Newport Beach City Council
March 10, 2026

See accompanying notes to basic financial statements
58 Capital Project Fund Debt Service Fund
Facilities Other
Financial Planning Debt Service Governmental
Reserve Fund Funds Totals
Assets
Cash and investments (n
ote 2) 23,434,039$ -$
108,499,10
5$ 299,625,51
4$
Receivables:

Accounts (net o
f allowance) 4,643,968 -
513,601 13,438,789
Interest 106,670 -
508,239 1,455,559
Intergovernmental receivab
les -
1,004,032 2,001,123 14,167,779 Lease receivables (no
te 3) -
-
3,268,884 276,374,01
1 Public-private p
artnership receivable (note 17) -
-
- 629,813
Restricted cash an
d investments with fiscal agent (note 2) -
7,542,238 20,239,954 27,782,192 Due from other fun
ds (note 4) -
-
- 8,718,563
Advance to othe
r funds (note 4) -
-
- 4,426,659
Prepaid items -
-
17,024 1,452,250
Inventory -
-
- 183,978
Total assets 28,184,677$ 8,546,270$ 135,047,93 0$ 648,255,10
7$
Liabilities, Deferred Inflows of Res
ources
and Fund Balances
Liabilities:

Accounts pay
able -$
4,099$
7,688,301$ 19,034,411$
Accrued pay
roll -
-
4,327 7,242,628
Deposits paya
ble -
-
- 3,658,843
Unearned reven
ue -
-
2,017,874 5,652,744
Due to other f
unds (note 4) -
6,517,778 1,847,784 8,365,562 Advance from o
ther funds (note 4) -
-
- 4,426,659
Total liabilities -
6,521,877 11,558,286 48,380,847 Deferred Inflows of
Resources:

Unavailable reven
ue 4,643,968 -
1,255,134 5,899,102
Deferred amoun
t from leases (note 3) -
-
3,162,503 271,248,28
1 Deferred amoun
t from public-private partnerships (note 17) -
-
- 630,001
Total defe
rred inflows of resources 4,643,968 - 4,417,637 277,777,38
4 Fund balances:

Nonspendab
le:

Prepaid items -
-
17,024 1,452,250
Inventorie
s -
-
- 183,978
Long-term loan
receivable -
-
- 4,426,659
Permanen
t endowment -
-
4,629,781 4,629,781
Restricted:

Upper Newport Ba
y restoration -
-
- 1,871,911
Other (note 15
) -
2,024,393 50,724,688 118,867,00 8 Committed:

Capital re-appropri
ations -
-
- 374,822
Oil and gas -
-
- 1,258,890
Other (note 15
) 23,540,709 -
63,700,525 90,652,278
Unassigned -
-
(11) 98,379,299
Total fun
d balances 23,540,709 2,024,393 119,072,00 7 322,096,87
6 Total liabilities
, deferred inflows of
resources an
d fund balances 28,184,677$ 8,546,270$ 135,047,93 0$ 648,255,10
7$

CITY OF NEWPORT BEACH
Governmental Funds
Balance Shee
t
June 30, 2025

See accompanying notes to basic financial statements
59 This page left blank intentionally.
60 Fund balances of
governmental funds 322,096,87
6$
Amounts reported f
or governmental activities in the statement of net position are different beca
use:

Capital assets net of
accumulated depreciation have not been included
as financial resou
rces in governmental fund activity. Amount excludes
capital assets from inte
rnal service funds which are added below. 2,381,189,9
72 All liabilities (both
current and long-term) are reported in the Statement of Net Position.

Amounts exclude
long-term debt activity from internal service funds which have been added be
low:

Certificate
s of participation payable - Series 2010B (84,290,000)
Certificate
s of participation payable - Series 2020A (5,000,000)
Bond
premium - Series 2020A (722,502)
Lease
liability (12,999,592)
Subscriptio
n liability (242,777)
Deferred inflo
ws for improvements by the operator to the underlying asset of a public-priva
te partnership are recognized only in the government-wide statements for governmental ac
tivities. (56,000)
Pension related d
ebt applicable to the governmental activities are not due and payable in the current p
eriod and accordingly are not reported as fund liabilities. Deferred outflows of resources and
deferred inflows of resources related to pension are only reported in the Statement o
f Net Position as the changes in these amounts affect only the government-wide sta
tements for governmental activities. Amounts exclude internal service fund
activity which has been added below:

Deferr
ed outflows of resources 89,455,293
Deferr
ed inflows of resources (1,001,078)
Pension
liability (262,100,803
)
OPEB related de
bt applicable to the governmental activities are not due and payable in the current p
eriod and accordingly are not reported as fund liabilities. Deferred outflows of resources and
deferred inflows of resources related to OPEB are only reported in the Statement o
f Net Position as the changes in these amounts affect only the government-wide sta
tements for governmental activities. Amounts exclude internal service fund
activity which has been added below:

Deferr
ed outflows of resources 8,045,360
Deferr
ed inflows of resources (1,893,588)
OPEB liab
ility (5,054,940)
Accrued interest pa
yable for the current portion of interest due on long-term debt has not bee
n reported in the governmental funds. (3,109,569)
Some of the reven
ue will be collected after year-end, but is not available soon enough to
pay for the current period's expenditures, and therefore is reported as unavailable reve
nue in the governmental funds. 5,899,102
Internal service f
unds are used by management to charge the costs of certain activities, such as self
-insurance, workers' compensation, compensated absences, retiree insuran
ce, fleet management and information technology, to individual funds.

