HCM 7th TWSC
6: RIRO Driveway & Sweetwater Road Existing AM
07/23/2025 Synchro 12 Report
LSA Page 2
Intersection
Int Delay, s/veh 0.3
Movement EBT EBR WBL WBT NBL NBR
Lane Configurations
Traffic Vol, veh/h 604 4 0 992 0 39
Future Vol, veh/h 604 4 0 992 0 39
Conflicting Peds, #/hr 0 0 0 0 0 0
Sign Control Free Free Free Free Stop Stop
RT Channelized - None - None - None
Storage Length - 0 - - - 0
Veh in Median Storage, # 0 - - 0 0 -
Grade, % 0 - - 0 0 -
Peak Hour Factor 92 92 92 92 92 92
Heavy Vehicles, % 2 2 2 2 2 2
Mvmt Flow 657 4 0 1078 0 42
Major/Minor Major1 Major2 Minor1
Conflicting Flow All 0 0 - - - 328
Stage 1 - -----
Stage 2 - -----
C r i t i c a l H d w y ----- 6 . 9 4
C r i t i c a l H d w y S t g 1 ------
C r i t i c a l H d w y S t g 2 ------
F o l l o w - u p H d w y ----- 3 . 3 2
Pot Cap-1 Maneuver - - 0 - 0 667
Stage 1 - - 0 - 0 -
Stage 2 - - 0 - 0 -
Platoon blocked, % - - -
Mov Cap-1 Maneuver - ---- 6 6 7
Mov Cap-2 Maneuver - -----
Stage 1 - -----
Stage 2 - -----
Approach EB WB NB
HCM Ctrl Dly, s/v 0 0 10.76
HCM LOS B
Minor Lane/Major Mvmt NBLn1 EBT EBR WBT
Capacity (veh/h) 667 - - -
HCM Lane V/C Ratio 0.064 - - -
HCM Ctrl Dly (s/v) 10.8 - - -
HCM Lane LOS B - - -
HCM 95th %tile Q(veh) 0.2 - - -
HCM 7th Signalized Intersection Summary
4: Sweetwater Road & Prospect Street Existing PM
07/23/2025 Synchro 12 Report
LSA Page 1
Movement EBL EBT EBR WBL WBT WBR NBL NBT NBR SBL SBT SBR Lane Configurations
Traffic Volume (veh/h) 24 991 64 217 759 62 74 18 163 107 18 15 Future Volume (veh/h) 24 991 64 217 759 62 74 18 163 107 18 15 I n i t i a l Q ( Q b ) , v e h 000000000000
Lane Width Adj. 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Ped-Bike Adj(A_pbT) 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Parking Bus, Adj 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Work Zone On Approach No No No No
Adj Sat Flow, veh/h/ln 1870 1870 1870 1870 1870 1870 1870 1870 1870 1870 1870 1870 Adj Flow Rate, veh/h 25 1043 67 228 799 65 78 19 172 113 19 16 Peak Hour Factor 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 P e r c e n t H e a v y V e h , % 222222222222
Cap, veh/h 40 1329 593 279 1676 136 437 36 325 220 36 19 Arrive On Green 0.02 0.37 0.37 0.16 0.50 0.50 0.22 0.22 0.22 0.22 0.22 0.22 Sat Flow, veh/h 1781 3554 1585 1781 3328 271 1373 160 1449 524 161 83 Grp Volume(v), veh/h 25 1043 67 228 427 437 78 0 191 148 0 0 Grp Sat Flow(s),veh/h/ln 1781 1777 1585 1781 1777 1822 1373 0 1609 769 0 0 Q Serve(g_s), s 0.9 16.1 1.7 7.7 9.7 9.7 0.0 0.0 6.5 6.1 0.0 0.0 Cycle Q Clear(g_c), s 0.9 16.1 1.7 7.7 9.7 9.7 2.8 0.0 6.5 12.6 0.0 0.0 Prop In Lane 1.00 1.00 1.00 0.15 1.00 0.90 0.76 0.11
Lane Grp Cap(c), veh/h 40 1329 593 279 895 917 437 0 361 275 0 0 V/C Ratio(X) 0.62 0.78 0.11 0.82 0.48 0.48 0.18 0.00 0.53 0.54 0.00 0.00 Avail Cap(c_a), veh/h 155 1632 728 402 1062 1089 622 0 578 463 0 0 HCM Platoon Ratio 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Upstream Filter(I) 1.00 1.00 1.00 1.00 1.00 1.00 1.00 0.00 1.00 1.00 0.00 0.00 Uniform Delay (d), s/veh 30.1 17.2 12.7 25.3 10.1 10.1 19.8 0.0 21.2 25.6 0.0 0.0 Incr Delay (d2), s/veh 14.7 2.1 0.1 8.3 0.4 0.4 0.2 0.0 1.2 1.6 0.0 0.0 Initial Q Delay(d3), s/veh 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 %ile BackOfQ(50%),veh/ln 0.5 5.9 0.5 3.6 3.2 3.2 0.9 0.0 2.4 2.2 0.0 0.0 Unsig. Movement Delay, s/veh
LnGrp Delay(d), s/veh 44.7 19.3 12.8 33.6 10.5 10.5 19.9 0.0 22.4 27.2 0.0 0.0 L n G r p L O S DBBCBBB CC
Approach Vol, veh/h 1135 1092 269 148
Approach Delay, s/veh 19.5 15.3 21.7 27.2
Approach LOS B B C C
Timer - Assigned Phs 1 2 4 5 6 8
Phs Duration (G+Y+Rc), s 14.8 28.6 18.6 6.8 36.6 18.6
Change Period (Y+Rc), s 5.1 5.4 * 4.7 5.4 * 5.4 4.7
Max Green Setting (Gmax), s 14.0 28.5 * 23 5.4 * 37 22.3 Max Q Clear Time (g_c+I1), s 9.7 18.1 14.6 2.9 11.7 8.5 Green Ext Time (p_c), s 0.2 5.1 0.5 0.0 5.7 1.2
Intersection Summary
HCM 7th Control Delay, s/veh 18.4
HCM 7th LOS B
Notes
* HCM 7th computational engine requires equal clearance times for the phases crossing the barrier.
HCM 7th TWSC
6: RIRO Driveway & Sweetwater Road Existing PM
07/23/2025 Synchro 12 Report
LSA Page 2
Intersection
Int Delay, s/veh 0.7
Movement EBT EBR WBL WBT NBL NBR
Lane Configurations
Traffic Vol, veh/h 1253 8 0 1053 0 95
Future Vol, veh/h 1253 8 0 1053 0 95
Conflicting Peds, #/hr 0 0 0 0 0 0
Sign Control Free Free Free Free Stop Stop
RT Channelized - None - None - None
Storage Length - 0 - - - 0
Veh in Median Storage, # 0 - - 0 0 -
Grade, % 0 - - 0 0 -
Peak Hour Factor 92 92 92 92 92 92
Heavy Vehicles, % 2 2 2 2 2 2
Mvmt Flow 1362 9 0 1145 0 103
Major/Minor Major1 Major2 Minor1
Conflicting Flow All 0 0 - - - 681
Stage 1 - -----
Stage 2 - -----
C r i t i c a l H d w y ----- 6 . 9 4
C r i t i c a l H d w y S t g 1 ------
C r i t i c a l H d w y S t g 2 ------
F o l l o w - u p H d w y ----- 3 . 3 2
Pot Cap-1 Maneuver - - 0 - 0 393
Stage 1 - - 0 - 0 -
Stage 2 - - 0 - 0 -
Platoon blocked, % - - -
Mov Cap-1 Maneuver - ---- 3 9 3
Mov Cap-2 Maneuver - -----
Stage 1 - -----
Stage 2 - -----
Approach EB WB NB
HCM Ctrl Dly, s/v 0 0 17.4
HCM LOS C
Minor Lane/Major Mvmt NBLn1 EBT EBR WBT
Capacity (veh/h) 393 - - -
HCM Lane V/C Ratio 0.263 - - -
HCM Ctrl Dly (s/v) 17.4 - - -
HCM Lane LOS C - - -
HCM 95th %tile Q(veh) 1 - - -
HCM 7th Signalized Intersection Summary
4: Sweetwater Road & Prospect Street Existing WP AM
07/24/2025 Synchro 12 Report
LSA Page 1
Movement EBL EBT EBR WBL WBT WBR NBL NBT NBR SBL SBT SBR Lane Configurations
Traffic Volume (veh/h) 12 478 71 171 795 65 55 7 39 57 8 21 Future Volume (veh/h) 12 478 71 171 795 65 55 7 39 57 8 21 I n i t i a l Q ( Q b ) , v e h 000000000000
Lane Width Adj. 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Ped-Bike Adj(A_pbT) 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Parking Bus, Adj 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Work Zone On Approach No No No No
Adj Sat Flow, veh/h/ln 1870 1870 1870 1870 1870 1870 1870 1870 1870 1870 1870 1870 Adj Flow Rate, veh/h 13 503 75 180 837 68 58 7 41 60 8 22 Peak Hour Factor 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 P e r c e n t H e a v y V e h , % 222222222222
Cap, veh/h 24 1148 512 240 1449 118 376 22 127 239 8 23 Arrive On Green 0.01 0.32 0.32 0.13 0.44 0.44 0.09 0.09 0.09 0.09 0.09 0.09 Sat Flow, veh/h 1781 3554 1585 1781 3328 270 1380 236 1385 671 89 246 Grp Volume(v), veh/h 13 503 75 180 447 458 58 0 48 90 0 0 Grp Sat Flow(s),veh/h/ln 1781 1777 1585 1781 1777 1822 1380 0 1621 1006 0 0 Q Serve(g_s), s 0.2 3.8 1.1 3.3 6.4 6.4 0.0 0.0 0.9 2.1 0.0 0.0 Cycle Q Clear(g_c), s 0.2 3.8 1.1 3.3 6.4 6.4 1.0 0.0 0.9 3.0 0.0 0.0 Prop In Lane 1.00 1.00 1.00 0.15 1.00 0.85 0.67 0.24
Lane Grp Cap(c), veh/h 24 1148 512 240 774 793 376 0 148 270 0 0 V/C Ratio(X) 0.54 0.44 0.15 0.75 0.58 0.58 0.15 0.00 0.32 0.33 0.00 0.00 Avail Cap(c_a), veh/h 285 3002 1339 739 1954 2003 1161 0 1072 1122 0 0 HCM Platoon Ratio 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Upstream Filter(I) 1.00 1.00 1.00 1.00 1.00 1.00 1.00 0.00 1.00 1.00 0.00 0.00 Uniform Delay (d), s/veh 16.5 9.0 8.1 14.0 7.2 7.2 14.4 0.0 14.3 15.8 0.0 0.0 Incr Delay (d2), s/veh 17.2 0.3 0.1 4.7 0.7 0.7 0.2 0.0 1.2 0.7 0.0 0.0 Initial Q Delay(d3), s/veh 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 %ile BackOfQ(50%),veh/ln 0.2 0.9 0.3 1.3 1.5 1.5 0.4 0.0 0.3 0.6 0.0 0.0 Unsig. Movement Delay, s/veh
LnGrp Delay(d), s/veh 33.7 9.3 8.2 18.7 7.9 7.9 14.6 0.0 15.6 16.5 0.0 0.0 L n G r p L O S CAABAAB BB
Approach Vol, veh/h 591 1085 106 90
Approach Delay, s/veh 9.7 9.7 15.0 16.5
A p p r o a c h L O S AABB
Timer - Assigned Phs 1 2 4 5 6 8
Phs Duration (G+Y+Rc), s 9.6 16.3 7.8 5.9 20.1 7.8
Change Period (Y+Rc), s 5.1 5.4 * 4.7 5.4 * 5.4 4.7
Max Green Setting (Gmax), s 14.0 28.5 * 23 5.4 * 37 22.3 Max Q Clear Time (g_c+I1), s 5.3 5.8 5.0 2.2 8.4 3.0
Green Ext Time (p_c), s 0.3 3.4 0.4 0.0 6.3 0.4
Intersection Summary
HCM 7th Control Delay, s/veh 10.3
HCM 7th LOS B
Notes
* HCM 7th computational engine requires equal clearance times for the phases crossing the barrier.
HCM 7th TWSC
6: RIRO Driveway & Sweetwater Road Existing WP AM
07/24/2025 Synchro 12 Report
LSA Page 2
Intersection
Int Delay, s/veh 0.4
Movement EBT EBR WBL WBT NBL NBR
Lane Configurations
Traffic Vol, veh/h 614 11 0 1028 0 62
Future Vol, veh/h 614 11 0 1028 0 62
Conflicting Peds, #/hr 0 0 0 0 0 0
Sign Control Free Free Free Free Stop Stop
RT Channelized - None - None - None
Storage Length - 0 - - - 0
Veh in Median Storage, # 0 - - 0 0 -
Grade, % 0 - - 0 0 -
Peak Hour Factor 92 92 92 92 92 92
Heavy Vehicles, % 2 2 2 2 2 2
Mvmt Flow 667 12 0 1117 0 67
Major/Minor Major1 Major2 Minor1
Conflicting Flow All 0 0 - - - 334
Stage 1 - -----
Stage 2 - -----
C r i t i c a l H d w y ----- 6 . 9 4
C r i t i c a l H d w y S t g 1 ------
C r i t i c a l H d w y S t g 2 ------
F o l l o w - u p H d w y ----- 3 . 3 2
Pot Cap-1 Maneuver - - 0 - 0 662
Stage 1 - - 0 - 0 -
Stage 2 - - 0 - 0 -
Platoon blocked, % - - -
Mov Cap-1 Maneuver - ---- 6 6 2
Mov Cap-2 Maneuver - -----
Stage 1 - -----
Stage 2 - -----
Approach EB WB NB
HCM Ctrl Dly, s/v 0 0 11.05
HCM LOS B
Minor Lane/Major Mvmt NBLn1 EBT EBR WBT
Capacity (veh/h) 662 - - -
HCM Lane V/C Ratio 0.102 - - -
HCM Ctrl Dly (s/v) 11.1 - - -
HCM Lane LOS B - - -
HCM 95th %tile Q(veh) 0.3 - - -
HCM 7th Signalized Intersection Summary
4: Sweetwater Road & Prospect Street Existing WP PM
07/24/2025 Synchro 12 Report
LSA Page 1
Movement EBL EBT EBR WBL WBT WBR NBL NBT NBR SBL SBT SBR Lane Configurations
Traffic Volume (veh/h) 24 998 87 249 759 62 103 21 173 107 21 15 Future Volume (veh/h) 24 998 87 249 759 62 103 21 173 107 21 15 I n i t i a l Q ( Q b ) , v e h 000000000000
Lane Width Adj. 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Ped-Bike Adj(A_pbT) 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Parking Bus, Adj 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Work Zone On Approach No No No No
Adj Sat Flow, veh/h/ln 1870 1870 1870 1870 1870 1870 1870 1870 1870 1870 1870 1870 Adj Flow Rate, veh/h 25 1051 92 262 799 65 108 22 182 113 22 16 Peak Hour Factor 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 0.95 P e r c e n t H e a v y V e h , % 222222222222
Cap, veh/h 40 1297 579 310 1705 139 435 41 336 212 39 19 Arrive On Green 0.02 0.37 0.37 0.17 0.51 0.51 0.23 0.23 0.23 0.23 0.23 0.23 Sat Flow, veh/h 1781 3554 1585 1781 3328 271 1370 174 1438 503 169 80 Grp Volume(v), veh/h 25 1051 92 262 427 437 108 0 204 151 0 0 Grp Sat Flow(s),veh/h/ln 1781 1777 1585 1781 1777 1822 1370 0 1612 751 0 0 Q Serve(g_s), s 0.9 17.8 2.6 9.5 10.3 10.3 0.0 0.0 7.4 6.7 0.0 0.0 Cycle Q Clear(g_c), s 0.9 17.8 2.6 9.5 10.3 10.3 4.3 0.0 7.4 14.2 0.0 0.0 Prop In Lane 1.00 1.00 1.00 0.15 1.00 0.89 0.75 0.11
Lane Grp Cap(c), veh/h 40 1297 579 310 910 933 435 0 376 270 0 0 V/C Ratio(X) 0.63 0.81 0.16 0.85 0.47 0.47 0.25 0.00 0.54 0.56 0.00 0.00 Avail Cap(c_a), veh/h 144 1516 676 373 987 1012 573 0 538 412 0 0 HCM Platoon Ratio 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Upstream Filter(I) 1.00 1.00 1.00 1.00 1.00 1.00 1.00 0.00 1.00 1.00 0.00 0.00 Uniform Delay (d), s/veh 32.4 19.1 14.3 26.7 10.5 10.5 21.3 0.0 22.5 27.4 0.0 0.0 Incr Delay (d2), s/veh 15.4 3.0 0.1 14.1 0.4 0.4 0.3 0.0 1.2 1.8 0.0 0.0 Initial Q Delay(d3), s/veh 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 %ile BackOfQ(50%),veh/ln 0.5 6.9 0.8 5.0 3.4 3.5 1.4 0.0 2.8 2.4 0.0 0.0 Unsig. Movement Delay, s/veh
LnGrp Delay(d), s/veh 47.8 22.1 14.4 40.8 10.8 10.8 21.6 0.0 23.7 29.2 0.0 0.0 LnGrp LOS D C B D B B C C C
Approach Vol, veh/h 1168 1126 312 151
Approach Delay, s/veh 22.0 17.8 22.9 29.2
Approach LOS C B C C
Timer - Assigned Phs 1 2 4 5 6 8
Phs Duration (G+Y+Rc), s 16.7 29.8 20.3 6.9 39.6 20.3
Change Period (Y+Rc), s 5.1 5.4 * 4.7 5.4 * 5.4 4.7
Max Green Setting (Gmax), s 14.0 28.5 * 23 5.4 * 37 22.3 Max Q Clear Time (g_c+I1), s 11.5 19.8 16.2 2.9 12.3 9.4 Green Ext Time (p_c), s 0.2 4.6 0.4 0.0 5.7 1.3
Intersection Summary
HCM 7th Control Delay, s/veh 20.8
HCM 7th LOS C
Notes
* HCM 7th computational engine requires equal clearance times for the phases crossing the barrier.
HCM 7th TWSC
6: RIRO Driveway & Sweetwater Road Existing WP PM
07/24/2025 Synchro 12 Report
LSA Page 2
Intersection
Int Delay, s/veh 0.9
Movement EBT EBR WBL WBT NBL NBR
Lane Configurations
Traffic Vol, veh/h 1263 15 0 1085 0 118
Future Vol, veh/h 1263 15 0 1085 0 118
Conflicting Peds, #/hr 0 0 0 0 0 0
Sign Control Free Free Free Free Stop Stop
RT Channelized - None - None - None
Storage Length - 0 - - - 0
Veh in Median Storage, # 0 - - 0 0 -
Grade, % 0 - - 0 0 -
Peak Hour Factor 92 92 92 92 92 92
Heavy Vehicles, % 2 2 2 2 2 2
Mvmt Flow 1373 16 0 1179 0 128
Major/Minor Major1 Major2 Minor1
Conflicting Flow All 0 0 - - - 686
Stage 1 - -----
Stage 2 - -----
C r i t i c a l H d w y ----- 6 . 9 4
C r i t i c a l H d w y S t g 1 ------
C r i t i c a l H d w y S t g 2 ------
F o l l o w - u p H d w y ----- 3 . 3 2
Pot Cap-1 Maneuver - - 0 - 0 390
Stage 1 - - 0 - 0 -
Stage 2 - - 0 - 0 -
Platoon blocked, % - - -
Mov Cap-1 Maneuver - ---- 3 9 0
Mov Cap-2 Maneuver - -----
Stage 1 - -----
Stage 2 - -----
Approach EB WB NB
HCM Ctrl Dly, s/v 0 0 18.7
HCM LOS C
Minor Lane/Major Mvmt NBLn1 EBT EBR WBT
Capacity (veh/h) 390 - - -
HCM Lane V/C Ratio 0.329 - - -
HCM Ctrl Dly (s/v) 18.7 - - -
HCM Lane LOS C - - -
HCM 95th %tile Q(veh) 1.4 - - -
T RAFFIC A NALYSIS
S EPTEMBER 2025
1838 S WEETWATER R OAD D UTCH B ROS C OFFEE S HOP P ROJECT
N ATIONAL C ITY , C ALIFORNIA
P:\2025\20252337- 1838 Sweetwater Rd Dutch Bros Coffee\doc\study\TA Memo2.docx (09/10/25)
ATTACHMENT E
DUTCH BROS COFFEE TMP AND SITE SUMMARY
Traffic Management Plan
&
Site Summary
CA4707 | National City
1838 Sweetwater Road
Operator:TBD
Coach:TBD
Regional Activation Coach:TBD
Construction Manager:John Caglia
Construction Coordinator:Kelsey Staton
Created By:
Kyle Dallas|Site & Traffic Plan Administrator
C: 602.525.8737
E: [email protected]
Standard Edition
Revised as of 02/19/2025
Speed, Quality, Service
Timing Standards
45 seconds per car (at window). Speed timings
conducted weekly in addition to a quarterly company
wide evaluation.
Escape Lane
An escape lane permits customers to leave the line as
soon as their drinks are delivered by a drink runner.
Peak Hours
DB will staff an additional traffic controller during peak hours as needed.
Speed, Quality, Service
Off-Site Operations
DB always evaluates the need of off-duty police officer support during our grand opening period.
Off duty police officers provide off-site support during business hours as determined necessary by DB
leadership. Their job is to safely direct customer vehicles to and from a location. Prevent vehicles from blocking
critical drives or otherwise restricting traffic flow (off-site).
Staffing Model
Schedules are written a minimum of 1-2 weeks in advance (in accordance with state and local guidelines) based on gross sales, trends, local events, and weather.
Outside Traffic Management
Line Buster (LB)
Job Duty: Increase speed of the customers experience by taking orders while ensuring 2’ gap between cars. Ensuring when the line pulls forward the customers moves forward.
Drink Runner (DR)
Job Duty: Deliver completed drinks to the customer in line before reaching the window. Ensuring escape lane is used to minimize service time.
Dutch Bros. Traffic Controller (DBTC)
Job Duty: Direct traffic in and out of location. Preventing vehicles from blocking critical drives or otherwise restricting traffic flow (on-site).
Third Party Traffic Controller or Off Duty Police Officer (TC) Job Duty: Direct traffic in and out of location. Preventing vehicles from blocking critical drives or otherwise restricting traffic flow (off-site).
Additional Information
Full Shop Meetings:
● Monthly meetings in which all shop personnel are required to attend. Discuss traffic plans and new commitments in detail.
Pre-Shift Huddles:
● Before each shift (morning, noon, night) the crew goes over updates, important communication, issues, and ensures strategy is set for the shift
Promotional Days / Major Holidays / Sticker Days:
● Dutch will determine if needed and hire a Third-Party Traffic Control Company to come in when the Stacking could possibly be an issue.
Evolving Traffic Plan:
● The Grand Opening plan will be utilized whenever necessary to mitigate traffic congestion that may occur from our new shop opening. We reserve the right to adjust the plan as conditions dictate, and expect that after the initial community response, our traffic patterns will settle to a predictable level within the first 90 days of operation.
Directional Signage Examples
Staffing Plan
*Not every position will be shown on
Grand Opening Staffing Plan. Subject
to site by site staffing needs.*
Special Things to Note:
1. n/a
2. n/a
3. n/a
Signage Plan
Special Things to Note:
1. n/a
2. n/a
3. n/a
City of National City
Planning Commission
Meeting
MEETING OF OCTOBER 20, 2025
Public Hearing
CONDITIONAL USE PERMIT FOR A
DRIVE
-
THROUGH COFFEE SHOP
(
DUTCH
BROS COFFEE) TO BE
LOCATED AT 1838 SWEETWATER ROAD
Overhead
Site Characteristics
• 1838 Sweetwater Road
• MXD-2 (Major Mixed-Use District)
• 0.45-acre parcel
• Sweetwater Crossings Shopping Center
• Replacing the vacant Pizza Hut building
• Area is Commercial
• Subway, Boba Time, etc. to the north
• Across Sweetwater Road is Sweetwater Plaza Shopping Center and some residences • Texas Roadhouse and Denny's to the east
• LA Fitness to the south
• Sweetwater Crossing Shopping Center (CVS, Mors) to the west
Site Photos
Site Photos
Site Photos
Proposal
• 950 Square Foot Drive-Through Coffee Shop (Dutch Bros Coffee) • Dual drive-through lanes with queuing for 26 vehicles • Person-to-person ordering
• Exit lane
• Walk-up window
• Three parking spaces
• Access from Sweetwater Road
• 5 a.m. to 12 a.m. daily
• New business would employ between eight and ten people
Site Plan
EXIT LANE
QUEUING FOR 26 VEHICLES
3 PARKING SPACES
Site Plan
Site Plan
Analysis
• Proposal Consistent with General Plan
• Policies related to fast food
• HEJ-4.2: Encourage the development of healthy food establishments in areas with a high concentration of fast foot establishments, convenience stores, and liquor stores. • Coffee shop allowed by right without drive-through lane • HEJ-5.4: Discourage unhealthy fast food outlets from locating near schools. • Located over a half-mile from closest school (Sweetwater High School) • Proposal Consistent with Land Use Code
• A coffee shop with a drive-through is a conditionally-allowed use in MXD-2 zone • Chapter 18.41 – Site Planning Standards – has specific requirements for drive-through businesses
• Minimum queuing distances, interior turning radius, location of drive-through window and landscaping requirements
Analysis (cont.)
• Land Use Code (CONT.)
• Minimum queuing distance
• Traffic analysis used other Dutch Bros Coffee locations – Average maximum queuing not expect to exceed 17.25 vehicles
• Proposed drive-through has space for 26 vehicles before impacting the shopping center circulation
• Person-to-person ordering and exit lane proposed
• Minimum interior turning radius of 25 feet
• Site plan shows lesser interior turn radii of 20 feet – approved by City Engineer • Drive-through window location
• If facing right-of-way, code requires a minimum 10-ft landscape buffer with trees and minimum three-foot high hedges
• Drive-though window is facing the shopping center and landscape buffer is provided
Analysis (cont.)
• Land Use Code (CONT.)
• Design requirements
• Limited requirements for project of this type in the MXD-2 zone • Architectural variation, setbacks, height, etc.
• Request is for the drive-through lane and the architecture of the proposed building is conceptual in nature
• Conditions related to design, site development, and landscaping • Project would be allowed by right without the drive-through
Analysis (cont.)
• Traffic
• Project expected to generate approximately 756 weekday & 544 weekend net new daily trips • Half the trips are pass-by
• A pass‐by trip is a trip where an intermediate stop is made on the way from the origin to the primary destination of the trip without making a route diversion
• Project-related traffic would not result in the need for any street system improvements • Accessed off of signalized Sweetwater Road and Prospect Steet intersection • Study included Vehicle Miles Traveled (VMT) analysis – screened out of CEQA • Noise
• Typical concern for drive-through businesses
• Ordering Speakers: Dutch Bros uses person to person ordering • Operating Hours: 5 a.m. to 12 a.m. , similar to nearby drive-though’s
California Environmental Quality Act
(CEQA)
• Determine To Be Categorically Exempt From Environmental Review Pursuant To Class 32, Section 15332 (In-fill Development Projects) • Notice of exemption will be filed subsequent to an approval
Conditions / Summary
• Conditions of Approval
• Building and Fire Code compliance
• Engineering comments
• Design requirements and compliance with LUC
• Landscape Plan
• Proposed use consistent with General Plan
• Project is consistent with General Plan and Land Use Code • Consistent applicable design requirements
• Meets applicable Site Planning Standards
Options
• FIND PROJECT EXEMPT FROM CEQA & APPROVE 2025-29 CUP BASED ON FINDINGS LISTED IN THE DRAFT RESOLUTION / FINDINGS DETERMINED BY THE COMMISSION; OR • FIND PROJECT NOT EXEMPT FROM CEQA AND/OR DENY 2025-29 CUP BASED ON
FINDINGS LISTED IN THE DRAFT RESOLUTION / FINDINGS DETERMINED BY THE COMMISSION; OR
• CONTINUE THE ITEM FOR ADDITIONAL INFORMATION
• STAFF RECOMMENDING APPROVAL
• NOTICE OF DECISION TO CITY COUNCIL
Next Regularly-Scheduled
Meeting
NOVEMBER 4, 2025
RESOLUTION NO. 2025-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY, CALIFORNIA,
DETERMINING THAT THE PROJECT IS CATEGORIC ALLY EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) UNDER CLASS 32 O F THE CEQA GUIDELINES SECTION 1 5332 (IN-FILL DEVELOPMENT PROJECTS) AND APPROVING A
CONDITIONAL USE PERMIT FOR A DRIVE -THROUGH COFFEE SHOP (DUTCH BROS COFFEE) TO BE LOCATED AT 1838 SWEETWATER ROAD.
WHEREAS, the Planning Commission of the City of National City considered the Conditional Use Pe rmit application at a duly advertised public hearing held on October 20 , 2025, at which time the Commission approved the Conditional Use Permit; and
WHEREAS, subsequent to the Planning Commission approval of the Conditional Use Permit, the Appellant, Hear t Revolution Church, appealed the decision of the Planning Commission to the City Council; and
WHEREAS, the City Council of the City of National City considered the appeal of the Planning Commission’s approval of the Conditional Use Permit at a duly adver tised public hearing held on December 2 , 2025, at which time oral and documentary evidence was presented; and
WHEREAS, at said public hearing the City Council considered the staff report contained in Case File No. 2025 -29 CUP maintained by the City and i ncorporated herein by reference along with evidence and testimony at said hearing; and
WHEREAS, this action is taken pursuant to all applicable procedures required by State law and City law; and
WHEREAS, the action hereby taken is found to be essential for the preservation of the public health, safety and general welfare.
