolutions.
d. Items delegated to Department Directors – transfer appropriations within a department, within a single fund. Department Directors under this context is only permitted to move existing budget from one appropriation to another within a single department and fund. Department Directors cannot move funds from one department to another or from one fund to another.

5. Formal budgetary accounting is employed as a management tool for all funds. Annual budgets are legally adopted and amended as required for the general, special revenue, enterprise and internal service funds. Project length budgets are adopted for the capital projects funds. All budgets are prepared on a basis consistent with generally accepted accounting principles (GAAP), and budgetary comparisons for the general and major special revenue funds are presented on this basis in the required supplementary information. A debt service payment schedule for the debt service funds is also approved as part of the budget process.

6. Budget amounts are reflected after all authorized amendments and revisions. This budget is reported as the Final Budget in the budgetary comparison schedules. 94 #15..
- 871 -

CITY OF MODESTO

NOTES TO REQUIRED SUPPLEMENTARY INFORMATION (CONTINUED) FISCAL YEAR ENDED JUNE 30, 2023

7. For each legally adopted operating budget, expenditures may not exceed budgeted appropriations at the appropriation unit level. The legal appropriation basis is at the level called "department". A "department" for legal appropriation purposes may be a single organization (e.g., City Attorney), or an entire department having multiple organizations within the same fund (e.g., Operations and Maintenance), or an entire fund (e.g., Downtown Improvement District). All departments and funds completed the year within their legally authorized expenditures. Encumbrance accounting, under which purchase orders, contracts and other commitments are recorded to reserve the applicable appropriations, is employed in the governmental funds.

The City does, however, honor the contracts represented by year-end encumbrances and the subsequent year's appropriations provide authority to complete these transactions. 95 #15..
- 872 -

COMBINING AND INDIVIDUAL FUND

STATEMENTS AND SCHEDULES
96 #15..
- 873 -
This page is intentionally left blank.
97 #15..
- 874 -

Nonmajor Governmental Funds
Nonmajor Special Revenue Funds
Special Revenue Funds include funds which are restricted as to use by the Federal or State governments, and special purpose funds established by authority of the City Council. Nonmajor Special Revenue Funds include:

LOCAL TRANSPORTATION FUND – To account for revenues and expenditures of Local Transportation Fund allocations for streets, urban trails, and non-motorized facilities.

TRAFFIC SAFETY FUND – To account for receipts and expenditures of traffic safety fines.

DOWNTOWN IMPROVEMENT DISTRICT FUND – To account for the fiscal activities of Business Improvement Area A and Downtown Modesto Community Benefit District of the City of Modesto.

STRATEGIC PLANNING AND DEVELOPMENT FUND – Established to provide a funding source for future village planning, general plan update and other large expenses related to planning and development. This fund was originally financed with an apportionment of the PERS rebate related to AB702. Subsequent funding has been provided by transfers from the General Fund. Future funding will be provided by fees imposed on private development.

TRANSPORTATION SPECIAL TAX FUND – To account for state-collected, locally-shared gas tax, 25 year, ½ cent sales tax Measure L, SB-1 (Road Repair and Accountability Act of 2017) monies. This fund may be used for all road and traffic purposes including construction, purchase of rights-of-way, and maintenance.

Nonmajor Capital Projects Funds
Capital Projects Funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities other than those financed by proprietary funds. Nonmajor Capital Projects Funds include:

SPECIAL FUND FOR CAPITAL OUTLAYS – To account for capital outlay authorized by the City Council. No monies placed in this fund are to be disbursed except for this purpose unless authorized by a vote of the people.

PARKS FUND – To account for a discretionary transfer of General Fund property tax revenue to provide for the development of parks within the City, as directed by the City Council.

SECURITIES FOR FUTURE IMPROVEMENTS FUND – To account for the collection of impact fees for approved development projects to construct facilities needed for future development.

COMMUNITY FACILITIES DISTRICTS FUND – To account for the construction of public improvements deemed to benefit properties against which special taxes are levied.

SUCCESSOR REDEVELOPMENT HOUSING AGENCY FUND – To account for the housing redevelopment capital projects financed by the Successor Redevelopment Housing Agency of the City of Modesto.

CAPITAL FACILITY FEES FUND – To account for special fees collected on new building permits to be used for construction of certain growth related projects. The fees and related capital projects include police department expansion, fire department expansion, expressway loop, street lights, street improvements, parks, new traffic signals, City downtown, wastewater treatment, public transportation, and air quality improvements. 98 #15..
- 875 -

Nonmajor Capital Projects Funds (continued)
TRANSPORTATION SPECIAL TAX CAPITAL FUND – To account for receipts and disbursements of Governmental Fund capital projects funded through locally-shared gas tax, 25 year, ½ cent sales tax Measure L, and SB-1 (Road Repair and Accountability Act of 2017) monies.

Nonmajor Debt Service Fund
Debt Service Funds are used to account for the accumulation of resources for, and the payment of, general longterm debt principal and interest. Nonmajor Debt Service Fund includes:

PUBLIC FINANCING AUTHORITY FUND – To account for payment of debt issued to finance projects authorized by the Modesto Public Financing Authority.
99 #15..
- 876 -
This page is intentionally left blank.
100
#15..
- 877 -
Downtown Strategic
Local Traffic Improvement Planning and Transportation
Transportation Safety District Development Special Tax
ASSETS
Cash and cash equivalents $ 1,704,491 $ 5,424 $ $ 2,229,395 - $ 45,421,334 Receivables: -
Accounts, net - - - - 1,054,970
Interest - - - 5,730 123,199
Taxes - - 51,463 - -
Leases - - - - -
Due from governments 297,316 - - 161,955 4,970,496
Prepaid expenditures - - 20,983 121 -
Restricted assets:

Cash and cash equivalents 1,775 3,637,633 - - -
Cash and cash equivalents with fiscal agent - - - - -
Leases receivable - - - - -
Due from governments - 33,580 - - -
Notes receivable, net - - - - -
Total assets $ 2,003,582 $ 3,676,637 $ 72,446 $ 2,397,201 $ 51,569,999

LIABILITIES AND

AND FUND BALANCES
Liabilities:

Accounts payable $ $ - $ 18,630 - $ 7,114 $ 425,110
Accrued salaries and benefits - 5,424 - - 174,836
Interest payable - - - - -
Due to other funds - - 52,140 - -
Unearned revenue 2,001,807 - - - 477,672
Payable from restricted assets:

Refundable deposits - - - - -
Advances from other funds - - - 105,761 -
Total liabilities 2,001,807 5,424 70,770 112,875 1,077,618 -
Deferred inflows of resources:

Unavailable revenue - - - - 1,294,264
Leases - - - - -
Total deferred inflows of resources - - - - 1,294,264
Fund balances:

Nonspendable - - 20,983 121 -
Restricted 1,775 3,671,213 - - -
Assigned - - 1,676 2,284,205 49,198,117
Unassigned - - (20,983) - -
Total fund balances 1,775 3,671,213 1,676 2,284,326 49,198,117 Total liabilities, deferred inflows of
resources, and fund balances $ 2,003,582 $ 3,676,637 $ 72,446 $ 2,397,201 $ 51,569,999 Special Revenue

CITY OF MODESTO

COMBINING BALANCE SHEET - NONMAJOR GOVERNMENTAL FUNDS
JUNE 30, 2023
101
#15..
- 878 -
Special Fund Securities Community Successor Capital Transportation for Capital for Future Facilities Redevelopment Facility Special Tax Outlays Parks Improvements Districts Housing Agency Fees Capital $ 174,063 $ $ - $ 745,111 - $ $ 1,019,032 - $ 1,381,761 - - - - - - -
7,555 1,528 - 61,678 - 113,045 -
- - - 88,147 - - -
- 404,068 - 1,094,814 - - -
- - - - 1,192,004 - -
- - - - - - -
2,684,614 597,524 76,757 23,038,505 - 41,895,883 -
- - - - - - -
- 4,477 - - - - -
- - - - - 4,838,051 -
- - - - 2,211,000 - -
$ 2,866,232 $ 1,007,597 $ $ 25,028,255 76,757 $ 3,403,004 $ 47,866,011 $ 1,381,761 $ $ 12,636 - $ $ 703,871 - $ $ 634,551 - $ 1,381,761
- - - 16,477 - - -
- - - - 284 - -
- - - - 103,298 - -
- - - - - -
- - - 99,265 - - -
181,618 - - 75,974 145,727 436,933 -
181,618 12,636 - 895,587 249,309 1,071,484 1,381,761
- - - 44,743 - 60,593 -
- 392,960 - 1,049,420 - - -
- 392,960 - 1,094,163 - 60,593 -
- - - - - - -
2,684,614 602,001 76,757 23,038,505 2,211,000 46,733,934 - - - - - 942,695 - -
- - - - - - -
2,684,614 602,001 76,757 23,038,505 3,153,695 46,733,934 - $ 2,866,232 $ 1,007,597 $ $ 25,028,255 76,757 $ 3,403,004 $ 47,866,011 $ 1,381,761 (continued)
Capital Projects
102
#15..
- 879 -
Debt Service
Public
Financing
Authority Total
ASSETS
Cash and cash equivalents $ $ 52,682,234 1,623
Receivables:

Accounts, net - 1,054,970
Interest - 312,735
Taxes - 139,610
Leases - 1,498,882
Due from governments - 6,621,771
Prepaid expenditures - 21,104
Restricted assets:

Cash and cash equivalents - 71,932,691
Cash and cash equivalents with fiscal agent 5,210,527 5,210,527 Leases receivable - 4,477
Due from governments - 4,871,631
Notes receivable, net - 2,211,000
Total assets $ 5,212,150 $ 146,561,632

LIABILITIES AND FUND

BALANCES
Liabilities:

Accounts payable $ $ 3,258,812 75,139
Accrued salaries and benefits - 196,737
Interest payable - 284
Due to other funds - 155,438
Unearned revenue - 2,479,479
Payable from restricted assets:

Refundable deposits - 99,265
Advances from other funds - 946,013
Total liabilities 75,139 7,136,028
Deferred inflows of resources:

Unavailable revenue - 1,399,600
Leases - 1,442,380
Total deferred inflows of resources - 2,841,980
Fund balances:

Nonspendable - 21,104
Restricted 5,210,527 84,230,326
Assigned - 52,426,693
Unassigned (73,516) (94,499)
Total fund balances 5,137,011 136,583,624
Total liabilities, deferred inflows of
resources, and fund balances $ 5,212,150 $ 146,561,632
(concluded)

CITY OF MODESTO
COMBINING BALANCE SHEET - NONMAJOR GOVERNMENTAL FUNDS (continued) JUNE 30, 2023
103
#15..
- 880 -
This page is intentionally left blank.
104
#15..
- 881 -
Downtown Strategic
Local Traffic Improvement Planning and Transportation
Transportation Safety District Development Special Tax
REVENUES:

Taxes $ $ - $ 211,645 - $ $ 2,088,570 -
Licenses and permits - - - - 2,537
Intergovernmental 28,574 - 161,955 23,171,728
Charges for services - 288,723 - 286,094 1,354,963
Special assessments levied - - 729,012 - -
Interest and rent 59,697 - 466 34,363 702,436
Net increase (decrease) in fair
value of investments - - 1,851 (21,339) (345,552)
Fines and forfeits - 200,723 - - -
Miscellaneous - - - - 60,457
Total revenues 88,271 489,446 942,974 461,073 27,035,139 EXPENDITURES:

Current:

Community development - - 941,028 283,948 204,572
Highways and streets - - - - 13,897,666
Parks and recreation 65,693 - - - -
Public safety - 1,358,983 - - -
Capital outlay:

Community development - - - - 7,932
Highways and streets - - - - -
Parks and recreation - - - - -
Debt service:

Principal retirement - 49,280 - - 3,972
Interest - 2,565 - - -
Other - - - - -
Total expenditures 65,693 1,410,828 941,028 283,948 14,114,142

EXCESS (DEFICIENCY) OF

REVENUES OVER (UNDER)
EXPENDITURES 22,578 (921,382) 1,946 177,125 12,920,997
OTHER FINANCING SOURCES (USES):

Transfers in - - - 159,800 1,540,205
Transfers out (22,577) - - (2,173) (8,636,989)
Other financing proceeds - 253,106 - - 20,931
Sale of assets - - - - 10,540

TOTAL OTHER FINANCING
SOURCES (USES) (22,577) 253,106 - 157,627 (7,065,313)
CHANGES IN FUND BALANCES 1 (668,276) 1,946 334,752 5,855,684 FUND BALANCES, JULY 1 1,774 4,339,489 (270) 1,949,574 43,342,433 FUND BALANCES, JUNE 30 $ $ 3,671,213 1,775 $ $ 2,284,326 1,676 $ 49,198,117 Special Revenue

CITY OF MODESTO

COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES

IN FUND BALANCES - NONMAJOR GOVERNMENTAL FUNDS
FISCAL YEAR ENDED JUNE 30, 2023
105
#15..
- 882 -
Special Fund Securities Community Successor Capital Transportation for Capital for Future Facilities Redevelopment Facility Special Tax Outlays Parks Improvements Districts Housing Agency Fees Capital $ $ - $ - $ - $ - $ - $ - -
- - - - - - -
- - - - - 5,386,673 -
- 4,210 - 672,425 - 3,640,169 -
- - - 3,708,195 - - -
43,848 53,013 2,962 419,063 152,308 677,068 -
(26,786) (6,191) - (204,262) 1,549 (372,347) -
- - - - - - -
- - - - - 17,260 -
17,062 51,032 2,962 4,595,421 153,857 9,348,823 -
1,178 - - 3,231,628 - 116,487 -
- - - - - 45,931 4,770
- 54,689 - - - 577 -
- - - - - - -
- - - 477,126 - - -
- - - - - 1,019,440 7,144,415
- 194,072 - - - 886,777 -
- - - 1,251 - - -
- - - - - - -
- - - - - - -
1,178 248,761 - 3,710,005 - 2,069,212 7,149,185
15,884 (197,729) 2,962 885,416 153,857 7,279,611 (7,149,185) 120,000 194,072 - 566,983 - 1,408,974 7,149,185
(3,723) (15,871) - - (713,202)
- - - - - - -
- - - - - - -
116,277 178,201 - 566,983 - 695,772 7,149,185
132,161 (19,528) 2,962 1,452,399 153,857 7,975,383 -
2,552,453 621,529 73,795 21,586,106 2,999,838 38,758,551 - $ 2,684,614 $ 602,001 $ 76,757 $ 23,038,505 $ 3,153,695 $ 46,733,934 $ - (continued)
Capital Projects
106
#15..
- 883 -
Debt Service
Public
Financing
Authority Total
REVENUES:

Taxes $ $ 2,300,215 -
Licenses and permits - 2,537
Intergovernmental 1,119,243 29,868,173
Charges for services - 6,246,584
Special assessments levied - 4,437,207
Interest and rent 165,419 2,310,643
Net increase (decrease) in fair
value of investments - (973,077)
Fines and forfeits - 200,723
Miscellaneous - 77,717
Total revenues 1,284,662 44,470,722
EXPENDITURES:

Current:

Community development - 4,778,841
Highways and streets - 13,948,367
Parks and recreation - 120,959
Public safety - 1,358,983
Capital outlay:

Community development - 485,058
Highways and streets - 8,163,855
Parks and recreation - 1,080,849
Debt service:

Principal retirement 2,585,000 2,639,503
Interest 1,437,541 1,440,106
Other 112,870 112,870
Total expenditures 4,135,411 34,129,391

EXCESS (DEFICIENCY) OF REVENUES OVER (UNDER)
EXPENDITURES (2,850,749) 10,341,331
OTHER FINANCING SOURCES (USES):

Transfers in 2,740,217 13,879,436
Transfers out - (9,394,535)
Other financing proceeds - 274,037
Sale of assets - 10,540

TOTAL OTHER FINANCING
SOURCES (USES) 2,740,217 4,769,478
CHANGES IN FUND BALANCES (110,532) 15,110,809
FUND BALANCES, JULY 1 5,247,543 121,472,815
FUND BALANCES, JUNE 30 $ 5,137,011 $ 136,583,624
(concluded)

CITY OF MODESTO

COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - NONMAJOR GOVERNMENTAL FUNDS (continued) FISCAL YEAR ENDED JUNE 30, 2023
107
#15..
- 884 -
Variance with
Original Final Actual Final Budget
REVENUES:

Intergovernmental $ $ - $ - $ 28,574 28,574
Interest and rent - - 59,697 59,697
Total revenues - - 88,271 88,271
EXPENDITURES:

Parks and recreation - - 65,693 (65,693)
Total expenditures - - 65,693 (65,693)
EXCESS OF REVENUES OVER EXPENDITURES - - 22,578 22,578
OTHER FINANCING SOURCES (USES):

Transfers out - (666,382) (22,577) 643,805
TOTAL OTHER FINANCING SOURCES (USES) - (666,382) (22,577) 643,805 CHANGES IN FUND BALANCE - (666,382) 1 666,383
FUND BALANCE, JULY 1 1,774 1,774 1,774 -
FUND BALANCE (DEFICIT), JUNE 30 $ 1,774 $ (664,608) $ $ 666,383 1,775 NOTE: The expenditures by function amounts listed above include the capital outlay expenditures within each department.

FISCAL YEAR ENDED JUNE 30, 2023
Budget

BUDGET (GAAP BASIS) AND ACTUAL - LOCAL TRANSPORTATION SPECIAL REVENUE FUND

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE -

CITY OF MODESTO
108
#15..
- 885 -
Variance with
Original Final Actual Final Budget
REVENUES:

Charges for services $ 305,000 $ 305,000 $ 288,723 $ (16,277) Fines and forfeits 170,000 170,000 200,723 30,723
Total revenues 475,000 475,000 489,446 14,446
EXPENDITURES:

Public safety 950,197 1,640,320 1,410,828 229,492
Total expenditures 950,197 1,640,320 1,410,828 229,492

EXCESS (DEFICIT) OF REVENUES OVER
(UNDER) EXPENDITURES (475,197) (1,165,320) (921,382) 243,938 OTHER FINANCING SOURCES:

Other financing proceeds - 253,106 253,106 -
TOTAL OTHER FINANCING SOURCES - 253,106 253,106 -
CHANGES IN FUND BALANCE (475,197) (912,214) (668,276) 243,938 FUND BALANCE, JULY 1 4,339,489 4,339,489 4,339,489 -
FUND BALANCE, JUNE 30 $ 3,864,292 $ 3,427,275 $ 3,671,213 $ 243,938 NOTE: The expenditures by function amounts listed above include the capital outlay expenditures within each department.