The assets (including
capital assets) and liabilities of the internal service funds must be added to th
e statement of net position. 49,341,311
Investment in joint ven
tures is not a current financial resource and therefore not reported in the governmen
tal funds. 339,272
Internal balance crea
ted by the consolidation of internal service fund activities related to ente
rprise funds is not reported in the governmental funds. 2,065,843 Net position of go
vernmental activities 2,481,962,1
80$

CITY OF NEWPORT BEACH
Governmental Funds
Reconciliation of the Ba
lance Sheet of Governmental Funds
to the Statement of Net Position
June 30, 2025
See accompanying notes to basic financial statements
61 Tide and Tide and
Submerged Submerged
General Land - Operating Land - Harbor Capi
tal
Revenues:

Taxes and assessments:

Property tax 154,182,579$ -$ -$ Sales tax 45,934,260 - - Transient occupancy ta
x 33,174,268 - -
Other taxes 10,385,818 - - Intergovernmental 5,670,490 - - Licenses, permits and fee
s 6,350,277 110,943 -
Charges for services 26,966,719 65,341 - Fines and forfeitu
res 4,344,836 37,814 -
Investment income 3,771,565 332,181 2,170,732 Net increase in fair val
ue of investments 1,129,325 52,743 625,833 Property income 19,808,736 16,739,019 6,711,452 Donations 795,959 - - Other 1,202,884 78 - Total reven
ues 313,717,716 17,338,119 9,508,017 Expenditures:

Current:

General governmen
t 21,920,035 576,031 -
Public safety 145,807,405 - - Public works 55,236,683 1,546,690 - Community develo
pment 16,506,628 29,506 - Community services 28,461,405 2,709,858 - Capital outlay - 1,160,516 945,092 Debt service:

Principal 1,283,576 - - Interest and fiscal ch
arges 77,188 - - Total expe
nditures 269,292,920 6,022,601 945,092 Excess (deficien
cy) of revenues
over expen
ditures 44,424,796 11,315,518 8,562,925 Other financing so
urces (uses):

Transfers in (note 5) 20,317,944 12,263,815 5,832,875 Transfers out (no
te 5) (53,036,418) (20,317,944) -
Total oth
er financing sources (uses) (32,718,474) (8,054,129) 5,832,875 Net change in f
und balances 11,706,322 3,261,389 14,395,800 Fund balances, begin
ning 96,441,188 8,547,722 43,107,346 Fund balances, endin
g 108,147,510$ 11,809,111$ 57,503,146$ Special Revenue Funds

CITY OF NEWPORT BEACH
Governmental F
unds
Statement of Revenue
s, Expenditures and Changes in Fund Balances
For the Year Ended Ju
ne 30, 2025

See accompanying notes
to basic financial statements
62 Capital Project Fun
d Debt Service Fund
Facilities Other
Financial Planni
ng Debt Service Governmental
Reserve Fund Funds Totals
Revenues:

Taxes and assessments:

Property tax -$ -$ -$ 154,182,579$ Sales tax - - - 45,934,260 Transient occupancy ta
x - - - 33,174,268 Other taxes - - 1,021,443 11,407,261 Intergovernmental - 2,006,281 10,497,718 18,174,489 Licenses, permits and fee
s - - 851,257 7,312,477 Charges for services - - 92,129 27,124,189 Fines and forfeitu
res - - - 4,382,650 Investment income 857,449 45,430 4,508,461 11,685,818 Net increase in fair val
ue of investments 186,073 - 1,260,300 3,254,274 Property income - - 725,753 43,984,960 Donations 1,068,190 - 3,726,024 5,590,173 Other - - 120,155 1,323,117 Total reven
ues 2,111,712 2,051,711 22,803,240 367,530,515 Expenditures:

Current:

General governmen
t - - 1,610 22,497,676 Public safety - - 777,707 146,585,112 Public works - - 10,739,240 67,522,613 Community develo
pment - - 225,546 16,761,680 Community services - - 231,066 31,402,329 Capital outlay - - 41,637,631 43,743,239 Debt service:

Principal - 4,235,000 - 5,518,576 Interest and fiscal ch
arges - 6,366,168 - 6,443,356 Total expe
nditures - 10,601,168 53,612,800 340,474,581 Excess (deficien
cy) of revenues
over expen
ditures 2,111,712 (8,549,457) (30,809,560) 27,055,934 Other financing so
urces (uses):

Transfers in (note 5) 12,104,412 8,250,735 25,673,861 84,443,642 Transfers out (no
te 5) (11,111,169) - - (84,465,531) Total oth
er financing sources (uses) 993,243 8,250,735 25,673,861 (21,889) Net change in f
und balances 3,104,955 (298,722) (5,135,699) 27,034,045 Fund balances, begin
ning 20,435,754 2,323,115 124,207,706 295,062,831 Fund balances, endin
g 23,540,709$ 2,024,393$ 119,072,007$ 322,096,876$

CITY OF NEWPORT BEACH
Governmental F
unds
Statement of Revenue
s, Expenditures and Changes in Fund Balances
For the Year Ended Ju
ne 30, 2025

See accompanying notes
to basic financial statements
63 27,034,045$
Amounts reported for governm
ental activities in the statement of activities differ
from the amounts reported in governmental funds because:

Governmental funds report capital outlays as expenditures. However, in the statement of activities, the costs of those assets are allocated over their estimated useful lives as depreciation expense. This is the amount by which capital outlay exceeded depreciation in the current period.

Capital outlay 26,386,385
Depreciation expense (15,910,049)
Other capital related items (1,203,127)
The issuance of long-term debt provides current financial resources to governmental funds, while repayment of the principal and issuance costs of long-term debt consumes the current financial resources of the governmental funds. Issuance of bond principal is an other financing source and repayment of bond principal is an expenditure in governmental funds, but the issuance increases long-term liabilities and the repayment reduces long-term liabilities in the Statement of Net Position.

The amounts are the net effect of these differences in the treatment of long-term debt:

Repayment of principal on bonds 4,235,000
Amortization of principal on leases 1,199,376
Amortization of principal on subscriptions 84,200
Amortization of deferred inflows for improvements by the operator to the underlying asset of a public-private partnership are recognized only in the government-wide statements for governmental activities. 8,000
Premium on bonds is recognized as revenues in the period received; however, in the statement of activities, it is amortized over the life of the bond.

Amortization of bond premium - Series 2020A 142,131
Accrued interest for debt service is the net change in accrued interest for the current period. 138,333 Pension expense reported in the governmental funds includes the employer contributions made.

In the Statement of Activities, pension expense includes the change in the net pension liability and related change in pension amounts for deferred outflows of resources and deferred inflows of resources. 7,257,210
OPEB expense reported in the governmental funds includes the employer contributions made.