NOW, THEREFORE, THE CITY COUNCIL OF NATIONAL CITY, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:
Section 1: That the City Council hereby denies the appellant’ s appeal of and upholds the Planning Commission’s decision to approve the Conditional Use Permit for a drive - through coffee shop (Dutch Bros) to be located at 1838 Sweetwater Road, based on the following findings:
1. The proposed use is allowable within the applicable zoning district pursuant to a Conditional Use Permit and complies with all other applicable provisions of the Land Use Code because drive-through businesses are identified as a conditionally -allowed use in the Major Mixed -Use District (MXD -2) zone, and the conditions of approval will assure the proposed drive-through aisles will meet all requirements as contained in NCMC §18. 41 – Site Planning Standards.
2. The proposed use is consistent with the General Plan and any applicable specific plan, because the Land Use Code conditionally allows drive-through businesses in the MXD-2
zone; the Land Use Code is consistent with the General Plan. There are no Specific Plans affecting this location.
3. The design, location, size, and operating characteristics of the proposed activity would be compatible with the existing and future land uses in the vicinity, because the property will be developed based on the provisions outlined in the Land Use Code. In addition, the proposed drive -through aisle, subject to the c onditions of approval, meets all requirements for such uses outlined in the Land Use Code.
4. The site is physically suitable for the type, density, and intensity of use being proposed, including access, utilities, and the absence of physical constraints, be cause a traffic impact analysis was conducted for the proposed use finding that the project is expected to generated approximately 756 net weekday daily trips and 544 weekend daily trips, which can be accommodated by the existing road network. Intersection s in this location are currently operating at a Level of Service (LOS) of C or better (passing) and are calculated by the provided traffic impact analysis to continue to have a passing LOS after construction. The site is located within an urbanized area wi th access to all necessary utilities and services and the proposed restaurant replaces a similar existing building.
5. Granting the permit would not constitute a nuisance or be injurious or detrimental to the public interest, health, safety, convenience, or welfare, or materially injurious to persons, property, or improvements in the vicinity and zone in which the property is located, because noise issues related to drive -through businesses, which are usually related to vehicle queuing and ordering windows an d speakers, will not be an issue given that the applicant will utilize person to person ordering in lieu of an amplified ordering system. A vehicle miles traveled (VMT) analysis was also conducted for the site and the project is presumed to have a less tha n significant impact on VMT. In addition, the new business will benefit the public interest by providing new jobs.
6. The proposed project has been reviewed in compliance with the California Environmental Quality Act and has been determined to be categorical ly exempt from environmental review pursuant to Class 32 of the CEQA Guidelines, Section 15332 (In - fill Development Projects), for which a Notice of Exemption will be filed subsequent to approval of this CUP. Class 32 consists of projects characterized as in-fill development that is consistent with applicable general plan and zoning designations, proposed on an urban site no more than five acres, has a site with no value as habitat for endangered, rare or threatened species, would not result in any signific ant effects relating to traffic, noise, air quality or water quality, and is adequately served by utilities and public services. The proposed use is consistent with this description and there is no potential for the project to cause either a direct or a re asonably foreseeable indirect physical change in the environment.
Section 2: That the City Council hereby approves the application for Conditional Use Permit subject to the following conditions:
General
1. This Conditional Use Permit authorizes a drive-through coffee shop at 1838 Sweetwater Road. Except as required by conditions of approval, all plans submitted for permits associated with the project shall conform to Exhibit A, Case File No. 2025-29 CUP, dated 9/29/2025.
2. Before this Conditional Use Permit shall become effective, the applicant and the property owner both shall sign and have notarized an Acceptance Form, provided by the Planning Division, acknowledging and accepting all conditions imposed upon the approval of this permit. Failure to return the signed and notarized Acceptance Form within 30 days of its receipt shall automatically terminate the Conditional Use Permit. The applicant shall also submit evidence to the satisfaction of the Planning Division that a Notice of Restriction on Real Property is recorded with the County Recorder. The applicant shall pay necessary recording fees to the County. The Notice of Restriction shall provide information that conditions imposed by approval of the Conditional Use Permit are binding on all present or future interest holders or estate holders of the property. The Notice of Restriction shall be approved as to form by the City Attorney and signed by the City Manager or assign prior to recordation.
3. Within four (4) days of approval, pursuant to Fish and Game Code 711.4 and the California Code of Regulations, Title 14, Section 753.5, the applicant shall pay all necessary environmental filing fees for the San Diego County Clerk. Checks shall be made payable to the San Diego County Clerk and submitted to the National City Planning Department.
4. This permit shall become null and void if not exercised within one year after adoption of the resolution of approval unless extended according to procedures specified in the Municipal Code.
5. This permit shall expire if the use authorized by this resolution is discontinued for a period of 12 months or longer. This permit may also be revoked, pursuant to provisions of the Land Use Code, if discontinued for any lesser period of time.
6. This Conditional Use Permit may be revoked if the operator is found to be in violation of any Conditions of Approval or applicable law.
Building
7. Building plans and permits shall be required to meet current California Building, Mechanical, Electrical, Plumbing, Accessibility, Green, Energy, and Fire Codes. a. A soils report is required for all new construction. b. Project requires Sweetwater Authority approval prior to permit issuance to determine the project has sufficient water supply.
Engineering
8. Storm Water Requirements
a. A Hydrology study (100 year fl ood) is required for the new project. The study should consider the proposed project area to the closest municipal storm drain collection point. The study should consider the adequacy of the existing storm drain system to convey any additional run off. All Hydrology study findings and recommendations are part of Engineering Department requirements. b. The completed Storm Water BMP Requirements Applicability Form I -1 and I -2 checklist is required to be submitted to the Engineering Department along with the grading plan submittal.
c. The Best Management Practices (BMPs) for the maintenance of the proposed construction shall be undertaken in accordance with the National Pollutant Discharge Elimination System (NPDES) regulations which may require a Storm Water Pollution Prevention Plan (SWPPP) for the project. An approved SWPPP will be required prior to issuing of a construction permit.
d. All surface run -off shall be treated with an approved Standard Urban Runoff Mitigation Plan (SUSMP) Best Management Practice (BMP) for all Priority SUSMP projects. No runoff will be permitted to flow over the sidewalk. Adjacent properties shall be protected from surface run-off resulting from this development. e. All existing and proposed curb inlet on property shall be provided with a “No Dumping” signage in accordance with the NPDES program.
f. A hydromodification plan or a letter sealed and signed by the Engineer of Work explaining why the project is exempt from hydromodification requirements shall be submitted.
9. Engineering Land Development Requirements
a. The Property is in the Federal Flood Plain area. Flood hazard permit shall be obtained from the Engineering Department.
b. A grading and drainage plan shall be submitted showing all of the proposed and existing on -site and off -site improve ments. The plan shall be prepared in accordance with the City’s standard requirements by a Registered Civil Engineer.
All necessary measures for prevention of storm water pollution and hazardous material run-off to the public storm drain system from the pr oposed parking lot or development shall be implemented with the design of the grading. This shall include the provision of such devices as storm drain interceptors, clarifiers, or filters. Best Management Practices for the maintenance of the parking lot, including sampling, monitoring, and cleaning of private catch basins and storm drains, shall be undertaken in accordance with the National Pollution Discharge Elimination System (NPDES) regulations. A private storm water treatment maintenance agreement shall be signed and recorded. A check list for preparation of the grading plan/drainage plan is available at the Engineering Department. c. The method of sewage collection and disposal shall be shown on the grading/drainage plan. Any new sewer lateral in the Cit y right-of-way shall be 6 inch in size with a clean out. A sewer stamp “S” shall be provided on the curb to mark the location of the lateral.
d. Separate street and sewer plans prepared by Registered Civil Engineer, shall be submitted showing all of the existing and proposed improvements. The plans shall be in accordance with City requirements.
e. A soils engineering report shall be submitted for the Engineering Department’s review, after Planning Commission approval. The report shall address the stability of all of the existing and proposed slopes on the property. It shall also address the adequacy of the building pads, the criteria for any new retaining wall design, the maximum allowable soil bearing pressure and the required pavement structural sections for t he proposed streets, the parking areas, and the driveways. As a minimum, the parking lot pavement sections shall be 2 inch A.C. over 4 inch Class II aggregate base. The street pavement sections shall be in accordance with National City modified Standard Dr awing G -34. All soils report findings and recommendations shall be part of the Engineering Department requirements. f. A title report shall be submitted to the Engineering Department, after the Planning Commission approval, for review of all existing easemen ts and the ownership at the property.
g. A limited traffic study is required for the proposed development.
h. A cost estimate for all of the proposed grading, drainage, street improvements, landscaping and retaining wall work shall be submitted with the plans. A performance bond equal to the approved cost estimate shall be posted. Three percent (3%) of the estimated cost shall also be deposited with the City as an initial cost for plan checking and inspection services at the time the plans are submitted.
The dep osit is subject to adjustment according to actual worked hours and consultant services
Fire
10. Plans are to be designed, fabricated and installed to code.
11. Project to be in compliance with the current editions of the National Fire Protection Association, California Fire Code 2022 Edition, Title 19 and local City of National City Municipal Codes.
12. California Fire Code Change (CFC) will occur beginning in 2026 with this Authority Having Jurisdiction (AHJ).
13. California fire code shall be considered if structure is to be outfitted with fire alarm and fire sprinklers.
14. A fire flow letter shall be requested from this AHJ early in the process if fire sprinklers will be installed.
15. Fire apparatus access roads shall comply with the requirements of this section (Section 5 CFC 2022) and shall extend to within 150 feet of all portions of the facility and all portions of the exterior walls of the first story of the building as measured by an approved route around the exterior of the building. Dead-end fire apparatus access roads in excess of 150 feet in length shall be provided with an approved area for turning around fire apparatus.
This comment shall apply to new residential structures. The fire code official shall have the authority to require or permit modifications to th e required access widths where they are inadequate for fire rescue operations or where necessary to meet the public safety objectives of the jurisdiction.
16. The required width of emergency fire apparatus access roads shall not be obstructed in any manner, including parking of vehicles. All access roads shall be no less than 20 feet wide, no less than 14 feet high and shall have an all weathered road with the ability to support 75 thousand pounds or greater. Where a fire hydrant is located on a fire apparatus road; the minimum road width shall be 26 feet. A 28 foot turning radius is required for fire department access through site. All fire department access roads shall be painted and signed to prevent parking in these required designated emergency areas.
17. Grade of fire apparatus road shall be within the limits established (15% Grade) by the fire code official based on fire department’s apparatus.
18. Buildings or portions of buildings or facilities exceeding 30 feet in height measured vertically from the centerline of the street adjacent to the project above the lowest level of fire department vehicle access shall be provided with approved fire apparatus access roads capable of accommodating fire department aerial apparatus.
19. Overhead utility and power lines shall not be located over the aerial fire apparatus access road or between the aerial fire apparatus road and the building. Other obstructions shall be permitted to be placed with approval of the fire code official.
20. Aerial fire apparatus roads shall have a minimum unobstructed width of 26 feet, exclusive of shoulders, in the immediate vicinity of the building or portion thereof.
21. Fire hydrants to be located throughout the project as not to have a separation distance greater than 300 feet. Fire hydrants to be located within 400 feet of all locations which are roadway accessible. (Measurement starts from nearest existing fire hydrant to project).
22. The following items pertain to fire hydrants:
a. Size and location, including size and number of outlets and whether outlets are to be equipped with independent gate valves.
b. Fire hydrant to be of three outlet design
23. Provide calculation confirming flow availability to meet fire flow demands and supply large diameter hose (4 inch).
24. Fire hydrants to be marked by use of blue reflective marker in the roadway.
25. Upon submittal for an underground permit, the following shall be included:
a. Data sheet for Back-Flows
b. Data sheets for Private and Commercial Hydrants
c. Data sheets for Post Indicator Valves
Information on required fire hydrants back-flow devices, etc.; can be acquired from Sweetwater Authority. All pipe and their appliances, shall meet industry/code standards for underground use
26. An approved water supply for fire protection, either temporary or permanent, shall be made available as soon as combustible material arrives on the site.
27. Approved vehicle access for firefighting shall be provided to all construction and demolition sites. Vehicle access shall be provided to within 100 feet of temporary or permanent fire department connections. Vehicle access shall be provided by either temporary or permanent roads, capable of supporting vehicle loading under all weather conditions.
Vehicle access shall be maintained until permanent fire apparatus access roads are available.
28. Where there is conflict between a general requirement and a specific requirement, the specific requirement shall be applicable. Where, in a specific case, different sections of this code specify different materials, methods of construction or other requirements , the most restrictive shall govern.
29. Should any plan corrections be required, contractor must correct the plan and re-submit to the Fire Department for approval once again prior to installation.
Planning
30. A landscape and underground irrigation plan shall be submitted as part of the construction permitting process in compliance with Land Use Code Chapter 18.44. The landscaping and irrigation required by this approval shall be maintained for the life of the project.
31. Plans submitted for construction shall conform to minimum turning radius requirements for drive-through businesses unless the City Engineer approves a lesser radius. Building permit plans shall be fully dimensioned and include all proposed signage and striping for the drive-through aisles, driveways, and parking spaces.
32. Business operations shall comply with Municipal Code Title 12 (Noise) at all times. Plans submitted for construction shall reflect the use of sound -attenuating speakers that automatically reduce the volume of ordering speakers during periods of low ambient noise should an electronic ordering system be installed.
33. Plans submitted for construction shall conform to Land Use Code Chapter 18.46 (Outdoor Lighting).
34. Plans submitted for construction shall comply with the guidelines stated in Land Use Code Section 18.42.050 (Commercial and institutional building design standards).
35. The trash enclosure design shall be in compliance with Municipal Code Title 7, Section
7.10.080 (Enclosures required), including the use of flame retardant materials.
36. The trash enclosure shall be painted with graffiti-resistant coating to a height of six feet.
37. The business shall only be permitted to operate between the hours of 5:00 a.m. to 12:00 a.m. daily.
38. Directional signs are not to exceed three square-feet per sign.
39. No new pole signs or monument signs are permitted. The business shall co -locate on existing monument and pole signs within the shopping center.
40. The operator of the business shall maintain an active business license and ensure that the business license renewed annually.
Indemnification Agreement
The Applicant shall defend, indemnify, and hold harmless the City, its agents, officers, and employees from any and all claims, actions, proceedings, damages, judgments, or costs, including attorney's fees, against the City or its agents, officers, or employees, relating to the issuance of this permit including, but not limited to, any action to attack, set aside, void, challenge, or annul this development approval and any environmental document or decision. The City will promptly notify the Applicant of any claim, action, or proceeding. The City may elect to conduct its own defense, participate in its own defense, or obtain independent legal counsel in defense of any claim related to this indemnification. In the event of such election, the Applicant shall pay all of the costs related thereto, including without limitation reasonable attorney's fees and costs. In the event of a disagreement between the City and Applicant regarding litigation issues, the City shall have the authority to control the litigation and make litigation related decisions, including, but not limited to, settlement or other disposition of the matter. However, the Applicant shall not be required to pay or perform any settlement unless such settlement is approved by the Applicant.
Section 3: The City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of orginal Resolutions.
PASSED and ADOPTED this 2nd day of December, 2025.
__________________________
Ron Morrison, Mayor
ATTEST:
_____________________________
Shelley Chapel, MMC, City Clerk
APPROVED AS TO FORM:
_____________________________
Barry J. Schultz, City Attorney
RESOLUTION NO. 2025-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY, CALIFORNIA,
APPROVING THE APPEAL AND OVERTURNING THE PLANNING COMMISSION
APPROVAL OF A CONDITIONAL USE PERMIT FOR A DRIVE-THROUGH COFFEE SHOP TO BE LOCATED AT 1838 SWEETWATER ROAD.
WHEREAS, the Planning Commission of the City of National City considered the Conditional Use Permit application at a duly advertised public hearing held on October 20 , 2025, at which time the Commission approved the Conditional Use Permit; and
WHEREAS, subsequent to the Planning Commission approval of the Conditional Use Permit, the appellant appealed the decision of the Planning Commission to the City Council; and
WHEREAS, the City Council of the City of National City considered the appeal of the Planning Commission’s approval of the Conditional Use Permit at a duly advertised public hearing held on December 2 , 2025, at which time oral and documentary evidence was presented; and
WHEREAS, at said public hearing the City Council considered the staff report contained in Case File No. 2025 -29 CUP maintained by the City and incorporated herein by reference along with evidence and testimony at said hearing; and
WHEREAS, this action is taken pursuant to all applicable procedures required by State law and City law; and
WHEREAS, the action hereby taken is found to be essential for the preservation of the public health, safety and general welfare.
NOW, THEREFORE, THE CITY COUNCIL OF NATIONAL CITY, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:
Section 1: That the City Council hereby approves the appellants’ appeal of and overturns the Planning Commission’s decision to approve Conditional Use Permit 2025-29 CUP for a drive-through coffee shop to be located at 1838 Sweetwater R oad, and is supported by the following finding:
1. Granting the permit would constitute a nuisance or be injurious or detrimental to the public interest, health, safety, convenience, or welfare, or materially injurious to persons, property, or improvements in the vicinity and zone in which the property is located, because it would contribute to a concentration of unhealthy fast food eating places.
Section 2: That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions.
PASSED and ADOPTED this 2nd day of December, 2025.
__________________________
Ron Morrison, Mayor
ATTEST:
_____________________________
Shelley Chapel, MMC, City Clerk
APPROVED AS TO FORM:
_____________________________
Barry J. Schultz, City Attorney
AGENDA REPORT
Department: Planning
Prepared by: Sophia Depew, Assistant Planner
Meeting Date: Tuesday, December 2, 2025
Approved by: Alejandro Hernandez, Interim City Manager
SUBJECT:
Public Hearing – Appeal of a Planning Commission Denial of a Conditional Use Permit for a Proposed Recycling Center to be Located at 1240 East Plaza Boulevard.
RECOMMENDATION:
Staff Recommended Approval of the CUP to the Planning Commission and Recommends Affirming the Appeal and Adopting the Resolution Entitled: “Resolution of the City Council of the City of National City, California, Determining that the Project is Categorically Exempt from the California Environmental Quality Act ( CEQA) under Class 1 of The C EQA Guidelines Section 15301 (Existing Facilities) and Approving a Conditional Use Permit for a Recycling Center to be Located at 1240 E Plaza Boulevard.”
BOARD/COMMISSION/COMMITTEE PRIOR ACTION:
On October 20, 2025, the Planning Commission recommended denial of the CUP by the following vote:
Ayes: Armenta, Castle, Gogue, Quinones Nays: Miller, Valenzuela Absent: Sanchez
EXPLANATION:
Executive Summary
The applicant is proposing a mobile recycling center to be located behind the Smart & Final grocery store within the shopping center. The recycling center will consist of three mobile recycling containers. The business will operate from 9:00 a.m. to 5:00 p.m. Monday through Saturday. The facility proposes to recycle aluminum cans, glass, and plastic bottles.
Planning Commission Action
Planning Commission held a public hearing on October 20, 2025 and denied the request for a CUP based on the finding in the attached Planning Commission Resolution No. 2025 -15. The applicant has appealed the decision of the Planning Commissi on and is thereby afforded the opportunity to present their appeal to the City Council. The requested action by City Council is to either uphold or reverse the decision of the Planning Commission (grant or deny the appeal request). One public comment in op position of the project was provided at the Planning Commission Public Hearing.
Site Characteristics
The proposed recycling center is located within a large shopping center, behind the Smart & Final grocery store. The area of the facility is primarily ac cessible from an entrance off of ‘N’ Avenue that leads to the back of the shopping center. No screening of the facility is proposed since the
facility is proposed in an area not easily visible from neighboring properties. While there are single- family home s located south of the proposed recycling center, the homes are separated by a substantial grade change and therefore the project area is not visible from any of the homes.
Proposed Use
The applicant proposes to install a mobile recycling center consisting of two 18-foot by 8-foot and one 8-foot by 5-foot prefabricated steel containers. The facility will be located behind the Smart & Final grocery store in an area accessible from either end of the shopping center. The proposed operating hours are 9:00 a.m. to 5:00 p.m. Monday through Saturday. An attendant will be on-site while in operation. The facility proposes to recycle aluminum cans, glass, and plastic bottles.
California Redemption Value (CRV) payments will be provided in cash by the operator s of the facility.
Analysis
The facility, as proposed, is consistent with Land Use Code section 18.30.170 – Recycling Collection Facilities. It is less than 350 square feet in area and more than 50 feet from a residential zone.
The State (Department of Resources Recycling and Recovery - CalRecycle) requires that a “convenience zone” have access to a recycling facility. A convenience zone is defined as an area within a one-mile radius of a supermarket with more than $2 million in annual sales. According to the State, National City has 10 such zones (see table). The other primary recycling location currently servicing National City is located at 1320 East 30th Street (Food 4 Less) which is in Chula Vista.
Market Name Market Address Zone Status
Seafood City Supermarket 1420 E Plaza Blvd Hold
Smart & Final 1220 E Plaza Blvd Hold
Grocery Outlet 3446 Highland Ave Served
Foodland IGA Supermarket 303 Highland Ave Hold
Manila Seafood Oriental Market 2220 E Plaza Blvd Exempt Carnival Supermarket 1750 E 8th St Hold
Food 4 Less 1320 E 30th St Served
Vallarta Supermarkets 36 901 Euclid Ave Exempt
El Super 3007 Highland Ave Served
Walmart Supercenter 1200 Highland Ave Hold
The Smart & Final is considered a convenience zone. The zone is currently on hold, which indicates that the zone was once served, but there is no longer a recycling center in the zone.
The status may change to unserved or exempt, depending on the proximity to new or existing recycling facilities. Currently, there ar e no operating recycling centers within the Smart & Final Convenience zone, so it is considered unserved. If approved, the recycling center could serve multiple convenience zones if they are within half a mile of the project.
One concern about recycling c enters is the potential for the accumulation of litter, including materials dropped off after hours. In an effort to avoid this situation, a condition has been included that requires that the area be maintained in a clean condition at all times, including sweeping at the end of the day. Furthermore, a condition of approval is included in the draft resolution for the applicant to post signage prohibiting material left after hours.
Police Department
The Police Department provided comments regarding the proposed recycling center. The comments included concerns over increased traffic, the high crime rate, and propensity for trash accumulation.
Conditions of approval for the CUP are intended to alleviate these concerns. The business is only operating during daytime hours, the site shall be swept and cleared of litter at the end of each day, containers shall be locked when not in use and emptied on a regular basis, (once to twice a week). Additionally, there is a condition requiring that no recyclable materi al be accepted from persons transporting the material in an unconventional fashion – such as shopping carts and similar non-motorized carrying devices, which are often discarded afterwards.
Traffic
The facility is not anticipated to significantly increase traffic to and from the site as customers will likely also be shopping at the shopping center. The applicant intends to use temporary traffic control devices to ensure efficient circulation during o peration Furthermore, no parking spaces are located in the area of the proposed facility, therefore none are being removed. The facility is also to be located clear of any required parking lot aisles, and does not impinge on any backup areas. There will be an employee on-site during operating hours that will ensure customers do not block any required access to the shopping center or the abutting right-of-way (N Avenue).
Noise
Noise issues related to recycling center are regulated by the Land Use Code. Noise levels for the project shall not exceed sixty dBA as measured at the property line of residentially zoned property, and not to exceed sixty -five dBA in any instance. Recycling centers are also required to be 50 feet from residentially zoned properties. The proposed recycling center is located over 50 feet from the nearest single -family residence as is separated by a substantial grade change. Since the proposed business is located within one hundred feet of residential zone, the business can only operate between 9:00 a.m. to 7:00 p.m. daily. The applicant has proposed operating hours from 9:00 a.m. to 5:00 p.m. Monday through Saturday. Additionally, the recycling center is not permitted to use any power -driven processing equipment, which will limit the noi se created on site.
Mailing
All property owners and occupants within a distance of 300 feet are required to be notified of a public hearing for a CUP application. Notice of this public hearing was sent to 141 occupants and owners. No public comment has been received as of the writing this report.
Department Comments
Comments were provided by the Building Division and the Engineering, Fire, and Police Departments. All comments have been incorporated as conditions of approval for the CUP.
Adherence to building and fire codes have also been addressed in the Conditions of Approval.
Findings for Approval
The following are the required findings in the attached draft resolution:
1. Allowable Use: Recycling Centers are a conditionally-allowed use in the Major Mixed-Use District (MXD -2) zone, and conditions of approval will ensure the proposed recycling center will meet all requirements as contained in NCMC §18.30.170 – Recycling collection facilities. Additionally, the recycling facility is located within an uns erved convenience zone, which means use is allowed in the convenience zone, as identified by the State.
2. General Plan Consistency: Mobile recycling centers are permitted uses, subject to a CUP, by the Land Use Code, which is consistent with the General Pla n. In addition, a Mobile recycling center is consistent with the Major Mixed-Use District zone land use designation and there are no Specific Plans affecting this location.
3. Compatibility, LUC, Traffic : The mobile recycling center will be in compliance wit h the City’s LUC and all applicable building and fire codes. There is adequate area on-site for a mobile recycling facility in accordance with the LUC requirements and the facility does not remove any parking spaces. In addition, the proposed mobile recycling center, subject to the conditions of approval, meets all requirements for such uses outlined in the Land Use Code, as discussed above.
4. Suitability: The site has sufficient access to a major street that is adequate in width and pavement type to carry the volume and type of traffic generated by the proposed use, since the use is expected to generate a minimal amount of additional traffic for the Smart & Final shopping center, as many of the customers will also shop at the center.
5. No Nuisance: Nuisance issues related to mobile recycling centers are usually related to noise, traffic, and litter. The business operates during daytime hours, the site shall be swept and cleared of litter at the end of each day, containers shall be locked when not in use and e mptied on a regular basis, the business is located in an area separate from residences that will not interfere with parking or circulation for the shopping center.
6. California Environmental Quality Act (CEQA): The proposed project has been reviewed in compliance with the California Environmental Quality Act (CEQA) and has been determined to be categorically exempt from environmental review pursuant to Class 1, Section 15301 (Existing Facilities) for which a Notice of Exemption will be filed subsequent to approval of this Conditional Use Permit. The reason for the exemption is that the use is proposed within an existing shopping center, the use is ancillary and does not include the addition of any permanent structures, and the use is similar to other commerci al uses in the area, which are permitted in Major Mixed-Use District zone.
Finding for Denial
There is one finding for denial as follows:
1. Granting the permit would constitute a nuisance or be injurious or detrimental to the public interest, health, safet y, convenience, or welfare, or materially injurious to persons, property, or improvements in the vicinity and zone in which the property is located, because it would contribute to increased traffic, crime, and litter.
Conditions of Approval
Conditions of Approval are included that address comments from the Police, Fire, and Engineering Departments. Additional conditions are included related to adherence to California Building and Fire Codes and the City’s Land Use Code.
Summary
As previously mentioned, the project area complies with all operation and design standards for mobile recycling centers found in Section 18.30.170 of the Land Use Code. The project is located within an unserved Convenience Zone as identified by the State, and the project is not visible from any residences.
Options
1. Find the project exempt from CEQA under Class 1 of the CEQA Guidelines Section 15301 and approve 2025-19 CUP, subject to the conditions included in the Resolution, or other conditions, and based on the findings included in the Resolution, or other findings to be determined by the City Council; or,
2. Find the project not exempt from CEQA and/or deny 2025 -19 CUP based on the attached findings, or findings to be determined by the City Council; or,
3. Continue the item to a specific date in order to obtain additional information.
FINANCIAL STATEMENT:
An application fee of $3,700 was paid with the submittal of the subject CUP. Fees are anticipated to cover the cost of staff review time and processing of the permit . An appeal fee of $1,500 was paid with the submittal of the appeal.
RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:
Balanced Budget and Economic Development
ENVIRONMENTAL REVIEW:
This is a project under CEQA subject to a Categorical Exemption. Existing Facilities. CCR 15301(c).
PUBLIC NOTIFICATION:
The Agenda Report was posted at least 72 hours before the Regular Meeting date and time, and 24 hours before a Special Meeting in accordance with the Ralph M. Brown Act.
ORDINANCE:
Not Applicable
EXHIBITS:
Exhibit A – Planning Commission Resolution 2025-15
Exhibit B – Overhead
Exhibit C – Applicants Plans
Exhibit D – Public Hearing Notice
Exhibit E – CalRecycle Certificate
Exhibit F – Appeal Letter
Exhibit G – Draft Council Resolution AFFIRMING Appeal
Exhibit H – Draft Council Resolution DENYING Appeal
ATTACHMENT 2
2025-19 CUP – 1240 East Plaza Boulevard – Overhead
N
25
8' - 0" 8' - 0"
8' - 0"
(E) Parking
(E) Parking
(E) Parking
(E) Parking(E) Parking
Elec panel
Trash
Adjacent building back door
Adjacent building
back door
N Ave
N Ave
N Ave
N Ave
N Ave
N Ave
Front Set back
(E) Grass
8'X18'8" Glass
Container
Adjacent building
Garage door
10' - 0"
8'X18'8"
Plastic #1 and Aluminuim
Container
Plastic #2-#7, Bi-
Metal, Bag-in-Box /
Pouches
Customer
Waiting Area
4' - 0"
Container Pickup Truck Route
Road Leading to Highland Ave
Enter Exit
Existing Building
Existing Building
1/16"=1'-0"
SITE PLAN
M.U
RE VISION BY DATE
Stephan Overton
SHEET NO.
DATE:
JOB NO.:
DRAWN BY:
SCALE:
TITLE:
PROJECT:
1 2
3 Designer
S
an Diego, CA
TEL: (619) 875-9116
PRPOSED PLAN OF NATIONAL CITY CRV CENTER
1240 EAST PLAZA BLVD., NATIONAL CITY, CA 91950
National City CRV Center,
(619-994-8564)
[email protected]
1/16" = 1'-0"1 Site Plan
Front Property Line
A-1.0ATTACHMENT 3
26
8' - 0" 8' - 0"
8' - 0"
(E) Parking
(E) Parking
(E) Parking
(E) Parking(E) Parking
Elec panel
Trash
Adjacent building back door
Adjacent building
back door
8'X18'8" Glass
Container
Adjacent building
Garage door
7 7
7 8'X18'8"
Plastic #1 and Aluminuim
Container
Plastic #2-#7,
Bi-Metal,
Bag-in-Box /
Pouches
Customer
Waiting Area
Roll up
Door
4' - 0"
10' - 0"
5' - 0"
Employee
Folding Chair
Weight
Scale
Bollards
With chain
for Traffic
Control
6' - 0"
8' - 0"
17' - 0"36' - 1 1/2"
14' - 0 1/2" 5' - 6" 16' - 9 1/2"
EC
Path of Travel
31' - 0"
3' - 0"
4' - 10"
Means of Egress
Means of Egress
Emergency
Exit path
7' - 0"
7' - 0"
45' - 10"
13' - 8"
21' - 10 1/2"
3' - 0"
3/16"=1'-0"
PROPOSED FLOOR PLAN
M.U
RE VISION BY DATE
Stephan Overton
SHEET NO.