Budget
FISCAL YEAR ENDED JUNE 30, 2023

BUDGET (GAAP BASIS) AND ACTUAL - TRAFFIC SAFETY SPECIAL REVENUE FUND

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE -

CITY OF MODESTO
109
#15..
- 886 -
Variance with
Original Final Actual Final Budget
REVENUES:

Intergovernmental:

State $ 22,536,765 $ 22,536,765 $ 23,171,728 $ 634,963
Taxes 1,350,000 1,350,000 2,088,570 738,570
Licenses and permits - - 2,537 2,537
Charges for services 1,057,733 1,057,733 1,354,963 297,230 Interest and rent - - 702,436 702,436
Net (decrease) in fair value of investments - - (345,552) (345,552) Miscellaneous 10,000 10,000 60,457 50,457
Total revenues 24,954,498 24,954,498 27,035,139 2,080,641 EXPENDITURES:

Current:

Community development 179,330 179,330 212,504 (33,174)
Highway and streets 15,236,882 15,223,882 13,901,638 1,322,244 Total expenditures 15,416,212 15,403,212 14,114,142 1,289,070 EXCESS OF REVENUES OVER EXPENDITURES 9,538,286 9,551,286 12,920,997 3,369,711 OTHER FINANCING SOURCES (USES):

Transfers in - - 1,540,205 1,540,205
Transfers out (32,917,432) (32,930,432) (8,636,989) 24,293,443 Other financing proceeds - - 20,931 20,931
Sale of assets - - 10,540 10,540
TOTAL OTHER FINANCING SOURCES (USES) (32,917,432) (32,930,432) (7,065,313) 25,865,119 CHANGES IN FUND BALANCE (23,379,146) (23,379,146) 5,855,684 29,234,830 FUND BALANCE, JULY 1 43,342,433 43,342,433 43,342,433 - FUND BALANCE, JUNE 30 $ 19,963,287 $ 19,963,287 $ 49,198,117 $ 29,234,830 NOTE: The expenditures by function amounts listed above include the capital outlay expenditures within each department.

Budget

CITY OF MODESTO

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN

FUND BALANCE - BUDGET (GAAP BASIS) AND ACTUAL

TRANSPORTATION SPECIALTAX REVENUE FUND
FISCAL YEAR ENDED JUNE 30, 2023
110
#15..
- 887 -
Variance with
Original Final Actual Final Budget
REVENUES:

Taxes $ 235,000 $ 235,000 $ 211,645 $ (23,355)
Special assessments levied 780,150 780,150 729,012 (51,138) Interest and rent - - 466 466
Net increase in fair value of investments - - 1,851 1,851 Total revenues 1,015,150 1,015,150 942,974 (72,176)

EXPENDITURES:

Current:

Community development 1,018,991 1,018,991 941,028 77,963 Total expenditures 1,018,991 1,018,991 941,028 77,963

EXCESS (DEFICIENCY) OF REVENUES OVER
(UNDER) EXPENDITURES (3,841) (3,841) 1,946 5,787
CHANGES IN FUND BALANCE (3,841) (3,841) 1,946 5,787
FUND BALANCE, JULY 1 (270) (270) (270) -
FUND BALANCE (DEFICIT), JUNE 30 $ (4,111) $ (4,111) $ $ 1,676 5,787 NOTE: The expenditures by function amounts listed above include the capital outlay expenditures within each department.

Budget

CITY OF MODESTO

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND

BALANCE - BUDGET (GAAP BASIS) AND ACTUAL - DOWNTOWN

IMPROVEMENT DISTRICT SPECIAL REVENUE FUND
FISCAL YEAR ENDED JUNE 30, 2023
111
#15..
- 888 -
Variance with
Original Final Actual Final Budget
REVENUES:

Charges for services $ $ 200,000 - $ 286,094 $ 86,094
Intergovernmental - - 161,955 161,955
Interest and rent - - 34,363 34,363
Net (decrease) in fair value of investments - - (21,339) (21,339) Total revenues - 200,000 461,073 261,073
EXPENDITURES:

Community development - 222,405 283,948 (61,543)
Total expenditures - 222,405 283,948 (61,543)

EXCESS (DEFICIT) OF REVENUES OVER
(UNDER) EXPENDITURES - (22,405) 177,125 199,530
OTHER FINANCING SOURCES (USES):

Transfers in - - 159,800 159,800
Transfers out - - (2,173) (2,173)
TOTAL OTHER FINANCING SOURCES (USES) - - 157,627 157,627 CHANGES IN FUND BALANCE - (22,405) 334,752 357,157
FUND BALANCE, JULY 1 1,949,574 1,949,574 1,949,574 -
FUND BALANCE, JUNE 30 $ 1,949,574 $ 1,927,169 $ 2,284,326 $ 357,157 NOTE: The expenditures by function amounts listed above include the capital outlay expenditures within each department.

Budget

CITY OF MODESTO

SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN

FUND BALANCE - BUDGET (GAAP BASIS) AND ACTUAL - STRATEGIC

PLANNING AND DEVELOPMENT SPECIAL REVENUE FUND
FISCAL YEAR ENDED JUNE 30, 2023
112
#15..
- 889 -
This page is intentionally left blank.
113
#15..
- 890 -

Nonmajor Enterprise Funds
Enterprise Funds are established to account for activities that render services on a user-charge basis to the general public. Nonmajor Enterprise Funds include:

PARKING FUND – Revenues in this fund consist of charges for off-street parking and the downtown parking garage, as well as in-lieu parking fees. The revenue is used to develop and maintain parking facilities.

STORM DRAIN FUND – To account for storm drain improvements, operations and maintenance. The activities of the fund include street cleaning, rock well maintenance, and compliance with Federal and State water quality standards on storm water discharge.

COMPOST FUND – To account for tip fees charged at the City’s composting facility for processing various compostable materials and the sale of compost product. Excess revenues over expenses are set aside to protect the enterprise against market fluctuations, and to provide for capital improvements to the facility infrastructure.

AIRPORT FUND – To account for all airport operations as stipulated in the City-Stanislaus County agreement of January 1968. Amounts received from the Federal government, State of California, and Stanislaus County, requiring matching amounts by the City, are recorded in this fund and are appropriated to finance approved capital projects.

GOLF FUND – Revenues in this fund consist of fees charged for using the City’s golf courses. The revenue is used to improve, operate, and maintain golf courses.

COMMUNITY CENTER FUND – Accounted for in this fund are all amounts collected for the purpose of operating and maintaining the Modesto Centre Plaza Community Center. Revenues include room rental, catering fees, ticket sales, and other charges for using the center.

ABATEMENT AND PUBLIC NUISANCE FUND – To account the activity for expenses and recovery for the cost for both dangerous and unsafe building and property abatements. 114
#15..
- 891 -
Storm
Parking Drain
Current assets:

Cash and cash equivalents $ 171,071 $ 10,906,294
Receivables:

Accounts 80,718 1,207
Interest 569 27,851
Taxes - -
Utilities, net - 598,546
Leases 133,548 -
Prepaid expenses 173 -
Due from governments 101,250 18,152
Inventories - -
Total current assets 487,329 11,552,050
Noncurrent assets:

Advances to other funds - -
Restricted cash and cash equivalents with fiscal agent - - Leases receivable 4,791,808 -
Land and construction in progress 3,131,803 928,316
Other capital assets, net of accumulated depreciation 2,621,385 13,012,804 Intangible assets right-to-use, net of accumulated amortization - 22,366 Total noncurrent assets 10,544,996 13,963,486
Total assets 11,032,325 25,515,536
Deferred OPEB 33,740 30,502
Deferred pensions 316,577 320,803
Total deferred outflows of resources 350,317 351,305
Total assets and deferred outflows of resources $ 11,382,642 $ 25,866,841

LIABILITIES
Current liabilities:

Accounts payable $ $ 251,648 6,275
Accrued salaries and benefits 25,216 17,875
Interest payable 348 -
Unearned revenue - -
Current portion - leases and SBITAS - 4,240
Current portion - long-term debt - -
Total current liabilities 31,839 273,763
Noncurrent liabilities:

Pollution remediation liability - -
Advances from other funds - 1,324,704
Leases and SBITAS - 14,791
Net OPEB liability 119,826 128,873
Net pension liability 1,058,367 1,072,497
Total noncurrent liabilities 1,178,193 2,540,865
Total liabilities 1,210,032 2,814,628
Deferred OPEB 54,151 38,569
Deferred pensions 4,781 4,845
Deferred leases 4,736,598 -
Total deferred inflows of resources 4,795,530 43,414
Net investment in capital assets 5,753,188 13,944,455
Unrestricted (376,108) 9,064,344
Total net position 5,377,080 23,008,799
Total liabilities, deferred inflows of resources, and net position $ 11,382,642 $ 25,866,841