In the Statement of Activities, OPEB expense includes the change in the net OPEB liability and related change in OPEB amounts for deferred outflows of resources and deferred inflows of resources. (2,020,827)
Some of the revenue will be collected after year-end, but is not available soon enough to pay for the current period's expenditures, and therefore is reported as unavailable revenue in the governmental funds. This is the net change in unavailable revenue for the current period. (629,867)
Internal service funds are used by management to charge the costs of certain activities, such as self-insurance, workers' compensation, compensated absences, retiree insurance and fleet management, to individual funds. The change in net position of the internal service funds is reported in the statement of activities. 11,190,381 Investment in joint ventures creates an explicit, measurable equity interest reported only in the statement of activities. 69,145
Internal balance created by the consolidation of internal service funds activities related to enterprise funds is reflected as a reduction of
expenses in the statement of activities. (2,563,694)
Change in net position of gover
nmental activities 55,416,642$
Net change in fund balances - total governmenta
l funds

CITY OF NEWPORT BEACH
Reconciliation of the Statement of Rev
enues, Expenditures,
and Changes in Fund Balances of Governmental Funds
to the Statement of Activities
Year Ended June 30, 2025
See accompanying notes to basic fina
ncial statements
64 FUND FINANCIAL STATEMENTS
65 This page left blank intentionally.
66 PROPRIETARY FUNDS

Business-type Activities

The Water Fund is a Major Fund used to account fo r the operations of the City’s water utility, a self-supporting activity which is entirely financed though user charges.

The Wastewater Fund is a Major Fund used to account for the operations of the City’s wastewater system, a self-supporting activity which is entirely financed through user charges.

Governmental Activities

The Internal Service Funds are used to allocate the cost of providing goods and services by one department to other departments on a cost reimbursement basis.

67 Governmental
Total Activities
Enterprise Internal Service
Water Wastewater Funds Funds
Assets and Deferred Outflow
s of Resources
Current assets:

Cash and investments
(note 2) 26,580,770$ 3,050,666$ 29,631,436$ 81,567,437$ Receivables:

Accounts (net of
allowance) 5,661,146 893,721 6,554,867 34,659 Interest 131,775 13,477 145,252 356,965 Intergovernmental receivabl
es -
451
451
195,387
Inventories -
-
-
502,830
Prepaid items -
-
-
5,698,092
Total cur
rent assets 32,373,691 3,958,315 36,332,006 88,355,370 Noncurrent assets:

Capital assets (note 6):

Land 2,219,450 -
2,219,450 -

Intangible righ
t to use land 3,883,062 -
3,883,062 -

Structures 688,396 -
688,396 39,581
Equipment 344,080 35,988 380,068 50,392,408 Intangible righ
t to use equipment -
-
-
363,725
Software -
-
-
4,360,625
Intangible righ
t to use subscriptions 146,843 -
146,843 2,099,163
Infrastructur
e 158,988,518 48,826,594 207,815,112 -

Work in progre
ss 6,379,733 848,787 7,228,520 -

Less: accumul
ated depreciation/amortization (60,383,202) (22,554,161) (82,937,363) (38,620,914) Total cap
ital assets (net of accumulated

depreciation/amortization) 112,266,880 27,157,208 139,424,088 18,634,588 Total
assets 144,640,571 31,115,523 175,756,094 106,989,958 Deferred outflows of
resources:

Deferred amount from pensi
on plans (note 11) 1,978,791 759,922 2,738,713 1,801,339 Deferred amount from OP
EB (note 12) 331,497 127,306 458,803 301,770 Total
deferred outflows of resources 2,310,288 887,228 3,197,516 2,103,109 Liabilities and Deferred Inflows of Resource
s
Current liabi
lities:

Accounts payable 5,654,480 351,708 6,006,188 955,767 Accrued payroll 244,519 75,494 320,013 509,870 Deposits payable 29,784 -
29,784 -

Due to other funds (note 4) -
-
-
353,001
Workers' compensati
on - current -
-
-
4,497,885
General liabili
ty - current -
-
-
3,941,299
Compensated absences - curre
nt -
-
-
8,097,760
Lease liability
- current 44,608 -
44,608 67,339
Subscription liabil
ity - current 36,593 -
36,593 170,375
Total cur
rent liabilities 6,009,984 427,202 6,437,186 18,593,296 Noncurrent liabi
lities:

Workers' compensati
on (note 7) -
-
-
20,992,090
General liabili
ty (note 7) -
-
-
6,658,815
Compensated absences (note 7) -
-
-
6,394,937
Lease liability
(note 7) 3,687,682 -
3,687,682 -

Subscription liabil
ity (note 7) 73,790 -
73,790 1,130,571
Net pension liabi
lity (note 11) 6,287,587 2,414,626 8,702,213 5,723,725 Net OPEB liabi
lity (note 12) 200,373 76,951 277,324 182,408 Total noncurre
nt liabilities 10,249,432 2,491,577 12,741,009 41,082,546 Total
liabilities 16,259,416 2,918,779 19,178,195 59,675,842 Deferred inflows of resources
:

Deferred amount from pensi
on plans (note 11) 5,320 2,044 7,364 4,844

Deferred amount from OP
EB (note 12) 78,070 29,979 108,049 71,070 Total
deferred inflows of resources 83,390 32,023 115,413 75,914 Net Position
Net investment i
n capital assets 108,424,207 26,714,173 135,138,380 16,984,653 Unrestricted 22,183,846 2,337,776 24,521,622 32,356,658 Total net po
sition 130,608,053$ 29,051,949$ 159,660,002$ 49,341,311$

Adjustm
ent to reflect the consolidation of internal

service fund activities related to enterprise funds (2,065,843) Net po
sition of business-type activities 157,594,159$

CITY OF NEWPORT BEACH
Proprietary Funds
Statement of
Net Position
June 30, 2025
Enterprise Funds
See accompanying notes to
basic financial statements
68 Governmental
Total Activities
Enterprise Internal Service
Water Wastewater Funds Funds
Operating revenues:

Charges for sales an
d services:

Water sale
s 40,173,666$ -$
40,173,666$ -$

Charges for
services -
-
-
39,112,990
Sewer s
ervice and connection fees -
5,929,991 5,929,991 -

Intergov
ernmental 15,456 10,728 26,184 195,387 Employ
ee contributions -
-
-
22,086
Other 290,243 50,778 341,021 6,396,146 Total
operating revenues 40,479,365 5,991,497 46,470,862 45,726,609 Operating expenses:

Purchase of water 14,258,486 -
14,258,486 -

Salaries and benefit
s 6,057,868 1,923,456 7,981,324 4,654,284 Depreciation/amortization 1,949,684 639,534 2,589,218 4,275,677 Professional servic
es 3,270,486 698,697 3,969,183 996,283 Maintenance and supplies 3,392,569 1,359,247 4,751,816 4,102,840 System maintenance 2,921,079 940,192 3,861,271 27,692 Utilities 2,293,501 102,163 2,395,664 -

Fleet parts and supp
lies -
-
-
545,348
Telecommunication -
-
-
188,617
Hardware -
-
-
534,370
Software -
-
-
369,728
Workers' compensation -
-
-
7,107,333
Claims and judgm
ents -
-
-
10,384,659
Compensated absences -
-
-
2,576,984
OPEB ARC - cash sub
sidy -
-
-
847,328
Other 4,688,299 890,710 5,579,009 2,227,349 Total ope
rating expenses 38,831,972 6,553,999 45,385,971 38,838,492 Oper
ating income (loss) 1,647,393 (562,502) 1,084,891 6,888,117 Nonoperating revenue
s (expenses):

Investment income 995,850 123,190 1,119,040 2,916,412 Net increase in fair va
lue of investments 275,733 37,479 313,212 946,672 Gain on sale of capital ass
ets -
-
-
425,594
Interest expense (21,399) -
(21,399) (8,303)
Total
nonoperating revenues 1,250,184 160,669 1,410,853 4,280,375 I
ncome (loss) before transfers 2,897,577 (401,833) 2,495,744 11,168,492 Transfers in (note 5) -
-
-
21,889
Cha
nge in net position 2,897,577 (401,833) 2,495,744 11,190,381 Net position, beginnin
g of year 127,710,476 29,453,782 38,150,930 Net position, end of year 13
0,608,053$ 29,051,949$ 49,341,311$
Adjustment
to reflect the consolidation of internal
service fund act
ivities related to enterprise funds 2,563,694
Change in net posi
tion of business-type activities 5,059,438$
Enterprise Funds

CITY OF NEWPORT BEACH
Proprietary Funds
Statement of Revenues
,
Expenses and Changes in Net Position
For the Year Ended June 30, 2025
See accompanying notes to basic financial statements
69 CITY OF NEWPORT BEACH
Statement of Cash Flows
For the Year Ended June 30, 2025
Governmental
Total Activities
Enterprise Internal Service
Water Wastewater Funds Funds
39,813,766$ 5,851,080$ 45,664,846$ 39,105,404$ (6,021,465) (1,913,288) (7,934,753) (11,441,209) (22,922,028) (3,281,254) (26,203,282) (39,330,748) (4,688,299) (890,710) (5,579,009) - 305,699 61,506 367,205 6,418,232 6,487,673 (172,666) 6,315,007 (5,248,321) - - - 21,889 - - - 21,889 (6,542,049) (390,931) (6,932,980) (3,456,839) (65,023) - (65,023) (73,663) (37,200) - (37,200) (212,547) - - - 425,594 (6,644,272) (390,931) (7,035,203) (3,317,455) 1,221,293 158,241 1,379,534 3,783,041 1,221,293 158,241 1,379,534 3,783,041 1,064,694 (405,356) 659,338 (4,760,846) 25,516,076 3,456,022 28,972,098 86,328,283 26,580,770$ 3,050,666$ 29,631,436$ 81,567,437$ 26,580,770$ 3,050,666$ 29,631,436$ 81,567,437$ 26,580,770$ 3,050,666$ 29,631,436$ 81,567,437$ 1,647,393$ (562,502)$ 1,084,891$ 6,888,117$ 1,949,684 639,534 2,589,218 4,275,677 (372,396) (80,449) (452,845) (7,586) 8,747 1,538 10,285 (195,387) - - - (39,048) - - - (4,902,194) 1,617,988 - 1,617,988 - 1,627,242 (172,812) 1,454,430 (13,915,435) 3,749 - 3,749 - - - - 2,039,412 - - - (241,204) - - - 844,531 (78,141) (30,006) (108,147) (71,132) 83,407 32,031 115,438 75,928 4,840,280 389,836 5,230,116 (12,136,438) 6,487,673$ (172,666)$ 6,315,007$ (5,248,321)$ -$ 443,036$ 443,036$ -$ 146,843 - 146,843 - Cash flows from operating activities:

Cash received from customers or user departments
Cash payments to employees for services
Cash payments to suppliers for goods and services
Cash payments for other operating activities
Cash received for other operating activities
Net cash provided (used) by operating activities
Cash flows from noncapital financing activities:

Cash received from other funds
Net cash provided by noncapital financing activities
Cash flows from capital and related financing activities:

Acquisition of capital assets
Lease liabilities and related
Subscription liabilities and related
Proceeds from sale of capital assets
Net cash (used) for capital and related financing activities Cash flows from investing activities:

Investment income
Net cash provided by investing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents, beginning
Cash and cash equivalents, ending
Reconciliation to the statement of net position:

Cash and investments reported on statement of net position Cash and cash equivalents
Reconciliation of operating income (loss) to net cash
provided by operating activities:

Operating income (loss)
Adjustments to reconcile operating income (loss)
to net cash provided by operating activities:

Depreciation
Changes in operating assets and liabilities:
(Increase) in accounts receivable
(Increase) decrease in intergovernmental receivables
(Increase) in inventories
(Increase) in prepaid items
Decrease in net infrastructure from capital assets
Increase (decrease) in accounts payable and accrued payroll Increase in deposits payable
Increase in workers' compensation
(Decrease) in general liability
Increase in compensated absences
(Decrease) in net pension liability and deferred cash flows Increase in net OPEB liability and deferred cash flows
Total adjustments
Net cash provided (used) by operating activities
Noncash financing and investing activities:

Capital assets financed by ending accounts payable
Obtaining an intangible right to use subscription asset (Loss) on disposal of capital assets (1,617,988) - (1,617,988) - Total of noncash activities 1,764,831$ 443,036$ 2,207,867$ -$ Proprietary Funds
Enterprise Funds
See accompanying notes to basic financial statements
70 FUND FINANCIAL STATEMENTS
71 This page left blank intentionally.
72 FIDUCIARY FUNDS

The Custodial Funds are used to account for assets held by the City as an agent for other government entities, private organizations, or individuals.