DATE:
JOB NO.:
DRAWN BY:
SCALE:
TITLE:
PROJECT:
1 2
3 Designer
S
an Diego, CA
TEL: (619) 875-9116PRPOSED PLAN OF NATIONAL CITY CRV CENTER 1240 EAST PLAZA BLVD., NATIONAL CITY, CA 91950
National City CRV Center,
(619-994-8564)
[email protected]
3/16" = 1'-0"1 Floor Plan
•
•
•
•
•
Hours of operation:
Monday-Saturday 8:30 AM - 5 PM, Closed Sundays
Employees on site per shift:1-2
Payment method to customers :Cash
Container haul-off frequency: 1 to 2 times a week
OPERATIONAL NOTES
The employee is responsible for sweeping and making sure trash is picked up.
Customers must park in recycling-designated parking spots to be accommodated.
Cones with a yellow safety chain for line control during Busy Hours The truck will enter the site through the Highland Avenue entrance of the shopping center, proceed along the rear service drive behind the center, and exit through N Avenue An electric generator will be used to power the scale, register, and camera/security system.
Disclaimer: Final container selection and artwork by owner.
A-1.1
27
Ground Floor
0' - 0"
Level 2
10' - 0"
Roof
20' - 0"
6'x8' Plastic #2-#7, Bi-
Metal, Bag-in-Box /
Pouches
8'X18' Glass
Container
8'X18'
Plastic #1 and Aluminuim
Container
Employee ChairWeight Scale
Pre-Fabricated
Containers
Existing Building Wall
NON-COMBUSTIBLE CONTAINERS
Ground Floor
0' - 0"
Level 2
10' - 0"
Roof
20' - 0"
4' - 0"
Scale
Plastic #2-#
7, Bi-Metal,
Bag-in-Box
/ Pouches
8'X18'8" Glass
Container
Exisiting building
Existing
Building Garage
Door
Employee
Foldable
Chair
Scale
Bollards Protection
Ground Floor
0' - 0"
Level 2
10' - 0"
Roof
20' - 0"
Trash
Existing Building
(N)8'X18'
Plastic #1 and Aluminuim
Container
(E)Elec Panel Employee Foldable Chair
Scale
Egress (E)Egress (E)
(E) Parking
Existing Building Wall
Pre-Fabricated Containers
Ground Floor
0' - 0"
Level 2
10' - 0"
Roof
20' - 0"
2 1/8" / 1'-0"2 1/8" / 1'-0" 2 1/8" / 1'-0"
Roll Up Doors Roll Up Doors Roll Up Doors
8' - 0"
Exisiting Building Pre-Fabricated Containers
6'x8' Plastic #2-#7, Bi-
Metal, Bag-in-Box /
Pouches
8'X18' Glass
Container
8'X18'
Plastic #1 and Aluminuim
Container
3' - 0"
Means of Egress Means of Egress Means of Egress
1/8"=1'-0"
ELEVATION PLAN
M.U
RE VISION BY DATE
Stephan Overton
SHEET NO.
DATE:
JOB NO.:
DRAWN BY:
SCALE:
TITLE:
PROJECT:
1 2
3 Designer
S
an Diego, CA
TEL: (619) 875-9116
PRPOSED PLAN OF NATIONAL CITY CRV CENTER
1240 EAST PLAZA BLVD., NATIONAL CITY, CA 91950
National City CRV Center,
(619-994-8564)
[email protected]
1/8" = 1'-0"1 East
1/8" = 1'-0"2 North
1/8" = 1'-0"3 South view
1/8" = 1'-0"4 West
A-2.0
•
•
•
•
•
Hours of operation:
Monday-Saturday 8:30 AM - 5 PM, Closed Sundays
Employees on site per shift:1-2
Payment method to customers :Cash
Container haul-off frequency: 1 to 2 times a week
OPERATIONAL NOTES
The employee is responsible for sweeping and making sure trash is picked up.
Customers must park in recycling-designated parking spots to be accommodated.
Cones with a yellow safety chain for line control during Busy Hours The truck will enter the site through the Highland Avenue entrance of the shopping center, proceed along the rear service drive behind the center, and exit through N Avenue An electric generator will be used to power the scale, register, and camera/security system.
Disclaimer: Final container selection and artwork by owner. 28
CITY OF NATIONAL CITY
NOTICE OF PUBLIC HEARING
NOTICE IS HEREBY GIVEN that the City Council of the City of National City will hold a Public Hearing after the hour of 6:00 p.m., Tuesday, December 2, 2025, in the City Council Chambers, Civic Center, 1243 National City Blvd., National City, CA., to consider:
PUBLIC HEARING - APPEAL OF A PLANNING COMMISSION DENIAL OF A
CONDITIONAL USE PERMIT FOR A PROPOSED RECYCLING
CENTER TO BE LOCATED AT 1240 EAST PLAZA BOULEVARD.
Anyone interested in this matter may appear at the above time and place and be heard.
The City Council will also accept written public comments regarding this matter. Written comments or testimony from the public must be submitted via e -mail to [email protected] by 2:00 P.M. on the day of the City Council Meeting. For information on registering to provide public comment via Zoom please visit the City Clerk’s webpage at https://www.nationalcityca.gov/government/city-clerk/public- comments.
If you challenge the nature of the proposed action in court, you may be limited to raising only those issues you or someone else raised at the Public Hearing described in this notice via e-mail, or through written correspondence delivered to the undersigned prior to the Public Hearing.
Shelley Chapel, MMC, City Clerk
Published in the Star News: Friday, November 21, 2025
State of California
DIVISION OF RECYCLING
Certification is Non-Transferable
Certified Recycling Center
Certificate issued to:
Contact Person: Anthony St John
Organization: SoCal EcoSolutions Inc.
Program/DBA: National City CRV Center
1240 East Plaza Boulevard
National City, CA 91950
For Collection Of:
Aluminum | Bag-in-Box | Bimetal | Glass | Paperboard Carton | Plastic | Multilayer Pouch Is
Jennifer Akins
Chief, Certification and Registration Branch
Certification Number: RC367459.001
Probationary End Date: 02/28/2027
Renewal Expiration Date: 02/28/2030
ATTACHMENT 5
30 Page 574 of 860
PERSONAL SIGNATURE
PERSONAL INFORMATION
PERSONAL INFORMATION PERSONAL INFORMATION
RESOLUTION NO. 2025-
RESOLUTION OF THE CI TY COUNCIL OF THE CI TY OF NATIONAL CITY, CALIFORNIA,
DETERMINING THAT THE PROJECT IS CATEGORICALLY EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) UNDER CLASS 1 OF THE CEQA GUIDELINES SECTION 15301 (EXI STING FACILITIES) AND APPROVING A CONDITIONAL USE PERMIT FOR A RECYCLING CENTER TO BE LOCATED AT 1240 E PLAZA BOULEVARD.
WHEREAS, the Planning Commission of the City of National City considered the Conditional Use Permit for a proposed recycling center, located at 1240 E Plaza Blvd. at a duly advertised public hearing held on October 20, 2025, at which time the Commission denied the Conditional Use Permit; and
WHEREAS, subsequent to the Planning Commission denial of the Conditional Use Permit, the applicant (“APPELLANT”) appealed the decision of the Planning Commission to the City Council; and
WHEREAS, the City Council of the City of National City considered the appeal of the Planning Commission’s denial of the Conditional Use Permit at a duly advertised public hearing held on December 2, 2025, at which time oral and documentary evidence was presented; and
WHEREAS, at said public hearing the City Council considered the staff report contained in Case File No. 2025 -19 CUP maintained by the City and incor porated herein by reference along with evidence and testimony at said hearing; and
WHEREAS, this action is taken pursuant to all applicable procedures required by State law and City law. .
NOW, THEREFORE, THE CITY COUNCIL OF NATIONAL CITY, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:
Section 1: That the City Council hereby upholds the appellants’ appeal of and overturns the Planning Commission’s decision to deny the Conditional Use Permit No. 2025 -19 CUP for a proposed recycling center based on the following findings:
1. The proposed use is allowable within the applicable zoning district pursuant to a Conditional Use Permit and complies with all other applicable provisions of the Land Use Code because mobile recycling centers are a conditionally-allowed use in the Major Mixed-Use District (MXD -2) zone, and the conditions of approval will ensure the proposed recycling center will meet all requirements as contained in NCMC §18.30.170 – Recycling collection facilities.
2. The proposed use is consistent with the General Plan and any applicable specific plan, because the Land Use Code conditionally allows mobile recycling centers in the MXD -2 zone; the Land Use Code is consistent with the General Plan. There are no Specific Plans affecting this location.
3. The design, location, size, and operating characteristics of the proposed activity would be compatible with the existing and future land uses in the vicinity, because the recycling facility will be in compliance with the City’s LUC and a ll applicable building and fire codes. There is adequate area on -site for a mobile recycling facility in accordance with the LUC requirements and the facility does not remove any parking spaces. In addition, the proposed mobile recycling center, subject to the conditions of approval, meets all requirements for such uses outlined in the Land Use Code, as discussed above.
4. The site is physically suitable for the type, density, and intensity of use being proposed, including access, utilities, and the absence o f physical constraints, because the site has sufficient access to a major street that is adequate in width and pavement type to carry the volume and type of traffic generated by the proposed use, since the use is expected to generate a minimal amount of ad ditional traffic for the Smart & Final shopping center, as many of the customers will also shop at the center.
5. Granting the permit would not constitute a nuisance or be injurious or detrimental to the public interest, health, safety, convenience, or welfare, or materially injurious to persons, property, or improvements in the vicinity and zone in which the property is located, because the proposed use will be subject to conditions that limit issues related to mobile recycling centers such as noise, traffic , and litter. The business operates during daytime hours, the site shall be swept and cleared of litter at the end of each day, containers shall be locked when not in use and emptied on a regular basis, the business is located in an area separate from resi dences that will not interfere with parking or circulation for the shopping center.
6. The proposed project has been reviewed in compliance with the California Environmental Quality Act and has been determined to be categorically exempt from environmental r eview pursuant to Class 1 of the CEQA Guidelines, Section 15301 (Existing Facilities), for which a Notice of Exemption will be filed subsequent to approval of this CUP. The reason for the exemption is that the use is proposed within an existing shopping center, the use is ancillary and does not include the addition of any permanent structures, and the use is similar to other commercial uses in the area, which are permitted in Major Mixed-Use District zone.
Section 2: That the City Council hereby approves the application for Conditional Use Permit subject to the following conditions:
General
1. This Conditional Use Permit authorizes a mobile recycling center at 1240 East Plaza Boulevard. Except as required by conditions of approval, all plans submitted for p ermits associated with the project shall conform to Exhibit A, Case File No. 2025-19 CUP, dated 9/17/2025.
2. Before this Conditional Use Permit shall become effective, the applicant and the property owner both shall sign and have notarized an Acceptance Form, provided by the Planning Division, acknowledging and accepting all conditions imposed upon the approval of this permit. Failure to return the signed and notarized Acceptance Form within 30 days of its receipt shall automatically terminate the Conditional Use Permit. The applicant shall also submit evidence to the satisfaction of the Planning Division that a Notice of Restriction on
Real Property is recorded with the County Recorder. The applicant shall pay necessary recording fees to the County. The Not ice of Restriction shall provide information that conditions imposed by approval of the Conditional Use Permit are binding on all present or future interest holders or estate holders of the property. The Notice of Restriction shall be approved as to form by the City Attorney and signed by the City Manager or assign prior to recordation.
3. Within four (4) days of approval , pursuant to Fish and Game Code 711.4 and the California Code of Regulations, Title 14, Section 753.5, the applicant shall pay all necessary environmental filing fees for the San Diego County Clerk. Checks shall be made payable to the San Diego County Clerk and submitted to the National City Planning Division.
4. This permit shall become null and void if not exercised within one year after adopt ion of the resolution of approval unless extended according to procedures specified in the Municipal Code.
5. This permit shall expire if the use authorized by this resolution is discontinued for a period of 12 months or longer. This permit may also be revoke d, pursuant to provisions of the Land Use Code, if discontinued for any lesser period of time.
6. This Conditional Use Permit may be revoked if the operator is found to be in violation of any Conditions of Approval or applicable law.
Building
7. Building plans a nd permits shall be required to meet current California Building, Mechanical, Electrical, Plumbing, Accessibility, Green, Energy, and Fire Codes.
8. An accessible path of travel must be identified and/or implemented from a public right of way to the facility. This path of travel must meet accessibility requirements set forth in the California Building Code for minimum width, grade, markings, etc.
9. An accessible path of travel to a restroom must be identified and/or implemented and must be no further than 500 feet from the employee workplace. There shall be an agreement in place with the property owner or management group for use of one of the existing business’ restrooms.
10. The facility must ensure dedicated working area for employees and customers loading/off- loading recycling material so to not impede traffic, parking, and ensure safety.
11. The facility must ensure proper best management practices for runoff.
Engineering
12. The operator shall maintain compliance with all the routine industrial/commercial facility BMPs in the National City BMP Manual (Table 2, Minimum BMPs for Industrial, Commercial, and Municipal Sites)
a. These are operational BMPs like regularly picking up trash and cleaning up/preventing spills.
13. The operator of the recycle center shall enter into a B MP maintenance agreement and shall execute said agreement and submit it to the National City Engineering/Public Works Department.
14. The operator shall be responsible for sweeping the area on a daily basis and removing all loose recycling material that has fallen onto the ground.
Fire
15. Plans are to be designed, fabricated and installed to code.
16. Project to be in compliance with the current editions of the National Fire Protection Association, California Fire Code 2022 Edition, Title 19 and local City of National City Municipal Codes.
17. The proposed recycling business must not, at any time, obstruct or impede the exits, access pathways, or areas designated for safe egress and refuge for surrounding businesses. A thorough evaluation of these considerations shall be c onducted by the responsible party for the proposed business. This evaluation must take into account the impact on all adjacent and affected businesses and ensure continued compliance with all applicable safety and accessibility regulations.
18. Fire apparatus access roads shall comply with the requirements of this section (Section 5 CFC 2022) and shall extend to within 150 feet of all portions of the facility and all portions of the exterior walls of the first story of the building as measured by an approved ro ute around the exterior of the building. Dead-end fire apparatus access roads in excess of 150 feet in length shall be provided with an approved area for turning around fire apparatus.
This comment shall apply to new residential structures. The fire code official shall have the authority to require or permit modifications to the required access widths where they are inadequate for fire rescue operations or where necessary to meet the public safety objectives of the jurisdiction
19. The required width of emergen cy fire apparatus access roads shall not be obstructed in any manner, including parking of vehicles. All access roads shall be no less than 20 feet wide, no less than 14 feet high and shall have an all -weathered road with the ability to support 75 thousand pounds or greater. Where a fire hydrant is located on a fire apparatus road; the minimum road width shall be 26 feet. A 28 -foot turning radius is required for fire department access through site. All fire department access roads shall be painted and signed to prevent parking in these required designated emergency areas
20. All designated fire access roads—including those located at the front, east, and rear of the business—must remain unobstructed at all times.
a. This requirement applicable to all vehicles associated with the business, including but not limited to customer parking, delivery vehicles, and product retrieval trucks.
It is the responsibility of the business to ensure that these fire lanes remain fully accessible and free from obstructions at all times during business operations. b. Failure to maintain clear fire access roads may result in enforcement action in accordance with applicable fire code regulations.
21. Fire hydrants to be located throughout the project as not to have a separation distance greater than 300 feet. Fire hydrants to be located within 400 feet of all locations which are roadway accessible. (Measurement starts from nearest existing fire hydrant to project)
22. Approved vehicle access for firefighting shall be provided to all construction and demolition sites. Vehicle access shall be provided to within 100 feet of temporary or permanent fire department connections. Vehicle access shall be provided by either temporary or permanent roads, capable of supporting vehicle loading under all weather c onditions.
Vehicle access shall be maintained until permanent fire apparatus access roads are available.
23. Where there is conflict between a general requirement and a specific requirement, the specific requirement shall be applicable. Where, in a specific ca se, different sections of
this code specify different materials, methods of construction or other requirements, the most restrictive shall govern.
Planning
24. The recycling collection facility shall conform to all provisions in Land Use Code Section
18.30.170 – Recycling Collection Facilities.
25. The recycling collection facility shall be established in conjunction with an existing commercial use or community service facility which is in compliance with the zoning, building, and fire codes of the city.
26. The recycling collection facility shall be no larger than three hundred and fifty square feet and occupy no more than three parking spaces.
27. The business shall not obstruct pedestrian or vehicular circulation.
28. The business shall only accept only glass, aluminum, non aluminum, and plastic containers.
29. The use of power-driven processing equipment is prohibited.
30. Containers shall be constructed and maintained with durable waterproof and rustproof material, covered when the site is not attended, secured from unauthorized e ntry or removal of material, and have a capacity sufficient to accommodate materials collected and the collection schedule.
31. All recyclable material shall be stored in containers and not left outside of designated storage containers at any time; the recycling center area shall be maintained free of litter, and any undesirable materials, and removed at the end of each collection day. Any discarded material left overnight shall be removed immediately upon opening of business in the morning.
32. Noise levels shall not exceed sixty dBA as measured at the property line of residentially zoned property, and otherwise not exceed sixty-five dBA.
33. Containers shall be labeled to identify the type of material which may be deposited. Labels shall include: facility name, facili ty operator telephone number, hours of operation, and notice stating that no material shall be left outside the recycling enclosure or containers.
34. Any required landscape areas shall not be occupied or interfered with.
35. The area shall be clearly marked to prohibit other vehicular parking during hours when the mobile unit is scheduled to be present.
36. No recyclable material shall be accepted from persons transporting said material in non - motorized carrying devices including, but not limited to, shopping carts, wagons, etc.
37. Loitering at the facility or in its vicinity shall be prohibited.
38. The hours of operation shall be permitted only between the hours of 9 a.m. and 5 p.m.
Monday through Saturday.
39. A signage plan shall be submitted to the Planning Division showing the location, size and type of signage, including labeling of containers, prior to operation of the facility.
40. Exterior walls of containers to a height of not less than 6 feet shall be treated with a graffiti resistant coating subject to approval from the B uilding Official. Graffiti shall be removed within 24 hours of its observance.
Indemnification Agreement
The Applicant shall defend, indemnify, and hold harmless the City, its agents, officers, and employees from any and all claims, actions, proceedings, damages, judgments, or costs, including attorney's fees, against the City or its agents, officers, or employees, relating to the issuance of this permit including, but not limited to, any action to attack, set aside, void, challenge, or annul this develop ment approval and any environmental document or decision. The City will promptly notify the Applicant of any claim, action, or proceeding. The City may elect to conduct its own defense, participate in its own defense, or obtain independent legal counsel in defense of any claim related to this indemnification. In the event of such election, the Applicant shall pay all of the costs related thereto, including without limitation reasonable attorney's fees and costs. In the event of a disagreement between the City and Applicant regarding litigation issues, the City shall have the authority to control the litigation and make litigation related decisions, including, but not limited to, settlement or other disposition of the matter. However, the Applicant shall not be required to pay or perform any settlement unless such settlement is approved by the Applicant.
Section 3: The City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of orginal Resolutions.
PASSED and ADOPTED this 2nd day of December, 2025.
__________________________
Ron Morrison, Mayor
ATTEST:
_____________________________
Shelley Chapel, MMC, City Clerk
APPROVED AS TO FORM:
_____________________________
Barry J. Schultz.
City Attorney
RESOLUTION NO. 2025-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIO NAL CITY ,
CALIFORNIA, DENYING THE APPEAL AND AFFIRMING THE PLANNING
COMMISSION DENIAL OF A CONDITIONAL USE PERMIT FOR A RECYCLING CENTER TO BE LOCATED AT 1240 E PLAZA BOULEVARD.
WHEREAS, the Planning Commission of the City of National City considered a Conditional Use Permit for a proposed recycling center at a duly advertised public hearing held on October 20 , 202 5, at which time the Commission denyed the Conditional Use Permit; and
WHEREAS, subsequent to the Planning Commission denial of the Conditional Use Permit, the applicant (“APPELLANT”) appealed the decision of the Planning Commission to the City Council; and
WHEREAS, the City Council of the City of National City considered the appeal of the Planning Commission’s denial of the Conditional Use Permit at a duly advertised public hearing held on December 2 , 2025, at which time oral and documentary evidence was presented; and
WHEREAS, at said public hearing the City Council c onsidered the staff report contained in Case File No. 2025 -19 CUP maintained by the City and incorporated herein by reference along with evidence and testimony at said hearing; and
WHEREAS, this action is taken pursuant to all applicable procedures requir ed by State law and City law.
NOW, THEREFORE, THE CITY COUNCIL OF NATIONAL CITY, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:
Section 1: That the City Council hereby denies the appellants’ appeal of and upholds the Planning Commission’s decision to deny Conditional Use Permit No. 2025-19 CUP for a recycling center to be located at 1240 E ast Plaza Boulevard, and is supported by the following finding:
1. Granting the permit would constitute a nuisance or be injurious or detrimental to the public interest, health, safety, convenience, or welfare, or materially injurious to persons, property, or improvements in the vicinity and zone in which the property is located, because it would contribute to increased traffic, crime, and litter.
Section 2: The City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions.
PASSED and ADOPTED this 2nd day of December, 2025.
__________________________
Ron Morrison, Mayor
ATTEST:
_____________________________
Shelley Chapel, MMC, City Clerk
APPROVED AS TO FORM:
_____________________________
Barry J. Schultz.
City Attorney
AGENDA REPORT
Department: Community Development
Prepared by: David Welch, Principal Planner
Meeting Date: Tuesday, December 2, 2025
Approved by: Alejandro Hernandez, Acting City Manager
SUBJECT:
Introduction and First Reading of Land Use Code Amendment to Restore Omitted Sections
18.10.060, 18.11.120, 18.22.020, 18.30.310, 18.30.340 & 345.
RECOMMENDATION:
Hold the Public Hearing and Introduce the Ordinance Entitled: “An Ordinance Amending Sections
18.10.060 (Rules of Measurement), 18.11.120 (Interim Uses), 18.22.020 (Allowed Land Uses Et Seq.), 18.30.310 (Tattoo Parlors Et Al), and 18.30.340 & 345 ( Medical Marijuana Dispensaries and Cultivation) of Title 18 (Zoning) of the National City Municipal Code to Restore Previously Omitted Sections.”
BOARD/COMMISSION/COMMITTEE PRIOR ACTION:
On the dates of March 15, 2021, October 18, 2021, October 17, 2022, November 7, 2022, and December 4, 2023, the Planning Commission made recommendations that the City Council Adopt Certain Ordinances Amending Title 18 of the Municipal Code.
EXPLANATION:
Various code amendments to Title 18 were adopted by City Council in the years 2021 through 2024. Concurrently, significant amendments to the same Title were being prepared by a consultant as part of the Focused General Plan Update. After passage of the code updates related to the Focused General Plan Update project, staff became aware of the omission of recently - adopted code amendments in the Ordinance adopted by City Council on June 18, 2024. To that end, staff is requesting that the City Council approve a follow-up Code amendment so that the previously-adopted Sections of Title 18 can be restored in the Zoning Code. The draft language is attached as Exhibit A.
FINANCIAL STATEMENT:
The requested code amendments to Title 18 were previously prepared by City staff and provide more flexibility for new development and business activity within the City. Negligible resources were required to create this item.
RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:
Balanced Budget and Economic Development
ENVIRONMENTAL REVIEW:
This is not a project under CEQA , and is therefore , not subject to environmental review.
CCR15378; PRC 21065.
PUBLIC NOTIFICATION:
The Agenda Report was posted at least 72 hours before the Regular Meeting date and time, and 24 hours before a Special Meeting in accordance with the Ralph M. Brown Act.
ORDINANCE:
First Reading
EXHIBITS:
Exhibit A – Draft Code Amendments
Exhibit B – Draft Ordinance
Section 18.10.060 (Rules of Measurement) is proposed to be amended to read as follows:
18.10.060 – Rules of Measurement.
A. Purpose. The purpose of this section is to explain how various measurements referenced in this title are to be calculated.
B. Applicant Responsibility. For all calculations, the applicant shall be responsible for supplying drawings illustrating the measurements that apply to a project.
These drawings shall be drawn to scale and of sufficient detail to allow easy verification upon inspection by the city.
C. Fractions. When calculating a maximum requirement, round down to nearest whole number. When calculating a minimum requirement, round up to nearest whole number.
D. Measuring Distances.
1. Measurements are the Shortest Distance. When measuring a required distance, such as the minimum distance between a structure and a lot line, the measurement is made at the closest or shortest distance between the two objects.
2. Distances are Measured Horizontally. Distances are measured along a horizontal plane unless otherwise specified.
3. Measurements Involving a Structure. Measurements involving a structure are made to the closest wall of the structure, unless otherwise specified.
4. Measurements Between Uses. When measuring the distance bet ween two different uses, the measurement is calculated from closest lot line to lot line.
E. Measuring Height.
1. General. Height shall be considered the vertical distance from the highest point of any structure to the ground level directly below, except as otherwise provided in this section. On sloped lots, the height shall be measured from the average grade to the tallest point of the structure.
2. Measuring the Height of Buildings Located Near Retaining Walls. If any portion of a building lies within th e setback area of a lot and the base of the retaining wall is at a lower elevation than the building, the height of the
building shall be calculated from the base of the retaining wall (at the lower of natural or finished grade) rather than from the base o f the building wall.
3. Measuring the Height of Combined Fences and Retaining Walls. When a fence is constructed on top of or within one foot of the face of an above - ground retaining wall, and located in a required yard, the height of the fence shall be me asured from the top of the fence to the midpoint height of the retaining wall.
F. Measuring Lot Width and Depth.
1. Lot Width. Minimum lot width shall be measured at the front setback line, or from the front property line is there is no required setback, a s determined by the zoning of the parcel.
2. Lot Depth. Lot depth is measured along an imaginary straight line drawn from the midpoint of the front property line of the lot to the midpoint of the rear property line or to the most distant point on any other lot line where there is no rear lot line.
G. Determining Floor Area. Floor area is the horizontal area (expressed in square feet) of all floors included within a building or buildings, according to the following rules:
1. Included in Floor Area. Floor are a is deemed to include:
a. The floor of atrium and lobby areas.
b. Enclosed and roofed storage and equipment spaces.
c. Enclosed and roofed halls, stairways, and elevator shafts. d. Enclosed and roofed porches and balconies.
e. Portions of basements and attics that meet building code height requirements for living space.
f. The actual floor space of mezzanines, interior balconies, and lofts.
2. Excluded from Floor Area. Floor area does not include:
a. Unenclosed balconies, decks, porches, and stairs.
b. Substandard height portions of attics and basements.
c. The area within a building adjacent to, and in an imaginary horizontal plane with, interior balconies, mezzanines, or lofts.
H. Determining Floor Area Ratio. Floor area ratio (FAR) is the ratio of the floor area of all principal and accessory buildings on a lot to the lot area. To calculate FAR, floor area is divided by lot area, and typically expressed as a decimal. For example, if the floor area of all buildings on a lot totals twenty thousand square feet, and the lot area is ten thousand square feet, the FAR is expressed as 2.0.
I. Determining Lot Coverage. Lot coverage is the ratio of the footprint of all structures on a lot to the lot area, typically expressed as a percentage. The footprints of all principal and accessory structures, including garages, carports and roofed porches, shall be summed in order to calculate lot coverage. The following structures shall be excluded from the calculations:
1. Unenclosed and unroofed structures; porches, landin gs, balconies, and stairways less than three feet in height.
2. Unenclosed and unroofed decks less than eighteen inches in height.
3. Eaves and roof overhangs projecting up to four feet from a wall.
4. Trellises and similar structures that do not have soli d roofs.
5. Swimming pools and hot tubs that are not enclosed in roofed structures.
6. Trash enclosures.
7. Solar collectors.
Section 18.11 (Nonconforming uses, structures, and parcels) is proposed to be amended to read as follows:
18.11.120 – Interim Uses.
A. Purpose. To provide a process for the temporary use of buildings that were previously legal nonconforming and lost their nonconforming status due to lack of use and establish a set amount of time for their use in the interim period between the cur rent nonconforming situation and the eventual redevelopment of the property. The interim use will require administrative review in order to evaluate the compatibility of the proposed use with surrounding uses and the suitability of the use to the site.
B. Applicability. An interim use permit is required to authorize proposed interim land uses as being allowable in the applicable zoning district subject to the approval of an interim use permit.
C. Application Requirements. An application for an interim use p ermit shall contain all information required by the city manager or his/her designee necessary to determine compliance with the Land Use Code and to accomplish the requirements of this section, including the means to provide notice of the application. It i s the responsibility of the applicant to provide evidence in support of the findings required by this section. A nonrefundable fee in such amount as the city council shall from time to time establish by resolution shall be paid to the finance officer at the time of filing. The application shall include a timeline for eventual redevelopment of the property.
D. Notice of Application.
1. The designated staff person shall mail notice of the application no later than ten days after an application has been deeme d complete to:
a. The applicant; and
b. The owners of any real property, as shown on the latest equalized property tax assessment roll of the San Diego County Assessor, located within three hundred feet of the boundary of the property that is the subject of the application.
E. Contents of the Notice of Application.
1. The notice of application shall include at least the following information:
a. A general description of the proposed use, including activities and duration of the use.
b. The location and siz e of the property that is the subject of the application.
c. The name, telephone number, and city address of the designated staff person to contact for additional information.
d. An explanation that an interim use permit is an administrative process whereb y the decision to approve, conditionally approve, or deny the proposed development will be made by the planning division without a public hearing.
e. An explanation of the process to appeal the decision.
