Agenda packet — Mountain House City Council, December 10, 2025 (part 3 of 4)

All work which requires inspection, shall be performed during the City’s normal working hours and work days. If any work is performed before 8:00 a.m., and after 5:00 p.m., or on an City holiday, or on a weekend, there must be a request in writing twenty-four (24) hours in advance for an inspector during those hours, and there must be paid to the City double the ATTACHMENT B-9
Item 7.10
Mountain House Page 354 of 545
8 Inspector’s hourly cost to the City. This payment is not included in the Mountain House inspection fee.

If an inspector is not available to work during such hours, as requested, no work shall be performed during those hours.

Project shall be constructed on a prevailing wage as required by the State of California.

20. NOTICE OF BREACH AND DEFAULT
If Subdivider refuses or fails to obtain prosecution of the work, or any severable part thereof, with such diligence as will insure its completion within the time specified, or any extensions thereof, or fails to obtain completion of said work within such time, or if the Subdivider should be adjudged a bankrupt, or Subdivider should make a general assignment for the benefit of Subdivider’s creditors, or if a receiver should be appointed in the event of Subdivider insolvency, or if Subdivider, or any of Subdivider’s contractors, subcontractors, agents, or employees should violate any of the provisions of this Agreement, the City Manager or City Council may serve written notice upon Subdivider and Subdivider’s surety of breach of this Agreement or of any portion thereof and default of Subdivider.

21. BREACH OF AGREEMENT: PERFORMANCE BY SURETY OR THE CITY In the event of any such notice, Subdivider’s surety shall have the duty to take over and complete the work and the Improvements; provided, however, that if the surety, within ten (10) days after the serving upon it of such notice of breach does not give the City written notice of its intention to take over the performance of the contract, and does not commence performance thereof within ten (10) days after notice to the City of such election, the City may take over the work and prosecute the same to completion, by contract or by any other method the City may deem advisable, for the account and at the expense of Subdivider, and Subdivider’s surety shall be liable to the City for the cost and damages occasioned the City thereby; and, in such event, the City without liability for so doing may take possession of, and utilize in completing the work, such materials, appliances, plant and other property belonging to Subdivider as may be on the site of the work and necessary therefore. The City reserves to itself all remedies available to it at law or in equity for breach of Subdivider’s obligations under this Agreement. The right of the City to draw upon or utilize the security is additional to and not in lieu of any other remedy available to the City. In the event that Subdivider fails to perform any obligations hereunder, Subdivider agrees to pay all costs and expenses incurred by the City in securing performance of such obligations, including costs of suit and reasonable attorney fees.

22. NOTICES
All notices herein required shall be in writing, and delivered in person or sent by registered mail, postage prepaid.

Notices required to be given to the City shall be addressed as follows:

City Manager
City of Mountain House
251 E. Main Street
Mountain House, California 95391
ATTACHMENT B-9
Item 7.10
Mountain House Page 355 of 545
9 Notices required to be given to Subdivider shall be addressed as follows:

Mountain House Developers, LLC
230 S. Sterling Dr.

Suite 246
Mountain House, CA 95391
Attn: Pulvy Sandhu

Provided that any party or the surety may change such address by notice in writing to the other party and, thereafter, notices shall be addressed and transmitted to the new address.

23. FIRE PROTECTION
No building permits will be issued in this Subdivision until the water system has been completed and tested and all access streets installed and made serviceable. This provision may be modified or waived if an alternate method of providing fire protection is provided and approved by the City Manager.

24. STREETLIGHTS
The Subdivider is installing specialized streetlights and poles in the Subdivision. For every 15 streetlights and poles or fraction thereof installed by Subdivider, Subdivider shall provide one additional streetlight and pole to the City. Streetlights shall be delivered to the City when requested anytime at or after acceptance of the improvements. This provision may be modified or waived if an alternate method of providing for spare street lights and poles is provided and approved by the City Manager.

25. STREET NAME SIGNS/IISNS
The Subdivider is installing specialized street signs and poles in the Subdivision. For every 10 street name signs and poles or fraction thereof installed by Subdivider, Subdivider shall provide one additional street pole and sign bracket and extension to the City. This provision may be modified or waived if an alternate method of providing for spare signs and poles is provided and approved by the City Manager.

26. SLURRY SEAL
The Subdivider shall install a slurry seal to the paved surface of the Subdivision upon completion of homebuilding activities in the Subdivision. Slurry seal shall be installed as described in the City of Mountain House Standard Specifications and Details. All streets constructed as part of this subdivision and shown on this map shall be included in the slurry seal project by the developer or builder who is performing this requirement regardless of whether buildings are built on those streets or not. Alternatively, the subdivider may provide a cash payment of an equivalent value to the City.

27. STREET STRIPING
The Subdivider shall install permanent street striping and markings with “Hot Applied Thermoplastic” as described in the City of Mountain House Standard Specifications and Details.

ATTACHMENT B-9
Item 7.10
Mountain House Page 356 of 545
10 Subdivider shall apply thermoplastic striping and signage to all streets within the Final Map including arterial and collector streets within the subdivision.

28. BEST MANAGEMENT PRACTICES-STORM WATER MANAGEMENT
The Subdivider shall purchase, install, and maintain, catch basin filters and/or other source control Best Management Practices (BMPs) for urban runoff as determined by the City.

The City approved catch basin filters must be installed in all streets and on the abutting arterials streets prior to home construction and acceptance. The filters shall be properly maintained, and filters replaced if damaged or filled with debris prior to acceptance. The Subdivider shall execute a Storm Water Management Agreement with the City.

29. LANDSCAPE PLANS

The Subdivider shall plan, design and install landscaping per the Conditions of Approval and the City Design Guidelines.

30. NEIGHBORHOOD I, PA-0600327, TENTATIVE MAP CONDITIONS OF APPROVAL The City has reviewed the Neighborhood I, PA-0600327, Tentative Map Conditions of Approval with the Subdivider. Some Conditions of Approval are not required to be satisfied prior to the recordation of the Final Map, or Subdivider compliance with said conditions is required on an ongoing basis. Subdivider agrees that the approval of the Final Map and this Agreement do not supersede those conditions, which will continue to apply.

31. ASSIGNMENT/SUBSTITUTION
Subdivider may assign this Agreement and its rights and obligations with the prior written approval of the City Manager, which approval shall not be unreasonably withheld, provided that such assignee expressly assumes the obligations of Subdivider hereunder. Upon any such assignment by Subdivider, Subdivider shall be fully relieved from any further liability hereunder.

This Agreement shall be binding upon and shall inure to the benefit of the successors and permitted assigns of the parties to this Agreement.

32. INTENTIONALLY DELETED
City of Mountain House
By: _____________________________________
Steven J. Pinkerton, City Manager
APPROVED AS TO FORM:

By: _____________________________________
John Bakker, City Attorney
ATTACHMENT B-9
Item 7.10
Mountain House Page 357 of 545
11 Mountain House Developers LLC,
a Delaware limited liability company
BY: ________________________________
Name: Karnail Singh Sandhu
Its: Manager
Date: ______________________________
ATTACHMENT B-9
Item 7.10
Mountain House Page 358 of 545
NO. ITEM UNIT QUAN. COST EXTENSION TOTAL

GRADING & DRAINAGE
1 Landscape Fine Grading & Drainage SF 94,022 0.30 $ 28,206.60 $ 2 Landscape Fine Grading for Hydroseed SF 397,000 0.10 $ $ 39,700.00 Sub-total $ 67,907

LANDSCAPE PREPARATION
3 Soil Preparation & Amendments SF 75,000 0.40 $ 30,000.00 $ 4 Steel Header at Parkway Tree Wells LF 140 8.25 $ $ 1,155.00 5 3" Depth Bark Mulch SF 75,000 0.85 $ $ 63,750.00
6 Linear Root Barrier (20' length x 18" depth per tree) LF 3,680 11. $ 50 $ 42,320.00 Sub-total $ 137,225

IRRIGATION
7 Shrub Bubbler Drip Irrigation Systems SF 3,481 6.00 $ 20,886.00 $ 8 12" Shrub Pp-Up Multi-Stream Irrigation System SF 71,519 3.00 $ 214,557.00 $ 9 Tree Bubbler - Root Watering System (2 per tree) EA 368 85.00 $ $ 31,280.00 10 96-Station 2-Wire ET Automatic Irrigation Controller EA 1 23,000.0 $ 0 $ 23,000.00 11 Reduced Pressure Backflow Preventer w/ Enclosure & Frost Blanket EA 1 8,400.00 $ $ 8,400.00 12 Normally Open Master Valve EA 1 3,125.00 $ $ 3,125.00 13 Double-Beam Ultrasonic Flow Sensor EA 1 2,500.00 $ $ 2,500.00 14 VFD Irrigation Booster Pump Assembly ALLOW 1 35,000.00 $ $ 35,000.00 Sub-total $ 338,748

PLANTING
15 15 Gal. & 24" Box Tree EA 184 500.00 $ $ 92,000.00
16 Non-Irrigated Native Hydroseed Grass Mix SF 397,000 0.10 $ $ 39,700.00 17 Shrub Planting Area SF 75,000 7.00 $ 525,000.00 $
Sub-total $ 656,700

HARDSCAPE
18 8' Lamp Black Colored Concrete Walk SF 3,408 15.00 $ $ 51,120.00 19 10' Lamp Black Colored Concrete Greenway Loop Trail SF 13,610 15.0 $ 0 $ 204,150.00 20 6" Natural Gray Concrete Mow Band LF 1,268 15.00 $ $ 19,020.00 21 Natural Gray Concrete Paving SF 100 15.00 $ $ 1,500.00 22 Concrete Paving (Par Course) SF 636 15.00 $ $ 9,540.00 Sub-total $ 285,330

FENCING
23 Steel Post and Cable Fence LF 1,293 45.00 $ $ 58,185.00 $ 58,185

MOUNTAIN HOUSE DEVELOPERS, LLC

NEIGHBORHOOD 'I'

SCHEMATIC PHASE LANDSCAPE COST OPINION

MOUNTAIN HOUSE, CALIFORNIA
November 20, 2025
GREENWAY LOOP PARK PHASE 1
Neighborhood I - Greenway Loop Park Ph. 1 Page 1 of 2
Landscape Cost Estimate
11/20/2025
ATTACHMENT B-9
Item 7.10
Mountain House Page 359 of 545

SITE AMENITIES & FURNITURE
24 6' Steel Bench w/ Back & Armrests EA 2 4,000.00 $ $ 8,000.00 25 Pet Waste Station EA 2 1,100.00 $ $ 2,200.00
26 48" Steel Collapsible Surface Mount Bollard EA 1 1,500.00 $ $ 1,500.00 27 Park Hours Sign Post EA 3 2,000.00 $ $ 6,000.00
28 Wayfinding & Informational Signage EA 2 3,250.00 $ $ 6,500.00 29 Par Course Outdoor Exercise Equipment ALLOW 2 4,000.00 $ $ 8,000.00 Sub-total $ 32,200
TOTAL $ 1,576,295
GRAND TOTAL: $ 1,576,295
COST PER SQUARE FOOT $ 3.21

ITEMS NOT INCLUDED
1 Fees and Permits
2 Performance Bonds
3 90-Day Maintenance
4 Rough Grading
5 Park Trash Totters (per Waste Disposal Company)
6 Sidewalk
7 Curb& Gutter
NOTES
1 This estimate is prepared as a guide only and is subject to possible change. It has been prepared to a standard of accuracy which, to the best of our knowledge and judgment, is sufficient to satisfy our understanding of the purposes of this estimate. vanderToolen Assocaites, Inc. makes no warranty, either expressed or implied, as to the accuracy of this estimate. 2 Costs presented herein represent an opinion based on historical data and current information shared by trade partners 3 4

SIGNATURE
11/20/25
Benjamin P. Green, PLA Date
Associate Principal
vanderToolen Associates, Inc.

Bond Estimate is based on the unapproved Neighborhood 'A/B': SP III Tract 3609 A5 Utility Corridor Trail Improvement Plans dated July 30, 2025.

Unit Legend: SF = Square Foot; LF = Linear Foot; CY = Cubic Yard; LS = Lump Sum; EA = Each; ALLOW = Allowance; Neighborhood I - Greenway Loop Park Ph. 1 Page 2 of 2
Landscape Cost Estimate
11/20/2025
ATTACHMENT B-9
Item 7.10
Mountain House Page 360 of 545

ATTACHMENT C
RESOLUTION NO. 2025-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MOUNTAIN HOUSE APPROVING THE FINAL MAP FOR MOUNTAIN HOUSE NEIGHBORHOOD I (TRACT NO. 4194), ACCEPTING OFFERS

OF DEDICATION, AND AUTHORIZING RECORDATION OF THE FINAL MAP WHEREAS, Mountain House Neighborhood I (Tract No. 4194) is located north of Byron Road and south of Old River; and
WHEREAS, the project subdivides an approximately 10.56-acre site zoned Medium Density Residential (R-M) into 61 residential lots; and
WHEREAS, the subdivider is Mountain House Developers LLC, a Delaware limited liability company (“Subdivider”); and
WHEREAS, the Subdivider has submitted the Final Map for Mountain House Neighborhood I (Tract No. 4194) for City approval; and
WHEREAS, approval of the Final Map is exempt from further environmental review pursuant to Section 15268(b)(3) of the CEQA Guidelines as a ministerial action; and WHEREAS, City staff has reviewed the Final Map and the related Improvement Agreements and determined that the subdivision is in substantial conformance with the approved Tentative Map and will be developed in accordance with Mountain House Specific Plan II and applicable City standards; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Mountain House as follows:

1. Approval of Final Map. The certain Final Map, consisting of eleven (11) sheets, entitled Mountain House Neighborhood I Final Map (Tract No. 4194), is hereby approved as and for the Final Map of that subdivision known as Mountain House Neighborhood I (Tract No. 4194) within the City of Mountain House. Said Final Map is attached hereto as Exhibit 1 and incorporated herein by reference.

2. Acceptance of Offers of Dedication and Recordation. The City Council hereby accepts, on behalf of the public, all offers of dedication for the purposes designated on the map and authorizes recordation of the Final Map.

3. Execution of Improvement Agreements. The City Council authorizes the City Manager, or designee, to execute the nine Improvement Agreements for Tract No. 4194 (Attachments B-1 through B-9) and to accept related improvement securities as required by the Agreements.

4. Recordation and Administrative Actions. The City Clerk is authorized and directed to sign and record said Final Map with the San Joaquin County Recorder once the map bears approval of the County Surveyor and City Engineer. The City Manager is further authorized to take all actions necessary and appropriate to carry out the purpose and intent of this Resolution.

Item 7.10
Mountain House Page 361 of 545
1 OWNER'S STATEMENT OWNER'S ACKNOWLEDGMENT

CITY ENGINEER'S STATEMENT RECORDER'S STATEMENT
TRACT NO. 4194
CONSISTING OF 11 SHEETS
BEING A SUBDIVISION OF PARCEL A, "TRACT NO. 4287, MOUNTAIN HOUSE, NEIGHBORHOOD I, LARGE LOT FINAL MAP" FILED IN BOOK ______ OF MAPS AND PLATS, PAGE _______ , SAN JOAQUIN COUNTY RECORDS,

BEING A PORTION OF RANCHO EL PESCADERO

CITY OF MOUNTAIN HOUSE, SAN JOAQUIN COUNTY, CALIFORNIA
SEPTEMBER 2025

CIVIL ENGINEERS SURVEYORS PLANNERS

SAN RAMON
WWW.CBANDG.COM

ROSEVILLE
(925) 866-0322
(916)788-4456

SUBDIVISIONS OF SAN JOAQUIN COUNTY,

MOUNTAIN HOUSE,
NEIGHBORHOOD 'I', UNIT NO. 4
JOB NO. 673-058 SHEET OF 11
SITE

VICINITY MAP

CITY CLERK'S STATEMENT
D.D. SHEET A
EXHIBIT 1
Item 7.10
Mountain House Page 362 of 545
2 COUNTY SURVEYOR'S STATEMENT:

NOTES:

SURVEYOR'S STATEMENT:

TRACT NO. 4194
CONSISTING OF 11 SHEETS
BEING A SUBDIVISION OF PARCEL A, "TRACT NO. 4287, MOUNTAIN HOUSE, NEIGHBORHOOD I, LARGE LOT FINAL MAP" FILED IN BOOK ______ OF MAPS AND PLATS, PAGE _______ , SAN JOAQUIN COUNTY RECORDS,

BEING A PORTION OF RANCHO EL PESCADERO

CITY OF MOUNTAIN HOUSE, SAN JOAQUIN COUNTY, CALIFORNIA
SEPTEMBER 2025

CIVIL ENGINEERS SURVEYORS PLANNERS

SAN RAMON
WWW.CBANDG.COM

ROSEVILLE
(925) 866-0322
(916)788-4456

SUBDIVISIONS OF SAN JOAQUIN COUNTY,

MOUNTAIN HOUSE,
NEIGHBORHOOD 'I', UNIT NO. 4
JOB NO. 673-058 SHEET OF 11
CERTIFICATE OF DEDICATION:

SIGNATURE OF OMISSIONS:

BENEFICIARY'S ACKNOWLEDGMENT:

BENEFICIARY'S STATEMENT:

EXHIBIT 1
Item 7.10
Mountain House Page 363 of 545

FUTURE CENTRAL PARKWAY

GRAYCLIFF AVENUE FUTURE
3 PRELIMINARY
TRACT NO. 4194
SCALE: 1" =
CONSISTING OF 11 SHEETS
BEING A SUBDIVISION OF PARCEL A, "TRACT NO. 4287, MOUNTAIN HOUSE, NEIGHBORHOOD I, LARGE LOT FINAL MAP" FILED IN BOOK ______ OF MAPS AND PLATS, PAGE _______ , SAN JOAQUIN COUNTY RECORDS,

BEING A PORTION OF RANCHO EL PESCADERO

CITY OF MOUNTAIN HOUSE, SAN JOAQUIN COUNTY, CALIFORNIA
SEPTEMBER 2025

CIVIL ENGINEERS SURVEYORS PLANNERS

SAN RAMON
WWW.CBANDG.COM

ROSEVILLE
(925) 866-0322
(916)788-4456

SUBDIVISIONS OF SAN JOAQUIN COUNTY,

MOUNTAIN HOUSE,
NEIGHBORHOOD 'I', UNIT NO. 4
BASIS OF BEARINGS:

LEGEND
#
REFERENCES:

JOB NO. 673-058 SHEET OF 11
100'

GRAPHIC SCALE
100' 0' 50' 100' 200' 400'

DETAIL B DETAIL A
EXHIBIT 1
Item 7.10
Mountain House Page 364 of 545
GRAYCLIFF AVENUE FUTURE5 GRAYCLIFF AVENUE FUTURE CENTRAL PARKWAY DEOL WAY DHARMENDRA STREET HEMA MALINI LANE DHARMENDRA COURT 1 2 34567 8 9 10 11 12 13 14
15 16
17 18
19 20
21 22
23 24
25 26
40 41
42 43
37 38
39 36
44 35
45 34
46 33
47 48 31
32 28
27 29
49 30
50 51
53 52 6 7 8 9
10 11
60 59 58 57 56 55
54 61 4
TRACT NO. 4194
SCALE: 1" =
CONSISTING OF 11 SHEETS
BEING A SUBDIVISION OF PARCEL A, "TRACT NO. 4287, MOUNTAIN HOUSE, NEIGHBORHOOD I, LARGE LOT FINAL MAP" FILED IN BOOK ______ OF MAPS AND PLATS, PAGE _______ , SAN JOAQUIN COUNTY RECORDS,

BEING A PORTION OF RANCHO EL PESCADERO

CITY OF MOUNTAIN HOUSE, SAN JOAQUIN COUNTY, CALIFORNIA
SEPTEMBER 2025

CIVIL ENGINEERS SURVEYORS PLANNERS

SAN RAMON
WWW.CBANDG.COM

ROSEVILLE
(925) 866-0322
(916)788-4456

SUBDIVISIONS OF SAN JOAQUIN COUNTY,

MOUNTAIN HOUSE,
NEIGHBORHOOD 'I', UNIT NO. 4
JOB NO. 673-058 SHEET OF 11
BASIS OF BEARINGS:

LEGEND#
REFERENCES:
100'

GRAPHIC SCALE
100' 0' 50' 100' 200' 400'

PRELIMINARY
EXHIBIT 1
Item 7.10
Mountain House Page 365 of 545
8 9
40 5
4 3
2 1
SEE SHEET 8 SEE SHEET 6

DEOL WAY DHARMENDRA STREET

DHARMENDRA COURT
1 2
2 3
3 4
4 5
JOB NO. 673-058 SHEET OF 11 5

PRELIMINARY
TRACT NO. 4194
SCALE: 1" =
CONSISTING OF 11 SHEETS
BEING A SUBDIVISION OF PARCEL A, "TRACT NO. 4287, MOUNTAIN HOUSE, NEIGHBORHOOD I, LARGE LOT FINAL MAP" FILED IN BOOK ______ OF MAPS AND PLATS, PAGE _______ , SAN JOAQUIN COUNTY RECORDS,

BEING A PORTION OF RANCHO EL PESCADERO

CITY OF MOUNTAIN HOUSE, SAN JOAQUIN COUNTY, CALIFORNIA
SEPTEMBER 2025

CIVIL ENGINEERS SURVEYORS PLANNERS

SAN RAMON
WWW.CBANDG.COM

ROSEVILLE
(925) 866-0322
(916)788-4456

SUBDIVISIONS OF SAN JOAQUIN COUNTY,

MOUNTAIN HOUSE,
NEIGHBORHOOD 'I', UNIT NO. 4

DETAIL D

DETAIL C

DETAIL E

DETAIL F

DETAIL G
30'

GRAPHIC SCALE
30' 0' 15' 30' 60' 120'
NOTES:

EXHIBIT 1
Item 7.10
Mountain House Page 366 of 545
39 10 11
12 13
14 15 FUTURE CENTRAL PARKWAY
SEE SHEET 7 SEE SHEET 5

DEOL WAY HEMA MALINI LANE
14 15
11 12
12 13
13 14 6

BEING A PORTION OF RANCHO EL PESCADERO

CITY OF MOUNTAIN HOUSE, SAN JOAQUIN COUNTY, CALIFORNIA
SEPTEMBER 2025

CIVIL ENGINEERS SURVEYORS PLANNERS

SAN RAMON
WWW.CBANDG.COM

ROSEVILLE
(925) 866-0322
(916)788-4456

SUBDIVISIONS OF SAN JOAQUIN COUNTY,

MOUNTAIN HOUSE,
NEIGHBORHOOD 'I', UNIT NO. 4
JOB NO. 673-058 SHEET OF 11

DETAIL H DETAIL I

DETAIL K

DETAIL J
30'

GRAPHIC SCALE
30' 0' 15' 30' 60' 120'
NOTES:

EXHIBIT 1
Item 7.10
Mountain House Page 367 of 545
37 38
36 35
34 33
32 16
17 18
19 20
21 22

FUTURE CENTRAL PARKWAY
SEE SHEET 6
SEE SHEET 10 SEE SHEET 9 SEE SHEET 8 HEMA MALINI LANE
15 16
JOB NO. 673-058 SHEET OF 11 7

BEING A PORTION OF RANCHO EL PESCADERO

CITY OF MOUNTAIN HOUSE, SAN JOAQUIN COUNTY, CALIFORNIA
SEPTEMBER 2025

CIVIL ENGINEERS SURVEYORS PLANNERS

SAN RAMON
WWW.CBANDG.COM

ROSEVILLE
(925) 866-0322
(916)788-4456

SUBDIVISIONS OF SAN JOAQUIN COUNTY,

MOUNTAIN HOUSE,
NEIGHBORHOOD 'I', UNIT NO. 4

DETAIL L

DETAIL N

DETAIL M
30'

GRAPHIC SCALE
30' 0' 15' 30' 60' 120'
NOTES:

EXHIBIT 1
Item 7.10
Mountain House Page 368 of 545
47 41
42 43
44 45
46 6
7 SEE SHEET 7 DHARMENDRA STREET
SEE SHEET 5
SEE SHEET 10
8 TRACT NO. 4194
SCALE: 1" =
CONSISTING OF 11 SHEETS
BEING A SUBDIVISION OF PARCEL A, "TRACT NO. 4287, MOUNTAIN HOUSE, NEIGHBORHOOD I, LARGE LOT FINAL MAP" FILED IN BOOK ______ OF MAPS AND PLATS, PAGE _______ , SAN JOAQUIN COUNTY RECORDS,

BEING A PORTION OF RANCHO EL PESCADERO

CITY OF MOUNTAIN HOUSE, SAN JOAQUIN COUNTY, CALIFORNIA
SEPTEMBER 2025

CIVIL ENGINEERS SURVEYORS PLANNERS

SAN RAMON
WWW.CBANDG.COM

ROSEVILLE
(925) 866-0322
(916)788-4456

SUBDIVISIONS OF SAN JOAQUIN COUNTY,

MOUNTAIN HOUSE,
NEIGHBORHOOD 'I', UNIT NO. 4
JOB NO. 673-058 SHEET OF 11

PRELIMINARY
30'

GRAPHIC SCALE
30' 0' 15' 30' 60' 120'
NOTES:

EXHIBIT 1
Item 7.10
Mountain House Page 369 of 545
FUTURE
24 CENTRAL PARKWAY
23 26 SEE SHEET 7 SEE SHEET 10
25 FUTURE

GRAYCLIFF AVENUE HEMA MALINI LANE
24 25
30 29
28 27
29 28 9
TRACT NO. 4194
SCALE: 1" =
CONSISTING OF 11 SHEETS
BEING A SUBDIVISION OF PARCEL A, "TRACT NO. 4287, MOUNTAIN HOUSE, NEIGHBORHOOD I, LARGE LOT FINAL MAP" FILED IN BOOK ______ OF MAPS AND PLATS, PAGE _______ , SAN JOAQUIN COUNTY RECORDS,

BEING A PORTION OF RANCHO EL PESCADERO

CITY OF MOUNTAIN HOUSE, SAN JOAQUIN COUNTY, CALIFORNIA
SEPTEMBER 2025

CIVIL ENGINEERS SURVEYORS PLANNERS

SAN RAMON
WWW.CBANDG.COM

ROSEVILLE
(925) 866-0322
(916)788-4456

SUBDIVISIONS OF SAN JOAQUIN COUNTY,

MOUNTAIN HOUSE,
NEIGHBORHOOD 'I', UNIT NO. 4
JOB NO. 673-058 SHEET OF 11

PRELIMINARY

DETAIL P

DETAIL S

DETAIL R

DETAIL Q
30'

GRAPHIC SCALE
30' 0' 15' 30' 60' 120'
NOTES:

EXHIBIT 1
Item 7.10
Mountain House Page 370 of 545
51 53
52 27
29 48
49 31
30 DHARMENDRA STREET

FUTURE GRAYCLIFF AVENUE

GRAYCLIFF AVENUE HEMA MALINI LANE
SEE SHEET 7
SEE SHEET 9
SEE SHEET 8
28 SEE SHEET 11
50 30
31 49
48 10
TRACT NO. 4194
SCALE: 1" =
CONSISTING OF 11 SHEETS
BEING A SUBDIVISION OF PARCEL A, "TRACT NO. 4287, MOUNTAIN HOUSE, NEIGHBORHOOD I, LARGE LOT FINAL MAP" FILED IN BOOK ______ OF MAPS AND PLATS, PAGE _______ , SAN JOAQUIN COUNTY RECORDS,

BEING A PORTION OF RANCHO EL PESCADERO

CITY OF MOUNTAIN HOUSE, SAN JOAQUIN COUNTY, CALIFORNIA
SEPTEMBER 2025

CIVIL ENGINEERS SURVEYORS PLANNERS

SAN RAMON
WWW.CBANDG.COM

ROSEVILLE
(925) 866-0322
(916)788-4456

SUBDIVISIONS OF SAN JOAQUIN COUNTY,

MOUNTAIN HOUSE,
NEIGHBORHOOD 'I', UNIT NO. 4
JOB NO. 673-058 SHEET OF 11
30'

GRAPHIC SCALE
30' 0' 15' 30' 60' 120'

PRELIMINARY
NOTES:

DETAIL T

DETAIL U
EXHIBIT 1
Item 7.10
Mountain House Page 371 of 545
59 58 57 56 55 54 SEE SHEET 10 DHARMENDRA STREET

GRAYCLIFF AVENUE
60 61
52 53
52 51
51 50
50 49
61 60
11 TRACT NO. 4194
SCALE: 1" =
CONSISTING OF 11 SHEETS
BEING A SUBDIVISION OF PARCEL A, "TRACT NO. 4287, MOUNTAIN HOUSE, NEIGHBORHOOD I, LARGE LOT FINAL MAP" FILED IN BOOK ______ OF MAPS AND PLATS, PAGE _______ , SAN JOAQUIN COUNTY RECORDS,

BEING A PORTION OF RANCHO EL PESCADERO

CITY OF MOUNTAIN HOUSE, SAN JOAQUIN COUNTY, CALIFORNIA
SEPTEMBER 2025

CIVIL ENGINEERS SURVEYORS PLANNERS

SAN RAMON
WWW.CBANDG.COM

ROSEVILLE
(925) 866-0322
(916)788-4456

SUBDIVISIONS OF SAN JOAQUIN COUNTY,

MOUNTAIN HOUSE,
NEIGHBORHOOD 'I', UNIT NO. 4
JOB NO. 673-058 SHEET OF 11

PRELIMINARY
30'

GRAPHIC SCALE
30' 0' 15' 30' 60' 120'
NOTES:

DETAIL Y

DETAIL X

DETAIL W

DETAIL V
DETAIL Z SEE SHEET 8
EXHIBIT 1
Item 7.10
Mountain House Page 372 of 545
TITLE: Receive and File the Audited Financial Report for the Fiscal Year Ended June 30, 2025
MEETING DATE: December 10, 2025
PREPARED BY: Thomas Retchless, Finance Director

RECOMMENDATION
Staff recommends that the City Council receive and file the audited financial statements for the fiscal year ended June 30, 2025.