CITY OF MODESTO
JUNE 30, 2023

NET POSITION

DEFERRED OUTFLOWS OF RESOURCES
ASSETS

DEFERRED INFLOWS OF RESOURCES

COMBINING STATEMENT OF NET POSITION - NONMAJOR ENTERPRISE FUNDS 115
#15..
- 892 -
Community Abatement and
Compost Airport Golf Center Public Nuisance Total
$ 4,848,250 $ 3,015,712 $ $ 636,040 61,590 $ 481,584 $ 20,120,541 2,111,784 35,169 355,980 81,532 1,265,523 3,931,913
19,121 7,712 - - 1,199 56,452
- 1,889 - - - 1,889
728,875 - - - - 1,327,421
- 73,782 61,067 8,256 - 276,653
2,935 115 154,664 276 - 158,163
65,769 264,179 - 463,291 - 912,641
- - 54,239 - - 54,239
7,776,734 3,398,558 687,540 1,189,395 1,748,306 26,839,912 - - - - 105,761 105,761
- - 551,077 - - 551,077
- 2,271,518 4,927,372 8,379 - 11,999,077
1,140,000 1,352,141 1,126,882 3,667,020 - 11,346,162
826,159 7,712,439 882,877 2,496,010 - 27,551,674
6,645 - - - - 29,011
1,972,804 11,336,098 7,488,208 6,171,409 105,761 51,582,762 9,749,538 14,734,656 8,175,748 7,360,804 1,854,067 78,422,674 160,460 - - 22,879 - 247,581
3,034,183 334,066 - 281,192 - 4,286,821
3,194,643 334,066 - 304,071 - 4,534,402
$ 12,944,181 $ 15,068,722 $ 8,175,748 $ 7,664,875 $ 1,854,067 $ 82,957,076 $ 447,414 $ $ 20,560 $ 97,760 $ 57,997 $ 881,654 -
166,971 19,334 27,061 24,597 - 281,054
3,746 - 5,541 - - 9,635
- - 857,096 - - 857,096
1,260 - - - - 5,500
- - 481,001 - - 481,001
619,391 39,894 1,468,459 82,594 2,515,940
1,106,738 - - - - 1,106,738
3,784,000 - - - - 5,108,704
4,394 - - - - 19,185
920,003 - - 115,190 - 1,283,892
10,143,765 1,116,836 - 940,070 - 14,331,535
15,958,900 1,116,836 - 1,055,260 - 21,850,054
16,578,291 1,156,730 1,468,459 1,137,854 24,365,994
206,209 - - 31,269 - 330,198
45,823 5,045 - 4,247 - 64,741
- 2,310,436 4,762,212 4,391 - 11,813,637
252,032 2,315,481 4,762,212 39,907 - 12,208,576
1,967,150 9,064,580 1,528,758 6,163,030 - 38,421,161
(5,853,292) 2,531,931 416,319 324,084 1,854,067 7,961,345 (3,886,142) 11,596,511 1,945,077 6,487,114 1,854,067 46,382,506 $ 12,944,181 $ 15,068,722 $ 8,175,748 $ 7,664,875 $ 1,854,067 $ 82,957,076 116
#15..
- 893 -
Parking Storm Drain
OPERATING REVENUES:

Charges for services $ 1,583,345 $ 6,287,051
Miscellaneous 22,800 1,186
Total operating revenues 1,606,145 6,288,237
OPERATING EXPENSES:

Salaries and wages 548,265 255,350
Contractual services 250,481 642,278
Utilities 141,067 30,334
Maintenance and supplies 128,959 2,523,801
Insurance 119,320 13,542
Employee benefits 270,948 318,903
Administration services 164,691 2,601,880
Allocated indirect administrative costs 35,001 126,249
Depreciation 385,570 439,863
Total operating expenses 2,044,302 6,952,200
OPERATING INCOME (LOSS) (438,157) (663,963)
NONOPERATING REVENUES (EXPENSES):

Gain on disposition of capital assets - 130,435
Operating grants - -
Tax revenue - -
Tax expense (29) -
Interest income 125,438 155,771
Net increase (decrease) in fair value of investments (1,197) (100,328) Rental income 157,051 -
Interest expense and amortization - -
Trustee fees - -
Total nonoperating revenues (expenses) 281,263 185,878
INCOME (LOSS) BEFORE TRANSFERS (156,894) (478,085)
Transfers in - 700,000
Transfers out - (63,279)
Total transfers - 636,721
CHANGES IN NET POSITION (156,894) 158,636
NET POSITION (DEFICIT), JULY 1 5,533,974 22,850,163
NET POSITION (DEFICIT), JUNE 30 $ 5,377,080 $ 23,008,799

CITY OF MODESTO

COMBINING STATEMENT OF REVENUES, EXPENSES, AND

CHANGES IN FUND NET POSITION - NONMAJOR ENTERPRISE FUNDS FISCAL YEAR ENDED JUNE 30, 2023
117
#15..
- 894 -
Abatement and
Community Public Nuisance
Compost Airport Golf Center Fund Total
$ 15,377,697 $ 988,304 $ 2,546,666 $ 245,277 $ 1,000,799 $ 28,029,139 243,748 19,748 553,179 2,074 - 842,735
15,621,445 1,008,052 3,099,845 247,351 1,000,799 28,871,874 3,918,484 435,826 - 679,586 - 5,837,511
1,931,345 211,827 2,535,661 383,034 31,700 5,986,326
31,000 111,463 64,874 266,046 - 644,784
2,259,363 122,925 237,810 154,149 - 5,427,007
524,201 75,207 34,676 49,412 - 816,358
2,352,331 327,223 - 252,591 - 3,521,996
681,719 105,951 283,266 70,552 107,433 4,015,492
286,237 26,117 42,697 - - 516,301
60,954 729,074 36,859 57,762 - 1,710,082
12,045,634 2,145,613 3,235,843 1,913,132 139,133 28,475,857 3,575,811 (1,137,561) (135,998) (1,665,781) 861,666 396,017 34,969 - - - - 165,404
267,196 343,179 - - - 610,375
- 291,711 - - - 291,711
- - - - - (29)
72,867 74,212 110,029 - 6,652 544,969
(13,693) (25,135) 9,378 - (3,050) (134,025)
- 263,549 140,890 617,526 - 1,179,016
- - (31,707) - - (31,707)
- - (581) - - (581)
361,339 947,516 228,009 617,526 3,602 2,625,133
3,937,150 (190,045) 92,011 (1,048,255) 865,268 3,021,150 386,083 - 841,276 564,978 2,173 2,494,510
(834,810) - - - - (898,089)
(448,727) - 841,276 564,978 2,173 1,596,421
3,488,423 (190,045) 933,287 (483,277) 867,441 4,617,571 (7,374,565) 11,786,556 1,011,790 6,970,391 986,626 41,764,935 $ (3,886,142) $ 11,596,511 $ 1,945,077 $ 6,487,114 $ 1,854,067 $ 46,382,506 118
#15..
- 895 -
Storm
Parking Drain
CASH FLOWS FROM OPERATING ACTIVITIES:

Receipts from customers and users $ 1,389,896 $ 6,300,697 Payments to suppliers (357,763) (1,364,297)
Payments to employees (777,735) (563,449)
Payments for interfund services used (503,978) (4,393,507) Net cash provided (used) by operating activities (249,580) (20,556)

CASH FLOWS FROM NONCAPITAL FINANCING
ACTIVITIES:

Operating grants received - -
Taxes received - -
Transfers in - 700,000
Transfers out - (63,279)
Advances from/to other funds - -
Net cash provided (used) by noncapital financing
activities - 636,721

CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:

Acquisition and construction of capital assets - (3,333) Proceeds from sale of capital assets - 130,435
Principal repayments - -
Interest paid 348 -
Trustee fees - -
Net cash provided (used) by capital and related
financing activities 348 127,102
CASH FLOWS FROM INVESTING ACTIVITIES:

Interest received 125,300 150,544
Net increase (decrease) in the fair value of investments (1,197) (100,328) Rental income received 157,051 -
Net cash provided (used) by investing activities 281,154 50,216 Net increase (decrease) in cash and cash equivalents 31,922 793,483 CASH AND CASH EQUIVALENTS, JULY 1 139,149 10,112,811
CASH AND CASH EQUIVALENTS, JUNE 30 $ 171,071 $ 10,906,294 RECONCILIATION TO STATEMENT OF NET POSITION:

Cash and cash equivalents $ 171,071 $ 10,906,294
Restricted cash and cash equivalents with fiscal agent - - TOTAL CASH AND CASH EQUIVALENTS $ 171,071 $ 10,906,294

CITY OF MODESTO

COMBINING STATEMENT OF CASH FLOWS - NONMAJOR ENTERPRISE FUNDS FISCAL YEAR ENDED JUNE 30, 2023
119
#15..
- 896 -
Abatement and
Community Public Nuisance
Compost Airport Golf Center Fund Total
$ 14,563,548 $ 762,311 $ 3,096,548 $ 484,485 $ 284,329 $ 26,881,814 (1,479,856) (267,742) (3,258,814) - (44,127) (6,772,599) (6,049,611) (668,271) - (889,907) - (8,948,973)
(4,092,000) (394,853) (249,238) (375,123) (107,433) (10,116,132) 2,942,081 (568,555) (411,504) (780,545) 132,769 1,044,110 267,196 343,179 - - - 610,375
- 291,711 - - - 291,711
386,083 - 841,276 564,978 2,173 2,494,510
(834,810) - - - - (898,089)
(654,200) - - - 52,881 (601,319)
(835,731) 634,890 841,276 564,978 55,054 1,897,188
- - (338,330) - - (341,663)
33,980 - - - - 164,415
- - (462,352) - - (462,352)
3,413 - (33,995) - - (30,234)
- - (581) - - (581)
37,393 (835,258) - - - (670,415)
60,979 72,210 111,026 - 6,007 526,066
(13,693) (25,135) 9,378 - (3,050) (134,025)
- 263,549 140,890 617,527 - 1,179,017
47,286 310,624 261,294 617,527 2,957 1,571,058
2,191,029 376,959 (144,192) 401,960 190,780 3,841,941
2,657,221 2,638,753 756,859 234,080 290,804 16,829,677
$ 4,848,250 $ 3,015,712 $ 612,667 $ 636,040 $ 481,584 $ 20,671,618 $ 4,848,250 $ 3,015,712 $ $ 636,040 61,590 $ 481,584 $ 20,120,541 - - 551,077 - - 551,077
$ 4,848,250 $ 3,015,712 $ 612,667 $ 636,040 $ 481,584 $ 20,671,618 120
#15..
- 897 -
Storm
Parking Drain

RECONCILIATION OF OPERATING INCOME (LOSS)
TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES:

Operating income (loss) $ (438,157) $ (663,963)
Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:

Depreciation 385,570 439,863
Taxes paid (29) -
Change in assets, liabilities, and deferred resources:
(Increase) decrease in accounts receivable (79,023) (837) (Increase) in taxes receivable - -
(Increase) decrease in utilities receivable - 13,298
(Increase) decrease in due from other governments - -
Increase (decrease) in accounts payable (22,172) 179,155 (Increase) in inventories - -
(Increase) decrease in prepaid expenses (21) 1,125
Increase in accrued salaries and benefits 6,031 3,762
Increase in net pension liability and deferred resources 48,655 15,672 (Decrease) in net OPEB liability and deferred resources (13,208) (8,631) Increase pollution remediation - -
Increase (decrease) in unearned revenue - -
(Decrease) in lease/SBITA payable - -
(Increase) in lease receivable (137,226) -
Total adjustments 188,577 643,407
Net cash provided (used) by operating activities $ (249,580) $ (20,556)