F. Requests for Notice of Decision. Persons who wis h to receive notice of the approval or denial of the application may request this information from the staff person indicated in the notice of application. The request must be received no later than ten business days after the date on which the notice of a pplication is mailed.
G. Findings and Decision. The planning division may approve or deny an application for an interim use permit. The designated staff person shall record the decision and the findings on which the decision is based. The planning division may approve an interim use permit only after first finding all of the following:
1. The proposed use is consistent with the General Plan and any applicable specific plan;
2. The design, location, size, and operating characteristics of the proposed activity would be compatible with the existing and future land uses in the vicinity;
3. The site is physically suitable for the type, density, and intensity of use being proposed, including access, utilities, and the absence of physical constraints; and
4. Granting the permit would not constitute a nuisance or be injurious or detrimental to the public interest, health, safety, convenience, or welfare, or materially injurious to persons, property, or improvements in the vicinity and zoning district in which the property is located.
H. Issuance of Permit and Duration.
1. Upon the approval of an application, the planning division shall authorize the issuance of an interim use permit, with or without conditions, and one copy of which shall be forwarded to each of the f ollowing:
a. The applicant;
b. The building official;
c. Any other department or agency the planning division considers affected by the issuance of the permit; and
d. The division files for permanent retention.
2. Interim use permits shall be in effect for five years, at which time up to two annual extensions may be granted for a total of seven years. Application for an extension shall be subject to a nonrefundable fee, in such amount as established by the
city coun cil from time to time by resolution and in effect at the time of filing of the extension. Extensions exceeding two additional years or seven total years may be requested and require a public hearing and approval by the Planning Commission.
3. No expansion of the premises shall be permitted.
I. Conditions of Approval. In approving an interim use permit, the planning division may impose any conditions deemed reasonable and necessary to ensure that the approval would comply with the findings required by this s ection.
J. This Code section shall be in effect for 15 years from time of adoption, at which time the Interim Use Permit program will cease and all issued Interim Use Permits shall be null and void.
Subsection 18.22.020 of the National City Municipal Code is proposed to be amended to read as follows:
18.22.020 Allowed land uses and permit requirements.
Table 18.22.020 identifies the uses of land allowed in each commercial zone. This table does not apply to the CL zone. For a list of allowable uses in the CL zone, please refer to Appendix A of the Westside Specific Plan.
Table 18.22.020
Allowed Land Uses
Commercial Zones
Land Use
Zone Specific Use
Regulations
CA CS
Used auto and truck sales - C
P Permitted
C Conditional use permit
M Minor use permit
— Not permitted
Section 18.30.310 (Tattoo Parlors and Body-Piercing Establishments) is proposed to be amended to read as follows:
18.30.310 – Tattoo parlors and body-piercing establishments
A. Restrictions.
1. No tattoo or body piercing establishment shall be located within one -mile of another such establishment.
2. Tattoo parlors and body -piercing establishments shall be located no less than 1,000 feet from a church, school, or playground.
3. Tattoo parlors and body -piercing establishm ents shall be no closer than two hundred fifty feet from a residential zone.
4. No tattoo and body -piercing establishments shall be located east of Interstate 805 except within the MXD -2 zone.
5. A Conditional Use Permit is required.
Section 18.30.340 (Medical Marijuana Dispensaries) is proposed to be amended to read as follows:
18.30.340 - Commercial Marijuana Activity
A. Prohibition.
1. Commercial marijuana activity is prohibited except as provided for in Chapter 9.60 of the National City Municipal Code.
B. Definitions.
1. "Commercial marijuana activity" includes the cultivation, possession, manufacture, distribution, processing, storing, laboratory testing, labeling, transportation, distribution, delivery, or sale of marijuana and marijuana products.
2. For purposes of this section, "marijuana" shall have the same meaning as the definition of that word in Section 11018 of the California Health and Safety Code.
Section 18.30.345 (Medical Marijuana Cultivation) is proposed to be struck in its entirety.
ORDINANCE NO. 2026 –
AN ORDINANCE AMENDING SECTIONS 18.10.060 (RULES OF MEASUREMENT), 18.11.120 (INTERIM USES) , 18.22.020 (ALLOWED LAND USES E T SEQ.) , 18.30.310 (TATTOO PARLORS ET AL) , AND 18.30.340 & 345 (MEDICAL MARIJUANA D ISPENSARIES AND CULTIVATION) OF TITLE 18 (ZONING) OF THE NATIONAL CITY MU NICIPAL CODE TO RESTORE PREVIOUSLY OMITTED SECTIONS.
WHEREAS, the City of National City (the “City”), pursuant to the police powers delegated to it by the California Constitution, has the authority to enact or amend laws which promote the public health, safety, and general welfare of its residents; and WHEREAS, pursuant to the terms and provisions of the Government Code of the State of California, proceedings were duly initiated for the amendment of the National City Municipal Code; and
WHEREAS, on the dates of March 15, 2021, October 18, 2021, October 17, 2022, November 7, 2022, and December 4, 2023 , noticed public hearing s were held by the Planning Commission related to the various proposed code amendments, and all persons interested were given the opportunity to appear and be heard before the National City Planning Commission; and WHEREAS, the Planning Commission regularly and duly certified its report to the City Council of National City and recommended approval of the amendments to NCMC Title 18:
and
WHEREAS, pursuant to a published 10 -day notice of the adoption of said ordinance, a public hearing was held by the City Council on January 20, 2026, and at said public hearing, all persons interested were given the opportunity to appear and be heard before the City Council.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF NATIO NAL CITY DOES ORDAIN AS FOLLOWS:
Section 1. All protests, if any, against said ame ndment to the Munic ipal Code and each of them be and hereby are denied and overruled.
Section 2. Section 18.10.060 (Rules of Measurement) is hereby amended to read as follows:
18.10.060 – Rules of Measurement.
A. Purpose. The purpose of this section is to explain how various measurements referenced in this title are to be calculated.
B. Applicant Responsibility. For all calculations, the applicant shall be responsible for supplying drawings illustrating the measurements that apply to a project. These
drawings shall be drawn to scale and of sufficient detail to allow easy verification upon inspection by the city.
C. Fractions. When calculating a maximum requirement, round down to nearest whole number. When calculating a minimum requirement, round up to nearest whole number.
D. Measuring Distances.
1. Measurements are the Shortest Distance. When measuring a required distance, such as the minimum distance between a structure and a lot line, the measurement is made at the closest or shortest distance between the two objects.
2. Distances are Measured Horizontally. Distances are measured along a horizontal plane unless otherwise specified.
3. Measurements Involving a Structure. Measurements involving a structure are made to the closest wall of the structure, unless otherwise specified.
4. Measurements Between Uses. When measuring the distance bet ween two different uses, the measurement is calculated from closest lot line to lot line.
E. Measuring Height.
1. General. Height shall be considered the vertical distance from the highest point of any structure to the ground level directly below, except a s otherwise provided in this section. On sloped lots, the height shall be measured from the average grade to the tallest point of the structure.
2. Measuring the Height of Buildings Located Near Retaining Walls. If any portion of a building lies within the setback area of a lot and the base of the retaining wall is at a lower elevation than the building, the height of the building shall be calculated from the base of the retaining wall (at the lower of natural or finished grade) rather than from the base of the building wall.
3. Measuring the Height of Combined Fences and Retaining Walls. When a fence is constructed on top of or within one foot of the face of an above-ground retaining wall, and located in a required yard, the height of the fence shall be mea sured from the top of the fence to the midpoint height of the retaining wall.
F. Measuring Lot Width and Depth.
1. Lot Width. Minimum lot width shall be measured at the front setback line, or from the front property line is there is no required setback, as determined by the zoning of the parcel.
2. Lot Depth. Lot depth is measured along an imaginary straight line drawn from the midpoint of the front property line of the lot to the midpoint of the rear property line or to the most distant point on any other lot line where there is no rear lot line.
G. Determining Floor Area. Floor area is the horizontal area (expressed in square feet) of all floors included within a building or buildings, according to the following rules:
1. Included in Floor Area. Floor area is deemed to include:
a. The floor of atrium and lobby areas.
b. Enclosed and roofed storage and equipment spaces.
c. Enclosed and roofed halls, stairways, and elevator shafts. d. Enclosed and roofed porches and balconies.
e. Portions of basements and att ics that meet building code height requirements for living space.
f. The actual floor space of mezzanines, interior balconies, and lofts.
2. Excluded from Floor Area. Floor area does not include:
a. Unenclosed balconies, decks, porches, and stairs.
b. Substandard height portions of attics and basements. c. The area within a building adjacent to, and in an imaginary horizontal plane with, interior balconies, mezzanines, or lofts.
H. Determining Floor Area Ratio. Floor area ratio (FAR) is the ratio of the flo or area of all principal and accessory buildings on a lot to the lot area. To calculate FAR, floor area is divided by lot area, and typically expressed as a decimal. For example, if the floor area of all buildings on a lot totals twenty thousand square fee t, and the lot area is ten thousand square feet, the FAR is expressed as 2.0.
I. Determining Lot Coverage. Lot coverage is the ratio of the footprint of all structures on a lot to the lot area, typically expressed as a percentage. The footprints of all pri ncipal and accessory structures, including garages, carports and roofed porches, shall be summed in order to calculate lot coverage. The following structures shall be excluded from the calculations:
1. Unenclosed and unroofed structures; porches, landings, balconies, and stairways less than three feet in height.
2. Unenclosed and unroofed decks less than eighteen inches in height.
3. Eaves and roof overhangs projecting up to four feet from a wall.
4. Trellises and similar structures that do not have solid r oofs.
5. Swimming pools and hot tubs that are not enclosed in roofed structures.
6. Trash enclosures.
7. Solar collectors.
Section 3. Section 18.11 ( Nonconforming uses, structures, and parcels ) is hereby amended to read as follows:
18.11.120 – Interim Uses.
A. Purpose. To provide a process for the temporary use of buildings that were previously legal nonconforming and lost their nonconforming status due to lack of use and establish a set amount of time for their use in the interim period between the current nonconforming situation and the eventual redevelopment of the property. The interim use will require administrative review in order to evaluate the compatibility of the proposed use with surrounding uses and the suitability of the use to the site.
B. Applicability. An interim use permit is required to authorize proposed interim land uses as being allowable in the applicable zoning district subject to the approval of an interim use permit.
C. Application Requirements. An application for an interim use p ermit shall contain all information required by the city manager or his/her designee necessary to determine compliance with the Land Use Code and to accomplish the requirements of this section, including the means to provide notice of the application. It i s the responsibility of the applicant to provide evidence in support of the findings required by this section. A nonrefundable fee in such amount as the city council shall from time to time establish by resolution shall be paid to the finance officer at th e time of filing. The application shall include a timeline for eventual redevelopment of the property.
D. Notice of Application.
1. The designated staff person shall mail notice of the application no later than ten days after an application has been deeme d complete to:
a. The applicant; and
b. The owners of any real property, as shown on the latest equalized property tax assessment roll of the San Diego County Assessor, located within three hundred feet of the boundary of the property that is the subject o f the application.
E. Contents of the Notice of Application.
1. The notice of application shall include at least the following information:
a. A general description of the proposed use, including activities and duration of the use.
b. The location and size of the property that is the subject of the application. c. The name, telephone number, and city address of the designated staff person to contact for additional information.
d. An explanation that an interim use permit is an administrative process whereby the decision to approve, conditionally approve, or deny the proposed development will be made by the planning division without a public hearing. e. An explanation of the process to appeal the decision.
F. Requests for Notice of Decision. Persons who wish to receive notice of the approval or denial of the application may request this information from the staff person indicated in the notice of application. The request must be received no later than ten business days after the date on which the notice of ap plication is mailed.
G. Findings and Decision. The planning division may approve or deny an application for an interim use permit. The designated staff person shall record the decision and the findings on which the decision is based. The planning division may approve an interim use permit only after first finding all of the following:
1. The proposed use is consistent with the General Plan and any applicable specific plan;
2. The design, location, size, and operating characteristics of the proposed activity would be compatible with the existing and future land uses in the vicinity;
3. The site is physically suitable for the type, density, and intensity of use being proposed, including access, utilities, and the absence of physical constraints; and
4. Granting the permit would not constitute a nuisance or be injurious or detrimental to the public interest, health, safety, convenience, or welfare, or materially injurious to persons, property, or improvements in the vicinity and zoning district in which the prop erty is located.
H. Issuance of Permit and Duration.
1. Upon the approval of an application, the planning division shall authorize the issuance of an interim use permit, with or without conditions, and one copy of which shall be forwarded to each of the following:
a. The applicant;
b. The building official;
c. Any other department or agency the planning division considers affected by the issuance of the permit; and
d. The division files for permanent retention.
2. Interim use permits shall be in effect for five years, at which time up to two annual extensions may be granted for a total of seven years. Application for an extension shall be subject to a nonrefundable fee, in such amount as established by the city council from time to time by resolution and i n effect at the time of filing of the extension. Extensions exceeding two additional years or seven total years may be requested and require a public hearing and approval by the Planning Commission.
3. No expansion of the premises shall be permitted.
I. Conditions of Approval. In approving an interim use permit, the planning division may impose any conditions deemed reasonable and necessary to ensure that the approval would comply with the findings required by this section.
J. This Code section shall be in effect for 15 years from time of adoption, at which time the Interim Use Permit program will cease and all issued Interim Use Permits shall be null and void.
Section 4. That Subsection 18.22.020 of the National City Municipal Code is amended to read as follows:
18.22.020 Allowed land uses and permit requirements.
Table 18.22.020 identifies the uses of land allowed in each commercial zone. This table does not apply to the CL zone. For a list of allowable uses in the CL zone, please refer to Appendix A of the Westside Specific Plan.
Table 18.22.020
Allowed Land Uses
Commercial Zones
Land Use
Zone Specific Use
Regulations
CA CS
Used auto and truck sales - C
P Permitted
C Conditional use permit
M Minor use permit
— Not permitted
Section 5. Section 18.30.310 (Tattoo Parlors and Body-Piercing Establishments) is hereby amended to read as follows:
18.30.310 – Tattoo parlors and body-piercing establishments
A. Restrictions.
1. No tattoo or body piercing establishment shall be located within o ne-mile of another such establishment.
2. Tattoo parlors and body -piercing establishments shall be located no less than 1,000 feet from a church, school, or playground.
3. Tattoo parlors and body -piercing establishments shall be no closer than two hundre d fifty feet from a residential zone.
4. No tattoo and body -piercing establishments shall be located east of Interstate 805 except within the MXD -2 zone.
5. A Conditional Use Permit is required.
Section 6. Section 18.30.340 (Medical Marijuana Dispensaries) is hereby amended to read as follows:
18.30.340 - Commercial Marijuana Activity
A. Prohibition.
1. Commercial marijuana activity is prohibited except as provided for in Chapter 9.60 of the National City Municipal Code.
B. Definitions.
1. "Commercial marijuana activity" includes the cultivation, possession, manufacture, distribution, processing, storing, laboratory testing, labeling, transportation, distribution, delivery, or sale of marijuana and marijuana products.
2. For purposes of this section, "marijuana" shall have the same meaning as the definition of that word in Section 11018 of the California Health and Safety Code.
Section 7. Section 18.30.345 (Medical Marijuana Cultivation) is hereby struck in its entirety.
Section 8. Severability. If any section, sentence, clause or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City C ouncil hereby declares that it would have passed this Ordinance and adopted this Ordinance and each section, sentence, clause or phrase thereof, irrespective of the fact that any one or more section, subsections, sentences, clauses, or phrases be declared invalid or unconstitutional.
Section 9. This Ordinance shall take effect and be in force thirty (30) days from the date of its passage, and before the expiration of fifteen (15) days after its passage, it or a summary of it, shall be published once, with the names of the members of the City Council voting for and against the same in the Star News, a newspaper of general circulation published in the County of San Diego, California.
INTRODUCED this 2nd day of December, 2025
PASSED and ADOPTED this ____ day of _________, 2026.
__________________________
Ron Morrison, Mayor
ATTEST:
_____________________________
Shelley Chapel, MMC, City Clerk
APPROVED AS TO FORM:
_____________________________
Barry J. Schultz, City Attorney
AGENDA REPORT
Department: Community Services
Prepared by: Mike Pacheco, Community Services Director Meeting Date: Tuesday, December 2, 2025
Approved by: Alejandro Hernandez, Acting City Manager
SUBJECT:
Approval of an Amendment to the Lease and Operating Agreement Between the City of National City and American Golf Corporation for the Operation of the Las Palmas Municipal Golf Course to Extend the Term Five (5) years to October 31, 2030.
RECOMMENDATION:
Adopt the Resolution entitled, “ Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute an Amendment to the Agreement with American Golf Corporation for the Maintenance and Operation of the National City Golf Course to Extend the Agreement by Five-Years.
BOARD/COMMISSION/COMMITTEE PRIOR ACTION:
Not Applicable.
EXPLANATION:
The City of National City entered into a Lease and Operating Agreement with American Golf Corporation (AGC) on May 3, 1984 for the operation of the Las Palmas Municipal Golf Course, a City-owned facility. The agreement provided for an initial five -year term with seven (7) five -year extensions at AGC’s discretion, and two (2) additional five-year options at the City’s discretion.
AGC exercised all seven of its extensions, with the lease scheduled to expire on August 31, 2025.
On August 19, 2025, per Resolution 2025-100, the City and AGC approved a short-term sixty-day extension to allow time for staff and legal review of the existing agreement, given that many provisions were outdated and did not reflect current operational standards or City policy.
The pro posed Second Amendment represents a comprehensive update to ensure continued operation of the golf course while improving accountability, maintenance oversight, and financial return to the City.
Key Terms of the Second Amendment
The amendment includes the following substantive updates:
1. Term Extension
a. Extends the agreement an additional five (5) years, from November 1, 2025 through October 31, 2030
2. Updated Rent and Revenue Sharing
a. Increases the minimum annual rent to $100,000 per year. b. Establishes a 10% gro ss revenue share across all categories, including green fees, cart rentals, driving range, food and beverage, and pro shop sales.
3. Indemnification and Hold Harmless Clause
a. Adds a comprehensive indemnity provision requiring AGC to defend, indemnify, and hold harmless the City, its officers, and employees against claims arising from AGC’s operations
4. Capital Reserve Fund
a. Establishes a Capital Reserve Fund requiring AGC to deposit 2% of monthly gross income into a restricted account for capital improvements and major repairs, subject to City approval before use
5. Annual Report of Capital Improvements and Expenditures a. Requires AGC to submit an annual capital expenditure report within 60 days of each lease year’s end, including actual expenditures, upcoming plans, and a five- year capital needs study every five years
6. Monthly Operational Meetings
a. Requires monthly coordination meetings between City staff and AGC management to discuss operations, revenues, maintenance, and community programming
7. Annual Fee Review
a. Adds an annual review meeting with the City to assess golf course fees to ensure compliance with the original lease intent and market conditions.
FINANCIAL STATEMENT:
The amendment is projected to increase General Fund revenue through both higher minimum rent and enhanced revenue-sharing provisions. Additionally, the Capital Reserve Fund ensures continued investment in facility improvements without reliance on City capital funds.
RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:
Parks, Recreation and Library
ENVIRONMENTAL REVIEW:
This is not a project under CEQA , and is therefore , not subject to environmental review.
CCR15378; PRC 21065.
PUBLIC NOTIFICATION:
The Agenda Report was posted at least 72 hours before the Regular Meeting date and time, and 24 hours before a Special Meeting in accordance with the Ralph M. Brown Act.
ORDINANCE:
Not Applicable
EXHIBITS:
Exhibit A – Agreement
Exhibit B – Resolution
AMENDMENT TO THE AGREEMENT
BY AND BETWEEN
THE CITY OF NATIONAL CITY
AND
AMERICAN GOLF CORPORATION
THIS AMENDMENT TO THE AGREEMENT is entered into this 1st day of November, 2025 (the “Effective Date”), by and between the CITY OF NATIONAL CITY, a municipal corporation (“CITY” or “LANDLORD” ), and AMERICAN GOLF CORPORATION (“TENANT”).
RECITALS
WHEREAS, the CITY and TENANT entered into a Lease and Operating Agreement for the Las Palmas Municipal Golf Couse on May 3, 1984 (the “Agreement” or “Lease”), wherein CITY leased real property to TENANT for operation of a golf course for an initial term of five (5) years, with the option to extend this term for up to seven (7) five-year extensions at the discretion of TENANT, plus two (2) additional five-year option periods at the discretion of CITY; and
WHEREAS, on July 2, 1985, CITY and TENANT entered into an amendment to the Agreement to modify language related to the “Construction Period,” from which time the lease term would commence; and
WHEREAS, TENANT exercised all seven (7) extensions at its discretion , extending the Agreement to August 31, 2025; and
WHEREAS, on August 19, 2025 , the City Council of CITY approved further extending the Agreement by sixty (60) days to allow sufficient time to evaluate compliance with the obligations of the Agreement and consider potential modifications to the Agreement, and to ensure continuation of golf course operations by TENANT in the interim; and
WHEREAS, given the age of the Agreement, amendments to the Agreement are necessary to more accurately reflect changing times and ensure continued operation of the golf course for the benefit of both TENANT and CITY and its residents; and
WHEREAS, the parties desire to amend the Agreement to amend certain specific terms and conditions of the Agreement as indicated below and by extending the term of the Agreement five (5) years to October 31, 2030 in order to continue the Agreement and operation of the golf course.
AGREEMENT
NOW, THEREFORE, the parties hereto agree that:
1. Term. The May 3, 1984 Agreement is hereby amended to further extend the term of the Agreement by five (5) years to October 31, 2030. From and after the Effective Date, the “Lease Year,” defined in section 4.4 of the Lease, shall commence on November 1st and end on October 31 st of the following calendar year. For purposes of the Lease
Year that immediately preceded the Effective Date, such Lease Year shall mean the fourteen (14) month period that commenced on September 1, 2024 and ended on October 31, 2025.
2. Section 4(A) of the Agreement is amended to read as follows:
4. RENT
…
A. During the term of this Lease, the annual rent shall be the greater of either the minimum rent hereinafter set forth for the periods stated or the percentage of gross sales stated in this paragraph.
In no event shall any annual rental payment be less than the following:
1) November 1, 2025 through, and including October 31,
2030, $100,000.00 per year.
Beginning November 1, 2025 and continuing through the end of this Lease, the percentages shall be as follows:
1) Sales from green fees, cart rentals and driving range – ten percent (10%) of gross income;
2) Sales of food and beverages – ten percent (10%) of
gross income;
3) Sales from Pro Shop – ten percent (10%) of gross
income.
3. Section 5.5 of the Agreement is added to read as follows:
5.5. Annual Report of Capital Improvements and Expenditures.
Tenant shall maintain complete and accurate books and records of all Capital Expenditures and provide an annual report and accounting of the same within sixty (60) days of the end of each Lease Year. The annual report shall also include planned and anticipated Capital Expenditures for the upcoming Lease Year and shall, at l east once every five (5) years, include a capital needs study that analyzes and discusses both necessary and desirable Capital Expenditures for commercially reasonable operation and maintenance activities of the course.
Landlord shall have the right to ins pect and audit such books and records in accordance with the general procedures for Landlord’s inspection and audit of Tenant’s books and records under section 4, above.
For purposes of this section, “Capital Expenditures” shall mean, subject to the exclusions below, the costs and expenses (including, but not limited to, labor and materials) incurred to construct, restore, reconstruct, refurbish, replace, augment, and enhance capital improvements. “Capital Expenditures” shall not include costs and expenses for (a) improvements having a minimum
useful life or useful life expectancy of less than one year, or (b) routine maintenance activities (which shall be activities which maintain but do not enhance the quality of the improvement, such as cleaning, adjusti ng, and servicing improvements).
4. Section 10.5 of the Agreement is added to read as follows:
10.5 Landlord and Tenant shall meet at least annually to review fees charged to patrons at the Premises and confirm compliance with the first paragraph of section 10.2, above.
5. Section 24 of the Agreement is added to read as follows:
24. HOLD HARMLESS AND INDEMNIFICATION
To the maximum extent allowed by law, Tenant agrees to indemnify, defend and hold harmless Landlord and its Councilmembers, agents, officers, and employees and volunteers from and against any and all liability or claim of liability, loss or expense, including defense costs and legal fee s and claims for damages of whatsoever character, nature and kind, arising from Tenant’s performance or other obligations under this Lease including, but not limited to, claims, losses, or expenses arising from (a) an act or omission of Tenant, or an agent, invitee, guess or employee of Tenant ; (b) Tenant’s operations or services under this Lease including, but not limited to, liability, expense and claims for: bodily injury , death, personal injury, or prop erty damage caused by negligence, creation or maintenance of a dangerous condition of property, breach of express or implied warranty of product, defectiveness of product, or intentional or reckless infliction of harm, including any workers’ compensation suits, liability or expense, arising from or connected with services performed by or on behalf of Tenant by any person pursuant to this Lease; (c) nonpayment for labor, materials, appliances or power, performed on, or furnished or contributed to the Premises at the request of Tenant; (d) Tenant’s infringement of a patent or copyright or disclosure of a trade secret; and (e) Tenant’s violation of state and federal antitrust laws. Tenant’s obligation to indemnify hereunder shall not be limited by Tenant’s insurance coverage or limits not shall it be restricted to insurance proceeds, if any, received by Landlord and its Councilmembers, officers, employees, agents and volunteers.
The preceding paragraph shall not apply to liability, claims, damages and other matters to the extent they arise from or pertain to (a) the established sole negligence or willful misconduct of the Landlord (which, for the purposes of this paragraph, shall include the Councilmembers, officers, employees, contractors, consultants, agents, representatives, guests, invitees, tenants, subtenants or licensees of Landlord); and (b) Landlord’s violation of any law or breach of this Lease.
6. Section 25 of the Agreement is added to read as follows:
25. CAPITAL RESERVE FUND
Commencing November 1, 2025, Tenant shall establish a fund (the “Capital Reserve Fund”) with an institutional lender selected by Tenant that shall be available exclusively to pay for additional capital improvements and major repairs at the Premises (“Eligible Work”), but not for ordinary maintenance or routine, minor repairs. Within thirty (30) days after the end of each month of the remaining term of this Lease thereafter, Tenant shall make a deposit into the Capital Reserve Fund an amount equal to two percent (2%) of total gross income for the immediately preceding month. Such Capital Reserve Fund deposits shall not be deducted from total gross income. The Capital Reserve Fund shall be expended to deplet ion during the remaining term of this Lease for the purposes outlined herein and for projects mutually agreeable to Landlord and Tenant.
Tenant shall provide to Landlord an annual report detailing the deposits and balance of the Capital Reserve Fund. In addition, the reports shall include all disbursements from the Capital Reserve Funds as well as the Eligible Work financed by such disbursements.
Upon the expiration or earlier termination of this Lease, Tenant shall not be entitled to retain the remainder of the Capital Reserve Fund. Such remaining funds shall be disbursed to Landlord immediately following Tenant's surrender of the Premises in accordance with the terms of this Lease.
For purposes of this section, “capital improvements” shall mean all construction, reconstruction, renovation or replacement of the Premises or portions thereof.
7. Section 26 of the Agreement is added to read as follows:
26. MONTHLY MEETINGS
Landlord and Tenant agree to meet monthly to monitor and discuss any relevant matters under this Lease including, but not limited to, fees and revenues, maintenance of the Premises, operations of the golf course, and special and community events. Landlord hereby designates its Community Services Director or designee to attend such mon thly meetings. Tenant hereby designates its Regional Vice President of Operations and the Golf Course Operations Manager, or their respective designees, to attend such monthly meetings.
8. The parties further agree that, with the foregoing exceptions, each and every other term and provision of the May 3, 198 4 Agreement , as amended by prior amendments, shall remain in full force and effect.
IN WITNESS WHEREOF , the parties hereto have exe cuted this Second Amendment to the Agreement on the date and year first above written.
CITY OF NATIONAL CITY
By:________________________
Ron Morrison, Mayor
APPROVED AS TO FORM:
By:___________________________
Barry J. Schultz
City Attorney
AMERICAN GOLF
CORPORATION
By:
__________________________
Title:______________________
RESOLUTION NO. 2025 -
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY, CALIFORNIA,
AUTHORIZING THE MAYOR TO EXECUTE AN AMENDMENT TO THE AGREEMENT WITH
AMERICAN GOLF CORPORATION FOR THE MAINTENANCE AND OPERATION OF THE
NATIONAL CITY GOLF COURSE TO EXTEND THE AGREEMENT BY FIVE YEARS
WHEREAS, on May 3, 1984, the City of National City (“City”) and American Golf Corporation (“American Golf”) entered into a Lease and Operating Agreement for the Las Palmas Municipal Golf Course (the “Agreement”) for operation of the golf course located at 1439 Sweetwater Rd. for an initial term of five (5) years, with the option for seven (7) five -year extensions at the discretion of American Golf, plus two (2) additional five -year option periods at the discretion of City; and
WHEREAS, on July 2, 1985, City and American Golf amended the Agreement to modify language related to the “Construction Period,” from which time the lease term would commence, and subsequently entered into a number of other amend ments to the Agreement to address contractual and operational updates, include fee updates; and WHEREAS, American Golf has exercised all seven (7) extensions at its discretion, extending the Agreement to August 31, 2025, and requested an offer of an addit ional five-year extension from City; and
WHEREAS, the parties discussed further extending the Agreement through exercise of the City’s option but, instead, extended the Agreement for sixty (60) days to allow time to evaluate the requested extension and consider potential modifications to the Agreement, as approved by the City Council on August 19, 2025; and
WHEREAS, under the Agreement, American Golf currently pays $72,000 annually for the operation of the property and an additional 10% of sales from green fees, cart rentals, and driving range, plus 6% of sales from pro shop, food and beverage sales; and
WHEREAS, to ensure continuation of operations and maintenance of the golf course under updated terms that better reflect current standards and practices, City staff recommends approval of an Amendment to the Agreement with American Golf that extends the Agreement by five (5) years t o October 31, 2030 ; increases the minimum annual rent to $100,000 ; increases revenue sharing to 10% for all categories; establishes a Capital Reserve Fund; and makes other administrative changes , including an indemnity provision, monthly coordination meetings , an annual review of fees charged, and annual capital reporting.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF NATIONAL CITY, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:
Section 1: That t he City Council hereby authorizes the Mayor to execute an Amendment to the agreement with American Golf Corporation to extend the agreement by five years to October 31, 2030, among other amendments.