The Other Post-Employment Benefits (OPEB) Trust F und is used to account for the activities of the City’s trust for the OPEB plan. 73 Custodial OPEB
Funds Trust
Assets
Cash and investments (no
te 2) 1,582,522$ -$
Restricted cash and investments with fiscal agent (note 2) 2,699,066 48,292,264 Receivable:

Interest 15,167 3,624
Intergovernmental receivable 34,320 -
Total assets 4,331,075 48,295,888
Liabilities
Due to others 35,616 -
Total liabilit
ies 35,616 -
Net Position
Restricted for:

Postemploymen
t benefits other than pensions - 48,295,888 Individuals, organiz
ations, and other governments 4,295,459 -
Total net position 4,295,459$ 48,295,888$

CITY OF NEWPORT BEA
CH
Fiduciary Funds
Statement of Fiduciar
y Net Position
June 30, 2025
See accompanying notes to basic financial statements
74 Custodial OPEB
Funds Trust
Additions
Special assessments 3,022
,899$ -$
Investment earnings 155,193 4,904,074
Other 101,760 -
Total addition
s 3,279,852 4,904,074
Deductions
Debt service 3,317,230 -

Benefit payments for OPEB trust - 2,682,141 Administrative 97,408 121,382
Other 133,537 -
Total deductions 3,548,175 2,803,523
Net increase in fiduciary
net position (268,323) 2,100,551
Net position, beginnin
g of year 4,563,782 46,195,337
Net position, end of y
ear 4,295,459$ 48,295,888$

CITY OF NEWPORT BEA
CH
Fiduciary Funds
Statement of Changes in Fiduciar
y Net Position
For the Year Ended June 30, 2025
See accompanying notes to basic financial statements
75 This page left blank intentionally.
76 77

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78 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies

The basic financial
statements of the City of Newport Beach (the “City”) have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) as applicable to government units. The Governmental Accounting Standards Board (“GASB”) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.

a. Reporting Entity

The City was incorpora
ted on September 1, 1906. The current City Charter was adopted in 1954. Since adoption, the Charter has been amended several times. The most recent Charter amendment was approved by the voters on November 2, 2010. The City operates under a Council-Manager form of government and provides the following services: public safety (police, fire, and marine), highway and streets, cultural and recreation, public improvements, planning and zoning, utilities, and general administrative services.

The financial statements present the financial activity of the City (the primary government) and its component unit. The component unit discussed below is included in the City's reporting entity because of the significance of its operational or financial relationship with the City. This entity is legally separate from the City. However, the City’s elected officials have continuing full or partial accountability for fiscal matters of the component unit. The financial reporting entity consists of: (1) the City; (2) organizations for which the City is financially accountable; and (3) organizations for which the nature and significance of their relationship with the City are such that exclusion would cause the City's financial statements to be misleading or incomplete.

An organization is fiscally dependent on the primary government if it is unable to adopt its budget, levy taxes, set rates or charges, or issue bonded debt without approval by the primary government. In a blended presentation, a component unit’s balances and transactions are reported in a manner similar to the balances and transactions of the City.

Component units are presented on a blended basis when the component unit's governing body is substantially the same as the City's or the component unit provides services almost entirely to the City.

Blended Component Unit

The financial stat
ements of the City include the financial activities of the Newport Beach Public Facilities Corporation (the "Corporation"). The Corporation was formed on March 9, 1992, for the purpose of assisting the City of Newport Beach in the financing of public improvements, including the City’s Central Library, Civic Center, and most recently the new Fire Station No. 2. The Corporation is governed by a Board of Directors, which is comprised of the seven City Council Members of the City. The Corporation's financial data and transactions are included in the debt service fund. Separate financial statements are not prepared for the Corporation. The debt service fund is used solely to account for the activities of the Corporation and contains no other City debt financing activities. 79 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

b. Basis of Accounting an
d Measurement Focus

The basic financial st
atements of the City are composed of the following:

 Government-wide financial statements
 Fund financial statements
 Notes to the financial statements

Government-wide Financial Statements

Government-wide fina
ncial statements display information about the reporting government as a whole, except for its fiduciary activities. These statements include separate columns for the governmental and business-type activities of the primary government (including its blended component units). The City has no discretely presented component units.

Eliminations have been made in the Statement of Activities so that certain allocated expenses are recorded only once (by the function to which they were allocated). However, general government expenses have not been allocated as indirect expenses to the various functions of the City.

Government-wide financial statements are presented using the economic resources measurement focus and the accrual basis of accounting. Under the economic resources measurement focus, all (both current and long-term) economic resources and obligations of the reporting government are reported in the government-wide financial statements. Basis of accounting refers to when revenues and expenses are recognized in the accounts and reported in the financial statements. Under the accrual basis of accounting, revenues, expenses, gains, losses, assets, and liabilities resulting from exchange and exchange-like transactions are recognized when the exchange takes place.

Program revenues include charges for services, special assessments, and payments made by parties outside of the reporting government’s citizenry if that money is restricted to a particular program. Program revenues are netted with program expenses in the statement of activities to present the net cost of each program.

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

Sometimes the City will fund outlays for a particular purpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted – net position and unrestricted – net position in the government-wide and proprietary fund financial statements, a flow assumption must be

80 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

b. Basis of Accounting an
d Measurement Focus (Continued)

made about the order
in which the resources are considered to be applied. It is the City’s practice to consider restricted – net position to have been depleted before unrestricted – net position is applied.