NONCASH INVESTING, CAPITAL AND FINANCING
ACTIVITIES:

Intangible assets right-to-use - SBITAS $ $ - 22,366
TOTAL NONCASH INVESTING, CAPITAL AND FINANCING ACTIVITIES $ $ - 22,366

CITY OF MODESTO
COMBINING STATEMENT OF CASH FLOWS - NONMAJOR ENTERPRISE FUNDS (Continued) FISCAL YEAR ENDED JUNE 30, 2023
121
#15..
- 898 -
Abatement and
Community Public Nuisance
Compost Airport Golf Center Fund Total
$ 3,575,811 $ (1,137,561) $ (135,998) $ (1,665,781) $ 861,666 $ 396,017 60,954 729,074 36,859 57,762 - 1,710,082
- - - - - (29)
(792,365) 34,960 (25,667) (25,771) (238,802) (1,127,505) - (1,889) - - - (1,889)
(221,942) - - - - (208,644)
63,736 (264,179) - 825,886 - 625,443
(7,961) (9,309) (156,914) 3,645 (12,427) (25,983)
- - (71) - - (71)
(717) 204 (154,664) (2) - (154,075)
45,344 6,011 2,581 5,528 - 69,257
190,498 88,767 - 43,608 - 387,200
(14,639) - - (6,866) - (43,344)
150,687 - - - - 150,687
(107,325) - 191,144 - (477,668) (393,849)
- - - (18,554) - (18,554)
- (14,633) (168,774) - - (320,633)
(633,730) 569,006 (275,506) 885,236 (728,897) 648,093
$ 2,942,081 $ (568,555) $ (411,504) $ (780,545) $ 132,769 $ 1,044,110 $ $ 6,645 - $ $ - $ - $ - 58,022
$ $ 6,645 - $ $ - $ - $ - 58,022
122
#15..
- 899 -
This page is intentionally left blank.
123
#15..
- 900 -

Internal Service Funds
Internal Service Funds are established to finance and account for services and commodities furnished by a designated agency of a governmental unit to other departments of the same governmental unit. Since the services and commodities are supplied exclusively to other departments of a governmental jurisdiction, they are distinguishable from those public services which are rendered to the public in general and which are accounted for in General, Special Revenue, or Enterprise Funds. Internal Service Funds include:

FLEET MANAGEMENT FUND – To provide the maintenance necessary for the City’s equipment pool, which serves the needs of all City departments.

CENTRAL SERVICES FUND – To provide office supplies, various maintenance and construction materials, records storage, and mail services to all City departments.

INFORMATION AND TECHNOLOGY SERVICES FUND – To finance and account for the replacement, upgrade and maintenance of the City’s network and technology infrastructure, and to develop and implement a coordinated city-wide information technology plan.

INSURANCE FUND – To finance and account for the City’s insurance and risk management programs.

EMPLOYEE BENEFITS MANAGEMENT FUND – To account for all compensated absences and other employee benefits. Insurance benefits for current employees are accounted for in the Insurance Fund.

BUILDING SERVICES FUND – To account for the true cost of occupying and maintaining office space, to better reflect the value of that space, and to accumulate amounts for future building repair costs. 124
#15..
- 901 -
Fleet Central
Management Services
ASSETS
Current assets:

Cash and cash equivalents $ 1,857,046 $ -
Receivables:

Accounts 11,625 -
Interest 3,154 284
Prepaid expenses 2,403 126
Due from governments 1,463,185 -
Inventories 2,339,228 1,992,147
Total current assets 5,676,641 1,992,557
Noncurrent assets:

Restricted assets - cash and cash equivalents - -
Restricted assets - cash from fiscal agent - -
Land and construction in progress 3,946,077 -
Other capital assets, net of accumulated depreciation 30,322,507 Intangible assets right-to-use, net of accumulated amortization - - Total noncurrent assets 34,268,584 -
Total assets 39,945,225 1,992,557
Deferred OPEB 81,278 -
Deferred pensions 1,909,230 331,788
Total deferred outflows of resources 1,990,508 331,788
Total assets and deferred outflows of resources $ 41,935,733 $ 2,324,345

LIABILITIES
Current liabilities:

Accounts payable $ 1,241,175 $ 218,881
Accrued salaries and benefits 118,490 17,618
Due to other funds - 1,467,637
Unearned revenue - -
Current portion - compensated absences - -
Current portion - claims liability - -
Current portion - leases and SBITAS - -
Total current liabilities 1,359,665 1,704,136
Noncurrent liabilities:

Compensated absences - -
Claims liability - -
Leases and SBITAS - -
Net OPEB liability 464,893 -
Net pension liability 6,382,865 1,109,221
Total noncurrent liabilities 6,847,758 1,109,221
Total liabilities 8,207,423 2,813,357
Deferred OPEB 165,639 -
Deferred pensions 28,833 5,011
Total deferred inflows of resources 194,472 5,011

NET POSITION
Net investment in capital assets 34,268,584 -
Restricted - -
Unrestricted (734,746) (494,023)
Total net position 33,533,838 (494,023)
Total liabilities, deferred inflows of resources, and net position $ 41,935,733 $ 2,324,345

DEFERRED OUTFLOWS OF RESOURCES

DEFERRED INFLOWS OF RESOURCES

CITY OF MODESTO

COMBINING STATEMENT OF NET POSITION - INTERNAL SERVICE FUNDS JUNE 30, 2023
125
#15..
- 902 -
Information Employee
& Technology Benefits Building
Services Insurance Management Services Total
$ 4,782,586 $ 14,978,839 $ $ 1,961,965 - $ 23,580,436
- 115,884 - 2,551 130,060
12,603 44,688 16,750 5,350 82,829
5,122 1,193,003 1,873 - 1,202,527
- - - 78,530 1,541,715
- - - - 4,331,375
4,800,311 16,332,414 18,623 2,048,396 30,868,942
- - 6,309,526 - 6,309,526
- 747,298 - - 747,298
- - - 2,115,215 6,061,292
3,355,077 - - 2,337,434 36,015,018
445,167 - - - 445,167
3,800,244 747,298 6,309,526 4,452,649 49,578,301
8,600,555 17,079,712 6,328,149 6,501,045 80,447,243
206,106 - - 7,967 295,351
2,577,781 349,376 99,954 460,831 5,728,960
2,783,887 349,376 99,954 468,798 6,024,311
$ 11,384,442 $ 17,429,088 $ 6,428,103 $ 6,969,843 $ 86,471,554 $ $ 1,135,242 484,932 $ $ 35,669 $ 3,306,684 190,785
138,428 17,741 7,037 26,048 325,362
- - - - 1,467,637
- 39,820 - - 39,820
- - 1,070,824 - 1,070,824
- 6,660,398 - - 6,660,398
144,635 - - - 144,635
767,995 7,853,201 1,113,530 216,833 13,015,360
- - 10,848,329 - 10,848,329
- 20,378,516 - - 20,378,516
148,936 - - - 148,936
612,753 - - 42,135 1,119,781
8,617,937 1,168,020 334,161 1,540,634 19,152,838
9,379,626 21,546,536 11,182,490 1,582,769 51,648,400
10,147,621 29,399,737 12,296,020 1,799,602 64,663,760
310,816 - - 17,277 493,732
38,929 5,276 1,509 6,960 86,518
349,745 5,276 1,509 24,237 580,250
3,506,673 - - 4,452,649 42,227,906
- 747,298 6,309,526 - 7,056,824
(2,619,597) (12,723,223) (12,178,952) 693,355 (28,057,186) 887,076 (11,975,925) (5,869,426) 5,146,004 21,227,544
$ 11,384,442 $ 17,429,088 $ 6,428,103 $ 6,969,843 $ 86,471,554 126
#15..
- 903 -
Fleet Central
Management Services
OPERATING REVENUES:

Charges for services $ 15,889,406 $ 5,085,958
Miscellaneous 15,604 -
Total operating revenues 15,905,010 5,085,958
OPERATING EXPENSES:

Salaries and wages 2,871,877 294,596
Cost of goods sold - 3,968,810
Contractual services 288,652 174,176
Utilities 194,522 91
Maintenance and supplies 8,472,311 118,036
Insurance 303,374 13,481
Claims - -
Employee benefits 1,541,981 459,614
Administration services 410,778 198,087
Allocated indirect administrative costs 220,610 -
Depreciation 3,226,000 8,643
Total operating expenses 17,530,105 5,235,534
OPERATING INCOME (LOSS) (1,625,095) (149,576)
NONOPERATING REVENUES (EXPENSES):

Gain (loss) on disposition of capital assets (13,106) - Interest income 10,465 1,471
Net increase (decrease) in fair value of investments (26,628) (289) Rental income 36,000 -
Tax Expense - -
Interest expense and amortization - -
Total nonoperating revenues (expenses) 6,731 1,182
INCOME (LOSS) BEFORE TRANSFERS (1,618,364) (148,394)
Capital contributions 1,253,210 -
Transfers in 1,961,950 -
Transfers out - (32,916)
Total contributions and transfers 3,215,160 (32,916)
CHANGES IN NET POSITION 1,596,796 (181,310)
NET POSITION (DEFICIT), JULY 1 30,690,920 (312,713)
PRIOR YEAR ADJUSTMENTS 1,246,122 -
NET POSITION (DEFICIT), JUNE 30 $ 33,533,838 $ (494,023)

COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES

IN FUND NET POSITION - INTERNAL SERVICE FUNDS
FISCAL YEAR ENDED JUNE 30, 2023

CITY OF MODESTO
127
#15..
- 904 -
Information Employee
& Technology Benefits Building
Services Insurance Management Services Total
$ 8,539,967 $ 34,365,757 $ 36,504,036 $ 3,905,363 $ 104,290,487 - 468,439 133,449 2,398 619,890
8,539,967 34,834,196 36,637,485 3,907,761 104,910,377
3,111,529 416,018 1,233,307 538,752 8,466,079
- - - - 3,968,810
132,324 2,513,101 304,256 1,814,902 5,227,411
143,078 904 1,657 234,969 575,221
2,117,940 16,555 39,699 676,695 11,441,236
107,012 22,052,205 4,140 27,930 22,508,142
- 11,042,040 1,441 - 11,043,481
1,830,618 409,936 33,555,044 297,093 38,094,286
6,576 154,560 288,771 109,143 1,167,915
- - - - 220,610
805,591 - - 278,908 4,319,142
8,254,668 36,605,319 35,428,315 3,978,392 107,032,333
285,299 (1,771,123) 1,209,170 (70,631) (2,121,956)
- - - 1,782 (11,324)
67,659 318,828 87,640 78,049 564,112
(24,302) 51,699 (43,386) (13,876) (56,782)
- - - 57,950 93,950
- - (16,073) (16,073)
(2,600) - - - (2,600)
40,757 370,527 44,254 107,832 571,283
326,056 (1,400,596) 1,253,424 37,201 (1,550,673)
- - - - 1,253,210
- - - - 1,961,950
(141,388) - - - (174,304)
(141,388) - - - 3,040,856
184,668 (1,400,596) 1,253,424 37,201 1,490,183
702,408 (10,575,329) (7,122,850) 5,108,803 18,491,239
- - - - 1,246,122
$ 887,076 $ (11,975,925) $ (5,869,426) $ 5,146,004 $ 21,227,544 128
#15..
- 905 -
Fleet Central
Management Services
CASH FLOWS FROM OPERATING ACTIVITIES:

Receipts from customers and users $ $ 28,478 -
Receipts from interfund services provided 15,875,000 5,123,808 Payments to suppliers (12,247,974) (4,356,032)
Payment of insurance claims - -
Payments to employees (4,207,353) (527,743)
Payments for interfund services used (949,788) (211,568) Net cash provided (used) by operating activities (1,501,637) 28,465 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:

Transfers in 1,961,950 -
Transfers out - (32,916)
Net cash provided (used) by noncapital financing activities 1,961,950 (32,916)

CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:

Acquisition and construction of capital assets (1,584,310) - Proceeds from sale of capital assets 35,654 -
Principal repayments - -
Interest paid - (7)
Net cash provided (used) by capital and related financing activities (1,548,656) (7) CASH FLOWS FROM INVESTING ACTIVITIES:

Interest received 9,835 1,312
Net increase (decrease) in the fair value of investments (26,628) (289) Rental income received 36,000 -
Net cash provided (used) by investing activities 19,207 1,023 Net increase (decrease) in cash and cash equivalents (1,069,136) (3,435) CASH AND CASH EQUIVALENTS, JULY 1 2,926,182 3,435
CASH AND CASH EQUIVALENTS, JUNE 30 $ 1,857,046 $ -
RECONCILIATION TO STATEMENT OF NET POSITION:

Cash and cash equivalents $ 1,857,046 $ -
Restricted cash and cash equivalents - -
Restricted cash and cash equivalents with fiscal agent - - TOTAL CASH AND CASH EQUIVALENTS $ 1,857,046 $ -

CITY OF MODESTO

COMBINING STATEMENT OF CASH FLOWS - INTERNAL SERVICE FUNDS FISCAL YEAR ENDED JUNE 30, 2023
129
#15..
- 906 -
Information Employee
& Technology Benefits Building
Services Insurance Management Services Total
$ $ - $ 742,062 $ 167,199 $ 20,620 958,359
8,539,967 34,365,757 36,504,036 3,905,363 104,313,931
(1,816,044) (25,135,634) (322,369) (2,657,101) (46,535,154) - (10,861,424) (4,140) - (10,865,564)
(4,643,686) (704,782) (34,843,335) (861,893) (45,788,792) (113,588) (154,560) (292,911) (193,276) (1,915,691)
1,966,649 (1,748,581) 1,208,480 213,713 167,089
- - - - 1,961,950
(141,388) - - - (174,304)
(141,388) - - - 1,787,646
(487,588) - - - (2,071,898)
- - - 1,782 37,436
(2,600) - - - (2,600)
(139,943) - - - (139,950)
(630,131) - - (2,177,012) 1,782
62,551 338,671 85,670 76,460 574,499
(24,302) 51,699 (43,386) (13,876) (56,782)
- - - 57,950 93,950
38,249 390,370 42,284 120,534 611,667
1,233,379 (1,358,211) 1,250,764 336,029 389,390
3,549,207 17,084,348 5,058,762 1,625,936 30,247,870
$ 4,782,586 $ 15,726,137 $ 6,309,526 $ 1,961,965 $ 30,637,260 $ 4,782,586 $ 14,978,839 $ $ - 1,961,965 $ 23,580,436
- - 6,309,526 - 6,309,526
- 747,298 - - 747,298
$ 4,782,586 $ 15,726,137 $ 6,309,526 $ 1,961,965 $ 30,637,260 130
#15..
- 907 -
Fleet Central
Management Services

RECONCILIATION OF OPERATING INCOME (LOSS) TO
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES:

Operating income (loss) $ (1,625,095) $ (149,576)
Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:

Depreciation 3,226,000 8,643
Taxes paid - -
Change in assets, liabilities, and deferred resources:
(Increase) decrease in accounts receivable (1,532) 37,850 (Increase) decrease in due from governments (82,975) -
(Increase) decrease in prepaid expenses 16,266 1,256
(Increase) in inventories (2,339,228) (183,679)
Increase (decrease) in accounts payable (901,578) (1,380,133) Increase in accrued salaries and benefits 14,639 1,458
Increase in due to other funds - 1,467,637
Decrease in compensated absences - -
Decrease in net OPEB liability and deferred resources (11,516) - (Increase) decrease in net pension liability and deferred resources 203,382 225,009 (Decrease) in unearned revenue - -
Increase (decrease) in lease and SBITA payable - -
Increase in claims liability - -
Total adjustments 123,458 178,041
Net cash provided (used) by operating activities $ (1,501,637) $ 28,465

NONCASH INVESTING, CAPITAL AND FINANCING
ACTIVITIES:

Intangible assets right-to-use - SBITAS $ $ - -
TOTAL NONCASH INVESTING, CAPITAL AND FINANCING ACTIVITIES $ $ - -

CITY OF MODESTO
COMBINING STATEMENT OF CASH FLOWS - INTERNAL SERVICE FUNDS (Continued) FISCAL YEAR ENDED JUNE 30, 2023
131
#15..
- 908 -
Information Employee
& Technology Benefits Building
Services Insurance Management Services Total
$ $ (1,771,123) 285,299 $ 1,209,170 $ $ (2,121,956) (70,631) 805,591 - - 278,908 4,319,142
- - - (16,073) (16,073)
- 307,469 33,748 2,249 379,784
- - - 4,292 (78,683)
(1,916) (1,132,031) (577) 29 (1,116,973)
- - - - (2,522,907)
283,043 579,162 21,121 87,256 (1,311,129)
38,754 3,221 1,912 9,600 69,584
- - - - 1,467,637
- - (42,920) - (42,920)
(63,554) - - (3,614) (78,684)
323,261 117,951 (13,974) (32,034) 823,595
- (33,846) - - (33,846)
296,171 - - (46,269) 249,902
- 180,616 - - 180,616
1,681,350 22,542 (690) 284,344 2,289,045
$ 1,966,649 $ (1,748,581) $ 1,208,480 $ 213,713 $ 167,089

$ 582,510 $ $ - $ - $ - 582,510
$ $ 582,510 $ - $ - $ - 582,510
132
#15..
- 909 -
This page is intentionally left blank.
133
#15..
- 910 -

Private Purpose Trust Funds and Investment Trust Funds
Private Purpose Trust Funds accounts as the fiduciary fund type used by the City to report trust arrangements under which principal and income benefit other governments. Investment Trust Funds account for assets held by the City as an agent for individuals, governmental entities, and non-public organizations.

Private Purpose Trust Funds
REDEVELOPMENT SUCCESSOR AGENCY – To account for allocated revenues in amounts necessary to pay the estimated annual installment payments on all enforceable obligations of the former redevelopment agency until all enforceable obligations of the prior redevelopment agency have been paid in full and all assets have been liquidated.

SPECIAL DISTRICTS – To account for collection of special assessment from property owners which are collected and forwarded to trustees for payment to bondholders. The cash and investment of the Special Districts are invested as part of the City’s investment pool.

Investment Trust Funds
TUOLUMNE RIVER REGIONAL PARK – To account for cash and investments of the Tuolumne River Regional Park, a joint powers agency between the City of Modesto, Stanislaus County and City of Ceres.

The agency provides financing, development, and maintenance of the Tuolumne River Regional Park facilities. The cash and investments of the Park are invested as part of the City’s investment pool.