BACKGROUND
The audited financial statements are a summary report of the financial transactions of the City of Mountain House for the fiscal year ending June 30, 2025. The report provides summary financial information for citizens, government agencies, lenders, investors and other interested parties. The format of this report complies with generally accepted accounting principles and reporting requirements of the national Governmental Accounting Standards Board (GASB).

In 2021, the Board of Directors of the Mountain House Community Services District issued a Request for Proposals for auditing services. After receiving and reviewing those responses, the Board awarded a fouryear contract (with two optional one-year extensions) for auditing services to Richardson & Co. For fiscal years 2021-2022 through 2024-2025. That agreement was re-affirmed at the time the City of Mountain House was incorporated.

DISCUSSION
Richardson issued an unqualified opinion on the City’s financial statements for fiscal year 2024-2025. This opinion indicates that the financial statements present fairly, in all material respects, the financial position of the City in accordance with generally accepted accounting principles and GASB reporting requirements.

Richardson also presented a report on internal control over financial reporting (Attachment B) and a management letter (Attachment C). Staff reviewed the information in the internal control report and the management letter and noted responses within the respective documents.

For the fiscal year 2024-25, the City is issuing an Annual Comprehensive Financial Report (ACFR). An ACFR is a set of financial statements for a governmental entity that complies with GASB accounting requirements. It must be audited by an independent auditor using generally accepted government auditing standards. The ACFR consists of three sections: Introductory, Financial, and Statistical and presents a wider variety of information intended to help the reader properly understand the basic statements. The Introductory Section orients and guides the reader through the report. The Financial Section presents the City’s basic financial statements as well as notes to the statements and the Item 8.1
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independent auditor’s report. The Statistical Section provides additional financial and statistical data, including data about financial trends that may better inform the reader about the City’s activities.

The auditors are in virtual attendance at tonight’s meeting and are available to answer any questions you may have.

FISCAL IMPACT
No fiscal impact.

STRATEGIC PLAN
Conducting the annual audit of the financial statements helps the City meet the following goals:
 Provide accurate and useful financial information on a timely basis  Annual financial report with unqualified opinion completed by December 31 of next fiscal year The auditors expressed an unqualified opinion on the financial statements for fiscal year 2024-2025. The audit was completed in December, 2025. Staff expects to continue to have future audits completed on a similar timely basis.

CEQA
Not applicable.

ACTION FOLLOWING CITY COUNCIL APPROVAL
Staff will post the audited financial statements and reports on internal control on the City’s website.

ATTACHMENTS
A. Audited financial statements, including the independent auditor’s report B. Independent auditor’s report on internal control over financial reporting C. Independent auditor’s letter of management recommendations Item 8.1
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City of Mountain House
Annual Comprehensive Financial Report
FY 2024-2025 | Fiscal Year Ended June 30, 2025
Mountain House, California
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CITY OF MOUNTAIN HOUSE

MOUNTAIN HOUSE, CALIFORNIA

ANNUAL COMPREHENSIVE FINANCIAL REPORT
For the Fiscal Year Ended
June 30, 2025
Prepared by the Finance Department
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CITY OF MOUNTAIN HOUSE
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025
Table of Contents
i

INTRODUCTORY SECTION
Letter of Transmittal .................................................................................................................................... iv List of Elected and Appointed Officials .................................................................................................... xvi Organizational Chart ................................................................................................................................. xvii GFOA Certificate of Achievement for Excellence in Financial Reporting ............................................. xviii

FINANCIAL SECTION
Independent Auditor’s Report ....................................................................................................................... 3 Management’s Discussion and Analysis (Required Supplementary Information) ....................................... 6 Basic Financial Statements
Government-Wide Financial Statements:

Statement of Net Position ........................................................................................................................ 17 Statement of Activities ............................................................................................................................. 18 Fund Financial Statements:

Governmental Funds:

Balance Sheet — Governmental Funds ................................................................................................ 19 Reconciliation of the Governmental Funds Balance Sheet to the GovernmentWide Statement of Net Position ........................................................................................................ 20 Statement of Revenues, Expenditures, and Changes in Fund Balances — Governmental Funds ......................................................................................................................... 21 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Government-Wide Statement of Activities — Governmental Activities .......................................................................................... 22 Proprietary Funds:

Statement of Net Position ..................................................................................................................... 23 Statement of Revenues, Expenses and Changes in Fund Net Position ................................................. 24 Statement of Cash Flows ...................................................................................................................... 25 Fiduciary Funds:

Statement of Fiduciary Net Position – Custodial Fund ........................................................................ 26 Statement of Changes in Fiduciary Net Position – Custodial Fund ..................................................... 27 Notes to the Basic Financial Statements ..................................................................................................... 30 Required Supplementary Information:

Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – General Fund ................................................................................................................... 62 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – Special Assessments Special Revenue Fund ................................................................... 63 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – Impact Fees Special Revenue Fund ................................................................................ 64 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – Development Services Special Revenue Fund ................................................................ 65 Note to Required Supplementary Information ......................................................................................... 66 Schedule of the Proportionate Share of the Net Pension Liability and Schedule of Contributions to the Pension Plan (Unaudited) ................................................................................ 67 Item 8.1
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CITY OF MOUNTAIN HOUSE
Annual Comprehensive Financial Report
For the Year Ended June 30, 2025
Table of Contents
ii
Supplementary Information:

Combining and Individual Fund Financial Statements and Schedules:

Combining Balance Sheet – Nonmajor Governmental Funds ................................................................. 69 Combining Statement of Revenues, Expenditures and Changes in Fund Balance – Nonmajor Governmental Funds .......................................................................................... 70 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – Measure K Special Revenue Fund .................................................................................. 71 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – Gas Tax Special Revenue Fund ...................................................................................... 72 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – Capital Projects Fund ...................................................................................................... 73

STATISTICAL SECTION
Table of Contents ................................................................................................................................... 75 Financial Trends
Net position by component ................................................................................................................ 76 Changes in net position....................................................................................................................... 77 Fund balances of governmental funds ............................................................................................... 79 Changes in fund balances of governmental funds ............................................................................ 80 Revenue Capacity
Water utility system – ten largest customers .................................................................................... 81 Water utility system rates ................................................................................................................... 81 Property tax valuations and rates ....................................................................................................... 82 Property and franchise taxes -governmental funds ........................................................................... 83 Special tax levies and rates ............................................................................................................ 84 Principal property taxpayers ............................................................................................................... 85 Debt Capacity
Ratio of outstanding debt by type ...................................................................................................... 86 Computation of direct and overlapping debt ..................................................................................... 87 Revenue bond coverage ...................................................................................................................... 88 Demographic and Economic Information
Demographic and economic statistics ............................................................................................... 89 Operating Information
Full-time and City employees by function ........................................................................................ 90 Capital asset statistics by function/program ...................................................................................... 91

COMPLIANCE REPORT
Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ........................................................ 94 Item 8.1
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iii

INTRODUCTORY SECTION
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December 1, 2025
To the Honorable Members of the City Council, and Residents of the City of Mountain House:

We are pleased to present to you the Annual Comprehensive Financial Report (ACFR) for the City of Mountain House (the City) for the year ended June 30, 2025. The City’s Revenue Bonds Continuing Disclosure requires the City submit audited financial statements in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board. This report fulfills that requirement for the year ended June 30, 2025.

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.

An annual audit is performed by an independent certified public accountant (CPA) selected by the City Council. The accounting firm of Richardson & Company, LLP. was selected to perform the City’s annual financial audits. The auditors have issued an unmodified (“clean”) opinion on the financial statements for the fiscal year ended June 30, 2025, which is presented on page 3. The audit was performed in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, and the State Controller’s Minimum Audit Requirements for California Special Districts.

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.

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v
The 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 Profile
The City of Mountain House is located in the west area of San Joaquin County, approximately 61 miles southeast of San Francisco, 52 miles east of Oakland, 51 miles northeast of San Jose,
and 76.5 miles
southwest of
Sacramento. The City
occupies 7.5 square
miles.

On March 5, 2024,
voters overwhelmingly
supported the
incorporation of
Mountain House.

Becoming a city will
provide new revenues,
policing powers, land
use and planning
control, and
opportunities to
participate in regional
agencies and grant
programs.

Incorporation achieved a long-standing goal of the Strategic Plan.

The Mayor is directly elected and the four Council Members are elected by the voters to serve overlapping four-year terms. The City Council sets policy and exercises the legislative authority of the City.

The City of Mountain House is a Council-Manager form of government. The City Council appoints the City Manager who appoints all other City personnel. The City Manager is charged with overseeing the City’s daily operations.

Mission and Values
The City of Mountain House is committed to a fiscally balanced budget through responsible governance and transparent communication, while providing reliable services, vibrant parks, and diverse recreation and maintaining a safe and inclusive community for all.

The City’s values are:
- Ethics: To hold to the highest ethical standards, and to act with honesty and integrity.

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- Responsibility: To accept responsibility for our individual and collective actions, and to have the courage to take right actions on behalf of the whole irrespective of political pressures.
- Vision: To be visionary, innovative,
and resourceful.
- Community-Minded: To create a
vibrant, thriving, and resilient
community and to build strong,
positive partnerships with residents
and stakeholders.
- Respect: To interact respectfully,
use active listening skills, and
develop the self-awareness to
monitor how our actions impact
ourselves and others.
- Competence: To competently
discharge our duties and seek
opportunities to increase our
efficiency.

Economic Growth and Development
The City is planned to include
approximately 2,619 acres of residential
development of varying densities, 674
acres of commercial and industrial uses,
and approximately 760 acres of open
space, recreation and resource
conservation areas. Essential public
services, including streets, public safety,
fire and emergency services, storm drain,
water and sewer, are provided by the City,
as required by the Master Plan. When fully
built out, Mountain House is intended to
provide approximately 15,700 units of housing and services for approximately 44,000 people.

Development within the City has been ongoing for over 20 years, and the community is expected to continue developing over approximately the next 25 to 30 years. As of June 30, 2025, over 8,000 units of housing have been built in seven neighborhoods, all being billed for utility services by the City. To date, nearly all of the planned homes in Neighborhoods C, D, E, F, G and H have been completed. Infrastructure in Neighborhoods A and B are underway and multiple merchant builders are actively constructing homes, many of which have been completed and sold to homeowners.

Construction of infrastructure in Neighborhoods I, J, K and L has begun. These neighborhoods will be a mix of family and active adult housing.

To date, eight K-8 schools, a high school and one of the planned village centers have been built. In March 2020, the City moved into its Town Hall and Library building in the town center. This building is expected to become an anchor and focal point for the Mountain House community. The Town Center Shopping Center is complete and Item 8.1
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vii
anchored by Safeway. In addition, 525,000 square feet of industrial/commercial has been completed.

The major economic impact facing the City is the rapid rate of development occurring within the City. The City has reached a level and pace of development and operations and maintenance activity that requires additional staff to review, evaluate, and manage growth as it relates to infrastructure development and construction, operations and maintenance activities, regulatory permits, and plan review services. The goal is to facilitate development while protecting the interests of the community by ensuring compliance with the City’s Master Plan and design standards and specifications. As we embark on this wave of economic activity, we anticipate rising to meet the following challenges:
- It is estimated that the City will issue in excess of 300 residential building permits during fiscal year 2025/2026.
- New growth will include multi-family residential as well as commercial developments, which will present additional challenges unique to these types of development.
- Growth has triggered the expansion of the water and wastewater plants, stormwater system, neighborhood and community parks, and construction of public buildings.
- As the population of the community increases, staff will observe traffic patterns and recommend effective, affordable, and proven safety improvements that comply with state and county regulations.
- The City’s parks require play equipment inspection, repair and replacement. Play surfaces for various sports activities require monitoring and management to ensure safe and reliable use for the community. As a result of the growth in development, more parks will be constructed and require similar oversight. - Administrative staff is in the process of evaluating processes that will need to be enhanced to support increased development activity.
- Staff is in the process of evaluating policies and processes that will need to be developed and enhanced to support increased development activity. - Staff will also be closely monitoring economic conditions to identify any budget requirements that may need to be adjusted during the fiscal year.

Financial Outlook
Growth in the City’s property tax revenue continues to reflect a healthy and thriving community. Following a loss in overall Assessed Valuation (AV) during the recession, the City has increased total AV from $1.1 billion in Tax Year 2013 to $5.5 billion in Tax Year 2025, owing to the number of property sales, higher sales prices, and new developments.

Total AV increased by $416 million (8%) over the prior year.

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Special taxes are the
second major revenue
source and have increased
roughly 30% over the last
five years. The dramatic
increases in the special
taxes is the result of slight
increases in rates but more
largely due to increase in
residential units in the
community. Over the last
five years the City has
issued permits for over
1,500 of the roughly 8,108 housing units in the City.

While FY 2024-25 finished with a General Fund addition to fund balance of approximately $11.5 million, it is long-term fiscal sustainability that remains at the forefront of budget discussions. Even with the continued growth in property tax, special taxes, and the rising costs of contracted services, it is projected that the General Fund surplus is not expected to decrease in the near future, but the Special Tax funds will need to increase rates to stay balanced, as reflected in the most recent update to the 5-Year Forecast.

Financial Planning and Policies
The Board of Directors adopted a Strategic Plan in Fiscal Year 2024-25. Strategies were identified to establish the framework and overarching policy focus for the delivery of public services to the community. The Budget document has a section containing the Strategic Plan and Goals and Objectives. Updates to programs in the Budget document were tied to the prioritization of elements within the Strategic Plan.

The City adopts a balanced operational budget in accordance with City policies and uses an annual budget format. The City uses a five-year financial planning model for long-term financial planning within the budget. This model is based on financial assumptions, trends, and the infrastructure needs of the City. This allows the City to prepare for future needs and have cashflows available when needed. The City Council adopts a final budget and appropriates funds in advance of the July 1st start of the new Fiscal Year. The importance of being prepared to address long-term needs has always been a key principle supported by the City Council.

Accomplishments
The City’s accomplishments:

General Administration
- Collaborated with and engaged staff in achievement of shared values:
transparency, accountability and service.
- Developed baseline goals and objectives for department in alignment with Strategic Plan for fiscal years 2025/2026 through 2026/2027. - Cultivated constructive, cooperative, and collaborative relationships with developers to envision and right-size improvements.
- In collaboration with developers and our legal team, established a Community Facility District (CFD) to expedite funding and construction of public infrastructure $-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Property taxes Specail taxes
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ix
in future neighborhoods, ensuring timely delivery of parks and other facilities before full neighborhood buildout.
- Appointed a Communications Officer to strengthen communication with residents, respond to inquiries, and build relationships with local journalists and stakeholders to improve the flow of information.

Human Resources
- Updated Personnel Policy as needed.
- Negotiated contracts with the Service Employees International Union (SEIU) in effect through June 30, 2026.
- Successfully opened and/or completed recruitments for vacant positions. - Negotiated contracts with the Service Employees International Union (SEIU) in effect through June 30, 2026.
- Successfully opened and/or completed recruitments for vacant positions. Ensured aspects of labor agreements are implemented including cost of living increases, step increases and performance evaluations.
- Worked with Finance staff to implement an in-house payroll system; secured a suite of benefits including health, dental, vision, and life insurance; retirement; and deferred compensation.
- Issued a Request for Proposals and awarded a contract for a Classification and Compensation study with an anticipated completion date of July 2025.

Risk Management
- Joined the Municipal Pooling Authority, a joint powers agency that better meets the City’s risk management needs related to general liability and employmentrelated issues. - Assumed accountability for in-house risk management, overseeing all risk, compliance and safety programs, and ensuring all training, best practices and mandated audits are being conducted.
- Coordinated with Human Resources to identify and assign appropriate training opportunities and monitor completion.
- Developed tracking system to log incidents, police reports, insurance information, claims made, and reimbursement received.

Finance
- Awarded a Distinguished Budget Presentation Award from the Government Finance Officers’ Association for the fiscal year 2024/25 budget. - Awarded an Operating Budget Excellence Award from the California Society of Municipal Finance Officers for the fiscal year 2024/25 budget. - Awarded a Certificate of Achievement for Excellence in Financial Reporting for the City’s Annual Comprehensive Financial Report (ACFR) for fiscal year 2024/25.

The ACFR consists of three sections – Introductory, Financial, and Statistical – and presents a wider variety of information intended to help the reader more fully understand the basic financial statements.
- Completed AB1600 annual reports, information required by the State Controller, and reports required by bond covenants timely and accurately. - Prepared updates to the Financial Management Policy Manual as appropriate. - Worked with financial and legal consultants to create Community Facilities District 2024-1 in order to expedite funding and construction of public infrastructure in future neighborhoods, ensuring timely delivery of parks and other facilities before full neighborhood buildout.
- Redeemed $10 million of the TIF lease revenue bonds as authorized by the TIF and Annexation Fee Programs Policies.

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- Since incorporation, staff has implemented in-house payroll, accounts payable, and business license systems and coordinated collection of new state and county revenues.
- Managed general office operations include requests for supplies, services and equipment.

Customer Service
- Implemented and converted to a new utility billing and collection system and hired and trained new staff to provide in-house customer service for 7,000+ accounts. - Maintained compliance with SB998 requirements related to utility services, including counseling utility customers on availability of amortization plans. - Streamlined lien procedures so that property tax liens are approved by the City Council annually, rather than throughout the year. In the interim, property liens are imposed throughout the year.

Information Technology
- Provided resources for staff to work, process transactions, and meet remotely and efficiently.
- Managed equipment and phone systems.
- Coordinated various software systems including implementation, integration, upgrades, and training.
- Negotiated a Memoranda of Understanding for Information technology services with San Joaquin County.

City Clerk
- Ensured compliance with Brown Act through timely publication and noticing of agenda packets.
- Transitioned to a new agenda management system that will increase staff efficiency and public accessibility.
- Worked with staff to implement a tracking system for public comments at City Council meetings.
- Processed legislative documents (Resolutions and Ordinances). - Ensured timely filing of required Fair Political Practices Form 700 by elected officials.

Web Services, Social Media, and Other Communications
- Evaluated various web platform providers with respect to qualifications, features, ease of use, and successful installations at other public agencies. Staff selected Granicus as the platform that will best meet our needs to design a site that is informative, up-to-date, easy to navigate and maintain, internally consistent, and pleasing to view. Improvement and maintenance of the site is on-going. - Implemented OpenTownHall to provide information to the public about City operations and development activity. The program is also used to engage the community by offering surveys.
- Posted surveys on a variety of topics to better inform the Board of the community’s priorities and preferences.
- Posted information on road closures, community meetings and recreation events.

Established an eblast subscription to sign up for topics of interest. - Developed a variety of on-line fillable PDFs forms with options to pay to facilitate applications and processing.

Recreation
- Hosted second annual Juneteenth Celebration at Central Park for over 2,000 guests with over 30 food and retail vendors, live performances, history presentations, dancing, music, and local, regional, and national dignitaries in attendance.

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- Hosted second annual “Light Up Main Street” with vendors, live music, and lights along Main Street from Town Hall to the tree at Central Park, increasing attendance and positive feedback.
- Updated website to be more customer friendly that includes:
o Weather field conditions page.
o Upcoming rental schedules.
o Policies and fees reference documents.
o Special event photos and information.
o Vendor information and sign-up links.
o Calendar items for upcoming events and programs.
o Park and facility maps for easy reference.
- Increased marketing and community involvement through more robust social media campaigns.
- Received sponsorships from local businesses for Holiday Tree Lighting and new Central Park Cinema special events offsetting the costs. Received additional funds from community member donations to offset the costs of the Bike Rodeo and Senior Health and Wellness Expo.
- City Council adopted the tennis courts, indoor facilities, parks and fields, and picnic shelters rental policies and fees.
- Developed a Community Hosted Special Event Policy and Process with collaboration between Parks and Recreation, Code Enforcement, Public Safety, Fire Department and Sheriff’s Department to be presented to Council for adoption. - Created a Contract Instructor Handbook to streamline the hiring process for specialized recreation instructors.
- Proposed a Facility Waiver/Grant Program for non-profits to offset their costs of renting City facilities.
- Added two pickleball courts to the Central Park Tennis Courts in response to community feedback.

Emergency Preparedness
- Completed Emergency Operations Plan and in the process of finalizing the Emergency Response Plan.

Public Works
- Transitioned responsibility for floodplain management from San Joaquin County to the City’s Public Works Department, appointing the Public Works Director as Floodplain Manager.
- Assisted in the development of the City’s GIS-EAM-CMMS program. - Coordinated relocation of Operations and Maintenance and Utility offices to the wastewater treatment plant.

Engineering
- Completed the Wicklund Village and Arterial Road Pavement Repair Project, including curb repairs, pavement grinding, overlay, slurry seal, and restriping. - Delivered the FY 2024-25 Citywide Sidewalk Improvement Project to mitigate pedestrian hazards.
- Executed an emergency sinkhole repair in Altamont Village to restore roadway safety.
- Secured Congestion Mitigation and Air Quality grant funding for electric vehicle charging stations and solar carports at City Hall.
- Issued requests for proposals for the Byron Road Pavement Assessment and the City’s first Transit Feasibility Study.
- Finalized City Hall parking lot access improvement plans.

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- Advertised the City’s first federally funded project: the Mountain House Parkway Traffic Signal Synchronization Project.
- Developed and published the City’s first Traffic Calming Program Manual. - Submitted six capital improvement projects for Measure K grant funding, including sidewalk replacement, ADA ramp improvements, and traffic safety enhancements. - Integrated the Byron Road Widening Project into the Measure K program for future grant opportunities.

Operations & Maintenance
- Issued requests for proposals for the maintenance of landscaped areas in the streetscape and parks.
- Created a draft Tree Maintenance Ordinance.
- Replaced a five-foot counter in the Fire Station Community Room. - Evaluated storage options for the Community Closet program. - Installed 12 new Neighborhood Watch signs in the Cordes neighborhood. - Completed safety inspection repairs at Town Hall and the Library. - Installed new signage and pavement markings in the Town Hall parking lot. - Procured and installed maximum occupancy signage for administrative offices. - Converted a tennis court for pickleball use through new court striping. - Investigated and estimated damages at multiple traffic accident sites, including Central/Aldrich, Providence/Arnaudo, Central south of Ramsey, Central/Questa Trail, and 123 Main Street.
- Re-keyed the Wastewater Treatment Plant and Operations & Maintenance offices. - Completed repairs at seven damaged sections of sound walls along arterial roadways.
- Installed redwood railing at the Unity Center to enhance building frontage. - Processed an agreement extension for Valley Communications services. - Installed a new drinking fountain at Questa Park.
- Reviewed design and cost estimates for the proposed Community Garden project.

Utilities Management
- Continued routine regulatory water quality sampling and reporting to the Water Board.
- Developed updated plans, protocols, and standard operating procedures for water and wastewater treatment plant compliance.
- Advanced solid waste and recycling programs, including SB 1383 compliance initiatives.
- Supported environmental stewardship activities through ongoing community education and regulatory participation.
- Continued to develop and update compliance plans, protocols, and Quality Assurance/Quality Control (QA/QC) programs for water, wastewater, and stormwater systems.
- Completed and published the 2023 Consumer Confidence Report; initiated the 2024 CCR in compliance with new State regulations.
- Completed initial Hexavalent Chromium sampling at the Water Treatment Plant with non-detect results.
- Completed EPA-mandated Unregulated Contaminant Monitoring Rule (UCMR-5) testing at the Water Treatment Plant with non-detect results. - Submitted the City’s Lead Service Line Inventory (LSLI) to the California State Water Resources Control Board.
- Participated in early detection sampling programs in partnership with the Department of Public Health.

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Construction Engineering
- Supported engineering teams with project inspections and construction administration for development and public infrastructure. - Advanced document coordination and project acceptance processes to streamline infrastructure turnover.

Community Development
- Completed updates to the Community Facilities Fee (CFF) and Traffic Impact Fee (TIF) programs.
- Released an RFP, conducted interviews, and hired a consultant to establish and manage the Building Division.
- Coordinated with San Joaquin County Community Development Department to transition City land use approvals, planning issues, and use permits from County to City authority.
- Assumed responsibilities from the County and implemented an internal process for assigning street names and addresses.
- Completed and implemented the Parks and Recreation Plan, including designs for Central Community Park, tennis courts, and an amphitheater. - Completed and implemented the phased Bicycle and Pedestrian Plan. - Developed a standard project reimbursement agreement for non-MARA developers in coordination with the City Attorney.
- Partnered with consultants and developers to form Community Facilities Districts (CFDs) to fund parks and infrastructure improvements.

Planning and Entitlement
- Established a fully functioning Planning Division, including onboarding consultants, developing applications and procedures, processing applications, and approving development projects.
- Updated the Master Plan and Specific Plans to reflect land use and community facility changes.
- Finalized and published online submittal checklist of requirements. - Issued an RFP to procure a consultant for the City’s General Plan update. - Developed and implemented Home Occupation Permit procedures to align with Business License issuance.

Development Engineering
- Reviewed and approved civil, grading, joint trench, streetlight, landscape, and traffic signal improvement plans for multiple residential tracts, including Tracts 4040 (A7), 3609 (A5), 3619 (B6, B7, B8), 3618 (B11), 3926 (Neighborhood K), 4194 (Neighborhood I), and 4200–4202 (Neighborhood I).
- Verified final maps and prepared subdivision and off-site improvement agreements for Tracts 3609, 3618, 3926, 3973, 3974, and 3975.
- Prepared conditions of approval for Neighborhoods F (Tracts 4210, 4211), H (Tracts 4212, 4618), and revised conditions for Neighborhoods I, J, K, and L. - Secured Union Pacific Railroad approvals for at-grade crossings at Byron Road and Mountain House Parkway and Byron Road and Great Valley Parkway. - Completed construction and acceptance of Grant Line Road improvements between Central Parkway and Great Valley Parkway, including the sound wall.

Building and Safety Services
- Established a fully functioning Building Department, including onboarding consultants, developing applications and procedures, processing building permits, and performing construction inspections.
- Launched the online GreenVue Permit Portal system to streamline applications and reviews.

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Code Compliance
- Conducted outreach initiatives including New Homeowner Day events, HOA outreach, and education on neighborhood street tree and sidewalk maintenance. - Initiated outdoor recreation season compliance efforts, including education on nonstandard vehicle parking. - Developed procedures and distributed informational materials to enhance public understanding of municipal code requirements.

Emergency Management
- Completed the Municipal Emergency Management Plan (MEMP) and began development of the ICS system.
- Trained staff to implement the MEMP and run the Emergency Operations Center. - Approved to be part of the Office of Emergency Services Disaster Council, with voting powers.
- Involved in the assessment of threats related to disasters at the County level with the Office of Emergency Services.
- Launched and expanded use of the Everbridge Notification system. - Updated the Facilities Emergency Response Plan.

Public Safety Services
- Increased traffic enforcement with one additional motorcycle officer for a total of two motorcycle officers.
- Hosted 2 successful traffic enforcement operations resulting in dozens of citations. - Used technology to increase the number of arrests and identification of suspects in various criminal activities.
- Developed all-volunteer pedestrian crossing guard program. - Conducted safety fire inspection and risk assessment at the Town Hall/Library with staff and Mountain House Fire.
- Designed process of monitoring 31 surveillance cameras strategically placed throughout the community along with additional cameras in the Town Hall/Library.

All cameras can be accessed remotely by authorized staff and Public Safety agencies as well remote monitoring by Rank’s dispatch center. - Managed 26 Flock Falcon Automated License Plate Recognition cameras in the community.
- Installed signage for Town Hall/Library doors and entrances indicating limited public access.
- Provided staff training in active incident procedures and 1st Amendment rights. - Participated in numerous community outreach programs throughout the year including Neighborhood Watch, Business Watch, Coffee with First Responders, National Night Out, and Senior Awareness.
- Conducted pedestrian crossing safety evaluations and collected data around schools and high traffic areas.
- Introduced a smart phone application for the Emergency Response Plan. - Community Preservation Officer obtained a Crime Prevention through Environmental Design Professional Designation.
- Community Preservation Officer took the lead in the GoGov program to enhance two-way public-agency communications and staff accountability. - Developed municipal codes specifically for code, parking, and park enforcement. - Established several new Neighborhood Watch and Business Watch groups. - Obtained certification as a drone pilot in compliance with FAA Part 107 UAS Pilot license.

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xv
Fire & EMS Services
- Responded to 62 fire and emergency incidents and 696 rescue and emergency medical calls.
- Completed 5,093 training hours in coordination with partner agencies, including CPR, CERT, and Stop the Bleed and monthly drone training. - Performed inspections and maintenance on 1,150 fire hydrants. - Participated in over 100 community events including:
o YAC summer program.
o July 4th Parade.
o Community pancake breakfast.
o Farmers’ Markets.
o National Night Out.
o Mountain House High School Career Fair.
o Fire Station open houses.
o Fire prevention assemblies at all elementary schools. - Coordinated efforts with the City to clear overgrown vegetation, weeds and tall grass in the large undeveloped lots in and around Mountain House. - Participated in 5 statewide fire deployments.
- Applied for and received the Cal Fire “50/50” grant for equipment and personnel protective equipment.
- Applied for “Assistance for Firefighter” grant to place a third person at the new firehouse 2. Awarding will take place in October 2025. If we are awarded the grant, FEMA would fully fund the position for 3 years.

Acknowledgements
The preparation of this report was made possible by the collaborative efforts of staff in the Administrative Services Department and other departments, as well as the City’s audit firm, Richardson & Company, LLP. A special thanks and acknowledgement goes to our Finance staff for their work on the audit. We would also like to recognize the City Council for their guidance and support in the City’s pursuit of excellence in financial reporting.