Fund Financial Statements

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

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

Governmental Funds

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

Property taxes, sales taxes, franchise taxes, gas taxes, motor vehicle license fees, transient occupancy taxes, grants, and interest associated with the current fiscal period are all considered to be subject to accrual and so have been recognized as revenues of the current fiscal period to the extent normally collected within the availability period. Other revenue items are considered to be measurable and available when cash is received by the City.

Revenue recognition is subject to the measurability and availability criteria for the governmental funds in the fund financial statements. Exchange transactions are recognized as revenues in the period in which they are earned (i.e., the related goods or services are

81 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

b. Basis of Accounting an
d Measurement Focus (Continued)

provided). Locally imp
osed derived tax revenues are recognized as revenues in the period in which the underlying exchange transaction upon which they are based takes place.

Imposed non-exchange transactions are recognized as revenues in the period for which they were imposed. If the period of use is not specified, they are recognized as revenues when an enforceable legal claim to the revenues arises or when they are received, whichever occurs first. Government-mandated and voluntary non-exchange transactions are recognized as revenues when all applicable eligibility requirements have been met.

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

Non-current portions of long-term receivables due to governmental funds are reported on their balance sheets in spite of their spending measurement focus.

Because of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by non-current liabilities. Since they do not affect “available spendable resources”, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities.

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

Permanent Funds, also referred to as Endowment Funds, are governmental funds used to report resources that are legally restricted to the extent that only earnings, and not principal, may be used for purposes that support City programs. The amount of net appreciation on investments that is available to support City programs is $2,555,481. The amount of investment earnings available for expenditure is reported as Restricted Fund Balance in the fund level financial statements. The endowment principal is reported as Nonspendable for Permanent Endowments in the Balance Sheet. The State law governing the spending of endowment funds investment earnings is California Probate Code §18504. The authority for spending investment earnings for scholarships resides with the City Manager, and the authority for periodic maintenance dredging in the Newport Bay resides with the City Council.
82 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

b. Basis of Accounting an
d Measurement Focus (Continued)

Proprietary & Fiduciary Funds

The City’s ente
rprise and internal service funds are proprietary funds. In the fund financial statements, proprietary and fiduciary funds are presented using the accrual basis of accounting. Revenues are recognized when they are earned and expenses are recognized when the related goods or services are delivered. In the fund financial statements, proprietary funds are presented using the economic resources measurement focus . This means that all assets, deferred outflows of resources, all liabilities and deferred inflows of resources (whether current or non-current) associated with their activity are included on their balance sheets. Proprietary fund type operating statements present increases (revenues) and decreases (expenses) in total net position.

Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values. Non-operating revenues, such as subsidies, taxes, and investment earnings result from non-exchange transactions or ancillary activities. Amounts paid to acquire capital assets are capitalized as assets in the proprietary fund financial statements, rather than reported as expenditures.

Proceeds of long-term debt are recorded as a liability in the proprietary fund financial statements, rather than as other financing sources. Amounts paid to reduce long-term indebtedness of the proprietary funds are reported as reductions of the related liabilities, rather than as expenditures.

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

Fiduciary funds are also reported using the economic resources measurement focus and the accrual basis of accounting.

c. Fund Classifications

The City utilizes the f
ollowing broad categories of funds:

Major Funds – Major funds are those funds which are either material or of particular importance.

Major Govern
mental Funds – Governmental funds are generally used to account for tax supported activities. The following governmental funds meet the criteria of a major fund:

83 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

c. Fund Classification
s (Continued)

General Fund
The General Fund is
the general operating fund of the City. It is used to account for all activities, except those required to be accounted for in another fund.

Special Revenue Funds

Tide and Submerged Land
– Operating
The Tide and Su
bmerged Land – Operating Fund is a special revenue fund used to account for revenues related to the operation of the City’s tidelands, including beaches and marinas, and the related expenditures. Revenue from tideland operations includes, but is not limited to, rents from moorings, piers, and leases, as well as income from parking lots, meters, and the sale of oil.

Tide and Submerged Land – Harbor Capital
The Tide and Su
bmerged Land - Harbor Capital Fund is used to account for incremental increases in revenue from certain property lease, pier, and mooring rentals that exceed Council designated base year revenue amounts, as well as other designated revenues and the related expenditures for capital projects, maintenance, and servicing of loan advances from the General Fund.

Capital Project Fund

Facilities Financial Pla
nning Reserve Fund
The Facilities Fina
ncial Planning Reserve Fund is used to account for the receipt and expenditure of funds for the replacement of facilities.

Debt Service Fund
The Debt Se
rvice Fund is used to account for debt service transactions related to the Certificates of Participation issued to finance the construction of the City’s Civic Center Complex and the construction of Fire Station No. 2.

Major Proprietary Funds – Proprietary funds are used to report an activity for which a fee is charged to external users to recover the cost of operation.

Water Fund
The Water Fund is
an enterprise fund used to account for the activities associated with the transmission and distribution of potable water by the City to its users.

Wastewater Fund
The Wastewater Fund
is an enterprise fund used to account for the activities associated with providing sewer services by the City to its users.

84 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

c. Fund Classification
s (Continued)

Other Governmental
Funds – Other Governmental Funds are those funds which do not meet the criteria of a ma
jor fund. Other Governmental Funds used by the City fall into the following governmental fund types:

Other Special Revenue Funds – Other Special Revenue Funds are used to account for the proceeds of speci
fic revenue sources which are legally restricted to expenditures for specified purposes.

Other Capital Projects Funds – Other Capital Projects Funds are used to account for resources used for the a
cquisition and construction of capital facilities by the City, except those financed by Enterprise Funds.

Permanent Funds – Permanent Funds are used to report resources that are legally restricted for the extent
that only earnings, not principal, may be used for purposes that support the reporting government’s programs.

Internal Service Funds – The Internal Service Funds are used to account for the City’s self-insured gene
ral liability and workers’ compensation, compensated absences, and retiree insurance liabilities; the cost of maintaining and replacing the City’s rolling stock fleet, parking equipment, coordinated communications systems equipment, certain fire equipment, and recreation equipment; and the cost of maintaining and replacing the City’s information technology systems. City departments are the primary users of these services and are charged a fee on a cost reimbursement basis.