MODESTO-CERES FIRE PROTECTION AGENCY – To record and distribute the special assessments for fire protection that were established under the Industrial Fire District. This is a joint powers agency between the Modesto Regional Fire Authority, the City of Ceres, and the Industrial Fire District. Cash and investments of the Agency are invested in the City’s investment pool. .
134
#15..
- 911 -
Redevelopment Special Total
Succesor Agency Districts Private Purpose Trust Funds
ASSETS
Cash and cash equivalents $ 1,177,530 $ $ 772,854 1,950,384 Cash and cash equivalents held with fiscal agent 1,699,498 3,574,023 5,273,521 Interest receivable 4,999 1,055 6,054
Taxes receivable - 70,097 70,097
Assessments receivable - 26,880,000 26,880,000
Prepaids Other assets 2,966 - - 2,966 -
Total assets 2,884,993 31,298,029 34,183,022
Deferred outflows of resources:

Loss on refunding - 904,920 904,920
Total assets and deferred outflows of resources 2,884,993 32,202,949 35,087,942

LIABILITIES
Accounts payables and other liabilities 20,666 - 20,666 Due to local governments 1,192,004 - 1,192,004
Interest payable 13,416 400,314 413,730
Long-term liabilities:

Due within one year 2,417,650 1,110,000 3,527,650
Due in more than one year 11,710,650 26,647,678 38,358,328 - Total liabilities 15,354,386 28,157,992 43,512,378
Deferred inflows of resources
Unavailable revenues - 706,169 706,169
Total deferred inflows of resources - 706,169 706,169

NET POSITION
Restricted 1,699,498 3,574,023 5,273,521
Unrestricted (14,168,891) (235,235) (14,404,126)
Total net position (deficit) $ (12,469,393) $ 3,338,788 $ (9,130,605)

CITY OF MODESTO

FIDUCIARY FUNDS - PRIVATE PURPOSE TRUST FUNDS
JUNE 30, 2023

COMBINING STATEMENT OF FIDUCIARY NET POSITION
135
#15..
- 912 -
Redevelopment Special Total
Succesor Agency Districts Private Purpose Trust Funds
Collections on behalf of other governments:

Special assessments $ $ - 1,519,095 $ 1,519,095
Property taxes 1,619,627 - 1,619,627
Total collections on behalf of other governments 1,619,627 1,519,095 3,138,722 Interest and investment earnings:

Interest earnings 92,991 192,472 285,463
Net (decrease) in fair value of investments (6,896) 9,949 3,053 Total interest and investment earnings 86,095 202,421 288,516 Total additions 1,705,722 1,721,516 3,427,238
DEDUCTIONS:

Distribution of property taxes to other taxing entities 369,593 - 369,593 Obligation retirements:

Interest expense 110,776 1,209,170 1,319,946
Trustee fees - 3,760 3,760
City administrative expenses 89,960 30,094 120,054
Other expenses 3,009 75,312 78,321
Total deductions 573,338 1,318,336 1,891,674
Net increase in fiduciary net position 1,132,384 403,180 1,535,564 Net position, July 1 (13,601,777) 2,935,608 (10,666,169) Net position (deficit), June 30 $ (12,469,393) $ 3,338,788 $ (9,130,605)

CITY OF MODESTO

COMBINING STATEMENTS OF CHANGES IN FIDUCIARY NET POSITION -

FIDUCIARY FUNDS - PRIVATE PURPOSE TRUST FUNDS
FISCAL YEAR ENDED JUNE 30, 2023
136
#15..
- 913 -
Tuolumne River Modesto-Ceres Total
Regional Park Fire Protection Agency Investment Trust Funds ASSETS
Cash and cash equivalents $ $ 3,619,218 $ 272,063 3,891,281 Receivables:

Interest receivable 527 1,443 1,970
Taxes receivable - 26,534 26,534
Leases receivable 1,185,368 - 1,185,368
Prepaid - 1,086 1,086
Due from governments 133,659 - 133,659
Land and construction in progress 2,946,745 - 2,946,745 Other capital assets, net of 3,683,597 - 3,683,597
Total assets 11,569,114 301,126 11,870,240

LIABILITIES
Accounts payable and other liabilities 180,624 299,968 480,592 Total liabilities 180,624 299,968 480,592
Deferred inflows of resources:

Leases 1,135,392 - 1,135,392
Total deferred inflows of resources 1,135,392 - 1,135,392

NET POSITION
Net invested in capital assets 6,630,342 - 6,630,342
Unrestricted 3,622,756 1,158 3,623,914
Total net position $ 10,253,098 $ $ 1,158 10,254,256

CITY OF MODESTO

COMBINING STATEMENT OF FIDUCIARY NET POSITION

FIDUCIARY FUNDS - INVESTMENT TRUST FUNDS
JUNE 30, 2023
137
#15..
- 914 -
Tuolumne River Modesto-Ceres Total
Regional Park Fire Protection Agency Investment Trust Funds ADDITIONS:

Contributions:

Members investment pool $ $ 625,183 $ - 625,183
Total contributions 625,183 - 625,183
Collections on behalf of other governments:

Special assessments - 291,148 291,148
Property taxes - 393,710 393,710
Grants 235,203 - 235,203
Other 3,000 - 3,000
Insurance recoveries 3,316,441 3,316,441
Total collections on behalf of other governments 3,554,644 684,858 4,239,502 Interest and investment earnings:

Interest and rent earnings 133,923 4,738 138,661
Net (decrease) in fair value of investments (5,681) (2,561) (8,242) Total interest and investment earnings 128,242 2,177 130,419 Total additions 4,308,069 687,035 4,995,104
DEDUCTIONS:

Distribution of property taxes to other taxing entities - 674,844 674,844 City administrative expenses 149,066 2,983 152,049
Other expenses - 8,032 8,032
Depreciation expense 438,048 - 438,048
Insurance expenses - 1,177 1,177
Operating expenses 978,126 - 978,126
Total deductions 1,565,240 687,036 2,252,276
Net increase (decrease) in net position 2,742,829 (1) 2,742,828 Net position, July 1 7,510,269 1,159 7,511,428
Net position, June 30 $ 10,253,098 $ $ 1,158 10,254,256

CITY OF MODESTO

COMBINING STATEMENTS OF CHANGES IN FIDUCIARY NET POSITION

FIDUCIARY FUNDS - INVESTMENT TRUST FUNDS
JUNE 30, 2023
138
#15..
- 915 -
This page is intentionally left blank.
139
#15..
- 916 -

STATISTICAL SECTION TAB
#15..
- 917 -
#15..
- 918 -

STATISTICAL SECTION
140
#15..
- 919 -
This page is intentionally left blank.
141
#15..
- 920 -

Statistical Section
This part of the Annual Comprehensive Financial Report presents detailed information to aid in understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City’s overall financial health. In contrast to the financial section, the statistical section information is not subject to independent audit.

Financial Trends
These schedules contain trend information to help the reader understand how the City’s financial performance has changed over time:

1. Net Position by Component

2. Changes in Net Position

3. Fund Balances of Governmental Funds

4. Changes in Fund Balances of Governmental Funds
Revenue Capacity
This schedule gives information on the City’s most significant local revenue source, the water usage charges:

1. Water Utility System – Ten Largest Customers

2. Water revenues by customer class

3. Water rates
Debt Capacity
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:

1. Ratio of Outstanding Debt by Type

2. Computation of Direct and Overlapping Debt

3. Computation of Legal Debt Margin

4. Revenue Bond Coverage, Wastewater Revenue Bonds
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:

1. Demographic and Economic Statistics

2. Principal Employers

3. Principal Property Taxpayers
Operating Information
These schedules contain service and infrastructure data to help the reader understand how the information in the City’s financial report relates to the services the City provides and the activities it performs:

1. Full-Time City Government Employees by Function

2. Operating Indicators by Function

3. Capital Asset Statistics by Function/Program
Sources: Unless otherwise noted, the information in these schedules is derived from the Annual Comprehensive Financial Reports for the relevant year.
142
#15..
- 921 -
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Governmental activities
Net investment in capital assets $ 347,647,419 $ 378,145,625 $ 381,887,289 $ 376,743,556 $ 377,529,238 $ 401,515,805 $ 374,618,780 $ 407,347,307 $ 457,620,157 $ 468,002,326 Restricted (2) 77,564,677 121,105,182 115,619,807 123,851,082 130,192,278 127,885,787 135,818,614 183,357,207 195,793,646 208,472,568 Unrestricted 9,167,253 (179,570,210) (173,275,294) (191,483,628) (182,197,396) (191,345,565) (206,772,243) (217,114,643) (189,907,446) (187,041,193) Total governmental activities net position $ 434,379,349 $ 319,680,597 $ 324,231,802 $ 309,111,010 $ 325,524,120 $ 338,056,027 $ 303,665,151 $ 373,589,871 $ 463,506,357 $ 489,433,701 Business-type activities
Net investment in capital assets $ 502,684,950 $ 527,784,338 $ 539,821,175 $ 555,163,217 $ 571,811,118 $ 607,813,261 $ 647,695,354 $ 648,609,186 $ 687,640,266 $ 589,299,184 Restricted (2) 22,398,957 20,622,619 22,052,595 21,525,961 21,071,542 15,569,107 15,857,655 17,004,338 15,918,799 16,788,942 Unrestricted 150,187,831 99,450,370 92,324,550 113,595,981 130,146,975 148,005,231 138,508,360 178,262,877 115,746,227 241,640,663 Total business-type activities net position $ 675,271,738 $ 647,857,327 $ 654,198,320 $ 690,285,159 $ 723,029,635 $ 771,387,599 $ 802,061,369 $ 843,876,401 $ 819,305,292 $ 847,728,789 Primary government
Net investment in capital assets $ 850,332,369 $ 905,929,963 $ 921,708,464 $ 931,906,773 $ 949,340,356 $ 1,009,329,066 $ 1,022,314,134 $ 1,055,956,493 $ 1,145,260,423 $ 1,057,301,510 Restricted (2) 99,963,634 141,727,801 137,672,402 145,377,043 151,263,820 143,454,894 151,676,269 200,361,545 211,712,445 225,261,510 Unrestricted 159,355,084 (80,119,840) (80,950,744) (77,887,647) (52,050,421) (43,340,334) (68,263,883) (38,851,766) (74,161,219) 54,599,470 Total primary government net position $ 1,109,651,087 $ 967,537,924 $ 978,430,122 $ 999,396,169 $ 1,048,553,755 $ 1,109,443,626 $ 1,105,726,520 $ 1,217,466,272 $ 1,282,811,649 $ 1,337,162,490 Restricted
(1) Accounting standards require that net position be reported in three components in the financial statements: net investment in capital assets; restricted; and unrestricted. Net position is considered restricted when (a) externally imposed by creditors (such as debt covenants), grantors, contributors, or laws or regulations of other governments or (b) imposed by law through constitutional provisions or enabling legislation. (2) Starting in fiscal year 2015, the significant decrease in net position was due to the implementation of GASB 68 related to the City's net pension liability.