Steven Pinkerton Sarah Ragsdale
General Manager Administrative Services Director

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xvi
City of Mountain House
Principal Officers
Fiscal Year 2024/2025
Mayor
Andy Su
Vice Mayor
Bernice King Tingle
Director Director Director
Ronna Green Matt Disko Dan Harrison
Administration Personnel
City Manager Steven Pinkerton
Deputy City Manager Jodi Almassy
Administrative Services Director Sarah Ragsdale
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xvii
City of Mountain House
Organization Chart

ELECTED OFFICIALS
Andy Su, Mayor
Councilmembers
Bernice King Tingle Matt Disko
Ronna Green Daniel Harrison
City Attorney
Redwood Public Law

CITIZENS
OF

THE CITY OF MOUNTAIN HOUSE
City Auditor
Richardson & Company
City Clerk
City Manager
Steven Pinkerton
Legend
Elected
Board Appointed
City Manager Appointed
Contracted Services
Public Works
Director
Administrative
Services Director
Community Dev
Director
Operations and
Maintenance Building
Planning
Code Enforcement
Finance
Human Resources
Recreation
Information
Technology
Risk Management
Utility System
Operations
Law Enforcement
Fire & EMS
Library Healthy Economy, Vibrant
Infrastructure & Sustainable
Environment
Neighborhood Engagement,
Community Programming and
Neighborhood Development,
Construction Management,
Economic Development,
Transportation Management ,
Land Acquisition and
Development
Effective Responsive &
Transparent Government
Driving Performance and
Innovation, Recruitment,
Customer Service, Accessible
Technology Implementation,
Information Dissemination,
Community Outreach
Safe Neighborhoods
Utility and Infrastructure,
Maintenance and Repair,
Hazardous Materials Control,
Fire Prevention, Safety
Education, Crime Prevention
and Mapping, Patrols, Traffic
Enforcement
Deputy
City Manager
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Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
Mountain House Community Services District
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2024
Executive Director/CEO
xviii
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1 FINANCIAL SECTION
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2 (This page intentionally left blank.)
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550 Howe Avenue, Suite 210
Sacramento, California 95825
Telephone: (916) 564-8727
FAX: (916) 564-8728
3 INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and City Council
City of Mountain House, California
Report on the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Mountain House, California (the City) as of and for the year ended June 30, 2025, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, business-type activities, each major fund and the aggregate remaining fund information of the City as of June 30, 2025 and the respective changes in financial position, 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 and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our 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 N to the financial statements, the City implemented Governmental Accounting Standards Board Statement No. 101, Compensated Absences. Our opinions are not modified with respect to this matter.

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

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To the Honorable Mayor and City Council
City of Mountain House, California
4 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 generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
 Exercise professional judgement 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 response 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 judgement, there are conditions or events, consider 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 other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.

Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, budgetary comparison information, Schedule of Proportionate Share of the Net Pension Liability, and Schedule of Contributions to the Pension Plan 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 Item 8.1
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To the Honorable Mayor and City Council
City of Mountain House, California
5 operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements.

We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

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 schedules 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 related 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 in accordance with auditing standards generally accepted in the Unites States of America. In our opinion, the individual fund financial statements and schedules are fairly stated, in all material respects, in relation to the basic financial statements as a whole.

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

In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated.

If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 1, 2025 on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations and 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.

December 1, 2025
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CITY OF MOUNTAIN HOUSE
Management’s Discussion and Analysis
June 30, 2025
6 The City of Mountain House (City) is an independent local government entity and a subdivision of the State of California guided by a five-member elected City Council including a City Mayor. As management of the City, we offer readers the City’s financial statements and this narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2025.

Financial Highlights
 The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year by $107.7 million.  The City’s total net position increased by $40.1 million. This is attributable to an increase in cash and investments from the General Fund due to revenues exceeding expenditures and also a transfer of funds from San Joaquin County due to the City incorporating.  As of the close of the current fiscal year, the City’s governmental funds reported combined fund balances of $140.3 million. Approximately $47.1 million or 34% of total fund balances is reported as Unassigned fund balance making it available for spending at the City’s discretion (in compliance with Governmental Accounting Standards Board’s (GASB) Statement No. 54, Fund Balance Reporting and Government Fund Type Definitions - see Note A).
 At the end of the current fiscal year, the Unassigned (GASB No. 54) fund balance for the General Fund was $47.1 million.
 The City’s total liabilities decreased by $16.4 million during the current fiscal year. The majority of the decrease was due to a decrease in unearned revenues. The key factor in the unearned revenue decrease was due to the amount of progress made on improvement projects. The majority of these improvement projects will be completed within the next two years. Some of the improvements include Grantline Road, Mustang Square, B4 and B5 Linear Park, and Village Parkway Corridor.

Using This Financial Report
This annual report consists of a series of financial statements. The Statement of Net Position and the Statement of Activities provide information about the activities and performance of the City using accounting methods like those used by private sector companies. The Statement of Net Position includes all the City’s investments in resources (assets), deferred outflows of resources, the obligations to creditors (liabilities) and deferred inflows of resources. It also provides the basis for computing a rate of return, evaluating the capital structure of the City and assessing the liquidity and financial flexibility of the City. This statement measures the success of the City’s operations over the past year and can be used to determine the City’s profitability and credit worthiness.

Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction of the City’s basic financial statements.

The City’s basic financial statements are comprised of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains required supplementary information and other supplementary information in addition to the basic financial statements themselves.

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

The statement of net position presents information on all the City’s assets, deferred outflows of resources, liabilities and deferred inflows of resources, with the net amount 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 the City’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., earned but unused vacation leave).

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CITY OF MOUNTAIN HOUSE
Management’s Discussion and Analysis
June 30, 2025
7 Both of the 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 significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, public ways and facilities, recreation and culture, and community development. The business-type activities of the City include water, wastewater and storm system operations and developer activity. The government-wide financial statements can be found on pages 17 - 18 of this report.

Fund financial statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities to ensure and demonstrate compliance with finance-related legal requirements. All the funds of the City can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds.

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

Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the City’s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.

The City maintains 16 individual governmental funds and sub-funds aggregated and grouped into nine funds for reporting purposes. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the general fund, the special assessment fund, the impact fees fund, the affordable housing fund, all of which are considered to be major funds, and the nonmajor governmental funds combined. The governmental fund financial statements can be found on pages 19 - 22 of this report.

The City adopts an annual appropriated budget for its general fund and major special revenue funds.

Budgetary comparison statements have been provided for the general fund, the special assessment fund, the impact fees fund and the development services fund located on pages 62 - 65 to demonstrate compliance with this budget.

Proprietary funds
The City maintains four proprietary funds. 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, wastewater and stormwater system operations and developer activities. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The basic proprietary fund financial statements can be found on pages 23 - 25 of this report.

Fiduciary fund
The City reports a custodial fund for assets held in a purely custodial capacity used to account for conduit debt owed by property owners.

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CITY OF MOUNTAIN HOUSE
Management’s Discussion and Analysis
June 30, 2025
8 Notes to the financial statements
The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found on pages 30 – 59 of this report.

Other information
In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information consisting of the budgetary schedules described above under Notes to the Required Supplementary Information and required disclosures related to the City’s pension plan.

Required supplementary information can be found on pages 62 – 67 of this report. Combining nonmajor fund statements and budgetary comparison schedules are included as other supplemental information.

Statistical Section
This report also contains a statistical section that presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary says about the City’s overall financial health. The statistical section can be found on pages 75 – 91.

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 and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $107.7 million at the close of the most recent fiscal year.

City of Mountain House's Net Position (in millions)
Governmental Business-Type Total
Activities Activities Total Dollar Percent
2025 2024 2025 2024 2025 2024 Change Change
Assets:

Current and other assets $150.33 $107.91 $27.53 $39.64 $177.86 $147.55 $30.31 21% Capital assets 122.83 131.37 154.68 152.41 277.50 283.78 (6.28) -2% Total assets 273.16 239.28 182.21 192.05 455.37 431.33 24.03 6% Deferred outflow s:

Pension plan
Deferred outflow 3.19 3.45 1.78 1.95 4.96 5.40 (0.43) -8% Total deferred outflow s 3.19 3.45 1.78 1.95 4.96 5.40 (0.43) -8% Liabilities:

Long-term liabilities outstanding 116.60 124.02 215.81 217.03 332.41 341.05 (8.64) -3% Other liabilities 10.41 5.85 8.66 20.95 19.05 26.80 (7.74) -29% Total liabilities 127.00 129.87 224.47 237.98 351.46 367.85 (16.39) -4% Deferred inflow s:

Pension plan
Deferred inflow 0.81 0.86 0.32 0.34 1.12 1.20 (0.08) -7% Total deferred inflow s 0.81 0.86 0.32 0.34 1.12 1.20 (0.08) -7% Net position:

85.08 75.48 14.48 21.80 99.56 97.28 2.28 2%
Restricted 75.41 47.97 16.04 17.35 91.45 65.32 26.13 40% Unrestricted (11.95) (11.46) (71.32) (83.48) (83.28) (94.94) 11.66 -12% Total net position $148.54 $111.99 $(40.80) $(44.32) $107.74 $67.67 $40.07 59% Net investment in capital assets
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CITY OF MOUNTAIN HOUSE
Management’s Discussion and Analysis
June 30, 2025
9 By far the largest portion of the City’s net position reflects its $99.6 million in net investment in capital assets (e.g., land, infrastructure, buildings, machinery, and equipment); less any related debt used to acquire those assets that is still outstanding. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.

The restricted portion of City’s net position, $91.5 million, is subject to constraints by bond financing agreements and enabling legislation.

The City’s unrestricted net position was at a deficit of $83.3 million due to pledged notes payable to developers for contributed infrastructure. In addition, the City is reporting a net pension liability at June 30, 2025 in the amount of $10.8 million.

City of Mountain House's Change in Net Position (in millions) Governmental Business-Type Total
Activities Activities Total Dollar Percent
2025 2024 2025 2024 2025 2024 Change Change
Revenues:

Program revenues:

Fees, fines and charges for services $28.58 $9.61 $43.07 $35.28 $71.67 $44.88 $26.79 60% Special assessments 16.92 15.95 0.00 0.00 16.92 15.95 0.97 6% Operating grants and contributions 1.81 0.19 0.00 0.00 1.81 0.19 1.62 100% General revenues:

Change in estimate - pledge notes payable 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0% Property taxes 11.40 8.75 0.00 0.00 11.40 8.75 2.65 30% Other taxes 0.75 0.00 0.00 0.00 0.75 0.00 0.75 100%
Miscellaneous revenues 6.96 5.13 1.82 3.06 8.79 8.18 0.61 7% Total revenues 66.43 39.63 44.89 38.33 111.32 77.96 33.38 43% Expenses:

General government 6.75 4.42 6.75 4.42 2.33 53%
Public safety 8.52 7.14 8.52 7.14 1.37 19%
Public w ays and facilities 16.28 13.92 16.28 13.92 2.36 17% Recreation and culture 4.30 4.14 4.30 4.14 0.16 4%
Interest on long-term debt 2.93 4.18 2.93 4.18 (1.26) -30% Water system 12.03 12.23 12.03 12.23 (0.20) -2%
Wastew ater system 7.48 7.56 7.48 7.56 (0.08) -1%
Stormw ater system 2.36 2.67 2.36 2.67 (0.30) -11%
Developer projects 19.49 13.72 19.49 13.72 5.78 42%
Total expenses 38.77 33.80 41.37 36.17 80.14 69.98 10.17 15% Increase in net position 27.66 5.83 3.52 2.16 31.18 7.98 23.20 291% Special items 9.39 0.00 0.00 0.00 9.39 0.00 9.39 100%
Net position, beginning of year, as previously reported 111.99 106.17 (44.32) (46.48) 67.67 59.69 7.98 0% Change in accounting principle (GASB 101) (0.50) 0.00 0.00 0.00 (0.50) 0.00 (0.50) 0% Net position, beginning of year, as restated 111.49 106.17 (44.32) (46.48) 67.17 59.69 7.48 13% Net position, end of year $148.54 $111.99 $(40.80) $(44.32) $107.74 $67.67 $40.07 59% Item 8.1
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CITY OF MOUNTAIN HOUSE
Management’s Discussion and Analysis
June 30, 2025
10 Governmental Activities: Governmental activities increased the City’s net position by $37.0 million. This increase is primarily due to the increase in special taxes, property taxes, and impact fees from scheduled rate increases, an increase in the number of properties paying the taxes, an affordable housing transfer from San Joaquin County, and due to development within the City.

0.00 5.00

10.00 15.00

20.00 25.00

30.00 35.00

40.00 General
government
Public safety Public ways
and facilities
Recreation
and culture
Community
development
Interest on
long-term debt
Total Expenses and Revenues - Governmental Activities
Expenses
Revenues
General revenues…
General …
Public safety
8% Public ways and facilities
57%
Recreation and … Community development…

TOTAL REVENUES BY SOURCE - GOVERNMENTAL

ACTIVITIES
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CITY OF MOUNTAIN HOUSE
Management’s Discussion and Analysis
June 30, 2025
11 Business-Type Activities: Business-type activities increased the City’s net position by $3.5 million. This is primarily due to revenues exceeding expenditure. Interest revenue was a major contributor to the increase.

0.00 5.00

10.00 15.00

20.00 25.00
Water Fund Wastewater Fund Stormwater Fund Developer Fund Total Expenses and Revenues - Business-type Activities
Expenses
Revenue
Water Fund,
28%
Wastewater Fund,
20%
Stormwater Fund,
7%
Developer Fund,
45%

REVENUE BY SOURCE - BUSINESS-TYPE ACTIVITIES
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CITY OF MOUNTAIN HOUSE
Management’s Discussion and Analysis
June 30, 2025
12 FINANCIAL ANALYSIS OF CITY FUNDS
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.

Governmental Funds
The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City’s financial requirements.

In particular, unreserved fund balance may serve as a useful measure of the City’s net resources available for spending at the end of the fiscal year.

At June 30, 2025, the City’s governmental funds reported total fund balances of $140.3 million, an increase of $37.8 million over the prior year.

The City reports the following components of fund balance:
 Nonspendable fund balance - $15.4 million (inherently nonspendable) included the portion of net resources that cannot be spent because of their form, and the portion of net resources that cannot be spent because they must be maintained intact.
 Restricted fund balance - $75.6 million (externally enforceable limitation on use) include amounts subject to limitation imposed by creditors, contributors, or laws and regulations of other government.
 Committed fund balance - $2.1 million (constrained to specific purpose) included amounts that cannot be used for any purpose unless government takes the same highest level action.  Unassigned fund balance - $47.1 million (residual net resources) is the total fund balance in the general fund in excess of nonspendable, restricted, committed, and assigned fund balance.

The General Fund is the main operational fund of the City. At June 30, 2025, the fund balance components were reported as nonspendable $15.4 million, restricted $2.7 million, committed $2.1 million, and unassigned $47.1 million. The fund balance increased by $11.5 million to $67.4 million compared to the prior year. The primary reason for the increase is due to revenues exceeding expenditures as the General Fund has done historically because taxes and franchise fees exceed the amount needed to fund expenditures.

The unspent Special Assessments Fund is used to account for funding from property assessments to pay for roads, transportation, community services, public safety, public works, parks and recreation, and landscaping and lighting City activity. Therefore, fund balance must be used for these designated services.

At June 30, 2025, restricted fund balance of $5 million was available to finance future appropriations. The fund balance decreased $1.2 million to $5 million compared to the prior year. The primary reason for the decrease is due to an increase in expenditures and reallocating more public ways and facilities expenditures to the unspent Special Assessments Fund.

The Impact Fees Fund is used to account for fees collected from builders to provide funds for City development. The fees are used to reimburse developers for identified infrastructure projects. At June 30, 2025, the restricted fund balance was $42.2 million. The fund balance increased by $13.2 million to $42.2 million compared to the prior year. The primary reason for the increase is due to unspent development fees.

The Affordable Housing Fund is used to account for fees collected from builders for affordable housing.

The fees are used for affordable housing projects. At June 30, 2025, the restricted fund balance was $11.2 million. The City received the majority of these funds from a transfer from San Joaquin County due to the City’s incorporation.

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CITY OF MOUNTAIN HOUSE
Management’s Discussion and Analysis
June 30, 2025
13 The Development Services Special Revenue Fund is used to account for fees collected from builders to mitigate the impact of development. The fees are used to offset the City development costs. At June 30, 2025, the restricted fund balance was $230 thousand. This is the first year the City has collected these fees as San Joaquin County collected them in prior years.

The Nonmajor Governmental Funds include Capital Projects Fund and smaller funds. At June 30, 2025, the restricted fund balance was $14.3 million. This is the first year the City has had Nonmajor Governmental Funds. The change is due to the capital projects fund being considered a nonmajor fund in 2025 and the City incorporating.

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

GENERAL FUND BUDGETARY HIGHLIGHTS
During the year, actual revenues were higher than budgetary estimates, which was mainly due to increases in taxes and investment earnings.

Actual expenditures were less than final budgeted estimates. The difference was due to conservative spending by the City.

Capital assets
The City’s capital assets, net of accumulated depreciation is shown below. For additional information related to capital assets, see Note D in the Notes to the Basic Financial Statements.

Increase
Original Budget Final Budget (Decrease)
Estimated Revenues $12.37 $12.37 $0.00
Appropriations 4.87 3.30 -1.57
Positive
Final Budget Actual (Negative)
Estimated Revenues $12.37 $17.52 $5.15
Appropriations 3.30 2.8 0.50
Original Budget to Final Budget (in millions)
Final Budget to Actual (in millions)
City of Mountain House's Capital Assets
(net of depreciation) in millions
Government Business-Type Total
Activities Activities Total Dollar Percent
2025 2024 2025 2024 2025 2024 Change Change
Land $28.04 $28.04 $2.60 $2.60 $30.64 $30.64 $0.00 0%

3.49 1.87 0.72 0.41 4.21 2.28 1.93 85%
Buildings 28.66 29.50 0.00 0.00 28.66 29.50 (0.83) -3%

62.63 71.96 151.35 149.40 213.97 221.36 (7.38) -3%
Total $122.83 $131.37 $154.67 $152.41 $277.49 $283.78 $(6.27) -2% Infrastructure
Machinery and equipment
Item 8.1
Mountain House Page 409 of 545

CITY OF MOUNTAIN HOUSE
Management’s Discussion and Analysis
June 30, 2025
14 Governmental activities machinery and equipment increased during the year due to the purchase of fire trucks and maintenance vehicles. Business-type activities infrastructure increased due to the accepting of improvements that were constructed by developers. The decreases in both government activity and business-type activity was due to depreciation.

Long-term debt
The City’s outstanding debt is shown below. The net decrease to outstanding debt is $8.1 million. The outstanding debt was decreased due to $10 million in bonds being called by the City during the fiscal year.

In addition to the long-term debt, the City also has a liability to pay future compensated absences in the amount of $1.1 million and a net pension liability of $10.8 million. For additional information related to longterm liabilities, see Note E in the Notes to the Basic Financial Statements.

Economic Factors and Next Year’s Budgets and Rates
During the current fiscal year, the City’s overall financial position improved over the prior year. There were increases in both the Business-Type Activities and in the Government Activities. The unassigned fund balance in the General Fund increased by $10.6 million to $47.1 million. The City has nonspendable funds of $15.4 million for advances to Water, Wastewater, and Storm Water enterprise funds. The special assessment rates increased by 2.37% for the 2024/25 budget year. The water, wastewater, and stormwater operations and maintenance rates remained consistent with the rate study which was adopted in June, 2022. Resulting rate increases are necessary to keep up with inflation and to keep the City from having to institute large rate increases in future years.

Conditions Affecting Current Financial Position
Management is unaware of any conditions, which could have a significant impact on the City’s current financial position, net position or operating results in terms of the past, present and future.

Requests for Information
This financial report is designed to provide a general overview of the City’s finances for all those with an interest in the government’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Administrative Services Director, 251 East Main Street, Mountain House, CA 95391.

City of Mountain House's Outstanding Debt
Pledged Notes and Revenue Bonds (in millions)
Governmental Business-Type Total
Activities Activities Total Dollar Percent
2025 2024 2025 2024 2025 2024 Change Change
Pledged Notes Payable $65.98 $62.64 $1.16 $0.00 $67.14 $62.64 $4.51 7% Revenue Bonds 36.97 47.93 198.79 200.40 235.76 248.33 (12.57) -5% Total $102.95 $110.57 $199.95 $200.40 $302.90 $310.96 $(8.06) -3% Item 8.1
Mountain House Page 410 of 545
15 BASIC FINANCIAL STATEMENTS
Item 8.1
Mountain House Page 411 of 545
16 (This page intentionally left blank.)
Item 8.1
Mountain House Page 412 of 545
Statement of Net Position
Governmental Business-Type
Activities Activities Total
ASSETS
Cash and investments 131,410,835 $ 15,783,530 $ 147,194,365 $ Restricted cash and investments 7,450 17,420,645 17,428,095 Accounts receivable, net 2,394,769 4,712,991 7,107,760
Taxes receivable 29,912 29,912
Interest receivable 1,044,081 312,120 1,356,201
Prepaid expense 20,440 2,220,075 2,240,515
Internal balances 15,424,097 (15,424,097)
Restricted accounts receivable 2,506,286 2,506,286
Capital assets:

Nondepreciable 28,041,500 2,604,300 30,645,800
Depreciable, net 94,785,689 152,072,231 246,857,920
Total capital assets 122,827,189 154,676,531 277,503,720 TOTAL ASSETS 273,158,773 182,208,081 455,366,854

DEFERRED OUTFLOWS OF RESOURCES
Debt refunding 523,310 523,310
Pension plan 3,188,344 1,251,702 4,440,046
3,188,344 1,775,012 4,963,356

LIABILITIES
Accounts payable 6,277,894 3,854,213 10,132,107
Retention payable 87,800 87,800
Accrued interest payable 369,650 666,707 1,036,357
Unearned revenues 2,595,000 3,833,815 6,428,815
Deposits from others 1,074,732 302,526 1,377,258
Long-term liabilities
Due within one year
Bonds and notes payable 1,050,000 1,815,000 2,865,000
Compensated absences 794,118 794,118
Due in more than one year
Bonds and notes payable 106,698,848 210,936,601 317,635,449 Compensated absences 265,331 265,331
Net pension liability 7,790,259 3,058,355 10,848,614
TOTAL LIABILITIES 127,003,632 224,467,217 351,470,849

DEFERRED INFLOWS OF RESOURCES
Pension plan 806,850 316,758 1,123,608

NET POSITION
Net investment in capital assets 85,081,065 14,481,237 99,562,302 Restricted for:

Roads, transportation and community services 71,666,794 71,666,794 Debt service 16,041,735 16,041,735
Public works 833,361 833,361
Lighting and landscaping 2,866,447 2,866,447
Community service 36,910 36,910
Public safety 4,644 4,644
Unrestricted (11,952,586) (71,323,854) (83,276,440)
TOTAL NET POSITION $ 148,536,635 $ (40,800,882) $ 107,735,753 The accompanying notes are an integral part of these financial statements.

June 30, 2025

CITY OF MOUNTAIN HOUSE
17 Item 8.1
Mountain House Page 413 of 545
Net (Expense) Revenue and
Changes in Net Position
Operating Primary Government
Charges for Contributions Governmental Business-Type
Functions/Programs Expenses Services and Grants Activities Activities Total Primary Government:

Governmental Activities
General government 6,752,277 $ 763,858 $ (5,988,419) $ (5,988,419) $ Public safety 8,517,429 4,952,665 87,500$ (3,477,264) (3,477,264) Public ways and facilities 16,275,729 37,575,208 21,299,479 21,299,479 Recreation and culture 4,301,095 859,380 (3,441,715) (3,441,715) Community development 1,355,827 1,355,827 1,355,827
Interest on long-term debt 2,928,082 (2,928,082) (2,928,082) Total governmental activities 38,774,612 45,506,938 87,500 6,819,826 6,819,826 Business-Type Activities
Water Fund 12,028,832 12,068,964 $ 40,132 40,132
Wastewater Fund 7,481,609 8,740,865 1,259,256 1,259,256 Stormwater Fund 2,364,898 2,767,332 402,434 402,434
Developer Fund 19,494,871 19,494,939 68 68
Total business-type activities 41,370,210 43,072,100 1,701,890 1,701,890 Total primary government $ 80,144,822 $ 88,579,038 87,500$ 6,819,826 1,701,890 8,521,716 General Revenues:

Taxes:

Property taxes 11,404,992 11,404,992
Franchise and miscellaneous taxes 1,506,056 1,506,056
Sales tax 153,095 153,095
Other taxes 2,320,092 2,320,092
Unrestricted interest and investment earnings 5,150,534 1,819,368 6,969,902 Other 300,995 300,995
Total general revenues 20,835,764 1,819,368 22,655,132
Change in net position before special item 27,655,590 3,521,258 31,176,848 Special item (affordable housing transfer from county) 9,387,590 9,387,590 Change in net position 37,043,180 3,521,258 40,564,438
Net position, beginning of year, as previously reported 111,990,012 (44,322,140) 67,667,872 Change in accounting principle - GASB Statement No. 101 (496,557) (496,557) Net position, beginning of year, as restated 111,493,455 (44,322,140) 67,171,315 NET POSITION, END OF YEAR $ 148,536,635 $ (40,800,882) $ 107,735,753 The accompanying notes are an integral part of these financial statements.

CITY OF MOUNTAIN HOUSE
Statement of Activities
For the Year Ended June 30, 2025
Program Revenues
18 Item 8.1
Mountain House Page 414 of 545
Special Affordable Development
Assessments Impact Fees Housing Services
Special Special Special Special Nonmajor Total
General Revenue Revenue Revenue Revenue Governmental Governmental Fund Fund Fund Fund Fund Funds Funds
ASSETS
Cash and investments 52,625,822 $ 7,895,876 $ 42,019,926 $ 11,085,647 $ 3,470,690 $ 14,312,874 $ 131,410,835 $ Restricted cash and investments 7,450 7,450
Accounts receivable, net 354,222 74,591 1,636,260 534 9,109 2,074,716 Taxes receivable 183,178 166,787 349,965
Interest receivable 434,889 97,494 302,322 96,894 6,661 105,821 1,044,081 Prepaid items 20,440 20,440
Due from other funds 135,542 135,542
Advances to other funds 15,424,097 15,424,097
TOTAL ASSETS 69,157,750 $ 8,088,401 $ 43,965,958 $ 11,183,075 $ 3,486,460 $ 14,585,482 $ 150,467,126 $

LIABILITIES AND

AND FUND BALANCES
Liabilities
Accounts payable 1,129,122 $ 2,358,134 $ 10,000 $ 2,630,481 $ 150,157 $ 6,277,894 $ Retention payable 87,800 87,800
Unearned revenues 82,625 736,985 1,768,798 6,592 2,595,000 Deposits from others 543,000 531,732 1,074,732
Due to other funds 135,542 135,542
TOTAL LIABILITIES 1,754,747 3,095,119 1,778,798 3,256,605 285,699 10,170,968 Fund balances:

Nonspendable 15,424,097 15,424,097
Restricted for:

Roads, transportation and
community services, operational
and administrative functions 2,741,371 1,251,920 42,187,160 11,183,075 $ 229,855 14,299,783 71,893,164 Public works 833,361 833,361
Lighting and landscaping 2,866,447 2,866,447
Community service 36,910 36,910
Public safety 4,644 4,644
Committed 2,099,160 2,099,160
Unassigned 47,138,375 47,138,375
Total fund balances 67,403,003 4,993,282 42,187,160 11,183,075 229,855 14,299,783 140,296,158

TOTAL LIABILITIES,

DEFERRED INFLOWS
AND FUND BALANCES 69,157,750 $ 8,088,401 $ 43,965,958 $ 11,183,075 $ 3,486,460 $ 14,585,482 $ 150,467,126 $ Balance Sheet

CITY OF MOUNTAIN HOUSE
June 30, 2025
Governmental Funds
The accompanying notes are an integral part of these financial statements.

Major Funds
19 Item 8.1
Mountain House Page 415 of 545
Fund Balances - total governmental funds $ 140,296,158
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 activities of the Statement of Net Position. 122,827,189 Interest payable on long-term debt did not require current financial resources. Therefore, interest payable was not reported as a liability in the Governmental Funds Balance Sheet. (369,650) Long-term assets and liabilities and related deferred inflows and outflows of resources are not due and payable in the current period and are not included in the fund financial statements, but are included in the governmental activities of the Statement of Net Position:

Deferred outflows of resources - pension plan 3,188,344 Long-term debt (107,748,848)
Compensated absences (1,059,449)
Net pension liability (7,790,259)
Deferred inflows of resources - pension plan (806,850)
NET POSITION OF GOVERNMENTAL ACTIVITIES IN THE STATEMENT OF NET POSITION 148,536,635 $ Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position For the Year Ended June 30, 2025

CITY OF MOUNTAIN HOUSE
20 Item 8.1
Mountain House Page 416 of 545

CITY OF MOUNTAIN HOUSE
Special Affordable Development
Assessments Impact Fees Housing Services
Special Special Special Special Nonmajor Total
General Revenue Revenue Revenue Revenue Governmental Governmental Fund Fund Fund Fund Fund Funds Funds
Revenues
Property taxes 10,834,742 $ $ 570,250 $ 11,404,992
Sales tax 153,095 153,095
Other taxes 594,357 594,357
Special assessments $ 16,922,463 16,922,463
Licenses and permits 9,204 9,204
Franchise fees 1,506,056 1,506,056
Intergovernmental 87,500 1,725,735 1,813,235
Developer and impact fees 1,068,250 $ 23,271,941 $ 1,355,827 2,879,043$ 28,575,061 Investment earnings 3,102,540 252,216 1,235,154 439,658 31,892 89,074 5,150,534 Other revenues 166,578 134,627 301,205
TOTAL REVENUES 17,522,322 17,309,306 24,507,095 1,795,485 2,910,935 2,385,059 66,430,202 Expenditures
Current:

General government 214,829 484,456 699,285
Public safety 7,819,378 7,819,378
Public ways and facilities 2,580,649 4,529,271 10,981 5,591,673 12,712,574 Recreation and culture 3,389,679 3,389,679
Debt service
Principal 11,254,361 11,254,361
Interest and fiscal charges 12,207 1,895,932 1,908,139
Capital outlay 60,601 2,183,871 2,244,472
TOTAL EXPENDITURES 2,795,478 15,811,136 13,161,274 5,591,673 2,668,327 40,027,888

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 14,726,844 1,498,170 11,345,821 1,795,485 (2,680,738) (283,268) 26,402,314

OTHER FINANCING SOURCES (USES)
Issuance of debt 1,970,853 1,970,853
Transfers in 2,684,133 3,361,609 6,045,742
Transfers out (3,189,133) (2,706,609) (150,000) (6,045,742) Total other financing sources (uses) (3,189,133) (2,706,609) 1,820,853 2,684,133 3,361,609 1,970,853

NET CHANGE IN FUND BALANCE
BEFORE SPECIAL ITEM 11,537,711 (1,208,439) 13,166,674 1,795,485 3,395 3,078,341 28,373,167

SPECIAL ITEM
Affordable housing transfer from County 9,387,590 9,387,590 NET CHANGE IN FUND BALANCES 11,537,711 (1,208,439) 13,166,674 11,183,075 3,395 3,078,341 37,760,757 Fund balances, beginning of year,
as previously reported 56,091,752 6,201,721 29,020,486 91,313,959 Changes within financial reporting entity:

Major to nonmajor fund 11,221,442 11,221,442
Creation of new fund (226,460) 226,460
Fund balance, beginning of year,
as restated 55,865,292 6,201,721 29,020,486 226,460 11,221,442 102,535,401 FUND BALANCE, END OF YEAR $ 67,403,003 $ 4,993,282 $ 42,187,160 $ 11,183,075 229,855$ $ 14,299,783 $ 140,296,158 Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds
For the Year Ended June 30, 2025
Major Funds
The accompanying notes are an integral part of these financial statements. 21 Item 8.1
Mountain House Page 417 of 545

CITY OF MOUNTAIN HOUSE
Net change in fund balances - total governmental funds $ 37,760,757 Governmental funds report capital outlay as expenditures because such outlays use current financial resources. In contrast, the Statement of Activities reports capital asset purchases as assets. The outlay is allocated over the assets' estimated useful lives as depreciation expense.