Section 2: That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions.
PASSED and ADOPTED this 2nd day of December, 2025.
Ron Morrison, Mayor
ATTEST:
Shelley Chapel, MMC, City Clerk
APPROVED AS TO FORM:
Barry J. Schultz, City Attorney
AGENDA REPORT
Department: City Manager's Office
Prepared by: Pedro Garcia, Economic Development Manager Meeting Date: Tuesday, December 2, 2025
Approved by: Alejandro Hernandez, Acting City Manager
SUBJECT:
Professional Services Agreement with H inderliter, de Llamas & Associates for a Revenue Modernization Study of the City’s Business License Program
RECOMMENDATION:
Adopt the Resolution Entitled: “Resolution of the City Council of the City of National City, California, Authorizing the Mayor to Execute an Agreement with H inderliter, de Llamas & Associates to Conduct a Revenue Modernization Study of the City’s Business License Program in the Amount of $50,000.”
BOARD/COMMISSION/COMMITTEE PRIOR ACTION:
Not Applicable.
EXPLANATION:
The City of National City contracts with Hinderliter, de Llamas & Associates (“HdL”) for business tax and Transient Occupancy T ax (TOT) administration services. HdL provides auditing, compliance, and operational support to ensure accuracy and efficiency in the City’s business license revenue collection processes.
As part of the City’s ongoing effort s to improve financial resilien ce and expand revenue opportunities, staff is recommending a specialized engagement with HdL to conduct a Revenue Modernization Study of the City’s business license program.
The proposed work aligns with the City Council’s direction to explore proactive, data-driven approaches to revenue management and diversification, ensuring the City can sustain service delivery levels while addressing long-term fiscal challenges.
HdL will perform a comprehensive evaluation of the City’s business license revenue program, including:
Reviewing existing business classifications, fee structures, and administrative processes to identify modernization opportunities.
Conducting a comparative analysis of similar -sized and regional cities to assess best practices and identify potential efficiency improvements. Modeling various revenue and administrative scenarios to determine potential impacts on small, medium, and large businesses under different policy approaches. Providing data visualizations, benchmarking, and recommended pol icy adjustments to align with equitable and sustainable revenue management practices.
The study will provide a technical foundation for understanding how National City’s business license program , in particular the business tax revenue, compares regionally and what modernization strategies could improve efficiency, compliance, and fairness.
The work will also help staff and Council identify opportunities to:
Streamline business registration and compliance processes. Modernize revenue collection tools and data management. Enhance customer service for business owners.
Strengthen the City’s fiscal position through improved administration and policy alignment.
HdL’s proposed scope of work includes analysis, interactive modeling, and presentations to staff and Council summarizing key findings and potential strategies for improvement.
The proposed study is exploratory and informational in nature, does not authorize or implement any new tax or fee, and any future policy changes would require separate City Council action.
Upon completion, staff would present the study findings and recommendations to the City Council for discussion and further policy direction.
FINANCIAL STATEMENT:
The total cost for the engagement is $50,000, which will be funded through the City Revitalization Project account 100-10-13-13500-7213-.
RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:
Balanced Budget and Economic Development
ENVIRONMENTAL REVIEW:
This is not a project under CEQA , and is therefore , not subject to environmental review.
CCR15378; PRC 21065.
PUBLIC NOTIFICATION:
The Agenda Report was posted at least 72 hours before the Regular Meeting date and time, and 24 hours before a Special Meeting in accordance with the Ralph M. Brown Act.
ORDINANCE:
Not Applicable
EXHIBITS:
Exhibit A – Agreement
Exhibit B – Scope of Services
Exhibit C – Resolution
AGREEMENT
BY AND BETWEEN
THE CITY OF NATIONAL CITY
AND
HINDERLITER, DE LLAMAS & ASSOCIATES
THIS AGREEMENT is entered into on this 2nd day of December, 2025 by and between the CITY OF NATIONAL CITY, a municipal corporation ( “CITY”), and HINDERLITER, DE LLAMAS & ASSOCIATES, a California corporation (the CONSULTANT”).
R E C I T A L S
WHEREAS, the CITY desires to employ a CONSULTANT to conduct a rev enue modernization study of CITY’s business license program.
WHEREAS, the CITY has determined that the CONSULTANT is a municipal finance, budgeting, and economic development firm specializing in providing auditing, operations and revenue solutions for public agencies and is qualified by exp erience and ability to perform the services desired by the CITY, and the CONSULTANT is willing to perform such services.
NOW, THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS FOLLOWS:
1. ENGAGEMENT OF CONSULTANT . The CITY agrees to engage the CONSULTANT to conduct a revenue modernization study of CITY’s business license program , and the CONSULTANT agrees to perform the services set forth here in accordance with all terms and conditions contained herein.
The CONSULTANT represents that all services shall be performed directly by the CONSULTANT or under direct supervision of the CONSULTANT.
2. EFFECTIVE DATE AND LENGTH OF AGREEMENT. This Agreement shall not become effective and binding until fully executed by both the CITY and CONSULTANT. The duration of this Agreement is for the period December 2, 2025 through December 31, 2026.
3. SCOPE OF SERVICES. The CONSULTANT will perform services as set forth in the attached Exhibit “A”.
The CONSULTANT shall be responsible for all research and reviews related to the work and shall not rely on personnel of the CITY for such services, except as authorized in advance by the CITY. The CONSULTANT shall appear at meetings specified in Exhibit “A” to keep staff and City Council advised of the progress on the project.
The CITY may unilaterally, or upon request from the CONSULTANT, from time to time reduce or increase the Scope of Services to be performed by the CONSULTANT under this Agreement. Upon doing so, the CITY and the CONSULTANT agree to meet in good faith and confer for the purpose of negotiating a corresponding reduction or increase in the copensation associated with said change in services.
4. PROJECT COORDINATION AND SUPERVISION . Bruce Foltz , Finance Director, hereby is designated as the Project Coordinator for the CITY and will monitor the progress and execution of this Agreement. The CONSULTANT shall assign a single Project Director to provide supervision and have overall responsibility for the progress and e xecution of this Agreement for the CONSULTANT. Connor Duckworth thereby is designated as the Project Director for the CONSULTANT.
5. COMPENSATION AND PAYMENT . The compensation for the CONSULTANT shall be based on the schedule and amounts set forth in Exh ibit “A” covering actual work performed. The total cost for all work described in Exhibit “A” shall not exceed $50,000. Invoices pursuant to the schedule in Exhibit “A” will be processed for payment and remitted within thirty (30) days from receipt of invo ice, provided that work is accomplished consistent with Exhibit “A”, as determined by the CITY.
The CONSULTANT shall maintain all books, documents, papers, employee time sheets, accounting records, and other evidence pertaining to costs incurred, and shall make such materials available at its office at all reasonable times during the term of this Agreement and for three (3) years from the date of final payment under this Agreement, for inspection by the CITY, and for furnishing of copies to the CITY, if requested.
6. ACCEPTABILITY OF WORK . The CITY shall decide any and all questions which may arise as to the quality or acceptability of the services performed and the manner of performance, the acceptable completion of this Agreement, and the amount of compensation due.
In the event the CONSULTANT and the CITY cannot agree to the quality or acceptability of the work, the manner of performance, and/or the compensation payable to the CONSULTANT in this Agreement, the CITY or the CONSULTANT shall give to the other written notice. Within ten (10) business days, the CONSULTANT and the CITY shall each prepare a report which supports their position and file the same with the other party. The CITY shall, with reasonable diligence, determine the quality or acceptability of the work, the manner of perfo rmance, and/or the compensation payable to the CONSULTANT.
7. DISPOSITION AND OWNERSHIP OF DOCUMENTS . The Memoranda, Reports, Maps, Drawings, Plans, Specifications, and other documents prepared by the CONSULTANT for this project, whether paper or electron ic, shall: (1) be free from defects; (2) become the property of the CITY for use with respect to this project ; and (3) shall be turned over to the CITY upon completion of the project, or any phase thereof, as contemplated by this Agreement.
Contemporaneously with the transfer of documents, the CONSULTANT hereby assigns to the CITY, and CONSULTANT thereby expressly waives and disclaims any copyright in, and the right to reproduce, all written material, drawings, plans, specifications, or other work prepared under this A greement, except upon the CITY’s prior authorization regarding reproduction, which authorization shall not be unreasonably withheld. The CONSULTANT shall, upon request of the CITY, execute any further document(s) necessary to fur ther effectuate this waiver and disclaimer.
The CONSULTANT agrees that the CITY may use, reuse, alter, reproduce, modify, assign, transfer, or in any other way, medium, or method utilize the CONSULTANT’ s written work product for the CITY’ s purposes, and the CONSULTANT expressly waives and disclaims any residual rights granted to it by Civil Code Sections 980 through 989 relating to intellectual property and artistic works.
Any modification or reuse by the CITY of documents, drawings, or specifications prepared by the CONSULTANT shall relieve the CONSULTANT from liability under Section 15, but only with respect to the effect of the modification or reuse by the CITY, or for any liability to the CITY should the documents be used by the CITY for some project other than what was expressly agreed upon within the Scope of Services of this project, unless otherwise mutually agreed.
8. INDEPENDENT CONTRACTOR. Both parties hereto in the performance of this Agreement will be acting in an independent capacity and no t as agents, employees, partners, or joint venturers with one another. Neither the CONSULTANT nor the CONSULTANT’ s employees are employees of the CITY, and are not entitled to any of the rights, benefits, or privileges of the CITY’s employees, including but not limited to retirement, medical, unemploy - ment, or workers’ compensation insurance.
This Agreement contemplates the personal services of the CONSULTANT and the CONSULTANT’s employees, and it is recognized by the parties that a substantial inducement to the CITY for entering into this Agreement was, and is, the professional reputation and competence of the CONSULTANT and its employees. Neither this Agreement , nor any interest herein, may be assigned by the CONSULTANT without the prior written consent of the CITY.
Nothing herein contained is intended to prevent the CONSULTANT from employing or hiring as many employees, or SUBCONSULTANTS, as the CONSULTANT may deem necessary for the proper and efficient performance of this Agreement. All agreements by CONSULTANT with its SUBCONSULTANT(S) shall require the SUBCONSULTANT(S) to adhere to the applicable terms of this Agreement.
9. CONTROL. Neither the CITY, nor its officers, agents , or employees shall have any control over the conduct of the CONSULTANT or any of the CONSULTANT’ s employees, except as set forth in this Agreement. The CONSULTANT, or the CONSULTANT’ s agents, servants, or employees are not in any manner agents, servants, or employees of the CITY. The CONSULTANT and its agents, servants, and employees are wholly independent from the CITY and CONSULTANT’s obligations to the CITY are solely prescribed by this Agreement.
10. COMPLIANCE WITH APPLICABLE LAW . The CONSULTANT, in the performance of the services to be provided herein, shall comply with all applicable state and federal statutes and regulations, and all applicable ordinances, rules, and regulations of the City of National City, whether now in force or subsequently enacted. The CONSULTANT and each of its SUBCONSULTANT(S), shall obtain and maintain a current City of National City business license prior to and during performance of any work pursuant to this Agreement.
11. LICENSES, PERMITS, ETC . The CONSULTANT represe nts and covenants that it has all licenses, permits, qualifications, and approvals of whatever nature that are legally required to practice its profession. CONSULTANT must promptly produce a copy of any such license, permit, or approval to CITY upon request. The CONSULTANT represents and covenants that the CONSULTANT shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement, any license, permit, or approval which is legally required for the CONSULTANT to practice its profession.
12. STANDARD OF CARE.
A. The CONSULTANT, in performing any services under this Agreement, shall perform in a manner consistent with that level of care and skill ordinarily exercised by members of the CONSULTANT’s trade or profession currently practicing under similar conditions and in similar locations. The CONSULTANT shall take all special precautions necessary to protect the CONSULTANT’s employees and members of the public from risk of harm arising out of the nature of the work and/or the conditions of the work site.
B. Unless disclosed in writing prior to the date of this Agreement, the CONSULTANT warrants to the CITY that it is not now, nor has it for the five (5) years preceding, been debarred by a governmental agency or involved in debarme nt, arbitration , or litigation proceedings concerning the CONSULTANT’ s professional performance or the furnishing of materials or services relating thereto.
C. The CONSULTANT is responsible for identifying any unique products, treatments, processes, or materials whose availability is critical to the success of the project the CONSULTANT has been retained to perform, within the time requirements of the CITY, or, when no time is specified, then within a commercially reasonable time. Accordingly, unless the CONSULTANT has notified the CITY otherwise, the CONSULTANT warrants that all products, materials, processes, or treatments identified in the project documents prepared for the CITY are reasonably commercially available. Any failure by the CONSULTANT to use due diligence under this sub-section will render the CONSULTANT liable to the CITY for any increased costs that result from the CITY’ s later inability to obtain the specified items or any reasonable substitute within a price range that allows for project co mpletion in the time frame specified or, when not specified, then within a commercially reasonable time.
13. DRUG FREE WORKPLACE. The CONSULTANT agrees to comply with the CITY’s Drug-Free Workplace requirements. Every person awarded a contract by the CITY for the provision of services shall certify to the CITY that it will provide a drug -free workplace. Any subcontract entered into by the CONSULTANT pursuant to this Agreement shall contain this provision.
14. NON-DISCRIMINATION PROVISIONS . The CONSULTANT shall not discriminate against any employee or applicant for employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. The CONSULTANT will take positive ac tion to insure that applicants are employed without regard to their age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. Such action shall include, but not be limited to , the following: employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. The CONSULTANT agrees to post in conspicuous
places available to employees and applicants for employment any notices provided by the CITY setting forth the provisions of this non-discrimination clause.
15. CONFIDENTIAL INFORMATION . The CITY may from time to time communicate to the CONSULTANT certain confidential information to enable the CONSULTANT to effectively perform the services to be provided herein. The CONSULTANT shall treat all such information as confidential and shall not disclose any part thereof without the prior written consent of the CITY. The CONSULTANT shall limit the use and circulation of such information, even within its own organization, to the extent necessary to perform the services to be provided herein. The foregoi ng obligation of this Section 15 , however, shall not a pply to any part of the information that (i) has been disclosed in publicly available sources of information; (ii) is, through no fault of the CONSULTANT, hereafter disclosed in publicly available sources of information; (iii) is already in the possession of the CONSULTANT without any obligation of confidentiality; or (iv) has been or is hereafter rightfully disclosed to the CONSULTANT by a third party, but only to the extent that the use or disclosure thereof has been or is rightfully authorized by that third party.
The CONSULTANT shall not disclose any reports, recommendations, conclusions, or other results of the services or the existence of the subject matter of this Agreement without the prior written consent of the CITY. In its performance hereunder, the CONSULTANT shall comply with all legal obligations it may now or hereafter have respecting the information or other property of any other person, firm, or corporation.
CONSULTANT shall be liable to CITY for any damages caused by breach of this condition, pursuant to the provisions of Section 16.
16. INDEMNIFICATION AND HOLD HARMLESS . To the maximum extent provided by law, the CONSULTANT agrees to defend, indemnify, and hold harmless the City of National City, its officers, officials, agents, employees, and volunteers against and from any and all liability, loss, damages to property, injuries to, or death of any person or persons, and all claims, demands, suits, actions, proceedings, reasonable attorneys’ fees, and defense costs, of any kind or nature, including workers’ compensation claims, of or by anyone whomsoever, resulting from or arising out of the CONSULTANT’ s performance or other obligations under this Agreem ent; provided, however, that this indemnification and hold harmless shall not include any claims or liability arising from the established sole negligence or willful misconduct of the CITY, its agents, officers, employees, or volunteers. CITY will cooperat e reasonably in the defense of any action, and CONSULTANT shall employ competent counsel, reasonably acceptable to the City Attorney.
The indemnity, defense, and hold harmless obligations contained herein shall survive the termination of this Agreement for any alleged or actual omission, act, or negligence under this Agreement that occurred during the term of this Agreement.
17. EMPLOYEE PAYMENTS AND INDEMNIFICATION.
17.1 PERS Eligibility Indemnification . If CONSULTANT’s employee(s) providing services under this Agreement claims, or is determined by a court of competent jurisdiction or the California Public Employees Retirement System (“PERS”) to be eligible for enrollment in PERS of the CITY, CONSULTANT shall indemnify, defend, and hold harmless CITY for the payment of any employer and employee contributions for PERS benefits on behalf of the employee as well
as for payment of any penalties and interest on such contributions which would otherwise be the responsibility of the CITY.
CONSULTANT’S employees providing service under this Agreement shall not:
(1) qualify for any compensation and benefit under PERS; (2) be entitled to any benefits under PERS; (3) enroll in PERS as an employee of CITY; (4) receive any employer contributions paid by CITY for PERS benefits; or (5) be entitled to any other PERS-related benefit that would accrue to a CITY employee. CONSULTANT’s employees hereby waive any claims to benefits or compensation d escribed in this Section 17 . This Section 17 applies to CONSULTANT notwithstanding any other agency, state , or federal policy, rule, regulation, law , or ordinance to the contrary.
17.2 Limitation of CITY Liability . The payment made to CONSULTANT under this Agreement shall be the full and complete compensation to which CONSULTANT and CONSULTANT’s officers, employees, agents, and subcontractors are entitled for performance of any work under this Agreement. Neither CONSULTANT nor CONSULTANT’s officers, employees, agents, and subcontractors are entitled to any salary or wages , or retirement, health, leave, or other fringe benefits applicable to CITY employees. The CITY will not make any federal or state tax withholdings on behalf of CONSULTANT. The CITY shall not be required to pay any workers’ compensation insurance on behalf of CONSULTANT.
17.3 Indemnification for Employee Payments . CONSULTANT agrees to defend and indemnify the CITY for any obligation, claim, suit, or demand for tax, retirement contribution including any contribution to PERS, social security, salary or wages, overtime payment, or workers’ compensation payment which the CITY may be required to make on behalf of (1) CONSULTANT, (2) any employee of CONSULTANT, or (3) any employee of CONSULTANT construed to be an employee of the CITY, for work performed under this Agreement. This is a continuing obligation that survives the termination of this Agreement.
18. WORKERS’ COMPENSATION. The CONSULTANT shall comply with all of the provisions of the Workers’ Compensation Insurance and Safety Acts of the State of California, the applicable provisions of Division 4 and 5 of the California Labor Code, and all amendments thereto; and all similar s tate or federal acts or laws applicable; and shall indemnify, and hold harmless the CITY and its officers, employees, and volunteers from and against all claims, demands, payments, suits, actions, proceedings, and judgments of every nature and description, including reasonable attorney’s fees and defense costs presented, brought, or recovered against the CITY or its officers, employees, or volunteers, for or on account of any liability under any of said acts which may be incurred by reason of any work to be performed by the CONSULTANT under this Agreement.
19. INSURANCE. The CONSULTANT, at its sole cost and expense, shall purchase and maintain, and shall require its SUBCONSULTANT(S), when applicable, to purchase and maintain throughout the term of this Agreement, the following insurance policies:
A. If checked, Professional Liability Insurance (errors and omissions) with minimum limits of $1,000,000 per occurrence.
B. Automobile Insurance covering all bodily injury and property damage incurred d uring the performance of this Agreement, with a minimum coverage of $1,000,000
combined single limit per accident. Such automobile insurance shall include owned, non -owned, and hired vehicles. The policy shall name the CITY and its officers, agents, employ ees, and volunteers as additional insureds, and a separate additional insured endorsement shall be provided.
C. Commercial General Liability Insurance, with minimum limits of either $2,000,000 per occurrence and $4,000,000 aggregate, or $1,000,000 per occurre nce and $2,000,000 aggregate with a $2,000,000 umbrella policy, covering all bodily injury and property damage arising out of its operations, work, or performance under this Agreement. The policy shall name the CITY and its officers, agents, employees, and volunteers as additional insureds, and a separate additional insured endorsement shall be provided. The general aggregate limit must apply solely to this “project” or “location”. The “project” or “location” should be noted with specificity on an endorsement that shall be incorporated into the policy.
D. Workers’ Compensation Insurance in an amount sufficient to meet statutory requirements covering all of CONSULTANT’ s employees and employers’ liability insurance with limits of at least $1,000,000 per accident. In addition, the policy shall be endorsed with a waiver of subrogation in favor of the CITY. Said endorsement shall be provided prior to commencement of work under this Agreement.
If CONSULTANT has no employees subject to the California Workers’ Compensation and Labor laws, CONSULTANT shall execute a Declaration to that effect. Said Declaration shall be provided to CONSULTANT by CITY.
E. The aforesaid policies shall constitute primary insurance as to the CITY, its officers, officials, employees, and volunteers, so that any other policies held by the CITY shall not contribute to any loss under said insurance. Said policies shall provide for thirty (30) days prior written notice to the CITY ’s Risk Manager, at the address listed in subsection G below, of cancellation or material change.
F. If required insurance coverage is provided on a “claims made” rather than “occurrence” form, the CONSULTANT shall maintain such insurance coverage for three (3) years after expiration of the term (and any extensions) of this Agreement. In addition, the “retro” date must be on or before the date of this Agreement.
G. The Certificate Holder for all policies of insurance required by this Section shall be:
City of National City
c/o Risk Manager
1243 National City Boulevard
National City, CA 91950-4397
H. Insurance shall be written with only insurers authorized to conduct business in California that hold a current policy holder’s alphabetic and financial size category rating of not less than A:VII according to the current Best’s Key Rating Guide, or a company of equal financial stability that is approved by the CITY’s Risk Manager. In the event coverage is provided by non- admitted “surplus lines” carriers, they must be included on the most recent List of Ap proved Surplus Line Insurers (“LASLI”) and otherwise meet rating requirements.
I. This Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by the CITY’s Risk Manager. If the CONSULTANT does not keep all insurance policies required by this Section 19 in full force and effect at all times during the term of this Agreement, the CITY may
treat the failure to maintain the requisite insurance as a breach of this Agreement and terminate the Agreement as provided herein.
J. All deductibles and self-insured retentions in excess of ten-thousand dollars ($10,000) must be disclosed to and approved by the CITY. CITY reserves the right to modify the insurance requirements of this Section 19, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.
K. If the CONSULTANT maintains broader coverage or higher limits (or both) than the minimum limits shown above, the CITY shall be entitled to the broader coverage or higher limits (or both) maintained by the CONSULTANT. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the CITY.
20. LEGAL FEES. If any party brings a suit or action against the other party arising from any breach of any of the covenants or agreements or any inaccuracies in any of the representations and warranties on the part of the other party arising out of this Agreement, then in that event, the prevailing party in such action or dispute, whether by final judgment or out-of-court settlement, shall be entitled to have and recover of and from the other party all costs and expenses of suit, including attorneys’ fees.
For purposes of determining who is to be considered the prevailing party, it is stipulated that attorney’s fees incurred in the prosecution or defense of the action or suit shall not be considered in determining the amount of the judgment or award. Attorney’s fees to the prevailing party if other than the CITY shall, in addition, be limited to the amount of attorney’s fees incurred by the CITY in its prosecution or defense of the action, irrespective of the actual amount of attorney’s fees incurred by the prevailing party.
21. TERMINATION.
A. This Agreement may be terminated with or without cause by the CITY.
Termination without cause shall be effective only upon sixty (60) day’s written notice to the CONSULTANT. During said sixty (60) day period the CONSULTANT shall perform all services in accordance with this Agreement.
B. This Agreement may also be terminated immediately by the CITY for cause in the event of a material breach of this Agreement, misrepresentation by the CONSULTANT in connection with the formation of this Agreement or the perform ance of services, or the failure to perform services as directed by the CITY.
C. Termination with or without cause shall be effected by delivery of written Notice of Termination to the CONSULTANT as provided for herein.
D. In the event of termination, all finished or unfinished Memoranda Reports, Maps, Drawings, Plans, Specifications , and other documents prepared by the CONSULTANT, whether paper or electronic, shall immediately become the property of and be delivered to the CITY, and the CONSULTANT shall be entitled to receive just and equitable compensation for any work satisfactorily completed on such documents and other materials up to the effective date of the Notice of Termination, not to exceed the amounts payable hereunder, and less any damages caused the CITY by the CONSULTANT’ s breach, if any. Thereafter, ownership of said written material shall vest in the CITY all rights set forth in Section 7.
E. The CITY further reserves the right to immediately terminate this Agreement upon: (1) the filing of a petition in bankruptcy affecting the CONSULTANT; (2) a reorganization of the CONSULTANT for the benefit of creditors; or (3) a business reorganization, change in business name, or change in business status of the CONSULTANT.
22. NOTICES. All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, return receipt requested; or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile , or fax; and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility, (iii) if mailed by registered, certified, or ordinary mail, five (5) days (ten (10) days if the address is outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, when delivered to the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile, or fax, when sent. Any notice, request, demand, direction , or other co mmunication delivered or sent as specified above shall be directed to the following persons:
To CITY: Bruce Foltz
Finance Director
City of National City
1243 National City Boulevard
National City, CA 91950-4397
To CONSULTANT:
Connor Duckworth
Client Advisor
Hinderliter, De Llamas & Associates
120 S State College Blvd. #200
Brea, CA 92821
Notice of change of address shall be given by written notice in the manner specified in this Section. Rejection or other refusal to accept or the inabilit y to deliver because of changed address of which no notice was given shall be deemed to constitute receipt of the notice, demand, request, or communication sent. Any notice, request, demand, direction , or other communication sent by cable, telex, telecopy, facsimile, or fax must be confirmed within forty-eight (48) hours by letter mailed or delivered as specified in this Section.
23. CONFLICT OF INTEREST AND POLITICAL REFORM ACT
OBLIGATIONS. During the term of this Agreement, the CONSULTANT shall not perfo rm services of any kind for any person or entity whose interests conflict in any way with those of the City of National City. The CONSULTANT also agrees not to specify any product, treatment, process, or material for the project in which the CONSULTANT has a material financial interest, either direct or indirect, without first notifying the CITY of that fact. The CONSULTANT shall at all times comply with the terms of the Political Reform Act and the Na tional City Conflict of Interest Code. The CONSULTANT shall immediately disqualify itself and shall not use its official position to influence in any way any matter coming before the CITY in which the CONSULTANT has a financial interest as defined in Gover nment Code Section 87103. The CONSULTANT represents that it has no knowledge of any financial interests that would require it to disqualify itself from any matter on which it might perform services for the CITY.
If checked, the CONSULTANT shall comply with all of the reporting requirements of the Political Reform Act and the National City Conflict of Interest Code.
Specifically, the CONSULTANT shall file a Statement of Economic Interests with the City Clerk of the City of National City in a timely manner on forms which the CONSULTANT shall obtain from the City Clerk.
The CONSULTANT shall be strictly liable to the CITY for all damages, costs , or expenses the CITY may suffer by virtue of any violation of this Section 23 by the CONSULTANT.
24. PREVAILING WAGES . State prevailing wage rates may apply to work performed under this A greement. State prevailing wage rates apply to all public works contracts as set forth in California Labor Code, including but not limited to, Sections 1720, 1720.2, 1720.3, 1720.4, and 1771. Consultant is solely responsible to determine if state prevailing wage rates apply and, if applicable, pay such rates in accordance with all laws, ordinances, rules, and regulations.
25. ADMINISTRATIVE PROVISIONS.
A. Computation of Time Periods. If any date or time period provided for in this Agreement is or ends on a Saturday, Sunday, or federal, state, or legal holiday, then such date shall automatically be extended until 5:00 p.m. Pacific Time of the next day which is not a Saturday, Sunday, or federal, state, or legal holiday.
B. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument.
C. Captions. Any captions to, or headings of, the sections or subsections o f this Agreement are solely for the convenience of the parties hereto, are not a part of this Agreement, and shall not be used for the interpretation or determination of the validity of this Agreement or any provision hereof.
D. No Obligations to Third Par ties. Except as otherwise expressly provided herein, the execution and delivery of this Agreement shall not be deemed to confer any rights upon, or obligate any of the parties hereto, to any person or entity other than the parties hereto.
E. Exhibits and Sch edules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. To the extent any exhibits, schedules, or provisions thereof conflict or are inconsistent with the terms and conditions contained in this Agreement, the terms and conditions of this Agreement shall control.
F. Amendment to this Agreement. The terms of this Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto.
G. Assignment & Assumption of Rights. CONSULTANT shall not assign this Agreement, in whole or in part, to any other party without first obtaining the written consent of CITY.
H. Waiver. The waiver or failure to enforce any provision of this Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof.
I. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. The venue for any legal action arising under this Agreement shall be in either state or federal court in the County of San Diego, State of California.
J. Audit. If this Agreement exceeds ten-thousand dollars ($10,000), the parties shall be subject to the examination and audit of the State Auditor for a period of three (3) years after final payment under the Agreement, per Government Code Section 8546.7.
K. Entire Agreement. This Agreement supersedes any prior agreements, negotiations, and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise made by either party hereto, or by or to an employee, officer, agent, or representative of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby.
L. Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto.
M. Subcontractors or Subconsultants. The CITY is engaging the services of the CONSULTANT identified in this Agreement. The CONSULTANT shall not subcontract any portion of the work, unless such subcontracting was part of the original proposal or is allowed by the CITY in writing. In the event any portion of the work under this Agreement is subcontracted, the subconsultant(s) shall be required to comply with and agree to, for the benefit of and in favor of the CITY, both the insurance provisions in Section 19 and the indemnification and hold harmless provision of Section 16 of this Agreement.
N. Construction. The parties acknowledge and agree that (i) each party is of equal bargaining strength, (ii) each party has actively participated in the drafting, preparation, and negotiation of this Agreement, (iii) each such party has consulted with or has had the opportunity to consult with its own, independent counsel and such other professional advisors as such party has deemed appropriate, relative to any and all matters contemplated under this Agreement, (iv) each party and such party’s counsel and advisors have reviewed this Agreement, (v) each party has agreed to enter into this Agreement following such review and the rendering of such ad vice, and (vi) any rule or construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Agreement, or any portions hereof, or any amendments hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year written below.