CITY OF MODESTO
NET POSITION BY COMPONENT (1)

LAST TEN FISCAL YEARS
(ACCRUAL BASIS OF ACCOUNTING)
($100)
$0
$100
$200
$300
$400
$500
$600
$700
$800
$900
$1,000
$1,100
$1,200
$1,300
$1,400
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Net investment in capital assets Restricted Unrestricted 143
#15..
- 922 -
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Expenses
Governmental activities:

General government $ 11,221,704 $ 12,085,051 $ 12,838,583 $ 13,945,824 $ 15,432,617 $ 13,973,768 $ 14,808,371 $ 14,727,031 $ 20,268,611 $ 16,573,945 Community development 13,002,466 11,888,475 12,552,115 15,419,529 17,268,926 15,720,280 25,698,343 30,782,573 20,615,432 28,589,701 Highways and streets 21,316,315 21,269,704 20,149,011 22,481,002 22,997,140 23,937,423 25,858,611 25,863,042 27,463,523 27,337,181 Public works 3,241,135 9,810,989 10,749,465 13,169,149 8,674,538 3,472,405 3,736,696 3,126,390 3,086,419 7,795,895 Parks and recreation 11,659,816 4,641,611 3,493,743 3,947,898 4,456,508 15,680,980 14,725,590 13,750,865 12,439,250 16,227,064 Public safety 72,301,682 86,782,741 86,907,876 104,348,464 120,629,673 111,059,794 140,709,104 129,785,835 121,675,443 147,700,874 Interest on long-term debt 2,958,471 3,204,203 2,691,894 2,500,849 2,510,224 2,402,299 2,302,626 2,039,849 1,954,306 1,719,479 Total governmental activities expenses $ 135,701,589 $ 149,682,774 $ 149,382,687 $ 175,812,715 $ 191,969,626 $ 186,246,949 $ 227,839,341 $ 220,075,585 $ 207,502,984 $ 245,944,139 Business-type activities:

Water $ 1,605,829 $ 54,718,239 $ 59,127,625 $ 63,008,231 $ 56,526,729 $ 62,745,688 $ 69,187,391 $ 68,792,875 $ 73,421,868 $ 77,533,248 Sewer 63,498,896 30,281,361 33,093,921 36,248,877 41,444,220 41,216,914 45,832,671 46,500,454 44,263,767 48,558,199 Bus (1) 31,895,568 18,614,175 19,709,745 21,979,360 20,538,934 24,276,760 25,261,736 28,889,011 - - Parking 6,372,418 1,513,185 1,625,943 1,628,226 1,553,258 1,899,479 1,905,382 1,700,607 1,926,834 2,026,547 Storm drain 4,951,441 3,913,204 5,312,896 6,119,472 5,202,444 7,157,290 7,384,884 5,585,980 5,965,352 6,767,327 Compost 2,291,222 7,841,048 11,998,345 9,648,481 9,652,175 8,477,947 10,330,237 12,022,746 11,497,333 11,902,440 Airport 19,618,547 2,025,146 1,787,081 1,744,557 1,578,654 1,646,800 1,841,645 1,865,063 1,686,375 2,130,694 Golf 2,845,109 2,998,505 3,130,536 2,871,167 2,616,077 3,052,785 2,939,639 2,865,795 3,229,764 3,238,111 Community center 2,031,928 1,852,585 1,981,307 1,934,179 1,780,010 1,541,592 1,603,302 1,961,576 1,570,818 1,899,017 Abatement and public nuisance 31,877 93,067 84,152 51,624 351,557 63,312 142,124 82,166 124,097 137,992 Total business-type activities expenses 135,142,835 123,850,515 137,851,551 145,234,174 141,244,058 152,078,567 166,429,011 170,266,273 143,686,208 154,193,575 Total primary government expenses $ 270,844,424 $ 273,533,289 $ 287,234,238 $ 321,046,889 $ 333,213,684 $ 338,325,516 $ 394,268,352 $ 390,341,858 $ 351,189,192 $ 400,137,714 Program revenues
Governmental activities:

Charges for services:

General government $ 5,825,407 $ 5,912,157 $ 6,539,908 $ 5,082,405 $ 6,544,581 $ 6,387,743 $ 5,973,621 $ 6,237,530 $ 6,572,771 $ 5,945,470 Community development 4,537,984 3,385,050 6,885,850 10,378,999 16,049,727 12,106,237 17,327,298 16,611,118 19,488,129 16,094,070 Highway and streets 873,566 1,744,505 1,154,290 1,101,813 758,952 748,319 909,580 651,061 651,082 1,077,458 Public works 4,146,641 6,621,704 5,469,419 5,908,332 1,637,024 2,779,546 2,921,053 2,869,808 2,711,433 3,780,309 Parks and recreation 3,004,001 1,344,923 771,733 1,614,443 2,346,211 2,450,965 3,358,983 2,145,685 2,205,344 2,507,683 Public safety 3,123,758 4,218,000 3,868,346 4,847,914 5,127,433 4,502,546 11,354,045 5,849,193 8,960,454 6,993,295 Operating grants and contributions 5,868,684 5,862,566 3,630,185 5,050,771 5,802,634 6,591,435 16,838,122 12,010,918 15,352,734 19,539,354 Capital grants and contributions 8,206,154 5,878,550 1,708,602 2,117,867 3,062,292 8,831,664 5,894,717 57,825,011 12,835,899 4,174,014 Total government activities program revenues 35,586,195 34,967,455 30,028,333 36,102,544 41,328,854 44,398,455 64,577,419 104,200,324 68,777,846 60,111,653 Business-type activities:

Charges for services:

Water $ 1,092,347 $ 59,800,535 $ 55,992,533 $ 69,075,873 $ 74,842,451 $ 76,806,740 $ 82,796,199 $ 87,713,122 $ 86,231,116 $ 81,863,397 Sewer 60,254,110 46,193,997 47,859,680 49,905,078 52,799,102 57,562,619 58,168,552 63,614,677 65,367,417 64,518,164 Bus (1) 46,046,304 3,424,662 3,352,615 3,253,046 3,305,910 3,176,134 2,443,208 1,624,167 - - Parking 5,831,133 1,239,439 1,289,211 1,284,269 1,434,311 1,519,954 1,264,938 983,353 1,281,097 1,606,145 Storm drain 4,853,133 5,874,349 5,588,169 5,910,988 6,004,682 6,133,801 6,114,242 6,167,491 6,216,242 6,288,237 Compost 634,530 7,191,145 7,352,767 8,903,917 8,934,075 10,090,662 10,216,018 10,433,758 10,944,785 15,621,445 Airport 2,989,504 551,373 622,383 596,152 651,693 737,072 651,447 686,923 722,767 1,008,052 Golf 2,196,280 2,574,496 2,431,904 2,236,100 2,485,688 2,419,938 2,005,588 3,343,027 3,010,990 3,099,845 Community center 230,801 257,991 326,839 305,436 294,524 285,685 188,589 36,914 166,370 247,351 Abatement and public nuisance 201,825 128,636 166,641 117,677 112,199 231,167 67,181 115,999 640,686 1,000,799 Operating grants and contributions 13,721,179 14,223,954 14,153,568 15,975,703 17,858,762 25,668,280 21,780,920 29,310,591 1,644,338 1,263,264 Capital grants and contributions 4,971,940 13,820,127 4,753,223 19,617,513 7,196,698 5,198,721 546,375 8,672,597 2,452,983 3,310,141 Total business-type activities program revenues 143,023,086 155,280,704 143,889,533 177,181,752 175,920,095 189,830,773 186,243,257 212,702,619 178,678,791 179,826,840 Total primary government program revenues $ 178,609,281 $ 190,248,159 $ 173,917,866 $ 213,284,296 $ 217,248,949 $ 234,229,228 $ 250,820,676 $ 316,902,943 $ 247,456,637 $ 239,938,493 Net (Expense)/Revenue
Governmental activities $ (100,115,394) $ (114,715,319) $ (119,354,354) $ (139,710,171) $ (150,640,772) $ (141,848,494) $ (163,261,922) $ (115,875,261) $ (138,725,138) $ (185,832,486) Business-type activities 7,880,251 31,430,189 6,037,982 31,947,578 34,676,037 37,752,206 19,814,246 42,436,346 34,992,583 25,633,265 Total primary government net expense $ (92,235,143) $ (83,285,130) $ (113,316,372) $ (107,762,593) $ (115,964,735) $ (104,096,288) $ (143,447,676) $ (73,438,915) $ (103,732,555) $ (160,199,221) (continued)
(1) Effective July 1, 2021 bus fund operations seized at the City of Modesto, due to the formation of the regionalized transit agency, Stanislaus Regional Transit Authority (StanRTA).

Modesto City CouncilFebruary 27, 2024

Modesto City Council
February 27, 2024