Capital outlay expense 2,244,472
Depreciation expense (10,787,702)
Governmental funds report bond proceeds as current financial resources. In contrast, the Statement of Activities reports such issuance of debt as a liability. Governmental funds report repayment of bond and note principal payments as an expenditures. In contrast, the Statement of Activities reports such repayments as a reduction in long-term liabilities.

This is the the difference between debt proceeds, repayments and premium amortization. 8,141,759 Interest expenses accrued as part of pledged notes payable reported in the Government-wide Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds. This amount represents the change in accrued interest on pledged notes plus accrued interest payable on governmental activities bonds payable. 109,600 Some expenses reported in the Statement of Activities do not require the use of current financial resources and these are not reported as expenditures in the governmental funds:

Change in net pension liability (169,303)
Change in compensated absences (52,941)
Change in deferred outflows/inflows of resources on the pension plan (203,462) Change in net position of governmental activities $ 37,043,180 The accompanying notes are an integral part of these financial statements.

Reconciliation of the Statements of Revenues, Expenditures and Charges in Fund Balances to the Government-Wide Statement of Activities - Governmental Activities Amounts reported for governmental activities in
the statement of activities are different because:

For the Year Ended June 30, 2025
22 Item 8.1
Mountain House Page 418 of 545
Water Wastewater Stormwater Developer Total
ASSETS
Current assets:

Cash and investments 5,707,768 $ 534,796 $ 3,535,857 $ 6,005,109 $ 15,783,530 $ Accounts receivable 1,450,013 885,795 170,265 2,206,918 4,712,991 Prepaid expenses 1,070,596 850,482 298,997 2,220,075
Interest receivable 72,942 66,935 81,098 91,145 312,120 Due from other funds 190,836 14,809 1,719 207,364
Total current assets 8,492,155 2,352,817 4,087,936 8,303,172 23,236,080 Non-current assets:

Restricted cash and investments 2,189,643 10,017,268 5,213,734 17,420,645 Restricted accounts receivable 1,178,658 996,143 331,485 2,506,286 Advances to other funds 8,553,201 8,553,201
Capital assets
Non-depreciable 984,200 1,620,100 2,604,300
Depreciable, net 79,365,645 48,673,568 24,033,018 152,072,231 Total captial assets, net 80,349,845 50,293,668 24,033,018 154,676,531 Total non-current assets 83,718,146 69,860,280 29,578,237 183,156,663 TOTAL ASSETS 92,210,301 72,213,097 33,666,173 8,303,172 206,392,743

DEFERRED OUTFLOWS
Debt refunding 275,432 184,909 62,969 523,310
Pension plan 599,098 498,807 153,797 1,251,702
TOTAL DEFERRED OUTFLOWS 874,530 683,716 216,766 1,775,012

LIABILITIES
Current liabilities:

Accounts payable 500,841 143,467 76,213 3,133,692 3,854,213 Accrued interest payable 322,992 255,139 88,576 666,707 Due to other funds 92,712 114,652 207,364
Unearned revenue 3,833,815 3,833,815
Deposits from others 302,526 302,526
Bonds, notes and loans payable, current portion 930,000 640,000 245,000 1,815,000 Total current liabilities 2,056,359 1,131,318 524,441 6,967,507 10,679,625 Long-term liabilities:

Advances from other funds 17,931,982 5,408,323 636,993 23,977,298 Bonds, notes and loans payable 102,324,194 80,662,732 27,949,675 210,936,601 Net pension liability 1,463,809 1,218,765 375,781 3,058,355 Total long-term liabilities 121,719,985 87,289,820 28,962,449 237,972,254 TOTAL LIABILITIES 123,776,344 88,421,138 29,486,890 6,967,507 248,651,879

DEFERRED INFLOWS
Pension plan 151,609 126,229 38,920 316,758

NET POSITION
Net investment in capital assets 10,329,934 (4,245,357) 8,396,660 14,481,237 Restricted for debt service 3,045,309 10,758,272 2,238,154 16,041,735 Unrestricted (44,218,365) (22,163,469) (6,277,685) 1,335,665 (71,323,854) TOTAL NET POSITION $ (30,843,122) $ (15,650,554) $ 4,357,129 $ 1,335,665 $ (40,800,882) The accompanying notes are an integral part of these financial statements.

Major Funds

CITY OF MOUNTAIN HOUSE
Statement of Net Position
Proprietary Funds
June 30, 2025
23 Item 8.1
Mountain House Page 419 of 545
Water Wastewater Stormwater Developer Total

OPERATING REVENUES
Charges for services $ 5,887,951 $ 4,153,829 $ 804,218 $ 19,494,939 $ 30,340,937 Charges for services - pledged 5,926,614 4,587,036 1,567,196 12,080,846 Penalty charges and other 254,399 395,918 650,317
TOTAL OPERATING REVENUES 12,068,964 8,740,865 2,767,332 19,494,939 43,072,100

OPERATING EXPENSES
Salaries and benefits 535,702 497,797 186,162 463,326 1,682,987 Professional and special services 2,099,499 1,449,765 251,528 19,031,545 22,832,337 Utilities 1,808,719 591,166 2,399,885
Chemicals 209,244 74,842 284,086
Maintenance 546,573 240,760 214,469 1,001,802
Depreciation 2,836,015 1,781,060 728,544 5,345,619
TOTAL OPERATING EXPENSES 8,035,752 4,635,390 1,380,703 19,494,871 33,546,716 OPERATING INCOME (LOSS) 4,033,212 4,105,475 1,386,629 68 9,525,384

NON-OPERATING REVENUES (EXPENSES)
Interest and investment revenue 237,457 697,781 299,553 584,577 1,819,368 Interest expense (3,993,080) (2,846,219) (984,195) (7,823,494)

TOTAL NON-OPERATING
REVENUES (EXPENSES) (3,755,623) (2,148,438) (684,642) 584,577 (6,004,126) CHANGE IN NET POSITION 277,589 1,957,037 701,987 584,645 3,521,258 Net position, beginning of year (31,120,711) (17,607,591) 3,655,142 751,020 (44,322,140) TOTAL NET POSITION, END OF YEAR (30,843,122) $ $ (15,650,554) $ 4,357,129 $ 1,335,665 $ (40,800,882) The accompanying notes are an integral part of these financial statements.

Major Funds

CITY OF MOUNTAIN HOUSE
Statement of Revenues, Expenses and Changes in Fund Net Position Proprietary Funds
For the Year Ended June 30, 2025
24 Item 8.1
Mountain House Page 420 of 545
Business-type Activities - Enterprise Funds
Water Wastewater Stormwater Developer Total
CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from customers $ 7,912,017 10,093,152 $ 2,443,072 $ 10,839,308 $ 31,287,549 $ Cash received from interfund services provided 15,095 982,399 106,471 1,103,965 Cash paid to suppliers (4,493,545) (2,317,421) (468,047) (17,069,855) (24,348,868) Cash paid to employees (439,479) (465,659) (168,180) (463,326) (1,536,644) CASH PROVIDED (USED) BY OPERATING ACTIVITIES 5,170,212 6,116,347 1,913,316 (6,693,873) 6,506,002

CASH FLOWS FROM NONCAPITAL FINANCING
ACTIVITIES:

Transfers from other funds (12,111) (12,111)

CASH USED BY NONCAPITAL AND
RELATED FINANCING ACTIVITIES (12,111) (12,111)

CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:

Payment for acquisition of capital assets (12,137) (171,930) (217,058) (401,125) Principal paid on long-term debt (5,751,855) (825,000) (1,510,910) (8,087,765) Interest paid on long-term debt (4,373,170) (3,103,235) (1,087,651) (8,564,056) Pledged notes developer refund 187,450 62,524 148,587 398,561 Advances (to) from other funds 1,477,242 (1,477,242)

CASH PROVIDED (USED) FOR CAPITAL AND
RELATED FINANCING ACTIVITIES (7,327,461) (6,659,892) (2,667,032) (16,654,385) CASH FLOWS FROM INVESTING ACTIVIITES:

Interest received 709,213 280,715 308,977 665,014 1,963,919

INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (1,448,036) (262,830) (444,739) (6,040,970) (8,196,575) Cash and cash equivalents, beginning of year 12,000,100 8,160,241 9,194,330 12,046,079 41,400,750 CASH AND CASH EQUIVALENTS, END OF YEAR $ 10,552,064 7,897,411 $ 8,749,591 $ 6,005,109 $ 33,204,175 $

RECONCILIATION OF CASH AND CASH EQUIVALENTS
TO THE STATEMENT OF NET POSITION:

Cash and investments 5,707,768 $ 534,796 $ 3,535,857 $ 6,005,109 $ 15,783,530 $ Restricted cash and investments 10,017,268 2,189,643 5,213,734 17,420,645 CASH AND INVESTMENTS $ 7,897,411 $ 10,552,064 $ 8,749,591 $ 6,005,109 $ 33,204,175

RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED BY OPERATING ACTIVITIES:

Operating income (loss) $ 4,105,475 4,033,212 $ 1,386,629 $ 68 $ $ 9,525,384 Adjustments to reconcile operating income (loss)
to cash provided by operating activities:

Depreciation 1,781,060 2,836,015 728,544 5,345,619
(Increase) decrease in accounts receivable (1,033,698) (813,753) (217,789) 5,762,211 3,696,971 (Increase) decrease in prepaid expenses 31,987 41,134 11,511 84,632 (Increase) decrease in deferred outflows 40,764 48,960 12,569 102,293 Increase (decrease) in accounts payable 129,356 7,125 (13,561) 1,961,690 2,084,610 Increase (decrease) in unearned revenue (14,417,842) (14,417,842) Increase (decrease) in deposits from others 40,285 40,285 Increase (decrease) in net pension liability 26,487 31,812 8,167 66,466 Increase (decrease) in deferred inflows (10,729) (8,933) (2,754) (22,416) CASH PROVIDED (USED) BY OPERATING ACTIVITIES $ 5,170,212 6,116,347 $ 1,913,316 $ (6,693,873) $ 6,506,002 $

SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES
Amortization of bond prepaid insurance 41,134 $ 31,987 $ 11,511 $ 84,632 $ Amortization of deferred amount on refunding of bonds $ 24,654 36,724 $ 8,396 $ 69,774 $ Amortization of bond premiums and discounts $ 426,861 $ 302,743 $ 110,773 $ 840,377 Change in fair value of investments $ 40,363 32,774 $ 39,674 $ 47,255 $ 160,066 $ Noncash additions to notes payable and capital assets $ 5,937,174 12,327 $ 1,295,433 $ 7,244,934 $ The accompanying notes are an integral part of these financial statements.

CITY OF MOUNTAIN HOUSE
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2025
25 Item 8.1
Mountain House Page 421 of 545
Community
Facilities
District
2024-01
Fund
ASSETS
Cash and investments 85,116$
TOTAL ASSETS 85,116
Liabilities
Unearned revenues 84,936
TOTAL LIABILITIES 84,936
Net Position
Restricted for:

Debt service 180
Total Net Position 180$

CITY OF MOUNTAIN HOUSE
Statement of Fiduciary Net Position -
Custodial Fund
June 30, 2025
The accompanying notes are an integral part of these financial statements. 26 Item 8.1
Mountain House Page 422 of 545
Community
Facilities
District
2024-01
Fund
Additions:

Investment earnings 180$
Total Additions 180
Net Increase in Fiduciary Net Position 180
Net Position, Beginning of Year
Net Position, End of Year 180$

CITY OF MOUNTAIN HOUSE
Statement of Changes in Fiduciary Net Position -
Custodial Fund
June 30, 2025
The accompanying notes are an integral part of these financial statements. 27 Item 8.1
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28 (This page intentionally left blank.)
Item 8.1
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29 NOTES TO BASIC FINANCIAL STATEMENTS
Item 8.1
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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2025
30 NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Reporting Entity: The reporting entity refers to the scope of activities, organizations and functions included in the financial statements. The City of Mountain House (City), was incorporated by voter approved referendum on March 5, 2024 and officially incorporated on July1, 2024, under the laws and regulations of the State of California (State). The City operates under a City Council/City Manager form of government pursuant to California Government Code Sections 34851–34906. The elected officials consist of a five-member City Council with a directly elected mayor and four City Council members elected at large throughout the City.

The City provides general government, public safety, public ways and facilities, recreation and culture, housing and development water, wastewater, and storm drain services. Police services are provided through contracts with the County of San Joaquin and a private security company. Fire services are provided through contract with French Camp McKinley Rural Fire Protection District. Development inspections and plan checks are provided by the County of San Joaquin.

For financial reporting purposes, the City’s basic financial statements include all financial activities that are controlled by or are dependent upon actions taken by the City and its component units. The Mountain House Community Services District, predecessor to the City, is a legally separate entity for which the City is financially accountable and is governed by the elected City Council. The District was established as a Subsidiary District of the City for the exclusive purpose of enforcement of covenants, conditions and restrictions (CC&Rs). The Subsidiary District’s property tax share was determined as the net share of available after calculating the net cost of services that would transfer from the District to the City, exclusive of CC&R enforcement. The financial activities of the District are blended with those of the City and are reported as a special revenue fund. Blended component units, although legally separate entities, are, in substance, part of the government’s operations and so data from these units are combined with data of the primary government. Separate component unit financial reports are not prepared. The accounting methods and procedures adopted by the City conform to generally accepted accounting principles as applied to governmental entities.

On July 1, 2024, the City Council approved the San Joaquin Council of Governments (SJCOG) Joint Powers Agreement. SJCOG administers federal and state grants, Transportation Development Act (Local Transportation Fund and State Transit Assistance), State of Good Repair and San Joaquin County Measure K sales tax funds that will be made available to the City for use on transit programs, streets and roads costs, pedestrian and bicycle costs, transit capital costs and programs to reduce greenhouse gas emissions.

The City entered into a Joint Exercise of Powers Agreement dated April 1, 2007, between the City and the County of San Joaquin for the purpose of creating the Mountain House Public Financing Authority (Authority). The Authority was created to facilitate the financing and refinancing of certain public programs and projects of the City through the issuance of the Utility Systems Revenue Bonds, Series 2007 and 2011. The City owns the underlying capital assets that were financed with the debt. The Bonds issued in the name of the Authority were refunded in December 2019 with the proceeds of the Utility System Revenue Bonds, Series 2019A and B. The Authority has no other transactions and does not issue separate financial statements.

The City entered into a Joint Exercise of Powers Agreement dated June 1, 2019, between the City and the California Statewide Communities Development Authority (CSCDA) for the purpose of creating the Mountain House Financing Authority (MHFA). The MHFA was created to issue bonds and to purchase Item 8.1
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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
31 NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) bonds issued by, or to make loans to, the City or CSCDA for financing public capital improvements, working capital, liability and other insurance needs, or projects whenever there are significant public benefits. The City owns any underlying capital assets financed with debt issued by the MHFA, as described in Note E. The accompanying basic financial statements of the City include the financial activities of the MHFA as a blended component unit of the City because the City’s Board of Directors controls the MHFA, the City is financially accountable for the MHFA and the MHFA is financially dependent upon the City. Debt issued by the MHFA is reflected as debt of the City in these financial statements. The MHFA has no other transactions and does not issue separate financial statements.

Basis of Presentation—Government-wide Statements: The statement of net position and statement of activities display information about the primary government. These statements include the financial activities of the overall government. Eliminations have been made to minimize the double counting of internal activities. These statements distinguish between the governmental and business-type activities of the City 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 charged to external parties.

The statement of activities demonstrates the degree to which the program expenses of a given function are offset by program revenues. Program expenses include direct expenses, which are clearly identifiable with a specific function. Program revenues include 1) charges paid by the recipients of goods or services offered by the programs and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Taxes and other items not properly included among program revenues are reported instead as general revenues. Revenues that are not classified as program revenues, including all taxes, are presented instead as general revenues.

Basis of Presentation—Fund Financial Statements: The fund financial statements provide information about the City’s funds. Separate statements for each fund category — governmental and proprietary — are presented. The emphasis of fund financial statements is on major governmental and enterprise funds, each displayed in a separate column. All remaining governmental and enterprise funds are separately aggregated and reported as non-major funds.

Proprietary funds distinguish operating revenues and expenses from nonoperating items. Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with the proprietary fund’s principal ongoing operations.

Nonoperating revenues, such as subsidies and investment earnings, result from nonexchange transactions or ancillary activities. All revenues and expenses not meeting the definition of operating revenues and expenses are reported as nonoperating.

The City reports the following major governmental funds:
 The General Fund is the general operating fund of the City. It is used to account for all financial resources and transactions except those required to be accounted for in another fund. It includes certain special accounts that are used to accumulate resources for designated purposes.  The Special Assessments Special Revenue Fund is used to account for funding from property assessments, levied per one hundred square feet of living area and per one hundred square feet of parcel area, to pay for roads, transportation, community services, public safety, public works, Item 8.1
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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
32 NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) parks and recreation as a result of the adoption of Resolutions 96-1, 96-2, 96-3 and 96-4 and continued under City Ordinance 2024-006 and assessments from three landscaping and lighting districts continued under City Ordinance 2024-007 as follows:
o Ordinance No. 96-1 – Transportation, Operations and Administration: Provides funding for capital and operating costs, including administrative costs, of providing public transportation, including, but not limited to, construction and maintenance of streets and roads rights of way, bus service and equipment and facilities, train station facilities, and programs for the provision of public transportation, including, but not limited to, such items as programs for transportation demand management and alternative transportation programs. Funding is also available for operational and administrative functions of the City to the extent these latter functions are not funded from other sources.

Ordinance No. 96-2 – Public Safety Services: Provides funding for capital and operating costs, including administrative costs, of providing public safety services, including, but not limited to, fire protection, weed and pest abatement, police, ambulance services, security services, graffiti abatement, and animal control, and other programs for the provision of public safety services. o Ordinance No. 96-3 – Parks, Recreation, and Community Facilities Services: Provides funding for capital and operating costs, including administrative costs, of providing parks, recreation and community facilities and services, including, but not limited to, public recreation activities and facilities, landscaping, wildlife habitat and open space, information services, library services, public events, and the administration and enforcement of community covenants, conditions and restrictions.
o Ordinance No. 96-4 – Public Works: Provides funding for capital and operating costs, including administrative costs, of providing public works services, including, but not limited to, flood control and prevention, stormwater and drainage, sewer services, water services, street lighting, utility undergrounding, and telecommunications services. o Mountain House Community Services District Consolidated Landscape Maintenance Assessment District No. 2016 (District No. 2016): Established under the provisions of the Landscaping and Lighting Act of 1972 to maintain landscaping and lighting improvements in Zone 1, Neighborhood D.
o Mountain House Community Services District Consolidated Landscape Maintenance Assessment District No. 2008-1 (District No. 2008-1): Established under the provisions of the Landscaping and Lighting Act of 1972 to maintain landscaping and lighting improvements in Zone 1, Neighborhood H.
o Mountain House Community Services District Consolidated Landscape Maintenance District No. 2019 (District No. 2019): Established under the provisions of the Landscaping and Lighting Act of 1972 to maintain landscaping and lighting improvements in District 2019.  The Impact Fees Special Revenue Fund is used to account for fees collected from builders to mitigate the impact of development. The fees are used to reimburse developers for identified infrastructure projects.
 The Affordable Housing Special Revenue Fund is used to account for fees collected in order to promote the development of housing that is affordable to low-income households within the City through the use or application of fee revenues.

Item 8.1
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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
33 NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)  The Development Services Special Revenue Fund is mostly self-sustaining fund with full cost recovery fees for development.

The City reports the following major enterprise funds:
 The Water Fund is used to account for the revenues from water users and the associated expenses to provide water treatment and services, and debt service.  The Wastewater Fund is used to account for the revenues from wastewater users and the associated expenses to provide wastewater treatment and services, and debt service.  The Stormwater Fund is used to account for the revenues from stormwater line users and the associated expenses to provide stormwater treatment and services, and debt service.  The Developer Fund is used to account for financial resources used and expended for new developments.

Additionally, the City reports the following nonmajor fund types:

GOVERNMENTAL FUNDS
Special Revenue Funds – Special Revenue Funds are used to account for the proceeds of specific revenue sources (not including private purpose trusts or major capital projects) that are legally restricted to expenditures for specified purposes, including the proceeds of San Joaquin Measure K, state gas tax funds, and the revenues and expenditures related to the enforcement of CC&Rs.

Capital Projects Funds – The Capital Projects Funds are used to account for financial resources used for the acquisition or construction of major capital facilities other than those financed by proprietary funds.

FIDUCIARY FUNDS
Custodial Funds – Custodial Funds are used to account for assets held by the City in a purely custodial capacity. Custodial funds typically involve only the receipt, temporary investment and remittance of fiduciary resources to individuals, private organizations or other governments. The City’s custodial funds account for Community Facility Districts used for conduit debt owed by property owners.

Basis of Accounting: The government-wide and proprietary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the City gives (or receives) value without directly receiving (or giving) equal value in exchange, include property taxes, special assessments and franchise fees. On an accrual basis, revenue from property taxes, special assessments and franchise fees is recognized in the fiscal year for which the taxes are levied.

Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Under this method, revenues are recognized when measurable and available (“susceptible to accrual”). The City considers all revenues reported in the governmental funds to be available if the revenues are collected within sixty days after the end of the accounting period so as to be measurable and available. Expenditures are generally recorded when a Item 8.1
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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
34 NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments are recorded only when payment is due. General capital assets acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term debt are reported as other financing sources.

Expenditures in the Special Assessment Special Revenue Fund are categorized consistently with the requirements of the related Ordinance. This results in general government expenditures being categorized with related expenditures rather than being reported separately as in the government-wide statements.

Cash and Cash Equivalents: The statements of cash flows include both cash and cash equivalents. Cash equivalents are defined as all cash and investments with original maturities of 90 days or less and the City’s investment in the County of San Joaquin’s pooled cash and investments.

Receivables, Unearned Revenue, and Unavailable Revenue: Receivables consist mostly of property taxes, developer reimbursements, and utility billings. Amounts in the Statements of Net Position for the Proprietary Funds are aggregated into a single accounts receivable. Below is the detail of the receivable for the proprietary funds:

Water Wastewater Stormwater Developer Total
Receivables $ 900,290 1,467,851 $ 174,309 $ 2,206,918 $ 4,749,368 $ Less: Allowance for
uncollectible accounts (14,495) (17,838) (4,044) (36,377) Ending balance $ 885,795 1,450,013 $ 170,265 $ 2,206,918 $ 4,712,991 $ The City reports unearned revenue on its financial statements. Unearned revenues arise when the City receives resources before it has a legal claim to them, including developer deposits for plan checks and inspections, a police station, roads and a water treatment plant extension that are not considered earned until the permit is pulled. In subsequent periods, when the City has a legal claim to the resources, the unearned revenue is removed from the financial statements and revenue is recognized. The City also reports unavailable revenues on its financial statements, which arise when potential revenue does not meet both the “measurable” and “available” criteria for recognition in the current period. Revenue is recognized when the revenue recognition criteria are met.

Restricted Assets: Certain resources set aside for repayment of revenue bonds and pledged notes payable are classified as restricted assets on the balance sheet because their use is limited by applicable bond covenants and the Master Acquisition and Reimbursement Agreement. The amounts reported as restricted cash and investments consist of debt service reserves as well as accumulated pledged revenue in restricted accounts containing the portion of the enterprise fund utility bills that are pledged for repayment of the revenue bonds and the pledged notes payable.

The capital improvement fee portion of the City’s utility bill collections from its customers is pledged to pay debt service on the bonds and to reimburse the developers for the cost of the construction of the utility infrastructure. The cash and investments and receivables not yet disbursed to the developer or to the bond trustee are reported as restricted assets. The cash and investments are held at Wells Fargo Bank to pay related debt service on the revenue bonds issued, with the remainder being used to pay the pledged notes payable to the developers.

Item 8.1
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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
35 NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Capital Assets: Capital assets (including infrastructure) are recorded at historical cost or at estimated historical cost if actual historical cost is not available. The City defines capital assets as assets with an initial, individual cost of more than $1,000 for equipment/furniture and $5,000 for structures and improvements, and an estimated useful life in excess of one year.

Capital assets acquired by the governmental funds are accounted for as expenditures of those funds and capitalized and recorded as assets in the government-wide financial statements. Donated capital assets are recorded at the acquisition value, which is the price that would be paid to acquire an asset with equivalent service potential in an orderly market transaction at the acquisition date. Contributed capital assets include public domain (infrastructure) general fixed assets consisting of certain improvements including roads, tract improvements, right of ways, and utility facilities.

Costs of assets sold or retired (and related amounts of accumulated depreciation) are eliminated from the accounts in the year of sale or retirement and the resulting gain or loss is included in the operating statement of the related fund. In governmental funds, the sale of general capital assets is included in the statement of revenues, expenditures, and changes in fund balances as proceeds from sale.

Maintenance and repairs are charged to operations when incurred. Betterments and major improvements that significantly increase values, change capacities or extend useful lives are capitalized. Upon sale or retirement of capital assets, the cost and related accumulated depreciation are removed from the respective accounts and any resulting gain or loss is included in the results of operations.

Depreciation is recorded using the straight-line method over the estimated useful lives of the capital assets. The range of estimated useful lives by type of asset is as follows:

Structures and Improvements 10-50 years
Equipment and Machinery 2-10 years
Infrastructure 25 years
Compensated Absences: Compensated absences are comprised of unpaid vacation, sick leave, floating and holiday pay, which are accrued as earned. Full-time employees accrue 80 to 184 hours of vacation and may accrue up to a maximum of 160 to 368 hours of vacation, depending on their years of service. A liability for compensated absences that are attributable to services already rendered and that are not contingent on a specific event that is outside the control of the government and its employees is accrued as employees earn the rights to the benefits. Compensated absences that relate to future services or that are contingent on a specific event that is outside the control of the government and its employees are accounted for in the period in which such services are rendered or such events take place. A liability for these amounts is reported in governmental funds only if they have matured, for example, as a result of employee resignations and retirements. Compensated absences are liquidated by the General Fund.

Long-term Obligations: In the government-wide financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, net of any related discounts. Issuance costs are expensed when incurred.

In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as issuance costs, during the current period. The face amount of the debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while Item 8.1
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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
36 NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) discounts on debt issuances are reported as other financing uses. Issuance costs, even if withheld from the actual net proceeds received, are reported as debt service expenditures.

Leases and Subscriptions: The City recognizes a lease liability and an intangible right-of-use lease asset and a subscription liability and subscription asset in the government-wide and enterprise fund statements if the lease meets the criteria in GASB Statement No. 87, Leases, or the subscription meets the criteria in GASB Statement No. 96, Subscription-Based Information Technology Arrangements. The City does not recognize short-term leases and subscriptions with a maximum possible term of 12 months or less. The City currently does not have any material leases or subscriptions.

Pledged Notes Payable: The City acquired various infrastructure facilities from developers through various Project Acquisition Agreements. In accordance with the Master Acquisition and Reimbursement Agreement and various Project Reimbursement Agreements, the City is obligated to reimburse for the accepted infrastructure based on agreed-upon amounts after costs are certified. In accordance with the agreements, financing charges are applied to the outstanding balance using the percentage increase in the Engineering News Record (ENR), a construction cost index. The rate used by the City during the year ended June 30, 2025 was 2.597%. Repayment of the governmental activities pledged notes payable are made as impact fees are collected. If fees collected are insufficient to completely reimburse the developers at the time of build-out, the City will not have further obligation for reimbursement. The City’s service area was approximately one-third built-out at year-end. Repayment of the business-type activities pledged notes are made from the capital improvement fee included in the utility billings received from the customers. When the developers have been fully reimbursed, the capital improvement fee will be used by the City to refurbish or replace the infrastructure.