CITY OF NATIONAL CITY
By: ____________________________
Ron Morrison, Mayor
Date: ___________
HINDERLITER, DE LLAMAS &
ASSOCIATES
(Corporation – signatures of two corporate officers required) (Partnership or Sole proprietorship – one signature)
By: ______________________________
(Name)
(Title)
Date: ___________
APPROVED AS TO FORM:
By: ____________________________
Barry J. Schultz
City Attorney
Date: ___________
By: ______________________________
(Name)
(Title)
Date: ___________
CONTACT INFORMATION
CITY OF NATIONAL CITY
1243 National City Boulevard
National City, CA 91950-4397
Phone: 619-336-4265
Contact: Bruce Foltz
Title: Finance Director
Dept.: Finance Department
Email: [email protected]
HINDERLITER, DE LLAMAS &
ASSOCIATES
120 S State College Blvd. #200
Brea, CA 92821
Phone: 714-879-5000
Contact: Connor Duckworth
Title: Client Advisor
Email: [email protected]
Revenue Modernization Study
Scope of Services
City of National City, CA
Consultant will provide the following Services relative to Client’s Revenue Modernization Study of the City’s business license program, inclusive of the scope elements and deliverables listed below.
1. Business Tax Ordinance / Fee Study
1.1. Current Tax Registry Analysis – Consultant will conduct an analysis of the City’s business tax registration database. Data will be compiled on the number of businesses, current tax revenues received by the City, categories, and other related information to provide a baseline of the City’s current tax structure and to allow consultant to model the potential impact of changes to the current model. Contingent on data availability, this analysis will include the following:
1.1.1. A calculation of the effective tax rate paid by small, medium, and large businesses in the City. (Consultant will use estimated or actual gross receipts to create these categories.)
1.1.2. An analysis of the length of tenure of currently active businesses in the City.
1.1.3. An analysis of the trends within major economic sectors, including whether revenue is tracking the measure of the tax (or if the current tax structure is deviating from the trend of the underlying input/measure of the tax).
1.1.4. An analysis of the net growth in numbers of inside businesses.
1.1.5. An analysis of the top 100 businesses (by the City’s current business tax measure) looking at their contribution to the total revenue and key trends, if any, in the top 100 businesses.
1.1.6. A review of the existing municipal code structure for both business tax and TOT to indicate any opportunities for administrative improvements.
1.2. Fee Analysis and Comparative Study – Using the data compiled from the registration analysis, as well as data compiled from other sources, such as revenu e data from the State, Consultant will prepare a report comparing the City model to those of neighboring cities. Contingent on data availability, this analysis will include the following.
1.2.1. Identification of a set of nine similar jurisdictions to use for comparison.
1.2.2. Review of the total revenue trends for each of the ten jurisdictions (nine comparison jurisdictions and the City) along with key attributes like population and number of businesses, the last substantial update to the code, and primary business tax measure.
1.2.3. Visualization of the City’s business tax revenue per capita and per business compared to the other nine jurisdictions.
1.2.4. Trend of the overall growth of business tax revenue for each of the ten jurisdictions, benchmarked against the highest year of revenue for the City.
1.2.5. Creation of a basket of hypothetical businesses and comparison of how each of the ten jurisdictions would tax those hypothetical businesses. The hypothetical businesses will be drawn from composites of small, medium, and large businesses in your City.
1.3. Modified Tax Structure Options – As a result of the findings of the comparison report, Consultant will prepare a report with three options for tax structure changes. Contingent on data availability, this analysis will include the following
1.3.1. An analysis of how the taxes paid by the hypothetical businesses in the basket of business identified in the comparison study would change for each model.
1.3.2. An analysis of how the effective tax rate would be changed for small, medium, and large businesses (as identified in the Current Registry Analysis).
1.3.3. An analysis of the models' impact on locally owned and small businesses. (Consultant defines a “locally owned business” as one with a physical and mailing address within the City.)
1.3.4. A comparison of the per-capita and per-business revenue for each of the three models against the ten comparison jurisdictions and, where useful, against additional high-revenue cities identified by Consultant.
1.3.5. A visualization of the proposed tax rates in the models compared to other tax rates, like sales tax.
1.3.6. A comparison of the % of revenues from the top 100 businesses pre- and post-change, assuming that one of the models is adopted.
1.4. Additional Support – the following activities are included at no additional cost.
1.4.1. Staff Meetings – Consultant will schedule the following meetings to review deliverables and questions with City staff.
1.4.1.1. Kick-off meeting
1.4.1.2. Review and approve the comparison jurisdictions
1.4.1.3. Review of the interactive model
1.4.1.4. Review of the first draft of the report
1.4.1.5. Review of the revised final report
1.4.2. Meetings with Committees and Council - Consultant will make ourselves available for the following meetings with reasonable advance notice.
1.4.2.1. A presentation of the draft report to a committee
1.4.2.2. The presentation of a revised, final draft report to the committee. (Consultant can make changes that take less than a total of two hours to revise at no additional cost. Changes beyond that two-hour limit will be made on a time and material basis after written approval from the City.)
1.4.2.3. Presentation of the final report to City Council
1.4.2.4. A second meeting with Council to answer technical questions post-polling
1.4.3. Technical Support for Community Meetings
1.4.3.1. Consultant will provide responses to the City to technical questions raised by community stakeholders in any community meetings the City holds.
1.4.3.2. Consultant will also provide a list of the top businesses that the City may want to contact to discuss the potential impact on their businesses.
1.4.4. Deliverables – The deliverables from the study will be:
1.4.4.1. Comparison jurisdiction set
1.4.4.2. Interactive model
1.4.4.3. Draft of report
1.4.4.4. PowerPoint for presentation of the report to the committee, Council, or both
1.4.4.5. Final report
1.4.4.6. List of potential businesses for community outreach
1.4.5. Additional Support Activities
1.4.5.1. Consultant will also review and work with the City Attorney’s office to draft new ordinance language supporting a chosen model
1.4.5.2. Consultant will provide reasonable support to assist any polling or ballot firm the City chooses to understand the models
1.4.6. Timeline - Once the contract is signed by both parties and the data is available to Consultant, the clock on the below timeline begins to run. For the tim eline, Week 1 is the week on which the clock starts to run.
1.4.6.1. Schedule the kick-off meeting. (By week 2)
1.4.6.2. Meet to review the Jurisdiction comparisons (By week 3)
1.4.6.3. Meet to review the interactive model (By week 6)
1.4.6.4. Deliver the first draft report. (By week 10)
1.4.6.5. Deliver PowerPoint for presentations. (By week 11)
1.4.6.6. Deliver the final report. (TBD based on presentations to the Council and staff direction.)
1.4.7. A Note on Implementation – Once a model is chosen and initial polling is completed, Consultant can meet with the City to discuss options for implementation. Changing the code also requires changes in forms, software set -up, process, and likely some community outreach ahead of renewal season. Consultant will be happy to meet with the City to discuss the additional sc ope of that work.
FEES
2. Business Tax Ordinance / Fee Study – Fee is $50,000.00, due 45% at the project kickoff meeting, 45% upon delivery of the first draft report for review, and 10% upon delivery of the final report.
RESOLUTION NO. 2025 -
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY , CALIFORNIA,
AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT WITH H INDERLITER, DE LLAMAS & ASSOCIATES IN THE AMOUNT OF $50,000 TO CONDUCT A REVENUE MODERNIZATION STUDY OF THE CITY’S BUSINESS LICENSE PROGRAM.
WHEREAS, the City of National City (“City”) engages outside consultants for specialized services, as needed, and previously entered into an agreement with Hinderliter, de Llamas & Associates (“HdL”) for business tax and transient occupancy tax administration services; and
WHEREAS, the City seeks to strengthen long -term fiscal sustainability through modernization of revenue administration, benchmarking against peer jurisdictions, and improved customer service for local businesses, and is desirous of entering into a new agreement with HdL due to their specialized expertise in municipal revenue analysis, program evaluation, and policy benchmarking; and
WHEREAS, based on HdL’s expertise and experience providing such specialized services, City staff recommends executing a new agreement with HdL, in the amount of $50,000, to perform a comprehensive revenue modernization study of the City’s business license program, including the review of classifications, processes, regional practices, and administrative scenarios.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF NATIONAL CITY, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:
Section 1: That the City Council hereby authorizes the Mayor to execute an agreement with H inderliter, de Llamas & Associates in the amount of $50,000 to conduct a revenue modernization study of the City’s business license program. The Agreement is attached to the Agenda Report as Exhibit A.
Section 2: That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions.
PASSED and ADOPTED this 2nd day of December, 2025.
Ron Morrison, Mayor
ATTEST:
Shelley Chapel, MMC, City Clerk
APPROVED AS TO FORM:
Barry J. Schultz, City Attorney
AGENDA REPORT
Department: Finance
Prepared by: Bruce Foltz, Finance Director
Meeting Date: Tuesday, December 2, 2025
Approved by: Alejandro Hernandez, Acting City Manager
SUBJECT:
City of National City Annual Comprehensive Financial Report (ACFR) for the Fiscal Year Ended June 30, 2024.
RECOMMENDATION:
Accept and File the Report.
BOARD/COMMISSION/COMMITTEE PRIOR ACTION:
Not Applicable.
EXPLANATION:
Transmitted herewith is the City of National City’s Annual Comprehensive Financial Report (ACFR) for the Fiscal Year ended June 30, 202 4, prepared by the City’s external auditors, The Pun Group, LLP. The report includes all agencies under the control of the City Council, as well as the Successor Agency to the Community Developm ent Commission as the National City Redevelopment Agency. The auditors have conducted their examination of the financial statements in accordance with generally accepted auditing standards and have expressed an unmodified (“clean”) opinion of those statements.
FINANCIAL STATEMENT:
The FY 2024 ACFR presents the financial position of the City as of June 30, 2024.
RELATED CITY COUNCIL 2020-2025 STRATEGIC PLAN GOAL:
Balanced Budget and Economic Development
ENVIRONMENTAL REVIEW:
This is not a project under CEQA , and is therefore , not subject to environmental review.
CCR15378; PRC 21065.
PUBLIC NOTIFICATION:
The Agenda Report was posted at least 72 hours before the Regular Meeting date and time, and 24 hours before a Special Meeting in accordance with the Ralph M. Brown Act.
ORDINANCE:
Not Applicable
EXHIBIT:
Exhibit A - Fiscal Year 2024 Annual Comprehensive Financial Report (ACFR)
City of National City
National City, California
Annual Comprehensive Financial Report
For the Year Ended June 30, 2024
Prepared by:
Finance Department, City of National City
City of National City
Annual Comprehensive Financial Report
For the Year Ended June 30, 2024
Table of Contents
i
Page
INTRODUCTORY SECTION (Unaudited)
Table of Contents ............................................................................................................................................................. i Letter of Transmittal ........................................................................................................................................................ v City Officials ................................................................................................................................................................ xiv City Organizational Chart ..................................................................................................... ........................................ xv
FINANCIAL SECTION
Independent Auditor’s Report on Financial Statements ........................................................................................... 1
Management’s Discussion and Analysis (Required Supplementary Information) (Unaudited) ............................ 5
Basic Financial Statements:
Government-Wide Financial Statements:
Statement of Net Position ..................................................................................................... ............................ 18 Statement of Activities ..................................................................................................... ................................ 20
Fund Financial Statements:
Governmental Fund Financial Statements:
Balance Sheet .............................................................................................................. ............................... 24 Reconciliation of the Governmental Funds Balance Sheet
to the Government-W ide Statement of Net Position .............................................................................. 27 Statement of Revenues, Expenditur es, and Changes in Fund Balance ...................................................... 28 Reconciliation of the Governmental Statement of Revenues, Expenditures, and Changes in Fund Balances to the Government-Wide Statement of Activiti es and Changes in Net Position ............................................................................. 30
Proprietary Fund Financial Statements:
Statement of Net Position .................................................................................................. ........................ 33 Statement of Revenues, Expenses, and Changes in Net Position .............................................................. 34 Statement of Cash Flows .................................................................................................... ....................... 35
Fiduciary Fund Financial Statements:
Statement of Fiduciary Net Position ........................................................................................ .................. 39 Statement of Changes in Fiduciary Net Position ....................................................................................... 40
Notes to the Basic Financial Statements ............................................................................................................. 45
City of National City
Annual Comprehensive Financial Report
For the Year Ended June 30, 2024
Table of Contents (Continued)
ii
Page
FINANCIAL SECTION (Continued)
Required Supplementary Information (Unaudited):
Budgetary Information ............................................................................................................................................ 95 Budgetary Comparison Schedules:
General Fund ................................................................................................................ .................................... 96 Housing Asset Special Revenue Fund .......................................................................................... .................... 97 Housing Choice Voucher Progr am Special Revenue Fund .............................................................................. 98 Sewer Special Revenue Fund .................................................................................................. ......................... 99 ARPA Special Revenue Fund ................................................................................................... ..................... 100 Other Special Revenue Fund .................................................................................................. ........................ 101 Housing Authority Special Revenue Fund ...................................................................................... ............... 103 Schedules of Changes in the Net Pension Liability and Related Ratios ......................................................... ...... 104 Schedules of Pension Contributions ........................................................................................... .......................... 106 Schedule of Changes in Total O PEB Liability and Related Ratios ...................................................................... 107
Supplementary Information:
Non-Major Governmental Funds:
Combining Balance Sheet ..................................................................................................... ......................... 114 Combining Statement of Revenues, Expend itures, and Changes in Fund Balances ...................................... 117 Schedule of Revenues, Expenditures, and Ch ange in Fund Balances – Budget and Actual:
Library Special Revenue Fund ............................................................................................... ................. 120 Parks Maintenance Special Revenue Fund ..................................................................................... ......... 121 Library Capital Outla y Special Revenue Fund ........................................................................................ 122 Gas Tax Special Revenue Fund ............................................................................................... ................ 123 Community Development Block Gran t (CDBG) Special Revenue Fund ................................................ 124 HOME Program Special Revenue Fund .......................................................................................... ........ 125 Asset Forfeiture Special Revenue Fund ...................................................................................... ............. 126 Nutrition Special Revenue Fund ............................................................................................. ................. 127 Library Bonds Debt Service Fund ............................................................................................ ............... 128
Internal Service Funds:
Combining Statement of Net Position ......................................................................................... ................... 130 Combining Statement of Revenues, Expe nses, and Changes in Net Position ................................................ 132 Combining Statement of Cash Flows ........................................................................................... .................. 134
City of National City
Annual Comprehensive Financial Report
For the Year Ended June 30, 2024
Table of Contents (Continued)
iii
Page
STATISTICAL SECTION (Unaudited)
Financial Trends:
Net Position by Component – Last Ten Fiscal Years ............................................................................ ............... 142 Changes in Net Position – Last Ten Fiscal Years .............................................................................. ................... 144 Fund Balances of Government F unds – Last Ten Fiscal Years ............................................................................ 148 Changes in Fund Balances of Government Funds – Last Ten Fiscal Years ......................................................... 150
Revenue Capacity:
Assessed Value and Actual Value of Ta xable Property – Last Ten Fiscal Years ................................................. 152 2023/24 Use Category Summary ................................................................................................. ......................... 154 Property Tax Dollar Breakdown ................................................................................................ ........................... 155 2023/24 Roll Summary Taxable Property Values ................................................................................. ............... 157 Taxable Sales by Category – Last Ten Calendar Years ........................................................................................ 158 Property Tax Levies and Collecti ons – Last Ten Fiscal Years ............................................................................. 160 Direct and Overlapping Property Tax Rates – Last Ten Fiscal Years ............................................................ ...... 162 Principal Property Tax Payers – Current Year and Nine Years Ago .................................................................... 164 Sales Value History Single Family Residential Full Value Sales ............................................................... .......... 165 Top 25 Sales Tax Producers ................................................................................................... .............................. 167
Debt Capacity:
Ratio of Outstanding Debt by Ty pe – Last Ten Fiscal Years ............................................................................... 168 Direct and Overlapping Debt .................................................................................................. .............................. 170 Net Taxable Assessed Value History ........................................................................................... ......................... 171 Legal Debt Margin Information – Last Ten Fiscal Years ........................................................................ ............. 172 Pledged Revenue Coverage – Last Ten Fiscal Years ........................................................................................... 174
Demographic and Economic Information:
Demographic and Economic Statis tics – Last Ten Fiscal Years .......................................................................... 177
Operating Information:
Full-Time Equivalent City Government Employees by Function/Program – Last Ten Fiscal Years ................... 178 Operating Indicators by Function/Pr ogram – Last Ten Fiscal Years .................................................................... 180 Capital Asset Statistics by Function/ Program – Last Ten Fiscal Years ................................................................ 182
iv
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Transmittal Letter
v
November 12, 2025
To the Honorable Mayor, Members of the City Council, and Citizens of the City of National City:
It is our pleasure to submit the Annual Comprehensive Financial Report (ACFR) of the City of National City (the “City”) for the fiscal year ended June 30, 2024. The ACFR has been prepared in conformity with accounting principles generally accepted in the United States (GAAP) and audited in accordance with Generally Accepted Government Aud iting Standards by an independent firm of licensed certified public accountants.
This report consists of management’s representations concerning the finances of the City. Consequently, management assumes full responsibility for the completeness and reliab ility of the information presented in this report. To provide a reasonable basis for making these representations, management has established a comprehensive internal control fra mework that is designed both to pr otect the City’s assets from loss, theft, or misuse and to compile sufficient reliable info rmation for the preparation of the City’s financial statements in conformity with GAAP. Because the cost of internal controls should not outweigh their benefits, internal controls have been designed to provide reasonable rather than absolute assurance that the financial statements will be free from material misstatement. As management, we assert that, to the best of our knowledge and belief, this fina ncial report is complete and reliabl e in all material respects. All disclosures necessary to enable the reader to gain an understanding of the City's financial activities have been included.
The Pun Group, LLP, an independent auditing firm of certified public accountants, has issued an unmodified opinion (clean opinion) on the City’s financial statements for the fiscal year ended June 30, 2024. The independent auditor’s report is presented as the first component of the financial section of this ACFR.
The Management’s Discussion and Analysis (MD&A) , which immediately follows the independent auditor’s report, provides a narrative introduction, overview, and analysis of the basic financial statements.
The MD&A complements this letter of transmittal and should be read in conjunction with this letter.
The independent audit of the financial statements of the City was part of a broader, federally mandated Single Audit designed to meet the special needs of federal grantor agencies. The standards governing Single Audit engagements require the independent auditor to report not only on the fair presentation of the financial statements, but also on internal controls and complia nce with legal requirements, with emphasis on those involving the administration of federal awards. The City’s Single Audit Report is issued separately.
P
ROFILE OF THE CITY OF NATIONAL CITY
The City of National City, incorporated on Septembe r 17, 1887, is located in southwestern San Diego County, bordered by the City of San Diego to the north and east, San Diego Bay to the west, and the City of Chula Vista to the south. The City is home to a fairly constant population of about 62,000 residents and occupies 9.2 square miles.
Transmittal Letter
vi
The City is a general law city and operates under the council/manager form of government. The City Council has five members, with the Mayor elected at large and the four Councilmembers elected by district.
The Mayor is the presiding officer of the Council. In 2022, National City voters approved transitioning the previously elected positions of City Treasurer and City Clerk to become appointive at the end of the current terms that ended in November 2024.
The City Council is responsible for enacting ordi nances, adopting the budget, establishing policies, reviewing the General Plan, appointing committees, and appointing the City Manager and the City Attorney. The City Manager is responsible for carry ing out the policies and ordinances of the Council, overseeing the day-to-day operations of the City, and appointing the heads of departments. The City Attorney is the legal counsel for the City, the Co mmunity Development Commission, Parking Authority, and the Successor Agency, and advises the City Council, the City’s boards and commissions, and City staff.
The City provides a full range of services, which include general government, public safety (police, fire, disaster preparedness, and building inspection), construc tion and maintenance of the City’s infrastructure, economic development, affordable housing, cultural and recreational programs, library and literacy programs, and senior and nutrition services.
B
UDGETARY CONTROL
The annual budget serves as the foundation for the City’s financial planning and control. The proposed budget is presented to the City Council for review a nd adoption prior to the beginning of each fiscal year, July 1st. The budget is prepared by fund, department and account. After budget adoption, in accordance with the National City Municipal Code, City Counc il must approve any revisions that increase total appropriations of a fund. The City Manager is authorized to make budgetary revisions between budget line items within a fund, and department directors ma y transfer appropriations within their respective departments. The budget is regularly monitored a nd the Council receives quarterly updates. Budget-to- actual comparisons are provided in this report for each major governmental fund for which an annual budget has been adopted. For the General Fund, this comparison is presented as part of the required supplementary information for the governmental funds. The budget-to -actual comparison for governmental funds other than the General Fund, are provide as supplementary information within this report.
F
ACTORS AFFECTING FINANCIAL CONDITION
Economic Profile
During fiscal year 2023-2024 National City continued its economic recovery from the impacts of the COVID-19 pandemic, building on the progress that began in fiscal year 2021. The National City unemployment rate peaked in April 2020 at 18.8%, fa lling steadily throughout fiscal year 2021 and 2022, and measured; at 5.1% as of June 2024.
During the budget development in the Spring of 2023, given continued uncertainty about how the City’s revenue would be impacted by the unpredictable pandemic recovery and global supply chain issues, the City budgeted sales tax revenue for fiscal year 2024 b ased on a 2.5% increase over FY 2023 actual sales tax revenues.
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Sales tax is the City’s main revenue source, accounting for approximately 53% of General Fund resources.
In fiscal year 2024, 59% of sales tax revenue came from the Bradley-Burns uniform local tax and 41% came from the National City voter-approved 1% district transactions and use tax (“Proposition D”). Though the City is heavily dependent upon retail sales-related tax revenues, it has, as Table 1 illustrates, a diversified commercial, retail, and industrial presence, which reduces the impacts of economic downturns and helps it recuperate steadily.
Bradley-Burns sales tax revenue increased in FY 2024 from FY 2023 by $853,937) or 3.72% while the City’s District sales tax increased in FY 2024 by $791,651 or 5.12% over FY 2023.
The second largest revenue source for the City is
property tax revenue. During fiscal year 2024
assessed values of property within National City
increased for the thirteen th consecutive year. Net
taxable values rose by 7.0% for the fiscal year 2024
property tax rolls, with details in table 2. Between
June 2023 and June 2024, the median price in the
City for a detached single-family residential home
grew 17.4%, reaching an average price of $691,089
and a median home price of $705,500. The increase
in home prices is driven by demand outpacing
supply, a common situation that occurs throughout
San Diego County.
The City built a budget for fiscal year 2024 which
anticipated growing unassigned fund balance by
$1.9 million. Actual unassigned fund balance
increased by $3.6 million due to a combination of
revenues increasing by $5.5 million over budget
and expenditure savings of approximately $13.0 million.
Table 1
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viii
The largest contributors to the increase in revenue was an increase in property tax by $1.1 million; total Sales Tax of $1.6 million and investment income of 2.5 million. Personnel cost s make up approximately 59% of the total General Fund’s budget. For the current fiscal year, the budget to actual expenditures for personnel costs saw a positive variance of $5.3 million primarily due to vacant positions, however, total overtime costs exceeded budget by $2.0 primarily in the Police and Fire departments.
Under the City’s General Fund, Maintenance & Operations (“M&O”) saw a savings of $1.0 million which was realized across various accounts, particularly in contract services $774,000, and professional services $333,000.
The capital projects category had a positive variance of $6.7 million between the budget and actuals. This $6.7 million variance does not represent savings. Rather , it is unspent monies on specifically authorized capital improvement projects that are still ongoing. Th e unspent appropriations were carried over to the fiscal year 2024 budget and are reflected in the assigned fund balance component of the fund balance.
Regarding the City’s fund balance categories, the majority of the increase, $5.5 million, was to the General Fund unassigned fund balance, which had a balance of $23.0 million as of June 30, 2023, and increased to $26.7 million as of June 2024.
National City has a progressive history of commerci al development, including the “Mile of Cars,” San Diego County’s first major auto park, and Westfield Plaza Bonita, the County’s first indoor mall and largest enclosed mall in the South San Diego Bay area. Both attract shoppers from throughout the County and outlying areas and continue to be major revenue sources for the City. The Walmart Supercenter is the retail hub of the City’s central section, generating significant tax revenue and bringing shoppers to nearby stores and restaurants. Despite these successes, however, National City has experienced economic ebbs and flows which have directly impacted community service levels. In 2005 and 2006, the City faced revenue shortfalls and a structural deficit that led to reductions in services.
In response, National City voters in 2006 approved th e “Proposition ‘D” transactions & use tax, which produced a high of $16.3 million of revenue in fiscal year 2024. During the November 2014 General Election, National City voters approved a measure ex tending the tax for an additional twenty years.
Proposition “D” has allowed the City to continue to provide important programs and services to its citizens.
During fiscal year 2022, the five-year Proposition D independent review committee convened and after a thorough review of the City’s Ge neral Fund finances, recommended ma intaining the current district transactions and use tax rate of 1% for the following five years. City Council agreed with the recommendation and therefore the tax rate will remain at 1% through fiscal year 2027.
Long-Term Financial Planning
During fiscal year 2020, City management reviewed an d updated the City’s five-year strategic plan. Its purpose is to:
establish a long-range vision and direction for the City; ensure all participants are working toward the same goals and objectives; assess/adjust the direction of the organization given the current (and changing) environment; communicate goals and initiatives of the organization; and provide a basis for developing a work plan to ensure the goals and initiatives of the Strategic Plan are carried out.
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City of National City Strategic Plan Goals
2020-2025
Balanced Budget & Economic Development
Communication & Outreach
Health, Environment, & Sustainability
Housing & Community Development
Parks, Recreation, & Library
Public Safety
Transportation Choices & Infrastructure
The City updates its five-year Capital Improvement Program (“CIP”) annually. The CIP encompasses and highlights some of the City’s needed infrastructure improvements. The City has identified approximately $89 million in capital needs over the next five year s. Funding comes from multiple sources, including available fund balance, general purpose revenues, user fees, special tax revenues, and regional, state, and federal funds. In addition to routine sewer, drainage , and transportation-related projects, the CIP includes improvements to parks, recreation, and community services facilities and municipal buildings and facilities, such as the library, community cen ter, police department, and fire stations. Recently completed and ongoing projects are described below under “Major Accomplishments and Initiatives.”
Funding Long-Term Liabilities
In November 2021, the City took action to refinance the City’s pension unfunded accrued liability owed to CalPERS by issuing approximately $84M in Pension Obligation Bonds (POB). The issuance will provide the City with about $20 million in savings over the term of the bonds by reducing the interest rate on the liability from a then 7% (now 6.8%) charged by CalPER S, to an average bond interest rate of 3%. In addition, the financing restructured the liability to smooth out future payments related to pension liabilities over the following fourteen years. The payment smoothing will have the greatest impact on the next few years, which would have had large spikes in payments owed to CalPERS had the POBs not been issued.
As part of the bond issuance process, the City had a credit rating review. The City’s general obligation bond rating was upgraded from ‘A+’ to ‘AA-‘ stable. In the ratings report, S & P Global stated “the raised rating reflects our view of the City’s significantly improved financial policies and practices coupled with strong performance and very strong and consistent reserves.”
Reserves
A portion of the fund balance of the General Fund, the “Economic Contingency Reserve,” is committed to strengthening the City’s ability to withstand unexpect ed financial emergencies and economic downturns.
During fiscal year 2021, City Council approved amendments to City Council Policy #201, Maintenance of Reserve Funds. The City’s reserve policy establishes that the City will strive to accumulate and maintain an Economic Contingency Reserve balance equal to a minimum of twenty percent (20%) of a single year’s General Fund operating expenditures for these purposes. The amended policy also formalized using a portion of General Fund unassigned fund balance as a reserve to be maintained at a minimum of ten percent (10%) General Fund operating expenditures. As of June 30, 2024, based on the final FY 2024 General Fund Budget of $75,200,881 less capital expenditures, the Economic Contingency Reserve is at 19.2% and the General Fund unassigned fund balance is at 35.4% as defined by the policy.
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The 2021 revision to the reserve policy also updated the funding target for the Facilities Maintenance Reserve to be three times the annual base needed for performing major maintenance on the City’s facilities, which is defined as being 1.5% of the City’s General Fund operating expenditures. The policy also specifies that the City’s annual budget includes funding for major maintenance in the amount of 1.5% of the General Fund operating expenditures. Based on the FY 2024 General Fund Budget, the Facility Maintenance Reserve is at 4.3% which is below the policy level of 4.5%. In accordance with the reserve policy, the assets maintained in the Facilities Maintenance Reserve, as well as those in the Contingency Reserve, described above, are designated as committed fund balance.
In addition to the Contingency R eserve and Facilities Maintenance Reserve, the City maintains a number of other reserves, most of which have accumulated their minimum target balances, as of June 30, 2024.
Cash Management Policies and Practices
As National City’s governing body, the City Council is granted the authority to manage the City’s investment program, pursuant to Califor nia Government Code Section 53600 et seq . Management responsibility for the cash and investment of City funds is delegated to the Director of Finance and/or Financial Services Officer.
The City annually adopts a comprehensive investment policy specifying investment objectives, such as type and term of investments, reporting requirements, and investment oversight. The City’s investments generally include US Treasury and Agency securities, Certificate of Deposit Account Registry Service deposits, medium-term corporate notes, negotiable certificates of deposit, commercial paper, the State of California’s Local Agency Investment Fund, and the County of San Diego Pooled Money Fund. See Note 2 for a list of the City’s authorized investments. The investment policy complies in all respects with State laws governing deposit and investment of public funds.
The objective of the investment portfolio is to enhance the City’s cash resources, while meeting the short and long term cash flow demands of the City. To achieve this objective, the portfolio is structured to provide safety of principal and liquidity, while providing a reasonable return on investments.
M
AJOR ACCOMPLISHMENTS AND INITIATIVES
The City of National City’s Capital Improvement Program (CIP) addresses the City’s initiatives of enhancing public safety and quality of life, and promoting a healthy community. The following summary contains notable projects that were recently completed, under construction or soon to be under construction.