Pension Plan: For purposes of measuring the net pension liability and deferred outflows/inflows of resources and pension expense related to the pension plan, information about the fiduciary net position of the City’s pension plan (the Plan) and additions to/deductions from the Plan’s fiduciary net position have been determined on the same basis as they are reported by the County of San Joaquin’s Pension Plan. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. The General Fund and enterprise funds are used to liquidate the pension liability.

Property Tax Revenues: Property taxes attach as an enforceable lien on property as of January 1st. Taxes are levied on July 1st and are payable in two installments on December 10th and April 10th.

The County of San Joaquin is responsible for the collection and allocation of property taxes. Under California law, property taxes are assessed and collected by the County up to 1% of the full cash value of taxable property, plus other increases approved by the voters and distributed in accordance with statutory formulas. The City recognizes property taxes when the individual installments are due, provided they are collected within 60 days after year-end.

The City participates in an alternative method of distribution of property tax levies and assessments known as the “Teeter Plan.” The State Revenue and Taxation Code allow counties to distribute secured real property and assessment and supplemental property taxes on an accrual basis resulting in full payment to cities each fiscal year. Any subsequent delinquent payments, penalties and interest during a fiscal year will revert to the County.

Item 8.1
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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
37 NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Special Assessments: There are five special taxes used to fund the services in the City. Each tax is levied per one hundred square feet of living area and per one hundred square feet of parcel area. The tax rates are subject to adjustment annually. The various assessments fund the capital and operating costs of providing roadways and other transportation infrastructure; public safety; parks, recreation, and community facilities; and public works services. The County of San Joaquin collects the special assessments as part of the property tax collection system and the City recognizes special assessment revenue when the installments are due, provided they are collected within 60 days after year-end.

Net Position/Fund Balances: The government-wide and business-type activities financial statements report net position. Net position is categorized as the net investment in capital assets, restricted and unrestricted. These categories are described on the following page:
 Net Investment in Capital Assets — This category groups all capital assets, including infrastructure, into one component of net position. Accumulated depreciation and the outstanding balances of debt and other payables that are attributable to the acquisition, construction or improvement of these assets reduce the balance in this category, with the exception of the accrued interest included in the pledged notes payable. The net investment in capital assets in the Water Enterprise Fund is negative due to the principal on pledged notes payable being paid slower than the capital assets are depreciated.  Restricted Net Position — This category represents net position that are subject to constraints either (1) externally imposed by creditors (such as debt covenants), grantors, contributors, or laws or regulations of other governments or (2) imposed by law through constitutional provisions or enabling legislation. The City’s restrictions are listed on the face of the statements of net position.  Unrestricted Net Position — This category represents net position of the City, not restricted for any project or other purpose.

When both restricted and unrestricted net position are available, unrestricted resources are used only after the restricted resources are depleted.

In the Governmental Fund Statements, the following classifications describe the relative strength of the spending constraints placed on the purposes for which resources can be used:
 Nonspendable fund balance — amounts that cannot be spent because they are either not spendable in form or legally or contractually required to remain intact.  Restricted fund balance — amounts with constraints placed on their use by those external to the City, including creditors, grantors, contributors or laws and regulations of other governments. It also includes constraints imposed by law through constitutional provisions or enabling legislation.  Committed fund balance — amounts that can only be used for specific purposes determined by a resolution of the City’s highest level of decision-making authority (the Board of Directors) and that remain binding unless removed with another resolution. The underlying action that imposed the limitation needs to occur no later than the close of the reporting period. The City’s committed fund balance in the General Fund represents an amount committed for the construction of an aquatic center.
 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 or by a body or an official designed for that purpose.

Item 8.1
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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
38 NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)  Unassigned fund balance — the residual classification that includes amounts not contained in the other classifications. The General Fund is the only fund that reports positive unassigned fund balance while negative fund balance may be reported as unassigned fund balance if expenditures incurred for specific purposes exceed the amounts that are restricted, committed or assigned for those purposes.

The City’s Board establishes, modifies or rescinds fund balance commitments and assignments by passage of a resolution. When 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. The City’s committed, assigned, or unassigned amounts are considered to have been spent when an expenditure is incurred for purposes for which amounts in any of those unrestricted fund balance classifications could be used.

Use of Estimates: The preparation of basic financial statements in conformity with accounting principles generally accepted in the United States of America, as prescribed by the GASB and the American Institute of Certified Public Accountants (AICPA), requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

New Pronouncements: In April 2022, the GASB issued Statement No. 99, Omnibus 2022. This Statement enhances comparability in accounting and financial reporting and consistency in authoritative literature, including the classification and reporting of derivative instruments within the scope of Statement No. 53, Accounting and Financial Reporting for Derivative Instruments, that do not meet the definition of either an investment derivative instrument or a hedging derivative instrument; clarification of provisions of Statement 87, Leases, related to the determination of the lease term, classification of a lease as a short-term lease, recognition and measurement of a lease liability and a lease asset and identification of lease incentives; clarification of provisions in Statement No. 96, Subscription-Based Information Technology Arrangements, related to the subscription-based information technology arrangement term, classification as short-term and recognition of a subscription liability; extension of the period during which the London Interbank Offered Rate (LIBOR) is considered an appropriate benchmark interest rate for the qualitative evaluation of the effectiveness of an interest rate swap that hedges the interest rate risk of taxable debt; accounting for the distribution of benefits as part of the Supplemental Nutrition Assistance Program (SNAP); disclosures related to nonmonetary transactions; pledges of future revenues when resources are not received by the pledging government; clarification of provisions in Statement No. 34, Basic Financial Statements-and Management’s Discussion and Analysisfor State and Local Governments, related to the focus of the government-wide financial statements; terminology updates related to provisions of Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position; and terminology used in Statement No. 53 to refer to resource flows statements. This Statement was implemented during the year ended June 30, 2024 and had no impact on the City’s financial statements.

In June 2022, the GASB issued Statement No. 100, Accounting Changes and Error Corrections, an Amendment of GASB Statement No. 62. This Statement prescribes the accounting and financial reporting for each type of accounting change, including changes in accounting principles, changes in accounting estimates and changes to or within the financial reporting entity, and error corrections. This Statement requires changes in accounting principles and error corrections to be reported retroactively by restating prior periods; requires changes to or within the financial reporting entity be reported by adjusting beginning balances of the current period; and requires changes in accounting estimates to be reported Item 8.1
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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
39 NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) prospectively by recognizing the change in the current period. This Statement applies to the implementation of new pronouncements in absence of specific transition provisions in the new pronouncement. This Statement also requires the aggregate amount of adjustments to and restatements of beginning net position, fund balance or fund net position, as applicable, to be displayed by reporting unit in the financial statements. Furthermore, this Statement requires information presented in required supplementary information or supplementary information to be restated for error corrections, if practicable, but not for changes in accounting principles. The provisions of this Statement are effective for accounting changes and error corrections made in fiscal years beginning after June 15, 2023. This statement was implemented by the City during the year ended June 30, 2024 and had no impact on the City’s financial statements.

In June 2022, the GASB issued Statement No. 101, Compensated Absences. This statement requires that liabilities for compensated absences be recognized for leave that has not been used that is attributable to services already rendered, accumulates and is more likely than not to be used for time off or paid in cash or settled through noncash means and leave that has been used but not paid in cash or settled through noncash means. Leave that is more likely than not to be settled through conversion to defined benefit postemployment benefits should not be included in the liability for compensated absences. This Statement requires that a liability for certain types of compensated absences, including parental leave, military leave and jury duty leave, not be recognized until the leave commences. Certain salary-related payments that are directly and incrementally associated with payments for leave also should be included in the measurement of the liabilities. With respect to financial statements prepared using the current financial resources measurement focus, this Statement requires that expenditures be recognized for the amount that normally would be liquidated with expendable available financial resources. The City implemented this Statement during the year ended June 30, 2025 and the effect of the implementation of this Statement is described in Note N to the financial statements.

In December 2023, the GASB issued Statement No. 102, Certain Risk Disclosures. This Statement requires a government to assess whether a concentration or constraint makes a primary government, or reporting unit that reports a liability for revenue debt, vulnerable to the risk of a substantial impact and to assess whether an event or events associated with a concentration or constraint that could cause the substantial impact have occurred, have begun to occur, or are more likely than not to occur within 12 months of the date the financial statements are issued. If the criteria in the Statement have been met for a concentration or constraint, the government should disclose information in notes to financial statements in sufficient detail to enable users of financial statements understand the nature of the circumstances disclosed and the government’s vulnerability to the risk of a substantial impact. The provisions of this Statement were implemented during the year ended June 30, 2025 and did not have a significant impact on the City’s financial statements.

In April 2024, the GASB issued Statement No. 103, Financial Reporting Model Improvements. This Statement improves key components of the financial reporting model to enhance its effectiveness in providing information that is essential for decision making and assessing a government’s accountability, including 1) certain topics and disclosures in Management’s Discussion and Analysis; 2) requiring the display of inflows and outflows of unusual and infrequent items to be reported separately as the last presented flow(s) of resources prior to the net change in resources flows in the government-wide, governmental fund, and proprietary fund statement of resources flows; 3) changing the definition of proprietary fund nonoperating revenues and expenses to include subsidies received and provided, contributions to permanent and term endowments, revenues and expenses related to financing, resources from the disposal of capital assets and inventory and investment income and expenses and defines Item 8.1
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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
40 NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) operating revenues and expenses as revenue and expenses other than nonoperating revenue and expenses; 4) requires major component units to be presented separately in the reporting entity’s statement of net position and statement of activities if it does not reduce the readability of the statements; and 5) requires budgetary comparison schedules to be reported as Required Supplementary Information (RSI), requires the presentation of variances between original and final budget amounts and final budget and actual amounts in the RSI and requires the explanation of significant variances to be reported in notes to the RSI. The provisions of this Statement are effective for years beginning after June 15, 2025.

In April 2024, the GASB issued Statement No. 104, Disclosure of Certain Capital Assets. This Statement requires lease assets recognized in accordance with GASB Statement No. 87, Leases, right-to-use assets recognized in accordance with GASB Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements, subscription assets recognized in accordance with GASB Statement. No 96, Subscription-Based Information Technology Arrangements, and other intangible assets to be disclosed separately in capital assets footnote disclosures. This Statement also requires additional disclosures for capital assets held for sale. A capital asset is a capital asset held for sale if (a) the government has decided to pursue the sale of the capital asset and (b) it is probable that the sale will be finalized within one year of the financial statement date. Governments should disclose the ending historical cost and accumulated depreciation by major class of asset and the carrying amount of debt for which the assets are pledged as collateral by major class of asset held for sale under this Statement. The provisions of this Statement are effective for fiscal years beginning after June 15, 2025.

The City is currently analyzing the impact of the required implementation of these new statements.

NOTE B – CASH AND INVESTMENTS
Cash and investments at June 30, 2025 are classified in the accompanying financial statements as follows:

Governmental Business-type Fiduciary
Activities Activities Funds Total
Cash and investments $ 15,783,530 131,410,835 $ 85,116 $ $ 147,279,481 Restricted cash and investments 7,450 17,420,645 17,428,095 $ 33,204,175 131,418,285 $ 85,116 $ 164,707,576 $
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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
41 NOTE B – CASH AND INVESTMENTS (Continued)
At June 30, 2025, the City’s total cash and investments at fair value were as follows:

Cash:

Cash on hand 300 $
Deposits in financial institutions 5,646,215
Total cash 5,646,515
Investments:

Investment in County of San Joaquin Treasury 154,628,562 U.S. Agency securites 1,417,931
Money market mutual funds 24,108
Certificates of deposit 857,266
Medium term corporate notes 2,133,194
Total investments 159,061,061
Total cash and investments 164,707,576 $
Except for amounts held by fiscal agents in accordance with bond ordinances and the Master Acquisition and Reimbursement Agreement, all of the City’s cash and investments are deposited in the County of San Joaquin Treasury. The County maintains a cash and investment pool that is available to all funds for which the County Treasury is the depository, for the purpose of increasing interest earnings through investment activities. Investments held in the County’s investment pool are available on demand and consist of cash held in banks or on hand, debt securities, and investments in third-party investment pools.

The County of San Joaquin Treasury Oversight Committee (Committee) has oversight responsibility for the County of San Joaquin’s cash and investment pool. The Committee consists of ten members as required by state law. The value of the pooled shares in the County of San Joaquin that maybe withdrawn is determined on an amortized cost basis, which is different that the fair value of the City’s position in the pool. Deposits held in the County investment pool are subject to withdrawal restrictions that may require thirty days’ notice of the intent to withdrawal funds.

The City’s cash and investments are stated at fair value, determined using statements provided by custodial agents. Interest earned on the pooled funds is accrued and apportioned quarterly, based upon the average daily balance of each fund. Information regarding categorizing, ratings, and risk of investments and fair value reporting can be found in the County of San Joaquin’s annual financial report, which can be obtained by contacting the Auditor-Controller’s office at the County of San Joaquin.

Investment Policy: The City’s investment in the County’s Treasury is subject to the County’s investment policy. County’s Board of Supervisors approves an investment policy each year that was adopted by the City and provides oversight for all pooled investments in the County Treasury. California statutes authorize cities to invest idle or surplus funds in a variety of credit instruments as provided for in the California Government Code, Section 53600, Chapter 4 – Financial Affairs.

The table below identifies the investment types that are authorized for the City by the California Government Code and the City’s investment policy that address interest rate risk, credit risk, and concentration of credit risk.

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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
42 NOTE B – CASH AND INVESTMENTS (Continued)
Maximum Maximum
Maximum Percentage Investment
Authorized Investment Type Maturity Of Portfolio In One Issue Local agency bonds 5 years 100% None
U.S. Treasury obligations 5 years 100% None
U.S. Agency securities 5 years 100% None
California State Warrants on Bonds 5 years 100% None
Repurchase Agreements 1 year 100% None
Bankers acceptances 180 days 40% 30%
Time deposits 1 year 30% None
High grade commercial paper 270 days 30% 10%
Negotiable certificates of deposit 1 year 30% 10%
Medium term corporate notes 3 years 30% None
Mutual funds N/A 20% None
Specific securities 5 years Per approval Per approval
Mortgage pass-through securities 5 years 20% None
Collateralized negotiable investments 5 years None None Repurchase agreements 92 days 100% None
California Local Agency Investment Fund (LAIF) N/A None None Local government investment pools N/A None $75,000,000
Joint Powers Authority Programs N/A 30% None
Supranationals 5 years 10% AA
Investment of debt proceeds held by bond trustee are governed by the provision of the debt agreements rather than the California Government Code. However, the City’s debt agreement authorizes investment in all investments that comply with the California Government Code with the following additional requirements: U.S. agencies and financial institutions in which the City invests must have a rating of “A” or higher by two nationally recognized statistical rating agencies and corporations in which the City invests must have total assets of at least $500 million.

The City complied with the provisions of the California Government Code pertaining to the types of investments held, institutions in which deposits were made and security requirements. The City will continue to monitor compliance with applicable statutes pertaining to public deposits and investments.

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

Information about the sensitivity of the fair values of the City’s investments (including investments held by bond trustees) to market interest rate fluctuations is provided by the following table that shows the distribution of the City’s investment by maturity date at June 30, 2025:

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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
43 NOTE B – CASH AND INVESTMENTS (Continued)
Weighted
12 Months 12 to 24 24 to 60 Average
Total or Less Months Months Maturity
Investment in County of San
Joaquin Treasury $ 154,628,562 154,628,562 $ 707 days
U.S. Agency securities 1,417,931 $ 236,692 $ 1,181,239 N/A Money market mutual funds 24,108 24,108 68 days
Certificates of deposit 857,266 611,097 246,169 N/A
Medium term corporate notes 2,133,194 464,951 749,487 918,756 N/A Total $ 1,010,287 159,061,061 $ 155,339,682 $ 2,711,092 $ Remaining Investment Maturities
Credit Risk: Generally, credit risk is the risk that the issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the minimum rating required by (where applicable) the California Government Code, the City’s investment policy, or debt agreements, and the actual rating as of year-end for each investment type as of June 30, 2025.

Minimum
Legal
Total Rating AAA
Investment in County of San
Joaquin Treasury $ N/A 154,628,562 $ 154,628,562
U.S. Agency securities 1,417,931 A 1,417,931 $
Money market mutual funds 24,108 A 24,108 $
Certificates of deposit 857,266 N/A 857,266
Medium term corporate notes 2,133,194 A 127,593 $ 251,445 $ 674,565 $ 1,079,591 $ Total $ 24,108 159,061,061 $ 1,417,931 $ 127,593 $ 251,445 $ 674,565 $ 1,079,591 $ 155,485,828 $ AA+ AA- Not Rated A+ A ACustodial Credit Risk of Cash Deposits: Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The California Government Code requires that a financial institution secure the City’s cash deposits by pledging securities in an undivided collateral pool held by a depository regulated under state law. The fair value of pledged securities in the collateral pool must equal at least 110% of the City’s cash deposits.

California law also allows institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the City’s total cash deposits.

At June 30, 2025, the carrying amount and the bank balance of the City’s deposits was $6,503,481, including certificates of deposit. The City had balances in banks of $5,651,107 above the federally insured limit of $250,000, which were secured by a pledge of the financial institution’s securities, but not in the name of the City.

Funds Held by Fiscal Agents: The City holds all of its restricted investments with a fiscal agent in various accounts for the purpose of paying principal and interest on its bonds, paying down the pledged notes payable and to establish a reserve for the bond issues. The fair value of investments is determined monthly based upon quoted market prices.

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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
44 NOTE B – CASH AND INVESTMENTS (Continued)
Concentration of Credit Risk: The City had no investment policy limiting the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. At June 30, 2025, the City had no investments in one issuer (other than the San Joaquin Pooled Investment Fund) that represented 5% or more of total City investments.

Custodial Credit Risk: For investments and deposits held with fiscal agents, custodial credit risk is the risk that, in the event of the failure of the counterparty, the City will not be able to recover the value of its investments or deposits that are in the possession of an outside party. At year end, the City’s cash and investments with fiscal agents had no securities exposed to custodial credit risk.

Fair Value Measurement: The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. The City has the following recurring fair value measurements as of June 30, 2025:

Total 123
U.S. Agency securites 1,417,931 $ 1,417,931 $
Money market mutual funds 24,108 24,108
Certificates of deposit 857,266 857,266
Medium term corporate notes 2,133,194 2,133,194
- 4,432,499 4,432,499 $ -
Investments not categorized:

Investment in County of San
Joaquin Treasury 154,628,562
Total $159,061,061
Level
For investments classified within level 2 of the fair value hierarchy, the City’s custodians generally use a multi-dimensional relational model. Inputs to their pricing models are based on observable market inputs in active markets. The inputs to the pricing models are typically benchmark yields, reported trades, broker-dealer quotes, issuer spreads and benchmark securities, among others.

NOTE C – INTERFUND TRANSACTIONS
Due to/from other funds: Amounts due to and from other funds are for temporary loans to cover deficit cash and other shortfalls. Due to/from other funds consisted of the following at June 30, 2025:

Receivable Fund Payable Fund Amount
General Fund Measure K Special Revenue Fund $ 135,542
Water Fund Wastewater Enterprise Fund 90,993
Stormwater Enterprise Fund 99,843
Wastewater Fund Stormwater Enterprise Fund 14,809
Stormwater Fund Wastewater Enterprise Fund 1,719
$ 342,906
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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
45 NOTE C – INTERFUND TRANSACTIONS (Continued)
Advances to/from other funds: Advances to and from other funds consisted of the following at June 30, 2025:

Receivable Fund Payable Fund Amount
General Fund Water Enterprise Fund $ (a) 9,378,781
Wastewater Enterprise Fund 5,408,323 (a)
Stormwater Enterprise Fund (a) 636,993
Wastewater Enterprise Fund Water Enterprise Fund (b) 8,553,201 $ 23,977,298
(a) Advances from the General Fund to Water, Wastewater and Stormwater Enterprise Funds are the result of funding shortfalls in the early years where the utility funds did not generate enough revenue in a start-up community to pay all the operating expenses. The Water Fund was advanced $2,295,186 during the year ended June 30, 2025. No advances were made to the Wastewater or Stormwater Funds during the year. All three enterprise funds generated a positive change in net position during the year ended June 30, 2025. There is currently no approved repayment plan, but repayment terms are expected to be considered during the next rate study. (b) The Wastewater Enterprise Fund advanced $10,752,341 of Utility System Revenue Bonds, Series 2023 proceeds to the Water Enterprise Fund on June 14, 2023 to repay developer notes payable in order to stabilize and reduce interest expense. Interest accrues annually on June 30 at the Local Agency Investment Fund rate. A principal payment of $1,477,242 and an interest payment of $442,443 was made on June 30, 2025 at 4.411%.

Transfer in/out: Interfund transfers for the year ended June 30, 2025 were as follows:

Transfer In Transfer Out Amount
Major Fund:

Development Services Fund General Fund 2,684,133 $ (a)
Non Major Fund:

Capital Projects Fund Special Assessments Special Revenue Fund 2,706,609 (b) General Fund 505,000 (b)
Impact Fees Special Revenue Fund 150,000 (b)
$ 6,045,742
(a) The transfer to the Development Service Fund is a subsidy to cover losses. (b) The transfer to the Capital Projects Fund is for future construction projects under the five-year CIP plan.

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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
46 NOTE D – CAPITAL ASSETS
Capital assets consisted of the following at June 30, 2025:

Balance at Balance at
June 30, 2024 Additions Deletions June 30, 2025
Governmental Activities
Capital assets, not being depreciated:

Land 28,041,500 $ 28,041,500 $
Total capital assets,
not being depreciated 28,041,500 28,041,500
Capital assets, being depreciated:

Equipment and furnishings 4,010,522 2,183,871 $ (57,899) $ 6,136,494 Buildings 33,710,975 60,601 33,771,576
Infrastructure 218,361,498 218,361,498
Total capital assets, being depreciated 256,082,995 2,244,472 (57,899) 258,269,568 Less accumulated depreciation for:

Equipment and furnishings (2,137,792) (562,677) 57,899 (2,642,570) Buildings (4,214,367) (892,526) (5,106,893)
Infrastructure (146,401,917) (9,332,499) (155,734,416)
Total accumulated depreciation (152,754,076) (10,787,702) 57,899 (163,483,879) Capital assets being depreciated, net 103,328,919 (8,543,230) 94,785,689

GOVERNMENTAL ACTIVITIES
CAPITAL ASSETS, NET $ (8,543,230) 131,370,419 $ - $ 122,827,189 $ Balance at Balance at
June 30, 2024 Additions Deletions June 30, 2025
Business-Type Activities
Capital assets, not being depreciated:

Land 2,604,300 $ 2,604,300 $
Total capital assets,
not being depreciated 2,604,300 2,604,300
Capital assets, being depreciated:

Equipment 1,571,939 401,125 $ 1,973,064
Other property 228,664,218 7,210,479 235,874,697
Total capital assets, being depreciated 230,236,157 7,611,604 237,847,761 Less accumulated depreciation for:

Equipment (1,161,416) (92,616) (1,254,032)
Other property (79,268,495) (5,253,003) (84,521,498)
Total accumulated depreciation (80,429,911) (5,345,619) (85,775,530) Capital assets being depreciated, net 149,806,246 2,265,985 152,072,231

BUSINESS-TYPE ACTIVITIES
CAPITAL ASSETS, NET $ 2,265,985 152,410,546 $ - $ 154,676,531 $ Item 8.1
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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
47 NOTE D – CAPITAL ASSETS (Continued)
Depreciation expense was charged to governmental functions as follows:

General government 837,405 $
Public safety 584,668
Public ways 8,014,655
Culture and recreation 1,350,974
Total Governmental Activities 10,787,702 $
Depreciation expense was charged to the business-type functions as follows:

Water $ 2,836,015
Wastewater 1,781,060
Stormwater 728,544
Total Business-type Activities 5,345,619 $
NOTE E – LONG-TERM LIABILITIES
The following is a summary of long-term liabilities at June 30, 2025:

Interest Principal Date of Amount Outstanding
Maturity Rates Installments Issue Authorized June 30, 2025 Governmental Activities Debt
Pledged notes payable None Agreement Based on impact fee Various 132,401,349 $ 65,980,770 $ (to acquire infrastructure from developers) based receipts Mountain House Financing Authority Oct 1
2021 Lease Revenue Bonds 2051 4.00% $845,000-$2,765,000 2021 49,690,000 36,965,000 (to finance the cost of improvements to
construct roads, streets and other
transporation improvements and
paydown pledged notes payable)
Total Governmental Activities 182,091,349 $ 102,945,770 $ Item 8.1
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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
48 NOTE E – LONG-TERM LIABILITIES (Continued)
The following is a summary of long-term liabilities at June 30, 2025:

Interest Principal Date of Amount Outstanding
Maturity Rates Installments Issue Authorized June 30, 2025 Business-type Activities Debt
Pledged notes payable None Agreement Based on utility
(to acquire water, wastewater, and based revenue receipts Various 194,268,479 $ 1,160,730 $ storm drain infrastructue and utilities)
Utility Systems Revenue Dec 1
Bonds, Series 2023 2052 4.125%-4.250% $3,240,000-$6,465,000 2023 42,775,000 42,775,000 (to provide funds to repay developers
for the cost of improvements to each system
and to fund a Reserve Fund for the
Bonds with a reserve fund insurance policy)
Mountain House Financing Authority
Utility Systems Revenue Dec 1
Bonds, Series 2020A 2055 4.00% $1,065,000-$6,780,000 2020 91,325,000 91,325,000 (to finance the cost of improvements to
the water, wastewater, and storm drain
system and paydown pledged notes payable)
Utility Systems Revenue Dec 1
Bonds, Series 2020B 2043 4.00% $180,000-$4,355,000 2020 37,300,000 36,300,000 (to finance the cost of improvements to
the water, wastewater, and storm drain
system and paydown pledged notes payable)
Utility Systems Revenue Dec 1
Bonds, Series 2019A 2041 3.0% - 5.0% $570,000-$2,275,000 2019 25,185,000 25,185,000 (to finance the cost of improvements to
the water, wastewater, and storm drain
system and refund remaining Utility System
Revenue Bonds, Series 2011 and 2007)
Utility Systems Revenue Dec 1
Bonds, Series 2019B 2028 2.316% - 3.671% $255,000-$1,065,000 2019 8,505,000 3,205,000 (to finance the cost of improvements to
the water, wastewater, and storm drain
system and refund remaining Utility System
Revenue Bonds, Series 2011 and 2007)
Total Revenue Bonds 205,090,000 198,790,000
Total Business-type Activities 399,358,479 $ 199,950,730 $ Item 8.1
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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
49 NOTE E – LONG-TERM LIABILITIES (Continued)
Changes to long-term liabilities during the year ended June 30, 2025 were as follows:

Restated
Balance Balance Due Within
July 01, 2024 Additions Retirements June 30, 2025 One Year Governmental Activities
Direct borrowings:

Pledged notes payable 62,635,335 $ 3,639,796 $ (294,361) $ 65,980,770 $ 50,000 $ Lease revenue bonds 47,925,000 (10,960,000) 36,965,000 1,000,000 Add premium 5,330,272 (527,194) 4,803,078
Total notes and bonds 115,890,607 3,639,796 (11,781,555) 107,748,848 1,050,000 Compensated absences 1,006,508 52,941 * 1,059,449 794,118 Net pension liability 7,620,956 169,303 * 7,790,259
Total governmental activities
long-term liabilties 124,518,071 $ 3,862,04 $ (11,781,555) 0 $ 116,598,556 $ 1,844,118 $ Business-type Activities
Direct borrowings:

Pledged notes payable 7,643,495 $ (6,482,765) $ 1,160,730 $ Revenue bonds 200,395,000 $ (1,605,000) 198,790,000 1,815,000 $ Add premium 15,053,080 (907,445) 14,145,635
Less discount (1,411,832) 67,068 (1,344,764)
Total notes and bonds 214,036,248 7,643,495 (8,928,142) 212,751,601 1,815,000 Net pension liability 2,991,889 66,466 * 3,058,355
Total business-type activities
long-term liabilities 217,028,137 $ 7,709,961 $ (8,928,142) $ 215,809,956 $ 1,815,00 $ 0 * Represents the net change in compensated absences and the net pension liability.

Additions to governmental activities pledged notes payable consists of new notes issued from the receipt of infrastructure from developers totaling $1,970,853 that are reported as other financing sources in the governmental funds plus long-term interest payable owed to developers that was added to the principal balance of pledged notes payable. The long-term interest payable will not be paid with current financial resources and, therefore, was not reported as interest expense in the governmental funds. The interest payable added to pledged notes payable principal will be reported as governmental funds principal expense when it becomes payable with current financial resources when new revenue bonds are issued.

As a result, this amount does not represent cash proceeds from the issuance of debt, and the amount is not reported as other financing sources in the governmental funds.

Defeasance of Debt:

In April 2025, the City used $10,000,000 of cash on hand refund a portion of the governmental activities 2021 Lease Revenue Bonds with an interest rate of 4%, resulting in a net present value savings of $9,831,400.

Payment Requirements for Debt Service: Due to the unknown amount and timing of future debt payments on the pledged notes payable, the future maturity schedules for these payables are not available.

As of June 30, 2025, annual debt service requirements of all Utility System Revenue Bonds to maturity were as follows:

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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
50 NOTE E – LONG-TERM LIABILITIES (Continued)
Year Ending
June 30: Principal Interest Total
2026 1,000,000 $ 1,458,600 $ 2,458,600 $
2027 1,040,000 1,417,800 2,457,800
2028 1,080,000 1,375,400 2,455,400
2029 1,120,000 1,331,400 2,451,400
2030 1,165,000 1,285,700 2,450,700
2031-2035 6,575,000 5,675,100 12,250,100
2036-2040 7,990,000 4,223,000 12,213,000
2041-2045 9,730,000 2,456,400 12,186,400
2046-2050 6,075,000 645,700 6,720,700
2051-2052 1,190,000 48,000 1,238,000
Totals 36,965,000 $ 19,917,100 $ 56,882,100 $
Govermental Activities
Year Ending
June 30: Principal Interest Total
2026 $ 7,968,656 1,815,000 $ 9,783,656 $
2027 7,899,379 2,045,000 9,944,379
2028 7,814,659 2,290,000 10,104,659
2029 7,711,637 2,555,000 10,266,637
2030 7,592,783 2,820,000 10,412,783
2031-2035 35,699,556 18,990,000 54,689,556
2036-2040 30,998,756 28,515,000 59,513,756
2041-2045 24,553,081 38,650,000 63,203,081
2046-2050 16,156,372 46,215,000 62,371,372
2051-2055 5,651,875 48,115,000 53,766,875
2056 135,600 6,780,000 6,915,600
Totals 198,790,00 $ 152,182,354 0 $ 350,972,354 $
Business-type Activities
Requirement for City to Issue Bonds to Repay Pledged Notes Payable: The Master Acquisition and Reimbursement Agreements between the City and developers require the City to issue bonds to repay pledged notes payable to developers when the City has capacity to issue revenue bonds until the pledged notes payable are fully reimbursed. The requirements reside in the City’s “Revenue Bond Rules,” which require the City to analyze bonding capacity every six months, with one review occurring not more than 180 days after the end of each fiscal year based on the previous 24-month period using the City’s audited financial statements. The Revenue Bond Rules require the City to issue revenue bonds if the review indicates: 1) the City is in compliance with all covenants and other tests set forth to bond holders in previous revenue bond issues, and 2) a minimum of $10 million face or par amount of additional revenue bonds can be issued in compliance with the rate covenant and additional indebtedness test described in the agreement. The requirement is subject to certain limitations discussed in the Revenue Bond Rules, including the ability of the City to obtain an investment grade rating (minimum of “Baa3”, “BBB-” or “BBB” by Moody’s, Standard & Poor’s or Fitch, respectively).

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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
51 NOTE E – LONG-TERM LIABILITIES (Continued)
Default Provisions: The Utility System Revenue Bonds, Series 2023, 2021 Lease Revenue Bonds and the Utility System Revenue Bonds, Series 2020A and B, and Utility System Revenue Bonds Series 2019A and B, contain default provisions that allow the trustee to call the revenue bonds principal and interest immediately due and payable if the bonds remain past due more than 30 days after the City is provided a notice of default by the trustee.

Pledged Revenues: The City has pledged utility revenues in enterprise funds to secure the repayment of principal and interest on the Utility System Revenue Bonds, Series 2023, Utility System Revenue Bonds, Series 2020A and B, Utility System Revenue Bonds Series 2019A and B, and pledged notes payable in accordance with the terms and the provisions of the bonds and other agreements. The Series 2023 Bonds have maturity dates of December 1, 2052, the Series 2020A and B Bonds have maturity dates of December 1, 2055 and December 1, 2043 respectively, the Series 2019A and B Bonds have maturity dates of December 1, 2041 and December 1, 2028, respectively, and the pledged notes receivable have no stated maturity date. The City has a rate covenant under the 2020A and B agreements and pledged note payable agreements to collect revenues from the water, wastewater and stormwater systems of a minimum of 110% of annual debt service payments allocated to those systems. Total principal and interest remaining on the Utility System Revenue Bonds, Series 2023, Series 2020A and B, Series 2019A and B, and pledged notes payable was $352,133,084 at June 30, 2025, which is payable through December 2055. Combined cash basis principal and interest payments on the bonds with pledged revenue were $9,631,966.

Payments totaling $6,482,765 were made during the year on the enterprise fund pledged notes payable.

Additions represent developer donated assets of $7,210,479, deferred annexation fees of $398,561 and finance charges accrued at the ENR index rate as described in Note A. Total pledged utility revenues for the year ended June 30, 2025 were $12,080,846, which represents 100% of the “Charges for services – pledged” revenue on the proprietary fund statement of revenues, expenses and changes in fund net position that is pledged for repayment of the Series 2023, Series 2020A and B Bonds, Series 2019A and B Bonds and the pledged notes payable combined.

In addition, the City has pledged governmental activity impact fees to secure repayment of the pledged notes payable in accordance with the terms of the Master Acquisition and Reimbursement Agreement.

Total principal and finance charges accrued at the ENR index rate on these pledged notes payable that were outstanding at June 30, 2025 were $65,980,770. Payments of $294,361 were made on the pledged notes payable, during the year ended June 30, 2025. Total pledged revenue for the year ended June 30, 2025 was $23,271,941, which represents total developer and impact fee revenue in the Impact Fee Special Revenue Fund.

Arbitrage: The Tax Reform Act of 1986 instituted certain arbitrage restrictions with respect to the issuance of tax exempt bonds after August 31, 1986. Arbitrage regulations deal with the investment of all tax-exempt bond proceeds at an interest yield greater than the interest yield paid to bondholders.

Generally, all interest paid to bondholders can be retroactively rendered taxable if applicable rebates are not reported and paid to the Internal Revenue Service (IRS) at least every five years. During the current year, the City performed calculations of excess investment earnings on various bonds and financings and at June 30, 2025, does not expect to incur a liability.

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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
52 NOTE F – CONDUIT DEBT
During the year ended June 30, 2025, the Mountain House Community Services District approved the formation of a community facilities district (CFD), which became a fiduciary component unit of the City after incorporation. The City Council and management are responsible for the administration of the CFD formed under the provisions of Mello-Roos. During the year ended June 30, 2025, the City of Mountain House Community Facilities District No. 2024-1 (Public Facilities and Services), Special Tax Bonds, Series 2025, were issued separately under Improvement Areas No. 1, 6, 7, and 8 in the amounts below. The 2025 Special Tax Bonds are payable solely from special tax revenue collected by the CFD within the Improvement Areas. The City has no direct or implied obligation to repay the conduit debt.

Special Tax Bonds with no City commitment outstanding at June 30, 2025, were as follows:

Community Facilities District No. 2024-1 Special Tax Bonds, Series 2025:

Improvement Area No. 1 40,130,000 $
Improvement Area No. 6 8,750,000
Improvement Area No. 7 6,000,000
Improvement Area No. 8 5,805,000
Total $ 60,685,000
NOTE G – NET POSITION DESIGNATIONS
Designations of unrestricted net position may be imposed by the City Council to reflect future spending plans or concerns about the availability of future resources. Designations may be modified, amended or removed by Board action. As of June 30, 2025, the Council has designated $1,850,000 for contingency funding in the event the City needs to make emergency water supply purchases. The City Council also approved a cash reserve of three months of operating expenditures as part of the budget.

NOTE H – PENSION PLAN AND DEFERRED COMPENSATION PLAN
Pension Plan
Plan Description: All qualified permanent and probationary employees are eligible to participate in the City’s cost-sharing multiple employer defined benefit pension plan administered by the San Joaquin County Employees’ Retirement Association (SJCEA). The Plan consists of the Tier 1 and Tier 2 rate plans.

The County Employee’s Retirement Act of 1937 is the statutory basis for the SJCERA. The Board of Retirement has the authority to establish and amend benefit provisions. The SJCERA issues a Comprehensive Annual Financial Report available at www.sjcera.org or by writing to the Board of Retirement, San Joaquin County Employees’ Retirement Association, 6 South El Dorado, Suite 400, Stockton, California 95202.

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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
53 NOTE H – PENSION PLAN AND DEFERRED COMPENSATION PLAN (Continued) Benefits Provided: SJCERA provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries.

Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years of total service are eligible to retire at age 50 (52 for Tier 2) with statutorily reduced benefits.

All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is the following: the 1957 Survivor Benefit or the Optional Settlement 2W Death Benefit. The cost-ofliving adjustments for each plan are applied as specified by the Public Employees’ Retirement Law.

The Plan provisions and benefits in effect at June 30, 2025, are summarized as follows:

Tier 1 Tier 2
(Prior to (On or after
Hire date January 1, 2013) January 1, 2013)
Benefit formula (at full retirement) 2.0% @ 55 1/2 2.0% @ 62 Benefit vesting schedule 5 years service 5 years service Benefit payments monthly for life monthly for life
Retirement age 50 - 62 52 - 67
Monthly benefits, as a % of eligible compensation 1.48% to 2.61% 1.0% to 2.5% Required employee contribution rates - 2024 5.67% - 10.12% 10.03% Required employer contribution rates - 2024 45.71% 39.60% The Tier 1 rate plan is closed to new members that are not already SJCERA eligible participants.

Contributions: Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. Funding contributions for the Plans are determined annually on an actuarial basis as of December 31 by SJCERA. 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 year ended June 30, 2025, the contributions to the plan were $1,871,485.

Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources: As of June 30, 2025, the City reported a net pension liability for its proportionate share of the net pension liability in the amount of $10,848,614.

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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
54 NOTE H – PENSION PLAN AND DEFERRED COMPENSATION PLAN (Continued) The net pension liability as of June 30, 2025, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of December 31, 2024 rolled forward to December 31, 2024 using standard update procedures. The City’s proportionate share of the net pension liability was based on a projection of the City’s long-term share of contributions to the pension plan relative to the projected contributions of all participating employers, as actuarially determined. The City’s proportionate share of the net pension liability for the Plan as of June 30, 2025 and 2024 (December 31, 2024 and 2023 measurement dates) was as follows:

Proportion - June 30, 2024 0.6353%
Proportion - June 30, 2025 0.7204%
Change - Increase (Decrease) 0.0851%
For the year ended June 30, 2025, the City recorded pension expense of $2,390,592. At June 30, 2025, the City reported deferred outflows of resources and deferred inflows of resources related to the Plan from the following sources:

Deferred Deferred
Outflows of Inflows of
Resources Resources
Pension contributions subsequent to measurement date 982,636 $ Changes in assumptions (169,277) $
Change in employer's proportion 1,865,629
Differences between the employer's contribution and
the employer's proportionate share of contributions (820,696) Net differences between projected and actual earnings
on plan investments 652,573
Differences between actual and expected experience 939,208 (133,635) Total $ (1,123,608) 4,440,046 $
The amount reported as deferred outflows of resources related to contributions subsequent to the measurement date above will be recognized as a reduction of the net pension liability in the subsequent fiscal year. Other amounts reported as net deferred inflows of resources related to pensions will be recognized as pension expense as follows:

Fiscal Year Ended
June 30
2026 939,181 $
2027 1,345,674
2028 (39,145)
2029 88,092
$ 2,333,802
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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
55 NOTE H – PENSION PLAN AND DEFERRED COMPENSATION PLAN (Continued) Actuarial Assumptions: The total pension liability at June 30, 2025 (according to January 1, 2024 actuarial valuation) was determined using the following actuarial assumptions:

Valuation Date December 31, 2023
Measurement Date December 31, 2024
Actuarial Cost Method Entry-Age Normal Cost Method
Actuarial Assumptions:

Inflation 2.75%
Amortization Growth Rate 3.00%
Salary Increases 3.00% plus service-based rates
Cost of Living Salary Increase 2.60%
Investment Rate of Return/Discount Rate 6.75%
Mortality Post-Retirement mortality: Gender distinct tables from 2021 CalPERS' experience study with
generational mortality improvements projected from
2017 using 80% of Projection Scale MP-2020.

Discount Rate: The discount rate used to measure the total pension liability was 6.75% as of the December 31, 2024 measurement date. The projection of cash flows used to determine the discount rate assumed plan member contributions will be made at the current contribution rate and that employer contributions will be made at rates equal to the actuarially determined contribution rates. For this purpose, only employer contributions that are intended to fund benefits of current plan members and their beneficiaries are included. Projected employer contributions that are intended to fund the service costs of future plan members and their beneficiaries, as well as projected contributions from future plan members, are not included. Based on those assumptions, the pension plan’s plan net position was projected to be available to make all projected future benefit payments for current plan members. Therefore, the longterm expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability as of December 31, 2024.

Change of Assumptions: There was not change in assumptions for the year ended June 30, 2025.

The table below reflects the long-term expected real rate of return by asset class for the Plan. The rate of return was calculated using the capital market assumptions applied to determine the discount rate and asset allocation. These rates of return are net of administrative expenses.

Asset Class Target Allocation Real Return (a)
Aggressive Growth 16.00% 10.33%
Traditional Growth 34.00% 6.98%
Risk Parity 6.00% 5.78%
Credit 15.00% 5.78%
Core Real Assets 9.00% 2.62%
Principal Protection 7.00% 2.27%
Crisis Risk Offset (CRO) 13.00% 0.36%
Total 100.0%
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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
56 NOTE H – PENSION PLAN AND DEFERRED COMPENSATION PLAN (Continued) Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate: The following presents the City’s proportionate share of the net pension liability for the Plan, calculated using the discount rate for the Plan, as well as what the City’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower or 1-percentage point higher than the current rate:
1% Decrease 5.75%
Net Pension Liability 16,754,343 $
Current Discount Rate 6.75%
Net Pension Liability 10,848,614 $
1% Increase 7.75%
Net Pension Liability 5,980,477 $
Pension Plan Fiduciary Net Position: Detailed information about the Plan fiduciary net position is available in the separately issued SJCERA financial reports.

Payable to the Pension Plan: As of June 30, 2025, there were no significant payables to the Plan.

Deferred Compensation Plan
The City participates in the County of San Joaquin Internal Revenue Code (IRC) Section 457 Deferred Compensation Plan (457 Plan). All employees are allowed to participate. The 457 Plan is administered by Nationwide Retirement Solutions and Nationwide Life Insurance Company.

Benefit terms, including contribution requirements and withdrawals for the 457 Plan are established by the County of San Joaquin Board of Supervisors and are subject to limitations imposed by the IRC.

Employees are permitted to make contributions to the 457 Plan, up to the applicable IRC limits. The City makes contributions based on a percentage of base salary. Contributions are 1% for management employees and employees who are members of its Supervisor/Confidential bargaining unit and 2% for persons designated as City Council Members. The City contributes 5% on behalf of the General Manager in according with the related employment contract. All participant and employer contributions and earnings on the contributions vest immediately. Plan member and City contributions totaled $289,275 and $50,534 respectively, during the year ended June 30, 2025.

NOTE I – RISK MANAGEMENT
The City is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; injuries to employees; and natural disasters for which the City is a member of the Municipal Pooling Authority of Northern California. (Authority). The Authority provides general liability, property, commercial auto and workers compensation and employers liability.

Authority is a Joint Powers Authority established in 1978 for the purpose of providing liability insurance to municipal agencies in Northern California. The Authority is comprised of over 19 California member cities and is organized under a Joint Powers Agreement pursuant to the California Government Code. The purpose of the Authority is to arrange and administer programs of insurance for the pooling of self-insured losses and to purchase excess insurance coverage. Liabilities of the Item 8.1
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NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
57 NOTE I – RISK MANAGEMENT (Continued)
City are reported when it is probable that a loss has occurred, and the amount of the loss can be reasonably estimated. The City considers claims incurred and reported, as well as claims incurred but not reported, to be immaterial and has not accrued an estimate of such claims payable. The City’s maximum coverage as of June 30, 2025 consisted of $2.0 million per occurrence for general liability and $1.0 million per occurrence for auto liability, including bodily injury, property damage, and personal injury. The City has a $3,000 deductible on police vehicles and $2,000 on other vehicles.

Workers’ compensation coverage includes $5.0 million for employer’s liability and the statutory limit for workers’ compensation. The City has public officials errors and omissions of $250,000 with a self-insured-retention of $25,000. The City’s excess coverage through California Affiliated Risk Management Authorities (CARMA) per claim is $34.5 million.

The City insures through the County of San Joaquin’s self-insurance programs for unemployment compensation. Dublin Insurance Trust provides medical insurance, vision and dental insurance.

There have been no significant reductions in insurance and settled claims have not exceeded insurance coverage limits in any of the past three fiscal years.

NOTE J – FUND BALANCE/NET POSITION DEFICIT
The following funds had a deficit net position at June 30, 2025:

Deficit Amount
Water $ (30,843,122)
Wastewater (15,650,554)
The deficits in these funds are expected to be eliminated in the future through increased charges for services revenues as the number of connections increase or through the collection of development fees.

NOTE K – COMMITMENTS AND CONTINGENCIES
Byron-Bethany Irrigation District: The City entered into an agreement on June 22, 2015 with ByronBethany Irrigation District (Irrigation District) whereby the City, in addition to paying actual costs of water delivered, agrees to indemnify the Irrigation District for any and all costs, including, but not limited to, any fines penalties, legal or other costs associated with any enforcement or other action brought by the State Water Resources Control Board or any other rent related to the Irrigation District’s diversion of water to meet the water supply requirements of the City while the State Water Resources Control Board curtailment of the Irrigation District’s pre-1914 appropriative water rights is in effect.

French Camp McKinley Rural Fire Protection District: The City entered into an agreement with French Camp McKinley Rural Fire Protection District to provide fire protection and emergency medical services extending through June 30, 2030, with subsequent 5 year extensions subject to approval by both parties.

The annual fee will be negotiated based on the Fire District’s proposed budget, or if unable to negotiate, the fee will be the current contract fee increased by 3%. The annual fee for year ended June 30, 2025 was $3,493,691.

Legal Actions: The City is party to legal actions that arose in the normal operation of business.

Management of the City believes that the legal actions will not have a material adverse impact on the financial position of the City.

Item 8.1
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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
58 NOTE K – COMMITMENTS AND CONTINGENCIES (Continued)
Contingency on Developer Notes Payable: The City reports notes payable for governmental activities.

The notes payable represent amounts due for infrastructure and improvements constructed by various developers. Some developers have taken issue with the amount reported for their individual note. They assert that the balance of their individual note payable should be increased and the balance of another developer should be decreased. However, if any adjustments of amounts payable were to be proven warranted, the changes would not impact the total of notes payable reported in these financial statements.

The City is responsible for reimbursement of certified costs of certain developer improvements under development agreements. The City records an estimate of the allowable costs as capital assets and developer notes payable when submitted to the City by developers and adjusts the costs when a final cost certification is completed. Developers may have incurred costs that are reimbursable under the development agreements that have not been submitted for reimbursement at year-end. Consequently, the capital assets and developer note payable submitted by developers are subject to change and certain costs have not been recorded as they are not estimable. Projects in the process of being completed by developers at June 30, 2025 include a wastewater treatment plant expansion project that is budgeted at $55 million and water treatment plan infrastructure improvements budgeted at $2 million.

Contract Commitments: At June 30, 2025, the City had the following contract commitments:

Utility billing and operation services 16,577,465 $
City inspection services 14,423,804
Plan checking 4,084,285
Playground replacement 1,153,565
Inspection new infrastructure and annexation services 742,200 Traffic and engineering services 735,737
Design build consultants 598,640
Community camera safety program 523,239
Pavement repairs 465,121
Tree maintenance 421,668
Vehicle purchases 348,496
Public safety and process management 341,900
Janitorial services 204,772
$ 40,620,892
Collective Bargaining Arrangement: The City depends on its workforce to deliver services. Certain City employees are covered by a Memorandum of Understanding (MOU) that expires on June 30, 2026. The City’s delivery of services could be disrupted if the MOU is not extended by the expiration date.

Item 8.1
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CITY OF MOUNTAIN HOUSE

NOTES TO BASIC FINANCIAL STATEMENTS (CONTINUED)
June 30, 2025
59 NOTE L – SUBSEQUENT EVENTS
Approval of Contracts: The City Council approved the following contracts subsequent to June 30, 2025:

Project manangment and regulatory technical expertise 5,292,002 $ Water treatement plant filter media replacement project 1,108,636 Human resources and risk management consulting 968,517
Town hall improvements project 858,000
Federal legislative and advocacy services 363,000
Filter bed underdrain nozzles project 249,380
Mountain House Parkway traffice signal synchornization project 228,345 $ 9,067,880
NOTE M – SPECIAL ITEM: AFFORDABLE HOUSING FEE BALANCE TRANSFER Effective July 1, 2024, the community formally incorporated as the City of Mountain House. Prior to incorporation, the Affordable Housing Fee program was administered by the County of San Joaquin on behalf of the former Mountain House Community Services District. At the beginning of the fiscal year, the County transferred the related Affordable Housing Fee program balance to the City of $9,387,590.

NOTE N – CHANGE IN ACCOUNTING PRINCIPLE
The City implemented GASB Statement No. 101, Compensated Absences, during the year ended June 30, 2025, which resulted in additional sick and administrative leave payable being accrued for leave expected to be used for time off in addition to termination payments previously recognized as part of the compensated absences liability. As a result of this change of accounting principle, governmental activities net position decreased as July 1, 2024 as follows:

Change in
June 30, 2024 Accounting July 1, 2024
As previously Principle for As
Reported GASB 101 Restated
Net Position 111,990,012 $ (496,557) $ 111,493,455 $
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60 (This page intentionally left blank.)
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61 REQUIRED SUPPLEMNTARY INFORMATION
Item 8.1
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Variance
with Final
Budget -
Actual Positive
Original Final Amounts (Negative)
Revenues
Taxes 9,899,727 $ 9,899,727 $ 10,834,742 $ 935,015 $
Sales Tax 85,000 85,000 153,095 68,095
Other Taxes 400,000 400,000 594,357 194,357
Licenses and permits 7,000 7,000 9,204 2,204
Franchise fees 1,355,840 1,355,840 1,506,056 150,216
Developer and impact fees 260,600 260,600 1,068,250 807,650 Investment earnings 350,000 350,000 3,102,540 2,752,540 Other revenues 14,600 14,600 166,578 151,978
TOTAL REVENUES 12,372,767 12,372,767 17,522,322 5,149,555 Expenditures
Current:

General government 581,466 112,093 214,829 (102,736)
Public ways and facilities 4,274,135 3,184,135 2,580,649 603,486 Capital outlay 13,000 374 374
TOTAL EXPENDITURES 4,868,601 3,296,602 2,795,478 501,124

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 7,504,166 9,076,165 14,726,844 5,650,679

OTHER FINANCING SOURCES (USES)
Transfer out (6,694,688) (6,694,688) (3,189,133) 3,505,555 Total other financing sources (uses) (6,694,688) (6,694,688) (3,189,133) 3,505,555 NET CHANGE IN FUND BALANCE 809,478 2,381,477 11,537,711 9,156,234 Fund balances, beginning of year,
as previously reported 55,865,292 55,865,292 55,865,292 Change within financial reporting entity
(creation of new fund) (226,460) (226,460) (226,460)
Fund balance, beginning of year,
as restated 55,638,832 55,638,832 55,638,832
FUND BALANCE, END OF YEAR 56,674,770 $ $ 58,246,769 $ 67,403,003 $ 9,156,234 Budget Amounts

CITY OF MOUNTAIN HOUSE
Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual
General Fund
For the Year Ended June 30, 2025
62 Item 8.1
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Budget Amounts
Original Final
Revenues
Special assessments 16,465,645 $ 16,465,645 $ 16,922,463 $ 456,818 $ Investment earnings 160,000 160,000 252,216 92,216
Other revenues 110,000 110,000 134,627 24,627
TOTAL REVENUES 16,735,645 16,735,645 17,309,306 573,661 Expenditures
Current:

Public safety 8,718,069 8,588,262 7,819,378 768,884
Public ways and facilities 4,784,644 6,388,786 4,529,271 1,859,515 Recreation and culture 4,425,939 4,425,939 3,389,679 1,036,260 Debt service
Interest and fiscal charges 6,445 18,652 12,207 6,445
Capital outlay 36,500 154,100 60,601 93,499
TOTAL EXPENDITURES 17,971,597 19,575,739 15,811,136 3,764,603

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (1,235,952) (2,840,094) 1,498,170 4,338,264

OTHER FINANCING SOURCES (USES)
Transfers out (2,706,609) (2,706,609) (2,706,609)
Total other financing sources (uses) (4,305,419) (4,885,419) (2,706,609) 2,178,810 NET CHANGE IN FUND BALANCE (5,541,371) (7,725,513) (1,208,439) 6,517,074 Fund balance, beginning of year 6,201,721 6,201,721 6,201,721 FUND BALANCE, END OF YEAR $ 660,350 $ (1,523,792) $ 4,993,282 $ 6,517,074 Actual
Amounts
Variance with
Final Budget -
Positive
(Negative)

CITY OF MOUNTAIN HOUSE
Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual
Special Assessments Special Revenue Fund
For the Year Ended June 30, 2025
63 Item 8.1
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Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual
Impact Fees Special Revenue Fund
Budget Amounts
Original Final
Revenues
Developer and impact fees 8,636,600 $ 8,636,600 $ 23,271,941 $ 14,635,341 $ Investment earnings 206,445 206,445 1,235,154 1,028,709 TOTAL REVENUES 8,843,045 8,843,045 24,507,095 15,664,050 Expenditures
Current:

Public ways and facilities 10,981 (10,981)
Debt service
Principal 8,636,600 8,636,600 11,254,361 (2,617,761)
Interest and fiscal charges 1,895,932 (1,895,932)
TOTAL EXPENDITURES 8,636,600 8,636,600 13,161,274 (4,524,674)

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 206,445 206,445 11,345,821 11,139,376

OTHER FINANCING SOURCES (USES)
Issuance of debt 1,970,853 1,970,853
Transfers out (150,000) (150,000) (150,000)
Total other financing sources (uses) (150,000) (150,000) 1,820,853 1,970,853 NET CHANGE IN FUND BALANCE 56,445 56,445 13,166,674 13,110,229 Fund balance, beginning of year 29,020,486 29,020,486 29,020,486 FUND BALANCE, END OF YEAR 29,076,931 $ $ 29,076,931 $ 42,187,160 $ 13,110,229 Actual
Amounts
Variance with
Final Budget -
Positive
(Negative)
For the Year Ended June 30, 2025
64 Item 8.1
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Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual
Development Services Special Revenue Fund
Budget Amounts
Original Final
Revenues
Developer and impact fees $ 1,654,456 $ 2,014,456 $ 2,879,043 $ 864,587 Investment earnings 31,892 31,892
TOTAL REVENUES 1,654,456 2,014,456 2,910,935 896,479
Expenditures
Current:

Public ways and facilities 4,654,257 6,634,257 5,591,673 1,042,584 TOTAL EXPENDITURES 4,654,257 6,634,257 5,591,673 1,042,584

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (2,999,801) (4,619,801) (2,680,738) 1,939,063

OTHER FINANCING SOURCES (USES)
Transfers in (3,012,036) (3,012,036) 2,684,133 5,696,169 Transfers out 588,391 580,000 (580,000)
Total other financing sources (uses) (2,423,645) (2,432,036) 2,684,133 5,116,169 NET CHANGE IN FUND BALANCE (5,423,446) (7,051,837) 3,395 7,055,232 Fund balances, beginning of year,
as previously reported
Change within financial reporting entity:

Creation of a new fund 226,460 226,460 226,460
Fund balance, beginning of year,
as restated 226,460 226,460 226,460
FUND BALANCE, END OF YEAR $ (5,196,986) $ (6,825,377) $ 229,855 $ 7,055,232 For the Year Ended June 30, 2025
Actual
Amounts
Variance with
Final Budget -
Positive
(Negative)
65 Item 8.1
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NOTE TO REQUIRED SUPPLEMENTARY INFORMATION
June 30, 2025
66 BUDGETARY BASIS OF ACCOUNTING
The City prepares and legally adopts an operating balanced final budget on or before July 1, of each year.

Public hearings are conducted to review all proposed appropriations and the sources of financing before the adoption. Until the adoption of this balanced final budget, operations are governed by the prior budget, which is approved by the Board of Directors.

The budget is prepared on a modified accrual basis in accordance with generally accepted accounting principles. Throughout the fiscal year, supplemental appropriations may be made by the Board when revenues are received from unanticipated sources, or from anticipated sources in excess of estimates thereof, or from contingency sources.

The legal level for budgetary control (the level at which expenditures may not exceed budgeted appropriations) is at the fund level.

All amendments or transfers of line-item appropriations within the same fund require the General Manager’s approval. Amendments and transfers of appropriations between funds or that involve the addition or deletion of a project or piece of equipment must be approved by the General Manager. The Board of Directors has authorized the General Manager of the City to make year-end budget adjustments and appropriation transfers within the respective City budgets and funds to provide for expenditures in excess of budgeted amounts.

Budgeted amounts in the budgetary financial schedules are reported as originally adopted and amended during the fiscal year by resolutions approved by the Board of Directors.

The City did not prepare a legally adopted budget for the Affordable Housing Fee Special Revenue Fund (major fund) and the Mountain House Community Services District Special Revenue Fund (nonmajor fund) during the fiscal year ended June 30, 2025. Accordingly, budgetary comparison schedules are not presented for these funds.