Project names, descriptions, construction costs and completion dates are provided.
Infrastructure
Completed Projects FY 23-24
P-1 Sewer Upsize Project - Phase II, CIP No. 20-01
Project Cost: $1,478,225.71
Completion Date: January 2024
The scope of the P-1 Sewer Upsize Project - Ph ase II consisted of replacing approximately 600 linear feet of existing 8-inch sewer main with new 12-inch sewer main and approximately 400 linear feet with new 14-inch pipe. The area ad jacent to the old land fill site (locally known historically as the “Duck Pond”) and also a portion of the pipe alignment within developed private property required trenchless installation using jack and bore construction.
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xi
The existing 8-inch clay pipe, which was identified as undersized in the City’s Sewer Master Plan, had reached the end of its useful life and therefore, needed to be replaced.
Sweetwater Road Bikeway, CIP No. 19-20
Project Cost: $3,175,016.43
Completion Date: May 2024
This project provided nearly 1.2 miles of protected bike facilities along Sweetwater Road and extended the Class 1 bike path on Plaza Bonita Road to Sweetwater Road (0.4 miles). The project included a road diet, bicycle-friendly intersecti on improvements, and ped estrian enhancements.
This new bicycle facility directly linked the City's bike network to the regional network.
National City Street Resurfacing Project FY 21-22, CIP No. 22-19 Project Cost: $2,398,563.39
Completion Date: October 2023
On November 17, 2020, the City Council authori zed an agreement with Bucknam Infrastructure Group (Bucknam), to prepare the Pavement Mana gement Program (PMP) and to perform street sign inventory. As part of the PMP, Bucknam c onducted a pavement condition survey of all City streets in order to identify the most cost-effective strategies to fund Capital Improvement Program (CIP) projects to maintain and repair existing City streets. Based on the findings from the PMP, staff prioritized the following City streets to be resurfaced:
o National City Boulevard from 16th Street to 33
rd Street
o E. Plaza Boulevard from D Avenue to N Avenue
o E. 16th Street between D Avenue and Highland Avenue
o Mann Avenue from Beta Street to Alpha Street
o Driveway for Fire Squad Station 33 (northeast side of 4th and U Avenue) o Roosevelt Avenue from 8th Street to 15th Street
Ongoing Projects
Bicycle Wayfinding Project, CIP No. 19-25
Project Cost: $336,990
Estimated completion Date: December 2025
The Bicycle Wayfinding Project, CIP 19-25, consists of the fabrication and installation of more than 100 signs and five kiosks at key decision points throughout the City of National City’s recently constructed bicycle network. The wayfinding si gns will direct people on bikes to important destinations such as schools, transit stations, community centers, and parks.
Paradise Creek Water Quality and Community Enhancement Project Phase II, CIP No. 19-11 Project Cost: $2,610,245.00
Estimated completion Date: August 2025
The Paradise Creek Water Quality and Community Enhancement project Ph. II, CIP 19-11 is the second implementation phase that will provide immediate benefit to the creek and the community.
The first phase of the project included construction of a biofiltration detention basin for treatment of the storm water flows collected from Paradise Creek. Also included in Phase I was the installation of slope stability and erosion contro l measures surrounding the biofiltration basin and construction of an access road for Public Works staff to provide maintenance of the creek. On June 5, 2020, Phase I construction was completed.
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xii
Eastside I-805 Community Greenbelt Project, CIP No. 22-09 Project Cost: $3,155,990.50
Estimated completion Date: March 2025
The proposed project is a combination of public right-of-way, multi-use path, and local park improvements. The project is located in the City of National City along the east side of Interstate 805 between Division Street and Plaza Boulevard. It addresses ongoing issues related to waste debris, under-utilized public right-of-way, safet y, and comfort. The project is intended to implement a greenbelt for the neighborhoods on the east side of Interstate 805 between Division Street and Plaza Boulevard. The project will also improve connections to El Toyon Elementary School, Rancho de la Nacion Elementary School, El Toyon Park, and local shopping centers.
Parks & Facilities
Completed Projects FY 23-24
Kimball Park Dog Park and Tot Lot + Las Palmas Park Dog Park project, CIP No. 23-06 Project Cost: $1,036,359.28
Completion Date: April 2024
The project constructed new amenities and improvements at both Kimball and Las Palmas parks.
At Kimball Park construction included a dog park with dog agility equipment, chain link fence and gate, trash receptacles, pet waste station, wood bench, concrete pathway, removal and replacement of drinking fountain, removal and replacement of children play equipment and drainage system for Tot Lot, batting cage, installation of baseball field infield mix, and baseball field storage container.
At Las Palmas Park improvements included a dog park with dog agility equipment, chain link fence and gate, trash receptacles, pet waste station, w ood bench, full square and circle metal benches, solar lighting, removal and replacement of dr inking fountain, hand rail, and removal and replacement of small section of sidewalk.
MLK Community Center, CIP No. 23-02
Project Cost: $665,867.02
Completion Date: April 2024
This project replaced the entry hallway and meeti ng/dining room floor and upgraded the kitchen equipment at the Martin Luther King, Jr. Community Center, located at 140 E 12th Street.
Paradise Creek Educational Park Extension, CIP No. 19-33 Project Cost: $752,716.26
Completion Date: August 2023
This project involved the expansion of Paradise Creek Educational Park, located behind Kimball Elementary School, with access from Hoover Avenue and W. 19th Street. Improvements included the removal of existing asphalt pavement and concrete sidewalk at the northern entrance to the park on Hoover Avenue and replacement with decomposed granite and permeable pavers for stormwater infiltration; installation of new trees, na tive vegetation, and additional stormwater treatment/infiltration features; construction of a community gathering area; traffic calming and pedestrian enhancements such as pedestrian curb ramps for Americans with Disabilities Act (ADA) compliance, curb extensions, a high-visibility crosswalk, and pedestrian actuated flashing crosswalk signs at the intersection of W. 18
th Street and Hoover Avenue; and new bicycle facilities.
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xiii
Las Palmas Swimming Pool Renovation Project, CIP 22-01
Project Cost: $3,447,287.51
Completion Date: June 2024
o The scope of the Las Palmas Swimming Pool Re novation project included re-plastering, re- decking and expanding the width of the pool by 10 feet. The pool's expansion was based on the City Council's desire to increase the pool's capacity for both programming opportunities and swimming time for City residents. The expans ion of the width of the pool created positive benefits for the community, including:
o A 100% increase in lap and recreational swimming for both programmed (fee-based) and free swimming.
o Brought the pool to the standard size for competition at the high school and collegiate level. o Created the ability to construct different confi gurations for pool usage, resulting in more flexibility for programmed and free swim options simultaneously, increasing the overall use of the pool.
Ongoing Projects
Police Pistol Range Safety Improvements, CIP 20-05
Project Cost: $624,111
Estimated completion Date: January 2025
The firing range (Range), which is located within the National City Police Department headquarters, is being updated to address insufficient air filtra tion of metal contaminated dust from the Range and to address/enhance laminar air flow during multiple user training exercises.
Information on the City’s CIP projects can be found at:
https://www.nationalcityca.gov/government/engineering-public-works/engineering-division/capital- improvement-projects-cip
ACKNOWLEDGEMENTS
The preparation of this report would not have been possible without the dedication and professionalism of the entire staff of the Finance Department. We would like to express our gratitude to those who devoted significant hours in preparing the report. We appreciate and commend all the City departments who assisted and contributed materials to this document. And we acknowledge the Mayor and members of the City Council for their interest, dedication, and constant support for planning and conducting the financial operations of the City in a responsible and progressive manner.
Respectfully submitted,
Bruce Foltz
Finance Director
Chief of Police
Fire Chief
Director of Administrative Services
Director of Engineering & Public Works
Director of Housing Authority
Director of Library & Community Services
Acting Director of Community Development
Ron Morrison
Mayor
Luz Molina
Vice Mayor
Jose Rodriguez
Councilmember
Marcus Bush
Councilmember
Ditas Yamane
Councilmember
City Council
Directory of City Officials
R. Mitchel Beauchamp
City Treasurer
Shelley Chapel
City Clerk
%HQMDPLQ0DUWLQH]
City Manager
Barry J. Schultz
City Attorney
Jose Tellez
Sergio Mora
Molly Brennan
Roberto Yano
Carlos Aguirre
Joyce Ryan
Ben Martinez
Department Heads
xiv
CITY ORGANIZATIONAL CHART
xv
xvi
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4660 La Jolla Village Drive, Suite 1 00
San Diego, California 92122
INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and Members of the City Council
of the City of
National City
National City, California
Report on the Audit of the Financial Statements
We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the City of Nati onal City, California (the “City”), as of and for the year ended June 30, 2024, and the related notes to the basic fi nancial 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, each majo r fund, and the aggregate remaining fund information of the City, as of June 30, 2024, 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 unde r 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.
Responsibilities of Management for the Financial Statements Management is responsible for the prep aration and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United Stat es of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate wh ether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ab ility to continue as a going concern for twelve months beyond the financial st atement date, including any currently known information that may raise substantial doubt shortly thereafter.
To the Honorable Mayor and Members of the City Council
of the City of National City
National City, California
2 Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whet her the financial statements as a whole are free from material misstatement, whether due to fraud or error, a nd 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 auditing standards ge nerally accepted in the United States of America 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 ove rride 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 auditing standards generally accepted in the United States of America and the Government Auditing Standards, we
exercise professional judgment and maintain professional skepticism throughout the audit. identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed. evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal cont rol–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 Schedules, Schedule of Changes in the Net Pension Liability and Related Ratios, Schedules of Pension Contributions, and Schedule of Changes in Total OPEB Liability and Related Ratios to be presented to supplement the basic financial statements. Such information, although not a part of the financial statements, is required by the Government al Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the financial statements in an appropriate operational, economic, or historical context.
We have applied certain limited proce dures to the required supplementary in formation in accordance with auditing standards generally accepted in the Unit ed 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 financial statements, and other knowledge we obtained during our audit of the 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.
To the Honorable Mayor and Members of the City Council
of the City of National City
National City, California
3 Supplementary Information
Our audits were conducted for the purpose of forming opinio ns on the financial statements that collectively comprise the City’s basic financial statements. The Combining and Individual Non-Major Fund Financial Statements and the Budgetary Comparison Schedules are presented for purposes of a dditional analysis and are not a required part of the basic financial statements. Such information is the res ponsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the b asic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America and Government Auditing Standards . In our opinion, the Combining and Individual Non-Major Fund Financial Statements and the Budgetary Comparison Schedules are fairly st ated, in all material respec ts, in relation to the basic financial statements as a whole.
Other Information
Management is responsible for the othe r information included in the annual report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditor’s report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.
In connection with our audits of the b asic financial statements, our responsibility is to read the other information and consider whether a material inconsistenc y exists between the other information and the basic financial statements, or the other information otherwise appears to be materially mi sstated. 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 November 12, 2025, on our consideration of the City’s internal control over financia l reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.
San Diego, California
November 12, 2025
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5 Management’s Discussion and Analysis (Unaudited)
Management of the City of National City (the “City”) offe rs this narrative overview a nd analysis of the financial activities of the City for the fiscal year ended June 30, 2024.
We encourage readers to consider the information presented here in conjunction with our le tter of transmittal, which can be found beginning on page V of this report. The intent of this discussion and analysis is to provide a summarized view of the City’s financial performance, as a whole; therefore, readers should also review the basic financial statements and supporting notes to enhance their understanding of the City’s financial performance.
Overview of the Financial Statements
This Management’s Discussion & Analys is (“MD&A”) is intended to serve as an introduction to the City’s basic financial statements, which comprise th ree components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the basic financial statements.
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 government-wide financial statements consist of the Statement of Net Position and the Statement of Activities.
The Statement of Net Position presents information on all of the City’s assets, liabilities, and deferred inflows and outflows of resources, with the differen ce reported as net position. Over time, in creases or decreases in the City’s net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating.
The Statement of Activities and Chang es in Net Position presents information showing how the government’s net position changed during the most recent fiscal year. All ch anges 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 resu lt in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).
The government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from ot her 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, transportation, community development, health, and culture and recreation.
The government-wide financial statements report the activities of the City and its three blended component units: the Housing Authority of the City of National City, the Parking Authority of the City of National City, and the National City Joint Powers Financing Authority. Although legally sep arate, the component units function, for all practical purposes, as departments of the City and, therefore, have been blended, as part of the primary government. The Successor Agency to the Community Development Commission as the National City Redevelopment Agency (“Successor Agency”) is included as a fiduciary component unit, since it would be misleading to exclude it, due to the nature and significance of the relationship between it and the City. The activity of th e Successor Agency is reported with the City’s fiduciary funds, which are not included in the government-wide statem ents because the resources of those funds are not available to support the City’s own programs.
The government-wide financial statements are presented using the accrual basis of accounting, which differs from the modified accrual basis of accounting used for preparing the governmental fund financial statements. Note 1 of the Notes to the Basic Financial Statements section fully describes these bases of accounting. Proprietary funds, discussed below, also are reported using the accrual basis of accounting.
6 The government-wide financial statements can be found on pages 18-20 of this report.
Fund Financial Statements. A fund is a grouping of related accounts used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other st ate and local governments, uses fund accounting to ensure and demonstrate compliance with fina nce-related legal requirement s. In the basic financial statements, the emphasis is on major fund s. Each of the City’s funds falls into one of three categories: governmental, proprietary, or fiduciary.
Governmental Funds. Governmental funds are used to account for the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, the 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 the City’s near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers can better understand the long-term impact of the government’s near-term financing decisions. Reconciliations between the government-wide financial statements and the governmental fund financial statements are included as part of the basic financial statements. The major reconciling items relate to capital assets and debt. In the governmental funds, acquisitions of capital assets are treated as “expenditures,” because, upon purchase of a capital asset, cash used to acquire it is no longer available for other purposes. The issuance of debt provides cash, which is then available for specified purposes. At the end of the fiscal year, the unassigned fund balances in the governmental fund financial statements reflect spendable resources available for appropriation by the City Council. Spendable balances are not presented on the face of the government-wide financial statements.
The City maintains forty-seven individual governmental f unds, including the General Fund. Information is presented separately in the governmental funds’ Balance Sheet and Statement of Revenues, Expenditures, and Changes in Fund Balance for the General Fund, Housing Fund, Housing Choice Voucher (aka “Section 8”) Program Fund, Sewer Service Fund and American Rescue Plan Act (ARPA) Fund, all of which are major funds. The City’s other governmental funds are considered non-major, and their data are combined into a single, aggregated presentation.
The governmental fund financial statements can be found on pages 24-30. Individual fund information for each of the non-major governmental funds is provided in the form of combining statements and can be found on pages 114-119.
The City adopts annual budgets for its General, Housing, Housing Choice Voucher Progr am, Sewer Service, and the American Rescue Plan Act (ARPA) Funds. Budgetary comparison statemen ts, found on pages 96-100, have been provided, to reflect compliance with these budgets.
Proprietary Funds. The City maintains two types of proprietary funds: enterprise and internal service. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements.
Internal service funds are used to accumulate and allocate costs internally among the City’s functions. The City has seven internal service funds: the Facilities Maintenance Fund, the Liability Insurance Fund, the Information Systems Maintenance Fund, the Motor Vehicle Services Fund, the Equipment Replacement Reserve Fund, the Office Equipment Depreciation Fund, and the Telecommunications Revolvi ng Fund. Because these services predominantly benefit governmental, rather than business-type, functions, their fina ncial information is included within the governmental activities in the government-wide financial statements.
Proprietary fund financial
statements provide the same type of information as the government-wide financial statements (business-type activities), only in more detail. The internal service funds are combined into a single, aggregated presentation in the proprietary fund financial statements.
The proprietary fund financial statements can be found on pages 33-35. Individual fund data for the internal service funds is provided in the form of supplementary combining statements and can be found on pages 130-137.
7 Fiduciary Funds. Fiduciary funds are used to account for activities for which the City’s role is purely custodial. The fiduciary funds of the City are the Agency Funds (comprising the COBRA Insurance Fund and Miscellaneous Deposits Fund) and the Successor Agency Private-purpose Tr ust Fund. These funds are not reflected in the government-wide financial statements because the resources of the funds are not available to support the City’s programs. The accounting used for fiduciary funds is much like that used for proprietary funds.
The fiduciary fund financial statements can be found on pages 39 and 40.
Notes to the Basic Financial Statements. The Notes to the Basic Financial Statements section provides additional information essential for a full understanding of the data provided in the government-wide financial statements . The Notes to the Basic Financial Statements section begins on page 45.
Other Information. In addition to the basic financial statements and accompanying notes, this report presents certain required supplementary inform ation concerning the City’s progress in fundi ng its obligation to provide pension and other postemployment benefits (“OPEB”) to its employees. Required supplementary information can be found on pages 93-107.
The combining statements referred to earlier in connection with non-major governmental funds and internal service funds are presented on pages 114-119 and 130-137, respectively.
Government-wide Financial Analysis
As noted earlier, over time, a government’s net position may serve as a useful indicator of its financial position. Table 1 below presents a summarization of the City’s assets, liabilities, deferred outflows and inflows, and net position for its governmental and business-type activities.
2024 2023 $ Change % Change
Current and Other Assets 213,314,961$ 208,857,933$ 4,457,028$ 2.13% Capital Assets, Net 186,819,555 178,444,289 8,375,266 4.69% TOTAL ASSETS 400,134,516 387,302,222 12,832,294 3.31% Deferred Outflows of Resources 30,311,682 36,158,165 (5,846,483) -16.17% Current Liabilities 26,704,420 29,862,468 (3,158,048) -10.58% Long-term Liabilities 150,084,042 148,563,951 1,520,091 1.02% TOTAL LIABILITIES 176,788,462 178,426,419 (1,637,957) -0.92% Deferred Inflows of Resources 5,889,854 8,483,849 (2,593,995) -30.58% Net Position:
Net Investment in
Capital Assets 180,196,910 170,389,264 9,807,646 5.76% Restricted 110,060,972 106,369,321 3,691,651 3.47% Unrestricted (Deficit) (42,490,000) (40,208,465) (2,281,535) 5.67% TOTAL NET POSITION 247,767,882$ 236,550,119$ 11,217,762$ 4.74% TABLE 1
NET POSITION
For the years ended June 30, 2024 and 2023
Governmental
Activities
8 The City’s assets and deferred outflows of resources exceeded its liabilities and deferred inflows of resources by $206,036,990 at June 30, 2024, an increase of $59,146,860 from June 30, 2023. By far, the largest portion of the City’s net position, $180,196,910 is its investment in capital assets (i.e., land, buildings, machinery, equipment, and infrastructure less the associated debt on these assets). These capital assets are used to provide services to citizens and, consequently, 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 resources, since the capital assets themselves cannot be used to liquidate the liabilities.
Another portion of the City’s net positi on, $110,060,972, represents r esources that are subject to external restrictions on how they may be used. The remainder of net position, unrestricted deficit in net position, increased $2,281,535 year over year. The $9,807,646 increase in capital assets was the main driver of the overall gain in net position between 2024 and 2023.
2024 2023 $ Change % Change
REVENUES:
Program revenues:
Charges for services 23,218,318$ 38,087,351$ (14,869,033)$ -39.04% Op erat ing grant s and
contributions 29,396,626 18,456,518 10,940,108 59.28% Capital g rants and
contributions 218,889 7,090,261 (6,871,372) -96.91% Total program revenues 52,833,833 63,634,130 (10,800,297) -16.97% General revenues:
Tax es:
Property taxes 18,689,432 17,559,333 1,130,099 6.44% Sales taxes 40,326,068 38,678,895 1,647,173 4.26% Franchise taxes 3,400,238 2,490,691 909,547 36.52% Business license taxes 871,831 935,316 (63,485) -6.79% Transient occupancy taxes 2,042,380 2,488,614 (446,234) -17.93% Total taxes 65,329,949 62,152,849 3,177,100 5.11% Investment earnings (loss) 7,782,297 1,358,614 6,423,683 472.81% Miscellaneous 276,557 194,882 81,675 41.91% Total general revenues 73,388,803 63,706,345 9,682,458 15.20% TOTAL REVENUES 126,222,636 127,340,475 (1,117,839) -0.88% EXPENSES:
General government 15,511,130 12,467,497 3,043,633 24.41% Public safety 49,930,158 50,093,848 (163,690) -0.33% Transportation 9,528,332 9,619,556 (91,224) -0.95% Community development 19,932,582 17,168,341 2,764,241 16.10% Health 9,004,358 9,301,026 (296,668) -3.19% Culture and leisure 9,920,765 9,651,503 269,262 2.79% Interest on long-term debt 1,177,548 3,367,717 (2,190,169) -65.03% TOTAL EXPENSES 115,004,873 111,669,488 3,335,385 2.99% CHANGE IN NET POSITION 11,217,763 15,670,987 (4,453,224) -28.42% NET POSITION, BEGINNING OF YEAR 236,550,119 220,879,132 15,670,987 7.09% NET POSITION, END OF YEAR 247,767,882$ 236,550,119$ 11,217,763$ 4.74% TABLE 2
CHANGES IN NET POSITION
For the years ended June 30, 2024 and 2023
Governmental
Activities
9 Table 2 provides a condensed summary of activities of the City’s government for the period ended June 30, 2024, with the prior fiscal year presented for co mparative purposes. The $11,217,763 (4.74%) increase in the City’s total net position is the result of overall revenues exceeding expenses w ith investment earnings, representing the largest single increase in revenues were up $6,423,683 (472.81%) over June 30, 2023. During the fiscal year the City was able to take advantage of higher-than-normal interest rates as the Fede ral Reserve raised the Federal Fund Rate to 5.33% in August 2023 as a means to combat the growing inflation rate, this interest rate remained in effect throughout the entire fiscal year. The Federal Fund Rate had not reached this level since March 2001. The Governmental and Business-type operating results for the current fiscal year are provided in greater detail on page 24.
Governmental Activities. The City’s total revenues from governmental activities were $126,222,636 for the fiscal year ended June 30, 2024, decreasing $1,117,839 or 0.88%, compared to the prio r year. The largest source of revenue for the City, at 31.95%, is sales-related taxes (comprising sales & use tax and district transaction & use tax). Revenues from sales-related taxes increased by $1,647,173 or 4.26%. Property tax which represents property-related taxes (real property taxes, personal property taxes, and property tax in lieu of ve hicle license fee [“VLF”]), increased $1,130,099 or 6.44% compared to FY 2023, moistly due to the full increase in assessed values of 2% set by the County Assessor’s Office and the increase in assessed valu es from the turnover of home sales with in the City. The remaining taxes, Franchise, Business License and Transient Occupancy Tax re presents 8.9% of the City’s total revenues increased by $399,828 or 6.76%.
Capital grants and contributions for governmental activities ended the fiscal year at $218,889, for a 96.91% decrease from the prior year. The primary driver of this decrease was due to the completion of several capital projects in FY 2023 which were funded under the American Rescue Plan Act. Charges for services decreased by $14,869,033, or
39.04%, compared to the prior fiscal year as the accounting of funding for the pension obligation bond (POB) was treated as a charge for services during the prior fiscal year while during the cu rrent fiscal year these proceeds were treated as a transfer from other funds to the POB fund. Lastly, operating grants and contributions increased by $10,940,108, or 59.28%.
The City’s expenses for governmental activities cover a wide array of services, with $49,930,158, or 43.42%, for fiscal year 2024 related to public safety and $15,511,130, or 13.49%, to general government activities. Overall, expenses for governmental activities rose $3,335,385, or 2.99%, with the primary driver of the increase due to growth in general government and community development and decline in long-term debt interest payments.
Financial Analysis of the City’s Funds
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.
Governmental Funds. The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such in formation is useful in assessing the City’s financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year.
The City’s classifications of fund balance comprise a hierarchy based on the extent to which the City is bound to observe constraints imposed upon the use of the financial resources of the funds. Fund balance is reported in five categories, based upon the following defining characteristics:
non-spendable – either not in spendable form or legally or contractually required to be maintained intact; restricted fund – subject to externally enforceable limitations by law, enabling legislation, or limitations imposed by creditors or grantors;
committed – may be spent only for the specific purposes dete rmined by formal action of the government’s highest level of decision-making authority (City Council) and, ther efore, may be used for different purposes only upon the government’s taking the same formal action that imposed the original constraint; assigned – constrained by the City’s intent to utilize fund balance for specific purposes; unassigned – fund balance not falling in any of the foregoing categories and av ailable for spending at the City’s discretion.
10 The table above summarizes the balance sheet of the City’s General Fund and other governmental funds.
As of the end of the current fiscal year, the City’s gove rnmental funds reported combined ending fund balances of $167,251,521, an increase of $67,284,555 over the prior year. The restricted component represents the largest portion, $111,946,538, of the ending fund balance which includes the two bank notes the City holds pertaining to the sale of Kimball & Morgan Towers.
The General Fund is the principal operating fund of the City. At the end of the current fiscal year, the total fund balance of the General Fund increased to $67,899,593 in comparis on to $62,375,221 in the prior fiscal year, an increase of $5,524,372. General Fund revenues grew $4,167,479, or 5.97%, with increases of $2,841,422 in taxes, and $3,404,295 in use of money and property. Revenue decreased by $363,033 from charges for services, $1,429,765 from other revenues, and $55,174 from licenses and permits. Fines and forfeitures and intergovernmental revenues decreased by $212,563, and $17,703 respectively. General Fund expend itures decreased by $1,758,824, with a majority of the decrease in the public safety mostly due to vacant positions and capital outlay due to delayed project construction.
The fund balance classification for the General Fund and other major funds can be found on page 90, in Note 14 of the Notes to Financial Statements section.
Proprietary Funds. As noted earlier, the City’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. Factors concerning the finances of these funds have already been addressed in the discussion of the City’s business-type activities.
2024 2023 2024 2023 2024 2023
Total Assets 76,827,786$ 72,283,735$ 117,817,550$ 118,481,803$ 194,645,336$ 190,765,538$ Total Liabilities 6,351,699 6,879,016 18,041,704 21,523,835 24,393,403 28,402,851 Total Deferred Inflows of Resources 2,576,494 3,029,498 423,918 487,703 3,000,412 3,517,201 Fund Balances
Non-spendable 4,085,866 4,094,518 25,805 25,805 4,111,671 4,120,323 Restricted 10,781,807 9,956,427 101,164,731 97,320,165 111,946,538 107,276,592 Committed 15,680,000 15,680,000 - - 15,680,000 15,680,000 Assigned 10,697,013 9,604,056 - - 10,697,013 9,604,056 Unassigned 26,654,907 23,040,220 (1,838,608) (875,705) 24,816,299 22,164,515 Total fund balance 67,899,593 62,375,221 99,351,928 96,470,265 167,251,521 158,845,486 Total liabilities, deferred inflows of
resources, and fund balances 76,827,786$ 72,283,735$ 117,817,550$ 118,481,803$ 194,645,336$ 190,765,538$ TABLE 3
GOVERNMENTAL FUNDS SUMMARY
For the years ended June 30, 2024 and 2023
General Fund Other Governmental Funds Total Governmental Funds
11 General Fund Budgetary Highlights
Below in Table 4, shows the of the General Fund actual to budget comparison for fiscal year 2024. The City’s General Fund is the City’s largest discretionary fund and is the primary operating fund for the City. The original adopted budget for the General Fund anticipated a deficit of $1,046,190 wh ich including net transfers-out of $993,946 however, the General Fund ending June 30, 2024, actual revenues exc eeded net expenditures and transfers-out by $5,524,372 increasing the ending fund balance to $67,899,593.
Actual amounts differed from the final General Fund budget as follows:
Actual revenues were $5,779,316 more than the final budget. The two largest reve nues sources for the General Fund consist of property tax and sales tax which exceed their respective budget by $868,827 and 6 97,816. The largest single variance was reflected in interest inco me which exceeded budget by $2,679,115 as a result of high interest rates throughout the entire fiscal year.
Actual expenditures were less than their overall budgete d amount by $13,030,883. Th e most significant variance of $6,661,424 is attributable to unspe nt appropriations for capital projects not completed during the year. Capital budget appropriations are carried over to the following fiscal year and reflected in the committed portion of fund balance.
Variance with
Original Budget Final Budget Actual Amounts Final Budget Total Revenues 68,111,577 $ 68,190,313 $ 73,969,629 $ 5,779,316 $ Expenditures:
General government 11,514,687 11,667,405 9,781,914 1,885,491 Public safety 43,208,928 43,529,117 40,982,897 2,546,220 Transportation 4,633,703 5,754,954 4,858,238 896,716 Community development 289,232 289,232 227,624 61,608 Culture and leisure 4,700,277 4,852,508 3,850,661 1,001,847 Capital outlay 3,310,000 8,600,671 1,939,247 6,661,424 Principal 324,738 324,738 356,664 (31,926) Interest on long-term debt 182,256 182,256 172,753 9,503 Total expenditures 68,163,821 75,200,881 62,169,998 13,030,883 Revenues over (under) expenditures (52,244) (7,010,568) 11,799,631 18,810,199 Other Financing Sources (993,946) (1,267,446) (6,275,259) (5,007,813) Net change in fund balance (1,046,190) $ (8,278,014) $ 5,524,372 13,802,386 $ Beginning fund balance 62,375,221
Ending fund balance 67,899,593 $
TABLE 4
For the year ended June 30, 2024
12 Capital Asset and Debt Administration
Capital Assets. The City’s investment in capital assets (net of accumulated depreciation and amortization) for governmental and business-type activities, as of June 30, 20 24, amounted to $186,819,555. This investment includes land, rights of ways, construction in progress, buildings and improvements, machinery, and infrastructure. Infrastructure assets represented 45.48% of total combined assets.
Construction in progress totaled $44 ,560,120, which included new spendi ng of $6,322.807. Depreciation and amortization expense during the fiscal year was $7,237,993 for governmental activities.
Additional information on the City’s capital assets can be found in Note 6 on page 68 of this report.
Long-term Debt. At the end of the current fiscal year, the City had total debt outstanding of $84,185,891.
The City’s total debt decreased by $5,084,438 during the fiscal year 2024. The ne t decrease is due from debt that was retired due to the payment of principal on the City’s debt. As of November 2021, the City’s general obligation bond rating is “AA-.” Additional information on the City’s long-term debt can be found in Note 7 on pages 69-74 of this report.