Item 8.1
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2025 2024 2023 2022 2021 2020 2019 2018 2017 2016
Proportion of the net pension liability 0.7204% 0.6353% 0.5398% 0.5338% 0.4733% 0.4451% 0.4017% 0.3585% 0.3385% 0.2869% Proportionate share of the net pension liability 10,848,614 $ 10,612,845 $ 9,172,488 $ 6,507,631 $ 7,936,884 $ 7,517,184 $ 7,469,538 $ 5,671,032 $ 5,644,644 $ 4,413,499 $ Covered payroll during measurement period 4,224,510 $ 3,550,935 $ 2,818,964 $ 2,553,381 $ 2,408,599 $ 2,241,456 $ 1,990,698 $ 1,757,812 $ 1,527,861 $ 1,303,509 $ Proportionate share of the net pension liability
as a percentage of covered payroll 256.80% 298.87% 325.39% 254.86% 329.52% 335.37% 375.22% 322.62% 369.45% 338.58% Plan fiduciary net position as a percentage
of the total pension liability 75.57% 71.62% 69.20% 74.10% 67.90% 65.76% 60.44% 64.54% 60.51% 61.07% Notes to Schedule:

Changes in assumptions for measurement period:

Changes in discount rate 6.75% 6.75% 6.75% 7.00% 7.00% 7.25% 7.25% 7.40% 7.40% 7.40% 2024 2024 2023 2022 2021 2020 2019 2018 2017 2016
Contractually required contribution employer's
fiscal year (actuarially determined) 1,871,485 $ 1,668,052 $ 1,332,850 $ 1,142,040 $ 996,604 $ 894,751 $ 776,891 $ 641,658 $ 505,575 $ 410,518 $ Contributions in relation to the actuarially
determined contributions - employer fiscal year (1,871,485) (1,668,052) (1,332,850) (1,142,040) (996,604) (894,751) (776,891) (641,658) (505,575) (410,518) Contribution deficiency (excess) - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ Covered payroll - employer's fiscal year 4,419,311 $ 4,405,523 $ 3,588,560 $ 2,742,437 $ 2,702,903 $ 2,366,125 $ 2,125,488 $ 1,790,011 $ 1,548,017 $ 1,336,539 $ Contributions as a percentage of covered - payroll 42.35% 37.86% 37.14% 41.64% 36.87% 37.82% 36.55% 35.85% 32.66% 30.72% Notes to Schedule:

Valuation date- January 1 to 2023 then December 31: 2023 2023 2022 2021 2020 2019 2018 2017 2016 2015 Measurement date - December 31: 2024 2023 2022 2021 2020 2019 2018 2017 2016 2015 Methods and assumptions used to determine
contribution rates:

Actuarial cost method
Asset valuation method
Amortization method
Discount rate 6.75% 6.75% 7.00% 7.00% 7.00% 7.25% 7.25% 7.40% 7.40% 7.40% Amortization growth rate 3.00% 3.00% 3.00% 3.00% 3.15% 3.15% 3.15% 3.15% 3.15% 3.15% Price inflation 2.75% 2.75% 2.75% 2.75% 2.90% 2.90% 2.90% 2.90% 2.90% 2.90% Salary increases (plus merit component) 3.00% 3.00% 3.00% 3.00% 3.15% 3.15% 3.15% 3.15% 3.15% 3.15% Mortality - prior to 2022
Mortality - January 1, 2022
Mortality - December 31, 2023 Gender distinct tables from the CALPERS 2021 mortality tables, with generational mortality improvements projected from 2017 using 80% Projection Scale MP-2020 Gender distinct tables from Society of Actuaries' new Public mortality tables, with generational mortality improvements projected from 2010 using Projection Scale MP-2018.

Change in Benefit Terms: None

SCHEDULE OF CONTRIBUTIONS TO THE PENSION PLAN (UNAUDITED) Last 10 Years
Gender distinct tables from CALPERS' 2013 experience study, with generational mortality improvements projected from 2010 using Projection Scale MP-2018.

Entry age normal
Excess earnings smoothed over 5 years, 80%/120% corridor around fair value Level percentage of payroll, closed
Last 10 Years

CITY OF MOUNTAIN HOUSE

REQUIRED SUPPLEMENTARY INFORMATION
For the Year Ended June 30, 2025

SCHEDULE OF THE PROPORTIONATE SHARE OF THE

NET PENSION LIABILITY (UNAUDITED)
67 Item 8.1
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68 COMBINING AND INDIVIDUAL FUND STATEMENTS
Item 8.1
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Mountain
House
Community Total
Services Capital Nonmajor
Measure K Gas Tax District Projects Governmental
Fund Fund Fund Fund Funds
ASSETS
Cash and investments 589,638$ $ 1,119,838 85,976$ $ 12,517,422 $ 14,312,874 Taxes receivable 166,787 166,787
Interest receivable 753 2,697 102,371 105,821
TOTAL ASSETS 757,178$ $ 1,122,535 85,976$ $ 12,619,793 $ 14,585,482

LIABILITIES, DEFERRED

INFLOWS OF RESOURCES

AND FUND BALANCES
Liabilities
Accounts payable $ 150,157 $ 150,157
Due to other funds 135,542$ 135,542
TOTAL LIABILITIES 135,542 150,157 285,699
Fund balances:

Nonspendable
Restricted for:

Roads, transportation and
community services, operational
and administrative functions 621,636 $ 1,122,535 85,976$ 12,469,636 14,299,783 Total fund balances 621,636 1,122,535 85,976 12,469,636 14,299,783

TOTAL LIABILITIES,

DEFERRED INFLOWS
AND FUND BALANCES 757,178$ $ 1,122,535 85,976$ $ 12,619,793 $ 14,585,482

CITY OF MOUNTAIN HOUSE
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2025
Special Revenue Funds
69 Item 8.1
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Mountain
House
Community Total
Services Capital Nonmajor
Measure K Gas Tax District Projects Governmental
Fund Fund Fund Fund Funds
Revenues
Property taxes 570,250$ $ 570,250
Intergovernmental $ 617,153 $ 1,108,582 1,725,735
Investment earnings 4,483 13,953 182 $ 70,456 89,074
TOTAL REVENUES 621,636 1,122,535 570,432 70,456 2,385,059 Expenditures
Current:

General government 484,456 484,456
Capital outlay 2,183,871 2,183,871
TOTAL EXPENDITURES 484,456 2,183,871 2,668,327

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 621,636 1,122,535 85,976 (2,113,415) (283,268)

OTHER FINANCING SOURCES (USES)
Transfers in 3,361,609 3,361,609
Total other financing sources (uses) 3,361,609 3,361,609 NET CHANGE IN FUND BALANCE 621,636 1,122,535 85,976 1,248,194 3,078,341 Fund balances, beginning of year,
as previously reported
Change within financial reporting entity:

Major to nonmajor fund 11,221,442 11,221,442
Fund balance, beginning of year,
as restated 11,221,442 11,221,442
FUND BALANCE, END OF YEAR 621,636$ $ 1,122,535 85,976$ 12,469,636 $ $ 14,299,783

CITY OF MOUNTAIN HOUSE
Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds
For the Year Ended June 30, 2025
Special Revenue Funds
70 Item 8.1
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CITY OF MOUNTAIN HOUSE
Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual
Measure K Fund Special Revenue Fund
Budget Amounts
Original Final
Revenues
Intergovernmental 588,391 $ 617,153 $ 28,762 $
Investment earnings 4,483 4,483
TOTAL REVENUES 588,391 621,636 33,245

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 588,391 621,636 33,245

OTHER FINANCING SOURCES (USES)
Transfers in (588,391) 588,391
Total other financing sources (uses) (588,391) 588,391
NET CHANGE IN FUND BALANCE 621,636 621,636
Fund balance, beginning of year
FUND BALANCE, END OF YEAR - $ - $ 621,636 $ 621,636 $
For the Year Ended June 30, 2025
Actual
Amounts
Variance with
Final Budget -
Positive
(Negative)
71 Item 8.1
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CITY OF MOUNTAIN HOUSE
Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual
Gas Tax Fund Special Revenue Fund
Budget Amounts
Original Final
Revenues
Intergovernmental 601,700 $ 1,108,582 $ 506,882 $
Investment earnings 13,953 13,953
TOTAL REVENUES 601,700 1,122,535 520,835
NET CHANGE IN FUND BALANCE 601,700 1,122,535 520,835
Fund balance, beginning of year
FUND BALANCE, END OF YEAR - $ 601,700 $ 1,122,535 $ 520,835 $ For the Year Ended June 30, 2025
Actual
Amounts
Variance with
Final Budget -
Positive
(Negative)
72 Item 8.1
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CITY OF MOUNTAIN HOUSE
Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual
Capital Projects Fund
Budget Amounts
Original Final
Revenues
Investment earnings 70,456 $ 70,456 $
TOTAL REVENUES 70,456 70,456
Expenditures
Current:

Public ways and facilities 1,650,000 $ 3,961,632 $ 3,961,632 Capital outlay 2,130,000 6,234,595 2,183,871 4,050,724
TOTAL EXPENDITURES 3,780,000 10,196,227 2,183,871 8,012,356

EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (3,780,000) (10,196,227) (2,113,415) 8,082,812 Other Financing Sources (Uses)
Transfers in 3,950,000 3,950,000 3,361,609 (588,391)
Total other financing sources (uses) 3,950,000 3,950,000 3,361,609 (588,391) NET CHANGE IN FUND BALANCE 170,000 (6,246,227) 1,248,194 7,494,421 Fund balance, beginning of year,
as previously reported
Change within financial reporting entity:

Major to nonmajor fund 11,221,442 11,221,442 11,221,442 Fund balance, beginning of year,
as restated 11,221,442 11,221,442 11,221,442
FUND BALANCE, END OF YEAR 11,391,442 $ 4,975,215 $ 12,469,636 $ 7,494,421 $ Actual
Amounts
Variance with
Final Budget -
Positive
(Negative)
For the Year Ended June 30, 2025
73 Item 8.1
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74 STATISTICAL SECTION
Item 8.1
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75 City of Mountain House
Statistical Section
Table of Contents
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.

A. 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
B. Revenue capacity
These schedules give information on the City’s most significant local revenue sources:

1. Water utility system – ten largest customers

2. Water utility system rates

3. Property tax valuations and rates

4. Property and franchise taxes

5. Special tax levies and rates

6. Principal property taxpayers
C. Debt capacity
These schedules present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the Citys’ ability to issue additional debt in the future:

1. Ratio of outstanding debt by type

2. Computation of direct and overlapping debt

3. Revenue bond coverage
D. 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
E. 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 employees by function

2. Capital asset statistics by function/program
Sources: Unless otherwise noted, the information in these schedules is derived from the audited financial statements for the relevant year.

Item 8.1
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2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Governmental Activities
Net investment in capital assets 72,172,012 $ 66,219,990 $ 63,551,020 $ 69,069,002 $ 65,354,553 $ 96,861,978 $ 91,517,660 $ 88,951,441 $ 75,480,774 $ 85,081,065 $ Restricted 17,503,312 20,155,037 28,010,993 37,721,051 43,033,670 23,842,393 29,929,824 33,314,754 47,971,007 75,408,156 Unrestricted (28,022,197) (28,920,852) (28,891,469) (23,100,430) (20,349,760) (19,551,827) (18,417,182) (16,101,189) (11,461,769) (11,952,586) Total governmental activities net position 61,653,127 $ 57,454,175 $ 62,670,544 $ 83,689,623 $ 88,038,462 $ 101,152,543 $ 103,030,302 $ 106,165,006 $ 111,990,012 $ 148,536,635 $ Business-Type Activities
Net investment in capital assets 14,020,884 $ 13,051,286 $ 12,147,222 $ 11,970,183 $ 12,351,729 $ 10,677,879 $ 11,749,591 $ 25,064,102 $ 21,801,777 $ 14,481,237 $ Restricted 5,411,210 5,322,884 5,999,236 7,201,355 9,279,464 6,039,806 5,891,040 16,821,547 17,353,585 16,041,735 Unrestricted (51,011,009) (58,655,092) (63,875,644) (68,324,151) (71,463,109) (68,895,466) (72,800,562) (88,364,196) (83,477,502) (71,323,854) Total business-type activities net position (31,578,915) $ (40,280,922) $ (45,729,186) $ (49,152,613) $ (49,831,916) $ (52,177,781) $ (55,159,931) $ (46,478,547) $ (44,322,140) $ (40,800,882) $ Primary Government
Net investment in capital assets 86,192,896 $ 79,271,276 $ 75,698,242 $ 81,039,185 $ 77,706,282 $ 107,539,857 $ 103,267,251 $ 114,015,543 $ 97,282,551 $ 99,562,302 $ Restricted 22,914,522 25,477,921 34,010,229 44,922,406 52,313,134 29,882,199 35,820,864 50,136,301 65,324,592 91,449,891 Unrestricted (79,033,206) (87,575,944) (92,767,113) (91,424,581) (91,812,869) (88,447,293) (91,217,744) (104,465,385) (94,939,271) (83,276,440) Total primary government net position 30,074,212 $ 17,173,253 $ 16,941,358 $ 34,537,010 $ 38,206,546 $ 48,974,763 $ 47,870,371 $ 59,686,459 $ 67,667,872 $ 107,735,753 $ Source: City of Mountain House Audited Finacial StatementsNote: 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.

City of Mountain House
Net Position by Component
Last Ten Fiscal Years
(Accrual Basis of Accounting)
$(150,000,000) $(100,000,000)
$(50,000,000)
$-
$50,000,000
$100,000,000 $150,000,000 $200,000,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Net investment in capital assets Restricted Unrestricted 76 Item 8.1
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2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Expenses
Government activites:

General government $ 2,013,876 $ 1,455,982 $ 3,172,793 $ 3,234,369 $ 4,899,573 $ 4,170,256 $ 3,056,773 $ 3,561,394 $ 4,418,227 $ 6,752,277 Public safety 3,579,024 3,497,616 3,412,355 2,773,076 4,398,335 4,972,476 5,524,846 6,483,232 7,144,018 8,517,429Public ways and facilities 8,529,010 10,822,663 8,826,980 9,366,325 9,658,600 11,988,424 13,296,078 13,797,202 13,916,499 16,275,729 Recreation and culture 1,732,013 2,348,502 2,115,365 2,160,765 2,121,593 2,792,760 3,251,153 3,704,672 4,140,849 4,301,095Capital expenditures - - 3,316,231 - - - - - - - Interest on long-term debt 2,334,136 3,956,850 - 2,910,827 1,572,512 2,347,775 3,043,406 5,481,297 4,184,152 2,928,082 Total governmental activities expense 18,188,059 22,081,613 20,843,724 20,445,362 22,650,613 26,271,691 28,172,256 33,027,797 33,803,745 38,774,612Business-Type Activities:

Water Fund 8,083,278 9,932,771 9,804,272 9,846,232 8,800,063 10,151,539 12,798,136 11,018,662 12,225,741 12,028,832 Wastewater Fund 4,635,738 6,177,871 5,946,255 5,802,012 5,330,204 6,238,672 5,956,128 8,020,144 7,562,006 7,481,609Storm Fund 1,457,272 1,921,292 1,703,506 1,724,368 1,587,633 3,052,697 2,224,542 2,524,959 2,667,815 2,364,898 Developer Fund 1,516,447 3,384,006 2,600,066 4,392,076 4,308,647 3,608,206 8,706,525 12,672,511 13,718,461 19,494,871 Total business-type activities expense 15,692,735 20,632,000 20,838,039 21,764,688 20,026,547 23,051,114 29,685,331 34,236,276 36,174,023 41,370,210 Total primary government expenses 33,880,794 $ 42,713,613 $ 41,681,763 $ 42,210,050 $ 42,677,160 $ 49,322,805 $ 57,857,587 $ 67,264,073 $ 69,977,768 $ 80,144,822 $ Program revenues
Governmental activities:

Charges for services
General government 40,459 $ 87,374 $ 225,902 $ 899,374 $ 170,951 $ 568,184 $ 263,687 $ 277,021 $ 293,943 $ 763,858 $ Public safety 2,318,311 2,592,544 2,702,572 3,154,205 3,609,729 3,788,208 4,251,835 4,396,034 4,662,508 4,952,665Public ways and facilities 10,435,975 9,891,159 17,122,382 29,959,109 14,921,264 26,739,974 17,526,290 18,708,028 19,790,954 37,575,208Recreation and culture 444,413 521,048 515,002 615,278 664,738 658,948 739,222 764,115 810,157 859,380Community deveopment 1,355,827 Operating grants and contributions - 190,526 87,500 35,556 Total governmental activities program revenues 13,239,158 13,092,125 20,565,858 34,627,966 19,366,682 31,755,314 22,816,590 24,145,198 25,748,088 45,594,438 Business-type activities:

Charges for services
Water Fund 4,251,147 4,775,333 5,942,185 6,879,604 7,614,955 8,632,286 9,398,230 9,930,385 11,192,289 12,068,964 Wastewater Fund 3,251,615 3,573,826 4,189,463 4,846,667 5,398,879 6,105,102 6,727,728 7,806,059 7,955,518 8,740,865 Storm Fund 1,254,773 1,413,122 1,811,899 1,979,853 1,843,165 2,294,921 2,188,846 2,163,244 2,409,097 2,767,332 Developer Fund 1,511,418 2,593,295 3,378,023 4,390,829 4,308,647 3,608,656 8,706,521 12,672,514 13,718,461 19,494,939 .- - - - - - - - - -
Total business type activities program revenues 10,268,953 12,355,576 15,321,570 18,096,953 19,165,646 20,640,965 27,021,325 32,572,202 35,275,365 43,072,100 Total primary government program revenues $ 23,508,111 $ 25,447,701 $ 35,887,428 $ 52,724,919 $ 38,532,328 $ 52,396,279 $ 49,837,915 $ 56,717,400 $ 61,023,453 $ 88,666,538 Net (expense)/revenue
Governmental activities $ (4,948,901) $ (8,989,488) $ (277,866) $ 14,182,604 $ (3,283,931) $ 5,483,623 $ (5,355,666) $ (8,882,599) $ (8,055,657) $ 6,819,826Business-type activities (5,423,782) (8,276,424) (5,516,469) (3,667,735) (860,901) (2,410,149) (2,664,006) (1,664,074) (898,658) 1,701,890 Total primary government net expense $ (10,372,683) $ (17,265,912) $ (5,794,335) $ 10,514,869 $ (4,144,832) $ 3,073,474 $ (8,019,672) $ (10,546,673) $ (8,954,315) $ 8,521,716 Source: City of Mountain House Audited Finacial Statements (continued) City of Mountain House Changes in Net Position
Last Ten Fiscal Years
(Accrual Basis of Accounting)
77 Item 8.1
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2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
General revenues & other changes in net position
Governmental activities:

Taxes:Property taxes $ 3,100,699 $ 3,460,372 $ 3,750,725 $ 4,576,597 $ 5,211,254 $ 6,076,030 $ 6,926,727 $ 7,732,189 $ 8,753,957 $ 11,404,992 Franchise and miscellaneous taxes 701,898 750,332 836,508 1,024,749 1,048,786 1,088,748 1,145,319 1,106,275 1,360,135 1,506,056 Change in estimate - pledged note payable - - - - - - - 722,347 - - Sales tax - - - - - - - - - 153,095
Other taxes - - - - - - - - - 2,320,092
Unrestricted interest and investment earnings 119,607 234,577 513,438 1,225,989 1,335,586 443,313 (1,061,706) 2,009,733 3,553,329 5,150,534 Other 183,820 38,828 393,564 142,224 37,144 22,368 223,084 446,759 213,242 300,995 Transfers - 457,648 - - - - - - - -
Total governmental activities 4,106,024 4,941,757 5,494,235 6,969,559 7,632,770 7,630,459 7,233,424 12,017,303 13,880,663 20,835,764Business-type activities:

Unrestricted interest and investment earnings 15,489 32,065 68,205 111,224 181,598 64,284 (318,144) (72,229) 3,055,065 1,819,368 Change in estimate - pledged note payable - - - - - - - 10,417,687 - - Transfers - (457,648) - - - - - - - -
Total business-type activities 15,489 (425,583) 68,205 111,224 181,598 64,284 (318,144) 10,345,458 3,055,065 1,819,368 Total primary government $ 4,121,513 $ 4,516,174 $ 5,562,440 $ 7,080,783 $ 7,814,368 $ 7,694,743 $ 6,915,280 $ 22,362,761 $ 16,935,728 $ 22,655,132 Special item - - - - - - - - - 9,387,590
Change in net position
Governmental activities $ (842,877) $ (4,047,731) $ 5,216,369 $ 21,152,163 $ 4,348,839 $ 13,114,082 $ 1,877,758 $ 3,134,704 $ 5,825,006 $ 37,043,180Business-type activities (5,408,293) (8,702,007) (5,448,264) (3,556,511) (679,303) (2,345,865) (2,982,150) 8,681,384 2,156,407 3,521,258 Total primary government $ (6,251,170) $ (12,749,738) $ (231,895) $ 17,595,652 $ 3,669,536 $ 10,768,217 $ (1,104,392) $ 11,816,088 $ 7,981,413 $ 40,564,438 Source: City of Mountain House Audited Finacial Statements City of Mountain House
Changes in Net Position
Last Ten Fiscal Years
(Accrual Basis of Accounting)
78 Item 8.1
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2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
General Fund
Nonspendable $ 6,919,396 $ 9,601,868 $ 11,151,252 $ 11,298,699 $ 11,277,165 $ 11,348,342 $ 13,128,911 $ 14,177,939 $ 15,424,097 $ 15,424,097 Restricted - - - - - - 1,446,198 1,705,324 1,994,815 2,741,371 Committed - - - 2,099,160 2,099,160 2,099,160 2,099,160 2,099,160 2,099,160 2,099,160 Assigned 100,000 - - - - - - - - -
Unassigned 5,252,815 5,587,981 7,946,908 14,913,684 19,836,935 25,055,033 26,272,052 31,266,429 36,573,680 47,138,375 Total General Fund $ 12,272,211 $ 15,189,849 $ 19,098,160 $ 28,311,543 $ 33,213,260 $ 38,502,535 $ 42,946,321 $ 49,248,852 $ 56,091,752 $ 67,403,003 All other governmental funds
Nonspendable $ 2,673,000 $ 2,376,000 $ 2,080,008 $ 1,833,054 $ 1,499,790 $ 1,188,000 $ - $ - $ - -$ Restricted 14,830,312 17,779,037 25,930,985 35,750,869 41,533,969 21,134,705 28,483,626 31,609,430 46,443,649 72,893,155 Committed - - - - - - - - - -
Total other governmental funds $ 20,155,037 17,503,312 $ 28,010,993 $ 37,583,923 $ 43,033,759 $ 22,322,705 $ 28,483,626 $ 31,609,430 $ 46,443,649 $ 72,893,155 $ Note: The change in total fund balance for the General Fund and other governmental funds is explained in Management's Discussion and Analysis Source: City of Mountain House Audited Finacial Statements City of Mountain House
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
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2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Revenues
Taxes 3,102,872 $ 3,460,372 $ 3,750,725 $ 4,576,597 $ 5,211,254 $ 6,076,030 $ 6,926,727 $ 7,732,189 $ 8,753,957 $ 11,404,992 $ Sales tax - - - - - - - - - 153,095Other taxes - - - - - - - - - 594,357Special assessment 7,745,965 8,657,551 9,023,810 10,555,005 12,071,805 13,005,628 14,537,793 15,101,756 15,952,088 16,922,463Licences and permits 14,300 12,543 8,985 7,685 8,730 10,830 6,925 8,364 7,999 9,204Franchise fees 701,898 750,332 836,508 1,024,749 1,048,786 1,088,748 1,145,319 1,106,275 1,360,135 1,506,056Intergovernmental - - - - - - - - 190,526 1,813,235Developer and impact fees 5,431,291 4,278,126 11,272,221 19,687,037 7,282,634 18,736,624 8,228,828 9,034,602 9,597,424 28,575,061Investment earnings 119,315 234,577 513,438 1,225,989 1,335,586 444,569 (1,054,830) 2,009,733 3,553,329 5,150,534 Other revenues 224,410 179,473 643,686 485,566 96,435 23,344 259,252 447,235 213,292 301,205 Contributions from developers - - - 4,000,000 - - - - - - Total revenues 17,340,051 17,572,974 26,049,373 41,562,628 27,055,230 39,385,773 30,050,014 35,440,154 39,628,750 66,430,202 Expenditures
Current
General government 1,930,112 - 297,991 286,548 178,366 383,904 347,250 141,437 225,805 699,285 Public safety 3,475,095 3,923,703 4,505,383 3,994,712 4,141,477 4,693,489 5,290,562 6,071,136 6,626,915 7,819,378 Public ways and facilities 1,665,889 4,467,049 3,154,397 3,424,391 6,035,240 6,788,719 7,475,476 8,311,202 8,812,784 12,712,574 Recreation and culture 820,995 1,468,136 1,320,164 1,350,166 1,753,601 1,856,903 2,379,381 2,745,236 3,128,291 3,389,679 Debt service
Principal 2,374,551 1,838,522 4,472,682 13,105,932 2,745,732 40,587,084 58,381,422 5,102,274 1,679,694 11,254,361 Interest and fiscal charges - - - 47,110 34,464 7,425 902,274 1,924,896 1,957,008 1,908,139 Bond issuance costs - - - - - - 902,741 - - -Capital outlay 3,191,335 154,980 534,489 434,372 32,814,797 2,929,642 4,947,380 16,630,492 1,905,545 2,244,472Total expenditures 13,457,977 11,852,390 14,285,106 22,643,231 47,703,677 57,247,166 80,626,486 40,926,673 24,336,042 40,027,888Excess (deficiency) of revenues over (under) expenditures 3,882,074 5,720,584 11,764,267 18,919,397 (20,648,447) (17,861,393) (50,576,472) (5,486,519) 15,292,708 26,402,314 Other financing sources (uses)
Proceeds from long term debt - - - - 31,000,000 2,439,614 54,233,382 14,914,854 6,384,411 1,970,853 Debt premium - - - - - - 6,947,797 - - -
Transfer in 2,342,792 2,369,734 4,200,519 3,407,547 3,401,180 2,201,564 5,668,889 4,831,339 2,392,837 6,045,742 Transfer out (2,342,792) (2,369,734) (4,200,519) (3,407,547) (3,401,180) (2,201,564) (5,668,889) (4,831,339) (2,392,837) (6,045,742) Total other financing sources (uses) - - - - 31,000,000 2,439,614 61,181,179 14,914,854 6,384,411 1,970,853 Specail item - Affordable housing transfer from County - - - - - - - - - 9,387,590 Net change in fund balances 3,882,074 5,720,584 11,764,267 18,919,397 10,351,553 (15,421,779) 10,604,707 9,428,335 21,677,119 37,760,757Fund balances, July 1 25,893,449 29,775,523 35,344,886 47,109,153 65,895,466 76,247,019 60,825,240 71,429,947 80,858,282 102,535,401 Restatements - (151,221) - (133,084) - - - - - -
Fund balance, restated 25,893,449 29,624,302 35,344,886 46,976,069 65,895,466 76,247,019 60,825,240 71,429,947 80,858,282 102,535,401 Fund balances, June 30 29,775,523 $ 35,344,886 $ 47,109,153 $ 65,895,466 $ 76,247,019 $ 60,825,240 $ 71,429,947 $ 80,858,282 $ 102,535,401 $ 140,296,158 $ Debt service as a percentage of non capital expenditures 23.13% 15.72% 32.53% 59.22% 18.67% 74.74% 78.34% 28.92% 16.21% 34.84% Note: Noncapital expenditures are total expenditures less capital outlay.Source: City of Mountain House Audited Finacial Statements (Modified Accrual Basis of Accounting)
Last Ten Fiscal Years
Changes in Fund Balances of Governmental Funds
City of Mountain House
80 Item 8.1
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(1) (1)
Customer
Usage
(ccf)
% of Total
Usage
Water Sales
Revenue
% of Total
Water Sales
Revenue Customer
Usage
(ccf)
% of Total
Usage
Water Sales
Revenue
% of Total
Water Sales
Revenue
City of Mountain House 213,803 12.20% 666,878 $ 12.22% Mountain House CSD 205,137 12.97% 380,535 $ 11.00% School District 184,162 10.51% 602,032 11.03% School District 136,664 8.64% 266,842 7.72% Cambridge Place HOA 1.80% 225,616 31,606 4.13% Cambridge Place HOA 1.11% 150,382 17,531 4.35% Mountain House Investors 64,074 3.66% 117,367 2.15% San Joaquin Delta College 6,166 0.39% 30,988 0.90% Mountain House Apmt Owners LLC 19,123 1.09% 92,415 1.69% Gable Lane HOA 16,851 1.07% 21,971 0.64%San Joaquin Delta College 3,535 0.20% 68,317 1.25% Cobblestone Owners Association 7,258 0.46% 13,890 0.40%Mountain House Retail LLC 7,867 0.45% 50,419 0.92% Creston Park HOA 7,945 0.50% 12,588 0.36%Lennar Homes of California 15,035 0.86% 38,502 0.71% Century Communities 4,865 0.31% 11,152 0.32%Century Communities 12,244 0.70% 30,701 0.56% Mountain House Developers LLC 4,492 0.28% 8,677 0.25%Gable Lane HOA 10,707 0.61% 21,349 0.39% Shea Homes 2,326 0.15% 6,415 0.19%Top Ten Total 562,156 32.07% 1,913,596 $ 35.07% Top Ten Total 409,235 25.87% 903,440 $ 26.12% Total Flate/Metered Revenues (Water Sales) 5,457,112 $ Total Flate/Metered Revenues (Water Sales) 1,755,032 $ (1) CCF means “hundred cubic feet”
Amount Amount
$ 32.96 $ 23.68

25.80 17.8342.82 30.6663.59 43.76
105.14 69.96209.00 135.48333.64 214.09728.32 423.73
1,455.37 659.58
3,324.93 1,314.71
5,817.67 2,100.86

1.88 4.81

49.96 55.38
Source: City of Mountain House – Utility Division
Standard Water 0.625 inch
Standard Water 4 inchStandard Water 8 inch
Standard Water 0.625 inch
Standard Water 0.75 inch
Standard Water 1 inch Standard Water 1 inch
Standard Water 1.5 inch
Standard Water 2 inchStandard Water 3 inch
Note (1): In addition to these minimum charges, accounts are also charged a volumetric charge for 100 cubic feet of water used. Information was not available prior to fiscal year 2019-20 and will be added prospectively as it becomes available.

Fire Protection 0.625 inch
Standard Water 6 inch
Fire Protection 8 inch
Water - Low Den
Water - Med Den
Fire Protection 8 inch
Standard Water 1.5 inch
Standard Water 2 inchStandard Water 3 inchStandard Water 4 inch Standard Water 0.75 inch
Standard Water 6 inchStandard Water 8 inch
Fire Protection 0.625 inch
Water - Med Den
City of Mountain House
Water Utility System - Ten Largest Customers
Current Year and Five Years Ago
2024-25 2019-20
Meter Size
Water - Low Den
Water Utility System Rates
(As of July 1, 2024)
Water Utility System Rates
(As of July 1, 2019)
Meter Size
81 Item 8.1
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Year Local Secured Utility Unsecured Total
2016-17 $2,139,221,800 $0 $2,885,723 $2,142,107,5232017-18 2,359,684,956 0 3,107,598 2,362,792,5542018-19 2,760,427,065 0 3,409,051 2,763,836,1162019-20 3,167,577,710 0 2,534,630 3,170,112,3402020-21 3,625,595,443 0 3,466,798 3,629,062,2412021-22 4,026,478,524 0 3,994,084 4,030,472,6082022-23 4,564,475,477 0 5,028,913 4,569,504,3902023-24 5,094,152,567 0 12,918,322 5,107,070,8892024-25 5,502,526,134 0 20,558,117 5,523,084,251 Residential Commercial Industrial Other Total Local
Property Property Property Property Secured Property
$5,366,900,217 $69,689,322 $59,098,255 $6,838,340 $5,502,526,134 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 General 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 Lammersville Joint Unified School District - 0.0534 0.0550 0.0487 0.0395 0.0388 0.0467 0.0441 0.0409 Tracy Unified School District 0.0185 0.0172 0.0162 0.0151 0.0139 0.0137 0 0 0San Joaquin Delta Community College Dist. 0.0180 0.0180 0.0225 0.0199 0.0183 0.0163 0.0144 0.0135 0.0122 Total 1.0365 1.0886 1.0937 1.0837 1.0717 1.0688 1.0611 1.0576 1.0531Source: California Municipal Statistics, Inc. Note: Information was not available prior to fiscal year 2016-17. 2024-25 Total Local Secured Assessed Valuation Breakdown Typical Tax Rate per $100 of Assessed Valuation (TRA 92-018) City of Mountain House
Property Tax Valuations and Rates
Assessed Valuation
(Last Seven Fiscal Years)
82 Item 8.1
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2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Taxes
Property taxes 3,100,699 $ 3,460,372 $ 3,750,725 $ 4,576,597 $ 5,211,254 $ 6,076,030 $ 6,926,727 $ 7,732,189 $ 8,753,957 $ 11,404,992 $ Franchise and miscellaneous taxes 701,898 750,332 836,508 1,024,749 1,048,786 1,088,748 1,145,319 1,106,275 1,360,135 1,506,056 Total 3,802,597 $ 4,210,704 $ 4,587,233 $ 5,601,346 $ 6,260,040 $ 7,164,778 $ 8,072,046 $ 8,838,464 $ 10,114,092 $ 12,911,048 $ Source: City of Mountain House District Audited Finacial Statements City of Mountain House
Property and Franchise Taxes - Governmental Funds
Last Ten Fiscal Years
(Accrual Basis of Accounting)
$-
$2,000,000 $4,000,000 $6,000,000 $8,000,000
$10,000,000 $12,000,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Property taxes Franchise and miscellaneous taxes
83 Item 8.1
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2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Special Tax Levies
Special Tax No. 1: Roads 4,547,589 $ 5,086,928 $ 5,302,562 $ 6,188,080 $ 7,079,610 $ 7,430,993 $ 8,342,798 $ 8,673,183 $ 9,154,394 $ 9,721,667 $ Special Tax No. 2: Public Safety 2,318,311 2,592,544 2,702,572 3,154,205 3,609,729 3,788,208 4,251,835 4,396,034 4,662,508 4,952,665 Special Tax No. 3: Parks 403,823 451,974 471,077 544,646 629,991 658,740 738,610 763,639 810,157 859,380 Special Tax No. 4: Public Works 427,052 475,572 497,067 579,153 662,779 693,753 776,709 802,949 851,980 902,755 Lighting & Landscaping District 1 49,191 50,532 50,532 52,045 52,411 52,411 53,849 56,643 59,657 61,430 Lighting & Landscaping District 2 - - - 36,875 37,284 37,284 38,341 40,329 40,329 40,329 Lighting & Landscaping District 3 - - - - - 344,239 335,651 368,979 373,063 384,237 Total $ 7,745,965 $ 8,657,551 $ 9,023,810 $ 10,555,005 $ 12,071,805 $ 13,005,628 $ 14,537,793 $ 15,101,756 $ 15,952,088 $ 16,922,463 Living Area - Rate per 100 sq ft Parcel Area - Rate per 100 sq ft Living Area - Rate per 100 sq ft Parcel Area - Rate per 100 sq ft Special Tax No. 1: Roads 37.98 6.63 37.98 1.04
Special Tax No. 2: Public Safety 19.52 3.26 19.52 0.50Special Tax No. 3: Parks 3.26 0.63 3.26 0.14 Special Tax No. 4: Public Works 3.47 0.63 3.47 0.14
Source: City of Mountain House Audited Finacial Statements and Finance Department Lot Size < 6,000 sq ft Lot Size > 6,000 sq ft
2024-25 Special Tax Rates
City of Mountain House
Special Tax Levies and Rates - Governmental Funds
Last Ten Fiscal Years
(Accrual Basis of Accounting)
$4,000,000 $6,000,000 $8,000,000
$10,000,000 $12,000,000 $14,000,000 $16,000,000 $18,000,000 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
84 Item 8.1
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2024-25 % of 2019-20 % of
Property Owner Primary Land Use
Assessed
Valuation Total (1) Property Owner Primary Land Use
Assessed
Valuation Total (1)
1 Mountain House Developers LLC Residential Development $105,218,000 1.91% 1 Shea Homes LP Residential Development $84,901,961 2.68%2 Rurka Capital LLC & Mountain House Developers Residential Development $103,500,000 1.88% 2 Mountain House Investors LLC Residential Development 25,552,208 0.81%3 AG EHC II LEN CA 2 LP Residential Development $95,711,700 1.74% 3 Richmond American Homes Maryland Inc. Residential Development 24,237,985 0.77%4 AG EHC II LEN CA 1 LP Residential Development $33,292,703 0.61% 4 Arroyo Cap I LLC Residential Development 23,460,759 0.74%5 AG EHC II LEN CA 4B LP Residential Development $25,668,300 0.47% 5 Taylor Morrison California LLC Residential Development 19,428,060 0.61%6 Mountain Technology Center A LLC Warehouse $24,758,282 0.45% 6 Trimark Communities LLC Residential Development 16,864,565 0.53%7 Mountain House Apartments Owner LLC Apartments $15,085,800 0.27% 7 BMCH California LLC Residential Development 16,569,554 0.52%8 Mountain House Investors LLC Residential Development $14,003,733 0.25% 8 Tri Pointe Homes Inc. Residential Development 14,878,070 0.47%9 Mountain House Retail LLC Shopping Center $11,424,690 0.21% 9 MH Village D 94 Lots LLC Residential Development 9,561,464 0.30% 10 Trimark Communities LLC Residential Development $9,683,345 0.18% 10 MH Motor Courts 71 Lots LLC Residential Development 9,171,090 0.29%11 Mountain Technology Center B LLC Industrial Land $8,802,537 0.16% 11 Mountain House Developers LLC Residential Development 7,480,040 0.24%12 Mountain House Apartments Phase II Owner Apartments $8,789,299 0.16% 12 Sunchaser Real Estate One LLC Commercial Land 6,944,127 0.22%13 Mountain Technology Center C LLC Warehouse $8,018,749 0.15% 13 Mountain Technology Center B LLC Industrial Land 6,336,131 0.20%14 Sunchaser Real Estate Two Office Building $7,968,443 0.14% 14 Woodside 05N LP Residential Development 5,926,260 0.19%15 Ameen Housing Cooperative of California Residential Properties $7,767,693 0.14% 15 Sunchaser Real Estate Two Office Building 5,450,000 0.17%16 Shea Homes LP Residential Development $5,407,923 0.10% 16 K Hovnanian Meadow View Mt. House Residential Development 5,006,920 0.16%17 CATX Partners LLC Montessori School $5,352,803 0.10% 17 Meritage Homes of California Inc. Residential Development 2,953,999 0.09%18 Mountain House Square Inc. Residential Development $5,003,429 0.09% 18 Mountain Technology Center A LLC Industrial Land 2,226,891 0.07%19 Amanjit S. Sandhu Residential Land $4,824,908 0.09% 19 Bishwajit Nag, Trust Residential 2,212,352 0.07%20 GKG Mountain House Apartments LLC Residential Land 4,064,426 0.07% 20 Christopher Wai Cheung and Oi Lan Lau, Trust Residential 1,938,690 0.06% $504,346,763 9.17% $291,101,126 9.19%
Source: California Municipal Statistics, Inc.

City of Mountain House
Principal Property Taxpayers
Largest Local Secured Taxpayers
Current Year and Five Years Ago
Note (1): 2019-20 Local Secured Assessed Valuation: $3,167,577,710. Information was not available prior to fiscal year 2019-20 and will be added prospectively as it becomes available. 2024-25 Total Secured Assessed Valuation: $5,502,526,134 85 Item 8.1
Mountain House Page 481 of 545
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Governmental activites
Revenue Bonds - $ - $ - $ - $ - $ - $ 56,175,218 $ 54,736,412 $ 53,255,272 $ 41,768,078 $ Notes Payable 108,405,858 110,524,186 109,367,735 99,125,520 128,952,300 93,152,605 41,160,106 54,189,808 62,635,335 65,980,770Total 108,405,858 $ 110,524,186 $ 109,367,735 $ 99,125,520 $ 128,952,300 $ 93,152,605 $ 97,335,324 $ 108,926,220 $ 115,890,607 $ 107,748,848 $ Business-Type Activities
Revenue Bonds 28,012,633 $ 27,167,237 $ 26,276,842 $ 25,351,446 $ 35,741,291 $ 178,663,707 $ 176,757,614 $ 216,279,704 $ 214,036,248 $ 211,590,871 $ Notes Payable 184,432,002 188,891,138 192,065,188 194,268,477 182,829,201 42,757,753 44,105,767 - - 1,160,730Total 212,444,635 $ 216,058,375 $ 218,342,030 $ 219,619,923 $ 218,570,492 $ 221,421,460 $ 220,863,381 $ 216,279,704 $ 214,036,248 $ 212,751,601 $ Debt Per Capita 19,402 $ 19,843 $ 17,483 $ 16,361 $ 14,786 $ 12,182 $ 11,705 $ 11,647 $ 11,757 $ 11,130 $ Debt to Personal Income 2,732 $ 2,702 $ 2,487 $ N/A N/A 2,365 $ 1,975 $ 2,107 $ 1,978 $ 1,867 $ Source: City of Mountain House Audited Finacial StatementsNote: Not available = N/A.

City of Mountain House
Ratio of Outstanding Debt by Type
Last Ten Fiscal Years
$-
$50,000,000
$100,000,000 $150,000,000 $200,000,000 $250,000,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Governmental activites Business-Type Activities
86 Item 8.1
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2024-25 Assessed Valuation: $5,523,084,251
Total Debt District’s Share of
OVERLAPPING TAX AND ASSESSMENT DEBT: 6/30/2025 % Applicable (1) Debt 6/30/25 San Joaquin Delta Community College District $148,565,000 4.39% $6,527,946Lammersville Joint Unified School District 55,350,000 64.84% 35,888,940Lammersville School District Community Facilities District No. 2002 57,215,000 100.00% 57,215,000Lammersville School District Community Facilities District No. 2007-1 I.A. No. 1 21,675,000 100.00% 21,675,000Lammersville School District Community Facilities District No. 2014-1 I.A. No. 1 54,600,000 100.00% 54,600,000Lammersville School District Community Facilities District No. 2019-1 23,265,000 100.00% 23,265,000City of Mountain House Community Facilities District No. 2024-1 I.A. No. 1 40,130,000 100.00% 40,130,000City of Mountain House Community Facilities District No. 2024-1 I.A. No. 6 8,750,000 100.00% 8,750,000City of Mountain House Community Facilities District No. 2024-1 I.A. No. 7 6,000,000 100.00% 6,000,000City of Mountain House Community Facilities District No. 2024-1 I.A. No. 8 5,805,000 100.00% 5,805,000Mountain House Community Services District - Notes & Bonds 278,732,371 100.00% 278,732,371 TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT $538,589,257DIRECT AND OVERLAPPING GENERAL FUND DEBT:

San Joaquin County Certificates of Participation $43,190,000 4.74% $2,048,502Lammersville Joint Unified School District General Fund Obligations 13,930,000 64.84% 9,032,212 Mountain House Community Services District General Fund Obligations 41,768,078 100.00% 41,768,078 TOTAL DIRECT AND OVERLAPPING GENERAL FUND DEBT $52,848,792 TOTAL DIRECT DEBT $320,500,449
TOTAL OVERLAPPING DEBT $549,669,971 COMBINED TOTAL DEBT $591,438,049 (2) Total Overlapping Tax and Assessment Debt 9.75%
Total Direct Debt 5.80%
Combined Total Debt 10.71%
Legal Debt Margin Information does not pertain to special districts.Source: California Municipal Statistics, Inc.

City of Mountain House
Computation of Direct and Overlapping Debt
June 30, 2025
(1) The percentage of overlapping debt applicable to the district is estimated using taxable assessed property value. Applicable percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries of the community services district divided by the overlapping district'stotal taxable assessed value.

Ratios to 2024-25 Assessed Valuation:
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations. 87 Item 8.1
Mountain House Page 483 of 545
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Water revenue bonds
Pledged facility component revenue 2,521,251 $ 2,776,942 $ 3,135,513 $ 3,585,549 $ 3,941,256 $ 4,380,558 $ 4,756,185 $ 5,024,379 $ 5,473,782 $ 5,926,614 $ Annual installment payment 1,147,656 1,144,391 1,146,446 1,145,671 1,142,336 2,663,342 3,686,891 3,786,369 4,666,746 4,714,584 Installment payment coverage 2.20 2.43 2.73 3.13 3.45 1.64 1.29 1.33 1.17 1.26 Wastewater revenue bonds
Pledged facility component revenue 1,779,951 $ 1,972,362 $ 2,234,730 $ 2,568,168 $ 2,831,252 $ 3,149,768 $ 3,461,579 $ 3,913,735 $ 4,117,147 $ 4,587,036 $ Annual installment payment 880,114 880,454 881,214 879,949 881,549 1,978,274 2,721,257 2,755,522 3,609,589 3,635,860 Installment payment coverage 2.02 2.24 2.54 2.92 3.21 1.59 1.27 1.42 1.14 1.26 Stormwater revenue bonds
Pledged facility component revenue 589,422 $ 718,698 $ 797,341 $ 898,716 $ 995,204 $ 1,144,514 $ 1,236,432 $ 1,361,180 $ 1,459,724 $ 1,567,196 $ Annual installment payment 282,301 282,626 283,076 282,871 282,036 684,733 958,266 994,209 1,273,543 1,281,522 Installment payment coverage 2.09 2.54 2.82 3.18 3.53 1.67 1.29 1.37 1.15 1.22 Note: Revenues represent charges for services pledged as reported in the audited financial statements. Debt service payments represent cash basis principal and interest payments from the debt service payment schedule. Source: City of Mountain House Finance Department City of Mountain House
Revenue Bond Coverage
Last Ten Fiscal Years
-

2.00 4.00 6.00 8.00

10.00 12.00
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Water revenue bonds Wastewater revenue bonds Stormwater revenue bonds 88 Item 8.1
Mountain House Page 484 of 545
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Population (1) 16,537 16,458 18,745 19,482 23,504 25,823 27,185 27,923 28,063 28,795 Housing units (2) 4,455 4,684 5,335 6,008 6,438 6,984 7,330 7,386 7,684 8,108 Median home sales price (3) $ 566,000 534,000 $ 604,000 $ 645,000 $ 680,000 $ 950,000 $ 977,500 $ 930,000 $ 1,212,500 $ 1,010,000 $ Median household income (4) $ 120,868 117,433 $ 131,766 $ N/A N/A 133,000 161,086 154,357 166,821 171,675 (1) Source: California Department of Finance
(2) Source: San Joaquin County Community Development Department(3) Source: Zillow.com for information for years through 2020; Redfin.com for years after 2020(4) Source US Census Bureau; US Census Bureau for Economic Studies; ESRI Business Analyst On-Line; Kosmont CompaniesNote: Not available = N/A.

City of Mountain House
Demographic and Economic Statistics
Last Ten Fiscal Years
89 Item 8.1
Mountain House Page 485 of 545
Function 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Administration 2 2 5 6 7 7 8 911 13.3
Finance 6 65.5 5.5 5.58 8 8 8 8
Community Development 5 6 4 5 5 910 10 11 14
Public Works 2 2 4 5 52.5 3.5 3.5 3.5 3.5
Operations & Maintenance 3344555555
Recreation 11111122 3.4 3.4
Total 19 20 23.5 26.5 28.5 32.5 36.5 37.5 41.9 47.2Source: City of Mountain House Finance Department City of Mountain House
Full-time District Employees by Function
Last Ten Fiscal Years
05 101520253035404550
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
RecreationOperations & MaintenancePublic WorksCommunity DevelopmentFinanceAdministration 90 Item 8.1
Mountain House Page 486 of 545
June 30, 2025 June 30, 2024 June 30, 2023 June 30, 2022 June 30, 2021 June 30, 2020 Number of :

District trees 25,000 22,000 22,000 15,980 14,240 14,240Traffic signals intersections 22 19 19 11 10 10Street lights 3,200 3,000 3,000 1,673 1,598 1,598Pool vehicles 12 9 9 9 9 9 Square feet of landscaping maintained 14,123,400 11,600,000 11,600,000 8,470,964 7,936,900 7,936,900Number of Parks:

Regional 1111 1 1Neighborhood 11 11 11 7 6 6
Fire apparatus
Ladder truck 1111 1 1
Fire engine 4111 1 1Emergency response vehicle 3221 1 1 Roads: Lane miles Lane miles Lane miles Lane miles Lane miles Lane miles Arterial 86.28 70.86 70.86 70.86 70.86 70.86Collector 31.95 45.53 45.53 45.53 29.51 29.51 Residential/local 100.57 94.31 94.31 94.31 80.14 80.14
Total 218.8 210.7 210.7 210.7 180.51 180.51
Arterial Center-line miles Center-line miles Center-line miles Center-line miles Center-line miles Center-line miles Collector 22.54 17.75 17.75 17.75 17.75 17.75 Residential/local 15.98 21.76 21.76 21.76 14.23 14.23
Total 51.52 47.16 47.16 47.16 41.32 41.32

90.04 86.67 86.67 86.67 73.3 73.3
Water system
Miles of lines 122 122 122 99 90 90
Treated water storage tanks 4444 3 3
Million gallons/day capacity 19 19 19 19 15 15
Water supply available in acre feet 9,813 9,813 9,813 9,813 9,813 9,813 Water supplied by Byron-Bethany Irrigation District; pre-1914 water rights Approval from the State Water Resouces Control Board
Wastewater system
Miles of pipeline - gravity system 88 88 88 74 67 67Pipelne diameter range 8" - 24" 8" - 24" 8" - 24" 8" - 24" 8" - 24" 8" - 24" Millions of gallons/day capacity 3333 3 3
Millions of gallons/day average demand 1111 1 1System consists of headworks, anoxic reactors, sequencing batch reactors, cloth media filtration, and UV light disinfection Tertiary effluent from the plan is discharged into Old River pursuant to a permit from the Regional Water Quality Control Board Storm drain system
Miles of pipeline - gravity system 98 98 98 70 70 70
Detention basins serve as regulation storage of first flush runoff and the discharge into Mountain House Creek and eventually into Old River A state of the art system that includes primary filtration at street level collection sites using carbon-based filters for treatment of contaminants and debris
(1) Source: City of Mountain House Public Works Department Note: Information was not available prior to fiscal year 2019-20.

Last Five Fiscal Years
City of Mountain House
Capital Asset Statistics by Function/Program
Conventional surface water treatment plant with UV and chloramines disinfection 91 Item 8.1
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92 COMPLIANCE REPORT
Item 8.1
Mountain House Page 488 of 545
93 (This page intentionally left blank.)
Item 8.1
Mountain House Page 489 of 545
550 Howe Avenue, Suite 210
Sacramento, California 95825
Telephone: (916) 564-8727
FAX: (916) 564-8728
94 INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL

REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF

FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING

STANDARDS
To the Honorable Mayor and City Council
City of Mountain House, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of the City of Mountain House, California (the City) as of and for the year ended June 30, 2025, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements, and have issued our report thereon dated December 1, 2025.

Report on Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the City’s financial statements will not be prevented or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses and significant deficiencies may exist that that were not identified.

Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the Item 8.1
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To the Honorable Mayor and City Council
City of Mountain House, California
95 financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the result of that testing, and not to provide an opinion on the effectiveness of the City’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

December 1, 2025
Item 8.1
Mountain House Page 491 of 545
550 Howe Avenue, Suite 210
Sacramento, California 95825
Telephone: (916) 564-8727
FAX: (916) 564-8728

REQUIRED COMMUNICATIONS LETTER
To the City Council
The City of Mountain House
Mountain House, California
We have audited the financial statements of the governmental activities, the business type activities and each major fund of the City of Mountain House (the City) for the year ended June 30, 2025, and have issued our report thereon dated December 1, 2025. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing and Government Auditing Standards, as well as certain information related to the planned scope and timing of our audit. We have communicated such information to you in our letter dated July 14, 2025. Professional standards also require that we communicate to you the following information related to our audit.

Significant Audit Matters
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in Note A to the financial statements. The City implemented GASB Statement No. 101, Compensated Absences, during the year ended June 30, 2025, which resulted in the City accruing leave expected to be used for time off in the future in addition to leave expected to be paid at the termination of service as in the past. The effects of the implementation of this Statement is disclosed in Note N to the financial statements. The application of existing policies was not changed during the year. We noted no transactions entered into by the City during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period.

Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the financial statements were the fair value adjustment on the County investment pool, the depreciable lives used for capital assets, the allowance for doubtful accounts on receivables, the valuation of infrastructure contributed to the City by developers and related interest included as part of notes payable, the net pension liability and the allocation of indirect costs. The net pension liability is determined by an actuarial valuation. We evaluated the key factors and assumptions used to develop the estimates in determining that they are reasonable in relation to the financial statements taken as a whole.

Certain financial statement disclosures are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the financial statements were:
 Note A, page 36 and Note E discusses the pledged notes payable to developers for repayment of costs of constructing general infrastructure of the City as well as the utility infrastructure, under the terms of the Master Acquisition and Reimbursement Agreement, and related Project Reimbursement Agreements. The notes payable includes a finance charge based on the increase in a construction cost index. Repayment of the loan for general infrastructure are from impact Item 8.1
Mountain House Page 492 of 545
To the City Council
City of Mountain House
fees collected and repayments of the utility infrastructure are from the capital improvement fees collected as part of the utility billings.
 Note C discusses the loans made by the General Fund to the Water, Wastewater and Stormwater Funds as a result of shortfalls experienced by these funds in the early years of their organization.

The loans total $15,424,097 at June 30, 2025. No repayments have been made on these loans.

An additional advance of $10,752,342 was made to the Water Enterprise Fund by the Wastewater Enterprise Fund. The rates and charges of the enterprise funds will need to be sufficient to repay these advances in the future.
 Information on the City’s pension plan, including the City’s share of the net pension liability, is shown in Note H. The City’s share of the net pension liability at December 31, 2024, the most recent measurement date, was $10,848,614, which is reflected as a liability in the City’s financial statements.

The financial statement disclosures are neutral, consistent, and clear.

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

Corrected and Uncorrected Misstatements
Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management.

Management has corrected all such misstatements. During the course of our audit, 16 adjustments and closing entries were recorded as follows:
 Record proceeds from debt in governmental funds.
 Reduce long-term liabilities for $10 million bond call.  Adjust interest payable after bond call.
 Entry to make fund balance and net position roll-forward.  True-up restricted net position.
 Reverse unearned revenue earned in the Capital Projects Fund.  True-up compensated absences for the implementation of GASB Statement No. 101.  Record the fair value adjustment for the investment in the County of San Joaquin Treasury.  True-up nonspendable fund balance for long-term assets.  True-up the net investment in capital assets.
 Reclassification of affordable housing funds provided by the County as a special item for reporting purposes.

In addition, the attached summary reports unposted audit differences in the financial statements.

Management has determined that their effects are immaterial, both individually and in the aggregate, to the financial statements taken as a whole. The uncorrected misstatements or the matters underlying them could potentially cause future period financial statements to be materially misstated, even though, in our judgment, such uncorrected misstatements are immaterial to the financial statements under audit.

Item 8.1
Mountain House Page 493 of 545
To the City Council
City of Mountain House
Disagreements with Management
For purposes of this letter, professional standards define a disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter that could be significant to the financial statements or the auditor’s report. We are pleased to report that no such disagreements arose during the course of our audit.

Management Representations
We have requested certain representations from management that are included in the management representation letter December 1, 2025.

Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to the City’s financial statements or a determination of the type of auditor’s opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants.

Issues Discussed Prior to Retention of Independent Auditors We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the City’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention.

Other Matters
We applied certain limited procedures to management’s discussion and analysis, the schedules of proportionate share of the net pension liability and contributions to the pension plan and budgetary comparison schedules, which are required supplementary information (RSI) that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI.

We were engaged to report on the individual fund statements, consisting of combining nonmajor fund financial statements, which accompanies the financial statements but is not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or the financial statements themselves.

We were not engaged to report on the introductory and statistical section, which accompany the financial statements but are not RSI. Such information has not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it.

Item 8.1
Mountain House Page 494 of 545
To the City Council
City of Mountain House
Restriction on Use
This information is intended solely for the use of the City Council and management of the City and is not intended to be and should not be used by anyone other than these specified parties.

December 1, 2025
Item 8.1
Mountain House Page 495 of 545
Description (Nature)
of Audit Difference
$ (71,537) $ (71,537) $ (71,537)
$ (42,247) 38,656 8,692
(153,179) $ (132,897) (20,282)
(71,840) 71,840 71,840
To accrue June garbage charges.To accrue a subscription based technology arrangement asset and liability in accordance with GASB Statement No. 96.

To acccrue a Tesla Tower lease receivable in accordance with GASB Statement No. 87.

School District cash receipt for 2024-2025 resource program not accrued.

Net Unadjusted Audit Differences - Governmental Activities (296,556) (42,247) (132,897) 18,677 8,995 Net Unadjusted Audit Differences - Total Governmental Activities 273,158,773 $ 3,188,344 $ $ 806,850 127,003,632 $ 148,536,635 $ 37,043,180 $ Net Audit Differences as % of F/S Captions (0.11%) 0.00% (0.03%) (16.47%) 0.01% 0.02% Total Change
in Net Postion

CITY OF MOUNTAIN HOUSE

SUMMARY OF UNADJUSTED AUDIT DIFFERENCES
YEAR ENDED JUNE 30, 2025

GOVERNMENTAL ACTIVITIES
Financial Statement Effect -
Amount of Overstatement (Understatement) of:

Total
Assets
Total
Liabilities
Total Net
Position
Total Deferred
Outflows of
Resources
Total Deferred
Inflows of
Resources
Item 8.1
Mountain House Page 496 of 545
Total Deferred Total Change in
Description (Nature) Inflows of Total Fund Fund Balance/ of Audit Difference Resources Balance Net Postion
$ (72,241) $ 72,241 $ 72,241
$ (71,537) (71,537) (71,537)
(153,179) (132,897) (20,282)
(224,716) (72,241) (132,193) (19,578)
$ 69,157,750 $ 1,754,747 $ 67,403,003 - $ $ 11,537,711
(0.32%) 0.00% (100.00%) (0.20%) (0.17%)
General FundDefer property tax revenue that was not received within the 60-day availability period
To accrue June garbage charges.

To acccrue a Tesla Tower lease receivable in accordance with GASB Statement No. 87.

Net Unadjusted Audit Differences - General FundFinancial Statement Caption Totals - General Fund Net Audit Differences as % of F/S CaptionsSpecial Assessment FundSchool District cash receipt for 2024-2025 resource program not accrued. $ (71,840) $ 71,840 $ 71,840
- 71,840 71,840
4,993,282 - $ $ (1,208,439)
Net Unadjusted Audit Differences - Special Assessment Fund (71,840) - Financial Statement Caption Totals - Special Assessment Fund $ 8,088,401 $ 3,095,119 $ Net Audit Differences as % of F/S Captions (0.89%) 0.00% (100.00%) 1.44% (5.94%) Amount of Overstatement (Understatement) of:

Total
Assets
Total
Liabilities

CITY OF MOUNTAIN HOUSE

SUMMARY OF UNADJUSTED AUDIT DIFFERENCES
YEAR ENDED JUNE 30, 2025

GOVERNMENTAL FUNDS
Financial Statements Effect -
Item 8.1
Mountain House Page 497 of 545
550 Howe Avenue, Suite 210
Sacramento, California 95825
Telephone: (916) 564-8727
FAX: (916) 564-8728

MANAGEMENT LETTER
To the City Council and Management
City of Mountain House
Mountain House, California
In planning and performing our audit of the financial statements of the City of Mountain House (the City) as of and for the year ended June 30, 2025, in accordance with auditing standards generally accepted in the United States of America, we considered the City’s internal control over financial reporting (internal control) as a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented or detected and corrected on a timely basis.

Our consideration of internal control was for the limited purpose described in the first paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses. Given these limitations, during our audit, we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

However, during our audit, we became aware of the following matters that have been included in this letter for your consideration:

Capital Assets
We recommend that qualified personnel perform a capital asset inventory in all departments. The City has policies in place regarding the performance of a capital asset inventory annually and the required reporting regarding the relocation and disposal of equipment.

We noted some of the lives and in-service dates were missing from the capital asset depreciation list and others were revised to reflect dates asset costs were certified. We recommend the City ensure the in-service date and depreciable life that was used to determine the accumulated depreciation is included on the detail list when it is provided for next year’s audit.

Management’s response: The Strategic Plan includes a goal of developing an inventory program. A listing of assets is currently maintained in a spreadsheet; we are planning to implement the fixed assets module of our current accounting software that will make accounting for fixed asset additions and deletions, depreciation and taking an inventory more efficient. Staff will assign qualified personnel to inventory fixed assets annually. The lives and in-service dates will be addressed in the 2026 audit.

Item 8.1
Mountain House Page 498 of 545
City Council
City of Mountain House

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Mountain House City CouncilDecember 10, 2025

Mountain House City Council
December 10, 2025