2024 2023 $ Change % Change
Land 25,597,009$ 25,597,009$ -$ 0.00% Right-of-way 4,245,088 4,245,088 - 0.00% Construction in progress 44,560,120 38,237,313 6,322,807 16.54% Buildings and improvements 19,845,330 21,827,709 (1,982,379) -9.08% Machinery and equipment 6,750,272 6,062,497 687,775 11.34% Infrastructure 84,957,832 81,547,231 3,410,601 4.18% Right-to-use lease assets 101,445 101,445 - 0.00% Radio rights 762,459 825,997 (63,538) -7.69% TOTALS 186,819,555$ 178,444,289$ 8,375,266$ 4.69% TABLE 5
CAPITAL ASSETS AT YEAR-END
(NET OF DEPRECIATION AND AMOTIZATION)
For the years ended June 30, 2024 and 2023
Governmental
Activities
2024 2023 $ Change % Change
2012 General Obligation Refunding Bonds 1,845,000$ 2,175,000$ (330,000)$ -15.17% Bond Premium 6,418 8,023 (1,605) -20.00% HUD 108 Bonds, Series A - 605,000 (605,000) -100.00% 2017 Clean Energy Bonds 1,715,365 1,800,000 (84,635) -4.70% 2017 Lease Revenue Bonds 2,622,125 2,743,061 (120,936) -4.41% 2021 Pension Obligation Bonds 77,675,000 81,330,000 (3,655,000) - Bond Premium (128,554) (135,696) 7,142 - Notes payable 282,867 418,569 (135,702) -32.42% Lease liabilities 167,670 326,372 (158,702) -48.63% TOTALS 84,185,891$ 89,270,329$ (5,084,438)$ -5.70% Activities
TABLE 6
OUTSTANDING LONG-TERM DEBT
For the years ended June 30, 2024 and 2023
Governmental
13 Economic Factors and Next Year’s Budget
Many economic factors were considered in the development of the City’s fiscal year 2025 budget. The most significant factors are described below.
Property values continue to rise significantly throughout California and the San Diego County area resulting in increases to total assessed property valuation in the City. However, since assessed value increases are capped at 2% per year per Proposition 13, the City is only seeing consistent increases of 2% to 3% per year in property tax revenue. As a result, the projected increase in property tax revenues in the fiscal year 2025 budget is approximate ly 3.0% above the actual revenues received in the prior year.
Fiscal year 2024 actuals for sales & use tax and district transactions and use tax revenue combined exceed budget estimates and expectations as inflation grew but consumer spending remained high. Sales & use tax and district transactions & use tax revenues are budgeted at a combined $39.5 million for fiscal year 2025, a slight increase over fiscal year 2024 revised budget projections. Staff forecasts year over year growth of 1.01% for fiscal year 2025 as interest rates increases, inflation, and a possible recession slow down the economy. Beyond fiscal year 2025, the City is forecasting sales tax revenue growth of 0.25% per year.
Fiscal year 2024 was the seventeenth full year of collection of the City’s 1% district transactions & use tax. The tax measure (“Proposition ‘D”) was approved by National City voters in June 2006 and became effective in October 2006.
The initial measure was effective for a period of ten years; however, in Novemb er 2014, voters approved a measure to extend the tax for an additional twenty years.
The tax now generates approximately $16 million in revenue annually, allowing the City to continue to provide important programs and services to its citizens. In accordance with the measure, every five years an independent committee is appointed to evaluate the status of the district transac tions and use tax. The committee’s purpose is to report a recommendation to City Council on whether th e tax should remain in effect at the rate of one percent, or whether the rate should be reduced, or the tax terminated. In fiscal year 2022, an independent evaluation committee convened and recommended to City Council to maintain the current tax rate of 1% for an a dditional five-year period. City Council approved the recommendation.
Requests for Information
This financial report is designed to provide a general overview of the City’s finances for all those interested. Questions concerning any information provided in this report or requests for additional financial information should be addressed to the Director of Finance, 1243 National City Boulevard, National City, CA 91950.Page 660 of 860
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BASIC FINANCIAL STATEMENTS
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GOVERNMENT-WIDE
FINANCIAL STATEMENTS
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Governmental
Activities
ASSETS
Current assets:
Cash and investments 137,608,414$
Receivables:
Accounts 2,981,071
Taxes 7,754,525
Leases 395,183
Interest 717,776
Due from other governments 109,370
Land held for resale 4,866,182
Inventories and prepaid items 171,110
Total current assets 154,603,631
Noncurrent assets:
Restricted cash and investments:
Section 115 pension trust 7,222,427
Section 115 OPEB trust 3,539,380
Held by fiscal agent 10,334
Leases receivable 2,339,583
Loans receivable 45,599,606
Non-depreciable capital assets 74,402,217
Depreciable/amortizable capital assets, net 112,417,338 Total noncurrent assets 245,530,885
Total assets 400,134,516
DEFERRED OUTFLOWS OF RESOURCES
Deferred loss on refunding 16,800
Pension-related deferred outflows 29,857,777
OPEB-related deferred outflows 437,105
Total deferred outflows of resources 30,311,682
City of National City
June 30, 2024
Statement of Net Position
See accompanying Notes to the Basic Financial Statements. 18Page 665 of 860
Governmental
Activities
LIABILITIES
Current liabilities:
Accounts payable 5,149,911$
Due to other governments 61,220
Accrued liabilities 2,813,703
Interest payable 219,613
Unearned revenue 8,327,791
Total OPEB liability - due within one year 330,824
Compensated absences - due within one year 2,711,493
Claims payable - due within one year 2,541,967
Long-term debt - due within one year 4,547,898
Total current liabilities 26,704,420
Noncurrent liabilities:
Developer deposits 1,156,042
Total OPEB liability 4,651,936
Aggregate net pension liability 52,260,932
Compensated absences - due in more than one year 1,986,106 Claims payable - due in more than one year 10,391,033
Long-term debt - due in more than one year 79,637,993
Total noncurrent liabilities 150,084,042
Total liabilities 176,788,462
DEFERRED INFLOWS OF RESOURCES
Pension-related deferred inflows 2,144,838
OPEB-related deferred inflows 1,168,522
Lease-related 2,576,494
Total deferred inflows of resources 5,889,854
NET POSITION
Net investment in capital assets 180,196,910
Restricted:
General services 27,775,884
Community development 20,000
Public safety 320,086
Housing 65,602,772
Debt service 964,910
Capital projects 4,615,513
Investment in Section 115 OPEB trust 3,539,380
Investment in Section 115 pension trust 7,222,427
Total restricted 110,060,972
Unrestricted (deficit) (42,490,000)
Total net position 247,767,882$
Statement of Net Position (Continued)
June 30, 2024
City of National City
See accompanying Notes to the Basic Financial Statements. 19Page 666 of 860
Net (Expense)
Revenue and
Changes in
Net Position
Operating Capital
Charges for Grants and Grants and Governmental
Functions/Programs Expenses Services Contributions Contributions Activities Primary government:
Governmental activities:
General government 15,511,130 $ 2,814,908 $ 7,627,437 $ - $ (5,068,785)$ Public safety 49,930,158 3,774,597 1,283,779 218,889 (44,652,893) Transportation 9,528,332 3,526,439 - - (6,001,893) Community development 19,932,582 171,785 19,850,943 - 90,146 Health 9,004,358 12,572,073 16,177 - 3,583,892 Culture and leisure 9,920,765 358,516 618,290 - (8,943,959) Interest on long-term debt 1,177,548 - - - (1,177,548) Total governmental activities 115,004,873 23,218,318 29,396,626 218,889 (62,171,040) General revenues:
Taxes:
Property taxes 18,689,432
Sales taxes 40,326,068
Franchise taxes 3,400,238
Business license taxes 871,831
Transient occupancy taxes 2,042,380
Total taxes 65,329,949
Investment earnings 7,846,082
Miscellaneous 276,557
Total general revenues 73,452,588
Change in net position 11,281,548
Net position - beginning of year 236,550,119
Net position - end of year 247,831,667$
Statement of Activities
City of National City
For the Year Ended June 30, 2024
Program Revenues
See accompanying Notes to the Basic Financial Statements. 20Page 667 of 860
FUND FINANCIAL STATEMENTS
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GOVERNMENTAL FUND
FINANCIAL STATEMENTS
General Fund - This is the primary operating fund of the City. It is used to account for all revenues and expenditures that are not required to be accounted for in another fund.
Housing Asset Fund -T his fund is used to account for activities of housing assistance and assistance to low income families.
Housing Choice Voucher Program ("Section 8") Fund - This fund is used to account for the activities of housing assistance program funded by HUD. The program provides rental assistance to low income families by subsidizing a portion of the rent directly to landlords on behalf of very low income households.
Sewer Service Fund - This fund is used to account for the collection of sewer connection fees and monthly sewer service charges used for the construction and maintenance of City sewers.
ARPA Special Revenue Fund - This fund is used to account for the proceeds and expenditures of the American Recovery Plan Act funding received by the City.
Other Special Revenue Fund - This represents a combination of minor and less active funds that the City has combined for reporting purposes.
Housing Authority Special Revenue Fund - This fund is used to account for the activities of the development of a viable urban community by providing decent housing, a suitable living environment, and expanding economic opportunities, principally for persons with low and moderate incomes.
POB Debt Service Fund - This fund is used to account for the sources and uses of and debt service on the 2021 Pension Obligation Bonds.
23Page 670 of 860
Housing Choice
Housing Asset Voucher Program Sewer Service ARPA
General Special Revenue Special Revenue Special Revenue Special Revenue Fund Fund Fund Fund Fund
ASSETS
Cash and investments 41,034,919 $ 1,108,927 $ 875,409 $ 29,252,011 $ 6,371,056 $ Receivables:
Accounts 2,636,517 - 72,891 109,747 - Taxes 7,450,524 - - 5,373 - Interest 429,550 5,393 - 148,130 - Leases 2,734,766 - - - - Loans - 10,359,183 - - - Due from other funds 7,657,165 - - - - Due from other governments 36,672 - - 4,563 - Inventories and prepaid items 64,684 - - - - Land held for resale 4,021,182 845,000 - - - Restricted cash and investments:
Investment in Section 115 pension trust 7,222,427 - - - - Investment in Section 115 OPEB trust 3,539,380 - - - - Total assets 76,827,786$ 12,318,503 $ 948,300 $ 29,519,824 $ 6,371,056 $
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES, AND FUND BALANCES
Liabilities:
Accounts payable 2,403,251 $ - $ 19,609$ 139,572 $ 264,449 $ Due to other governments 61,220 - - - - Accrued liabilities 2,439,903 8,298 53,342 25,002 - Due to other funds - - - - - Deposits 118,052 - - - - Unearned revenue 1,329,273 - - - 6,106,607 Total liabilities 6,351,699 8,298 72,951 164,574 6,371,056 Deferred inflows of resources:
Lease-related 2,576,494 - - - - Unavailable revenues - - - - - Total deferred inflows of resources 2,576,494 - - - - Fund Balances:
Nonspendable 4,085,866 - - - - Restricted 10,781,807 12,310,205 875,349 29,355,250 - Committed 15,680,000 - - - - Assigned 10,697,013 - - - - Unassigned (deficit) 26,654,907 - - - - Total fund balances 67,899,593 12,310,205 875,349 29,355,250 - Total liabilities, deferred inflows of
resources, and fund balances 76,827,786$ 12,318,503 $ 948,300 $ 29,519,824 $ 6,371,056 $ (Continued)
City of National City
Major Funds
Balance Sheet
Governmental Funds
June 30, 2024
See accompanying Notes to the Basic Financial Statements. 24Page 671 of 860
Housing Total
Other Authority POB Non-major Total
Special Revenue Special Revenue Debt Service Governmental Governmental Fund Fund Fund Funds Funds
ASSETS
Cash and investments 7,935,710 $ 17,838,723 $ 9,699 $ 7,006,443$ 111,432,897 $ Receivables:
Accounts 3,867 45 - 97,686 2,920,753 Taxes 68 - - 298,560 7,754,525 Interest 18,328 91,931 - 24,444 717,776 Leases - - - - 2,734,766 Loans - 34,908,623 - 331,800 45,599,606 Due from other funds - - - - 7,657,165 Due from other governments 7,210 - - 60,925 109,370 Inventories and prepaid items - 25,805 - - 90,489 Land held for resale - - - - 4,866,182 Restricted cash and investments:
Investment in Section 115 pension trust - - - - 7,222,427 Investment in Section 115 OPEB trust - - - - 3,539,380 Total assets 7,965,183$ 52,865,127 $ 9,699 $ 7,819,858$ 194,645,336 $
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES, AND FUND BALANCES
Liabilities:
Accounts payable 1,044,692 $ 125,699 $ - $ 404,411$ 4,401,683 $ Due to other governments - - - - 61,220 Accrued liabilities 33,652 5,626 - 223,679 2,789,502 Due to other funds 5,858,438 - - 1,798,727 7,657,165 Deposits 949,717 88,273 - - 1,156,042 Unearned revenue - 890,823 - 1,088 8,327,791 Total liabilities 7,886,499 1,110,421 - 2,427,905 24,393,403 Deferred inflows of resources:
Lease-related - - - - 2,576,494 Unavailable revenues - 423,918 - - 423,918 Total deferred inflows of resources - 423,918 - - 3,000,412 Fund Balances:
Nonspendable - 25,805 - - 4,111,671 Restricted 78,684 51,304,983 9,699 7,230,561 111,946,538 Committed - - - - 15,680,000 Assigned - - - - 10,697,013 Unassigned (deficit) - - - (1,838,608) 24,816,299 Total fund balances 78,684 51,330,788 9,699 5,391,953 167,251,521 Total liabilities, deferred inflows of
resources, and fund balances 7,965,183$ 52,865,127 $ 9,699 $ 7,819,858$ 194,645,336 $ (Concluded)
City of National City
Major Funds
June 30, 2024
Governmental Funds
Balance Sheet (Continued)
See accompanying Notes to the Basic Financial Statements. 25Page 672 of 860
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26Page 673 of 860
Total Fund Balances - Total Governmental Funds 167,251,521$ Amounts reported for governmental activities in the Statement of Net Position were different because:
Capital assets used in governmental activities were not financial resources and therefore were not reported in governmental funds.
Government-wide Statement of Net Position 186,819,555
Less: internal service funds' capital assets (5,557,354) Total capital assets 181,262,201
Interest payable on long-term debt did not require current financial resources. Therefore, interest payable was not reported as a liability in Governmental Funds Balance Sheet (net of $2,069 in internal service funds). (217,544)
Long-term liabilities were not due and payable in the current period and therefore were not reported in the governmental funds.
Amount reported in Government-wide Statement of Net Position:
Compensated absences - due within one year (2,711,493)
Compensated absences - due in more than one year (1,986,106) Claims payable - due within one year (2,541,967)
Claims payable - due in more than one year (10,391,033) Long-term debt - due within one year (4,547,898)
Long-term debt - due in more than one year (79,637,993) Aggregate net pension liability (52,260,932)
Total OPEB liability - due within one year (330,824)
Total OPEB liability - due in more than one year (4,651,936) (159,060,182)
Less: amount reported in internal service funds
Leases payable - due within one year 167,670
Compensated absences - due within one year 161,728
Claims payable - due within one year 2,541,967
Claims payable - due in more than one year 10,391,033
13,262,398
Net long-term liabilities (145,797,784)
Deferred outflows of resources related to pensions are not available fo r current period and, therefore, are deferre d in the governmental funds or not recorded in the governmental funds. 29,857,777 Deferred outflows of resources related to OPEB are not available fo r current period and, therefore, are deferre d in the governmental funds or not recorded in the governmental funds. 437,105 Deferred inflows of resources related to pensions are not available for current period and, therefore, are deferred in the governmental funds or not recorded in the governmental funds. (2,144,838) Deferred inflows of resources related to OPEB are not available for current period and, therefore, are deferred in the governmental funds or not recorded in the governmental funds. (1,168,522) Deferred amounts on refunding are not available fo r current period and, therefore, are deferre d in the governmental funds or not recorded in the governmental funds. 16,800 Unavailable revenues are deferred in the governmental funds, but are recognized as revenues in the Government-wide statement of Net Position. 423,918
Internal service funds were used by management to charge the costs of certain activities to individual funds. The assets and liabilities of the internal service funds were included in governmental activities in the Government-wide Statement of Net Position. 17,847,248
Net Position of Governmental Activities 247,767,882$
City of National City
June 30, 2024
to the Government-Wide Statement of Net Position
Reconciliation of the Governmental Funds Balance Sheet
See accompanying Notes to the Basic Financial Statements. 27Page 674 of 860
Housing Choice
Housing Asset Voucher Program Sewer Service ARPA
General Special Revenue Special Revenue Special Revenue Special Revenue Fund Fund Fund Fund Fund
REVENUES:
Taxes 62,178,442 $ - $ - $ - $ - $ Licenses and permits 994,198 - - - - Fines and forfeitures 560,697 - - - - Use of money and property 5,505,978 269,931 3,671 1,151,945 - Intergovernmental 934,022 - 18,091,824 - 4,056,132 Charges for services 3,295,758 - - 12,236,588 - Other revenues 500,534 - - - - Total revenues 73,969,629 269,931 18,095,495 13,388,533 4,056,132 EXPENDITURES:
Current:
General government 9,781,914 - - - - Public safety 40,982,897 - - - - Transportation 4,858,238 - - - - Community development 227,624 337,808 17,846,636 - - Health - - - 8,618,475 - Culture and leisure 3,850,661 - - - - Capital outlay 1,939,247 - 4,623 1,597,663 2,056,132 Debt service:
Principal 356,664 - - - - Interest and fiscal charges 172,753 - - - - Total expenditures 62,169,998 337,808 17,851,259 10,216,138 2,056,132
REVENUES OVER
(UNDER) EXPENDITURES 11,799,631 (67,877) 244,236 3,172,395 2,000,000 OTHER FINANCING SOURCES (USES):
Transfers in 2,005,500 - - - - Transfers out (8,280,759) - - (99,142) (2,000,000) Total other financing sources (uses) (6,275,259) - - (99,142) (2,000,000) CHANGES IN FUND BALANCES 5,524,372 (67,877) 244,236 3,073,253 - FUND BALANCES:
Beginning of year 62,375,221 12,378,082 631,113 26,281,997 - End of year 67,899,593$ 12,310,205 $ 875,349 $ 29,355,250 $ - $ (Continued)
Major Funds
City of National City
Statement of Revenues, Expenditures, and Changes in Fund Balance Governmental Funds
For the Year Ended June 30, 2024
See accompanying Notes to the Basic Financial Statements. 28Page 675 of 860
Housing Total
Other Authority POB Non-major Total
Special Revenue Special Revenue Debt Service Governmental Governmental Fund Fund Fund Funds Funds
REVENUES:
Taxes 476,716 $ - $ - $ 5,800,019$ 68,455,177 $ Licenses and permits 390,686 - - - 1,384,884 Fines and forfeitures 95,627 - - 118,700 775,024 Use of money and property 159,635 1,843,068 - 194,367 9,128,595 Intergovernmental 4,784,679 869,870 - 1,364,428 30,100,955 Charges for services 178,373 - - 50,109 15,760,828 Other revenues - 169,908 - 10,516 680,958 Total revenue
s 6,085,716 2,882,846 - 7,538,139 126,286,421 EXPENDITURES:
Current:
General government 396,043 - 1,500 - 10,179,457 Public safety 1,298,438 - - 5,693 42,287,028 Transportation - - - 1,239,940 6,098,178 Community development 107,762 745,689 - 609,877 19,875,396 Health 284,383 - - - 8,902,858 Culture and leisure 157,835 - - 5,279,343 9,287,839 Capital outlay 6,009,703 - - 1,814,562 13,421,930 Debt service:
Principal - - 3,655,000 919,609 4,931,273 Interest and fiscal charges - - 2,151,469 76,003 2,400,225 Total expenditures 8,254,164 745,689 5,807,969 9,945,027 117,384,184
REVENUES OVER
(UNDER) EXPENDITURES (2,168,448) 2,137,157 (5,807,969) (2,406,888) 8,902,237 OTHER FINANCING SOURCES (USES):
Transfers in 397,571 - 5,806,467 3,186,166 11,395,704 Transfers out (469,481) (620,608) - (421,916) (11,891,906) Total other financing sources (uses) (71,910) (620,608) 5,806,467 2,764,250 (496,202) CHANGES IN FUND BALANCES (2,240,358) 1,516,549 (1,502) 357,362 8,406,035 FUND BALANCES:
Beginning of year 2,319,042 49,814,239 11,201 5,034,591 158,845,486 End of year 78,684$ 51,330,788$ 9,699 $ 5,391,953$ 167,251,521 $ (Concluded)
Major Funds
City of National City
For the Year Ended June 30, 2024
Governmental Funds
Statement of Revenues, Expenditures, and Changes in Fund Balance (Continued) See accompanying Notes to the Basic Financial Statements. 29Page 676 of 860
Net Change in Fund Balances - Total Governmental Funds 8,406,035$ Amounts reported for governmental activities in the Statement of Activities were different because:
Governmental funds reported capital outlay as expenditures. However, int he Government-Wide Statement of Activities and Changes in Net Position, the cost of those assets was allocated over their estimated useful lives as depreciation expense.
This was the amount of capital assets recorded in the current period (net of $2,401,992 added in internal service funds). 13,211,267 Depreciation and amortization expense on capital assets was reported in the Government-Wid e Statement of Activities and Changes in Net Position, but they did not require the use of current financial resources. Therefore, depreciation and amortization expense was not reported as an expenditure in the Governmental Funds. This amount did not include the depreciation and amortization expense for Internal Service Funds in the amount of $1,237,879. (6,000,114) Repayment of long-term liabilities was an expenditures in governmental funds, but the repayment reduced long-term liabilities in the Government-Wide Statement of Net Position.
Principal payment of long-term debt (net of $151,532 reported in internal service funds) 4,931,273 Amortization expenses were reported in the Government-Wide Statement of Activities and Changes in Net Position, but they did not require the use of current financial resources. Therefore, amortization expenses were not reported as expenditures in the Governmental Funds.
Bond premium/discount (5,537)
Deferred amount on refunding (4,200)
Certain long-term liabilities were reported in the Government-Wide Statement of Activities and Changes in Net Position, but they did not require the use of current financial resources. Therefore, long-term liabilities were not reported as expenditures in governmental funds. These amounts represented the changes in long-term liabilities from prior year.
Changes in compensated absences (205,133)
Changes in total OPEB liabilities (150,590)
Changes in the net pension liability (6,709,269)
The net effec
t of various miscellaneous transactions involving pension plans (i.e. deferre d inflow/outflow amortization, contributions after measurement date) decreased net position. (3,881,390) The net effec t of various miscellaneous transactions involving the OPEB plan (i.e. deferre d inflow/outflow amortization) decreased net position. 180,097
Unavailable revenues in the governmental funds were reported as revenue in the Government-Wide Statement of Net Position as follows:
Investment earnings (63,785)
Interest expense on long-ter m debt was reported in the Government-Wid e Statement of Activities and Changes in Ne t Position, but it did not require the use of current financial resources. This amount represented the change in accrued interest from prior year. 1,232,415
Internal service funds were used by management to charge the costs o f certain activities to individual funds. The net revenue of internal service funds was reported with governmental activities. 276,694 Change in Net Position of Governmental Activities 11,217,763$ City of National City
For the Year Ended June 30, 2024
in Fund Balances to the Government-Wide Statement of Activities and Changes in Net Position Reconciliation of the Governmental Statement of Revenues, Expenditures, and Changes See accompanying Notes to the Basic Financial Statements. 30Page 677 of 860
PROPRIETARY FUND
FINANCIAL STATEMENTS
Internal Service Funds are funds used to account for interdepartmental operations where it is the stated intent that costs of providing services to the departments of the City on a continuing basis be financed or recovered primarily by charges to the user departments.
31Page 678 of 860
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32Page 679 of 860
Governmental
Activities
Internal
Service Funds
ASSETS
Current assets:
Cash and investments 26,175,517$
Accounts receivable 60,318
Prepaid items and deposits 80,621
Total current assets 26,316,456
Noncurrent assets:
Restricted cash and investments 10,334
Capital assets:
Depreciable/amortizable assets, net of accumulated depreciation and amortization 5,557,354 Total capital assets, net 5,557,354
Total noncurrent assets 5,567,688
Total assets 31,884,144
LIABILITIES AND
NET POSITION
Liabilities:
Current liabilities:
Accounts payable and accrued liabilities 748,228
Salaries payable 24,201
Interest payable 2,069
Leases payable - due within one year 167,670
Compensated absences - due within one year 161,728
Claims payable - due within one year 2,541,967
Total current liabilities 3,645,863
Noncurrent liabilities:
Claims payable - due in more than one year 10,391,033
Total noncurrent liabilities 10,391,033
Total liabilities 14,036,896
Net Position:
Net investment in capital assets 5,389,684
Restricted:
Debt service 10,334
Total restricted 10,334
Unrestricted 12,447,230
Total net position 17,847,248$
City of National City
June 30, 2024
Proprietary Funds
Statement of Net Position
See accompanying Notes to the Basic Financial Statements. 33Page 680 of 860
Governmental
Activities
Internal
Service Funds
OPERATING REVENUES:
Charges for services 14,162,819$
Other 82,049
Total operating revenues 14,244,868
OPERATING EXPENSES:
Operations and administration 8,178,106
Maintenance 5,039,005
Depreciation and amortization 1,237,879
Total operating expenses 14,454,990
OPERATING INCOME (210,122)
NONOPERATING REVENUES (EXPENSES):
Interest expense (9,386)
Total nonoperating revenues (expenses) (9,386)
INCOME (LOSS) BEFORE TRANSFERS (219,508)
TRANSFERS
Transfers in 653,486
Transfers out (157,284)
Total transfers 496,202
CHANGES IN NET POSITION 276,694
NET POSITION:
Beginning of year 17,570,554
End of year 17,847,248$
City of National City
For the Year Ended June 30, 2024
Proprietary Funds
Statement of Revenues, Expenses, and Changes in Net Position See accompanying Notes to the Basic Financial Statements. 34Page 681 of 860
Governmental
Activities
Internal
Service Funds
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from other funds 14,164,066$
Cash payments for goods and services (11,940,416)
Other operating revenues 82,049
Net cash
provided by operating activities 2,305,699
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:
Principal paid on leases (158,702)
Acquisition of capital assets (2,401,991)
Interest paid (13,233)
Net cash (used in) capital and related
financing activities (2,573,926)
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Transfers in 653,487
Transfers (out) (157,284)
Net cash provided by noncapital financing activities 496,203 Net change in cash and cash equivalents 227,976
CASH AND CASH EQUIVALENTS:
Beginning of year 25,957,875
End of year 26,185,851$
RECONCILIATION TO STATEMENT OF NET POSITION:
Cash and investments 26,175,517$
Restricted cash and investments 10,334
Total cash and cash equivalents 26,185,851$
RECONCILIATION OF OPERATING INCOME (LOSS) TO
NET CASH PROVIDED BY OPERATING ACTIVITIES:
Operating income (loss) (210,122)$
Adjustments to reconcile operating income (loss) to net cash provided by operating activities:
Depreciation and amortization 1,237,879
Changes in operating assets and liabilities:
Accounts payable and accrued liabilities (386,756)
Salaries payable 2,175
Compensated absences 20,276
Claims payable 1,641,000
Total adjustments 2,515,821
Net cash
provided by operating activities 2,305,699$
City of National City
For the Year Ended June 30, 2024
Proprietary Funds
Statement of Cash Flows
See accompanying Notes to the Basic Financial Statements. 35Page 682 of 860
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36Page 683 of 860
FIDUCIARY FUND
FINANCIAL STATEMENTS
Custodial Fund – This fund is used to account for assets held by the City in a custodial capacity for individuals, private organizations, and/or other governments.
The Successor Agency to the Community Development Commission as the National City Redevelopment Agency ("Successor Agency") Private-Purpose Trust Fund – This fund is used to account for monies received from the San Diego County Auditor Controller for the payment of the enforceable obligations of the former National City Redevelopment Agency. These funds are restricted for the sole purpose of payment of items on an approved Recognized Payment Obligation Schedule (ROPS).
37Page 684 of 860
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38Page 685 of 860
Successor Agency
Custodial Private-Purpose
Fund Trust Fund
ASSETS
Cash and investments 2,835,551$ 4,146,581 $ Receivables:
Accounts - 10,963
Loans - 244,424
Restricted cash and investments with fiscal agent - 26,464 Total assets 2,835,551 4,428,434
DEFERRED OUTFLOWS OF RESOURCES
Deferred amount on refunding - 4,110,208 Total deferred outflows of resources - 4,110,208
LIABILITIES
Accounts payable and accrued liabilities 104,282 - Interest payable - 306,892 Long-term debt - due within one year - 3,363,000 Long-term debt - due in more than one year - 26,079,000 Developer deposits 2,731,269 25,000
Total liabilities 2,835,551 29,773,892
NET POSITION (DEFICIT)
Restricted for:
Held in trust for dissolution of redevelopment agency - (21,235,250) Total net position (deficit) -$ (21,235,250)$ City of National City
June 30, 2024
Fiduciary Activities
Statement of Fiduciary Net Position
See accompanying Notes to the Basic Financial Statements. 39Page 686 of 860
Successor Agency
Custodial Private-Purpose
Fund Trust Fund
ADDITIONS:
Property taxes -$ 3,950,251$ Investment income - 8,677 Total addition
s - 3,958,928
DEDUCTIONS:
Community development - 1,119,440 Administrative expenses - 193,350 Total deductions - 1,312,790 Changes in net position - 2,646,138 NET POSITION (DEFICIT):
Beginning of year - (23,881,388) End of year -$ (21,235,250)$ City of National City
For the Year Ended June 30, 2024
Fiduciary Activities
Statement of Changes in Fiduciary Net Position
See accompanying Notes to the Basic Financial Statements. 40Page 687 of 860
41 NOTES TO THE
BASIC FINANCIAL STATEMENTS