Fiduciary Funds – The Custodial Funds, a type of Fiduciary Fund, are used to account for assets held by the
City as an agent for property owners with special assessments, and local businesses in business improvements districts. The Other Post-Employment Benefit (OPEB) Trust Fund is used to account for the activities of the City's trust for the OPEB plan.

d. New Accounting Pronouncements

Current Year Standards

In fiscal year 2024-2
5, the City implemented the following GASB Statements:

 GASB Statement No. 101, Compensated Absences, updates the recognition and measurement guidance for compensated absences under a unified model. The Statement requires that liabilities for compensated absences be recognized for (1) leave that has not been used and (2) leave that has been used but not yet paid in cash or settled through noncash means. A liability should be recognized for leave that has not been used if (a) the leave is attributable to services already rendered,

85 CITY OF NEWPORT BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

d. New Accounting Pronouncements (Continued)

(b) the leave accumulates, and (c) the leave is more likely than not to be used for time off or otherwise paid in cash or settled through noncash means. As a result of this implementation, the City updated the recognition and measurement guidance for compensated absences to satisfy the criteria set forth above.

 GASB Statement No. 102, Certain Risk Disclosures , requires state and local governments to disclose certain risks that arise from vulnerabilities due to concentrations and constraints that could adversely affect the level of service they provide or their ability to meet obligations as they become due.

Pending Accounting Standards

GASB has issued the following pronouncements that may impact future financial reporting requirements:

 GASB Statement No. 103, Financial Reporting Model Improvements , Effective for reporting periods beginning after June 15, 2025. The objective of this Statement is to improve key components of the financial reporting model to enhance its effectiveness in providing information that is essential for decision making and assessing a government’s accountability. This Statement also addresses certain application issues.
 GASB Statement No. 104, Disclosure of Certain Capital Assets, Effective for reporting periods beginning after June 15, 2025. The objective of this Statement is to provide users of government financial statement with essential information about certain types of capital assets.
e. Cash and I nvestments
Cash and cash equivalents are defined to be cash on hand and demand deposits.

Investments are generally stated at fair value which is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Cash and investments are pooled to maximize investment yields. Typically, the City’s funds may deposit or withdraw from the City’s cash and investments pool on demand without penalty. The net change in fair value and interest earned on the pooled cash and investments is allocated to the respective funds based on each fund’s average monthly pooled cash and investments balance. Each fund’s share of the pooled cash and investments balance is treated as cash and cash equivalents on the City’s statements of 86 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

e. Cash and Investments
(Continued)

cash flows. Consi
stent with GAAP only the City’s proprietary funds report a statement of cash flows.

f. Accounts Receivable

Accounts receivable
represent all service and capital project billings other than intergovernmental receivables stated below. As of June 30, 2025, accounts receivable deemed to be uncollectible with an outstanding balance over 120 days past due were written off the City’s accounting records to ensure that the income statement and balance sheet are fairly stated at the amount expected to be collected in receivables. Receivables with governmental organizations are generally excluded from the write-off as they are more likely to be received due to the governments’ creditworthiness.

g. Intergovernmental Receivables

Intergovernmental receivab
les represent grant reimbursement requests, capital project billings, and pending transfers of taxes and fees collected by other government agencies.

As of June 30, 2025, the balance of these accounts totaled $14,363,617.

h. Inventories and Prepaid Items

Inventories are value
d at cost, which approximates market, using the first-in, first-out method. The City follows the consumption method for inventory control. The costs of governmental fund and internal service fund inventories are recorded as expenditures when consumed.

Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items. The City follows the consumption method for prepaid items.

i. Capital Assets

Capital assets are tangi
ble and intangible assets, which include land, structures, equipment, and infrastructure assets, and are reported in the applicable governmental or business-type activities columns in the Government-wide Financial Statements. Tangible capital assets are recorded at cost where historical records are available and at an estimated original cost where no historical records exist. Equipment purchased in excess of $5,000 is capitalized if it has an expected useful life in excess of one year. Buildings, infrastructure, and improvements are capitalized if cost is in excess of $30,000 and the expected useful life is in excess of one year. The cost of normal maintenance and repairs that do not add to the value of the asset’s life are not capitalized. The City chose to value and report on infrastructure assets in their entirety (e.g., prior to 1980).

87 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

i. Capital Assets (Co
ntinued)

Major capital outlay
s for tangible capital assets and improvements are capitalized as projects are constructed. Tangible capital assets acquired through lease obligations are valued at the present value of future lease payments at the date acquired. Contributed tangible capital assets are valued at their estimated acquisition value at the date of contribution. Intangible capital assets are generally an estimated present value of certain future lease or software subscription payments for the leases or subscriptions in which the City is the lessee or subscriber.

Capital assets used in operations are depreciated/amortized using the straight-line method in the government-wide financial statements and in the fund financial statements of the proprietary funds. Tangible capital assets are depreciated over their estimated useful lives.

Intangible assets are amortized over the shorter of the estimated useful life of the underlying asset or the period of time included in the estimated present value. Depreciation/ amortization is charged as an expense against operations and accumulated depreciation/amortization is reported on the respective balance sheet. The ranges of useful life for depreciation purposes for each capital asset class are as follows:

Structures 15-75 years
Equipment 3-
15 years
Infrastructure 20-75 years

j. Claims and Judgments

The City accounts
for material claims and judgments and associated legal and administrative costs when it is probable that the liability claim has been incurred and the amount of the loss can be reasonably estimated. The City records the estimated loss liabilities in the Internal Service Fund. Included therein are claims incurred but not reported, which consists of (a) known loss events expected to be presented as claims later, (b) unknown loss events that are expected to become claims, and (c) expected future development on claims already reported. This is based upon historical actual results that have established a reliable pattern supplemented by specific information about current matters. Small dollar claims and judgments are recorded as expenditures when paid.

k. Property Taxes

The assessment, le
vy, and collection of property taxes are the responsibility of the County of Orange. The City records property taxes as revenue when received from the County, except at fiscal year-end, when property taxes received within 60 days are accrued as revenue. Property taxes are assessed and collected each fiscal year according to the following property tax calendar:

88 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

k. Property Taxes
(Continued)

Lien date January 1
Levy date July 1
Due dates November 1 1st installment
March 1 2 nd installment
Collection dates December 10 1st installment
April 10 2 nd installment

l. Compensa
ted Absences

It is the City’
s policy to permit employees to accumulate earned but unused vacation and limited amounts of earned but unused sick leave benefits, which will be paid to employees upon separation from City service. Beginning in fiscal year 1990, the City adopted a general leave plan to replace the traditional vacation and sick leave plan. The City uses a general leave plan that permits a maximum of three years’ accrual for every employee, above which the excess either stops accruing or is paid out as current compensation. All employees hired prior to January 1,1990, were given the option of remaining in the traditional vacation and sick leave plan or enrolling in the general leave plan. All employees hired on or after January 1,1990, are automatically enrolled in the general leave plan.

Effective for the current fiscal year, the City implemented GASB Statement No. 101, Compensated Absences, which establishes a unified model for recognizing and measuring liabilities for compensated absences. Under this guidance, compensated absences are recognized as a liability for (1) leave that has not been used when the leave is attributable to services already rendered, accumulates, and is more likely than not to be used for time- off or otherwise paid or settled, and (2) leave that has been used but has not yet been paid or otherwise settled as of the financial statement date. The City measures compensated absences using employees’ pay rates in effect at the financial statement date, or, when applicable, the pay rates expected to be used to settle the obligation, and includes salary‑related amounts that are directly and incrementally associated with payments for such leave. It is assumed that when leave is taken the credits or hours earned first are the ones first utilized or paid.

Compensated absences are accrued in the Compensated Absence Internal Service Fund and in the government ‑wide financial statements when employee services have been rendered and when it becomes more likely than not that the City will compensate the employees for benefits through paid time off or cash or other settlement, including at termination or retirement.

The City accrues compensated absences for benefits that employees have earned but are not yet available for use when it is more likely than not that the employees will meet the required eligibility or service conditions for payment or use, based on the City’s historical

89 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

l. Compensated Absences
(Continued)

experience and cu
rrent policies. Benefits not covered by GASB 101, such as pension, retiree health, or other postemployment benefits (including those administered through CalPERS), are accounted for in accordance with the applicable GASB standards. Leave that does not accumulate or is contingent upon sporadic events, such as jury duty, bereavement, or certain forms of military or parental leave, is not accrued as compensated absences and is recognized as an expense in the period the leave is taken or paid.

m. Deposits Payable

In the government-
wide and fund-level financial statements, deposits payable represents monies collected for developer deposits, demolition deposits, planning deposits and others, for services which have not yet been performed. These unspent portions are reported as liabilities on the financial statements.

n. Unearned Revenue

Unearned revenues a
re those where asset recognition criteria have been met, but the revenue recognition criteria have not been met.

o. Deferred Inflows/Outflows of Resources

In addition to assets
, the statement of net position and the governmental funds balance sheet will sometimes report a separate section for deferred outflows of resources . This separate financial statement element, deferred outflows of resources , represents a consumption of net assets that applies to future periods and so will not be recognized as an outflow of resources (expense) until that time. The City has three items that qualify for reporting in this category. The first item is the deferred outflows related to employer pension and OPEB contributions made after the measurement date. The second item is a deferred outflow related to pensions and OPEB resulting from changes in assumptions. This amount is amortized over a closed period equal to the average of expected remaining service lives of all employees that are provided pensions and OPEB through the plans. The third item is a deferred outflow related to pensions and OPEB resulting from the difference between expected and actual experience. This amount is amortized over a closed period equal to the average of expected remaining service lives of all employees that are provided pensions and OPEB through the plans.

In addition to liabilities, the statement of net position and the governmental funds balance sheet will sometimes report a separate section for deferred inflows of resources . This separate financial statement element, deferred inflows of resources , represents an acquisition of net assets that applies to future periods and will not be recognized as an inflow of resources (revenue) until that time. The City has five items that qualify for reporting in this

90 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

o. Deferred Inflows/Outfl
ows of Resources (Continued)

category. The first item i
s unavailable revenues, which is only reported in the governmental funds balance sheet. The governmental funds report unavailable revenues from two sources: grants receivable and rent collections. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available. The second item is a deferred inflow related to pensions and OPEB resulting from the difference between actual and expected experience. This amount is amortized over a closed period equal to the average of the expected remaining service lives of all employees that are provided pensions through the plans. The third item is a deferred inflow related to pensions and OPEB resulting from the change in assumptions. This amount is amortized over a closed period equal to the average of expected remaining service lives of all employees that are provided pensions through the plans. The fourth item is a deferred inflow for certain leases for which the City is lessor and relates to a present value estimate of certain future lease payments. This amount generally is amortized over the same time period associated with the related present value estimate. The fifth item is a deferred inflow from a certain public-private partnership arrangement where the City is the transferor, and represents the sum of certain improvements by the operator to the underlying public-private partnership asset and a present-value estimate of certain future payments from the operator to the City.

This amount is generally amortized over the same time period associated with the related present value estimate.

p. Fund Balance Classifications

The governmental fund
balance is made up of different classifications and the following provides explanations as to the nature and purpose of each classification:

Nonspendable fund balance
That portion of
fund balance that typically includes amounts that are either (a) not in a spendable form such as inventories and prepaid items, or (b) legally or contractually required to be maintained intact such as endowments.

Restricted fund balance
The portion of fund
balance that reflects constraints placed on the use of resources (other than nonspendable items) that are either (a) externally imposed by creditors, grantors, contributors, or laws or regulations of other governments; or (b) imposed by law through constitutional provisions or enabling legislation.

Committed fund balance
That portion of
a fund balance that includes amounts that can only be used for specific purposes pursuant to constraints imposed by formal action by the government’s highest level of decision making authority and remain binding unless removed in the same manner.

The City Council has authority to establish or modify a fund balance commitment by

91 CITY OF NEWPORT
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Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

p. Fund Balance Classific
ations (Continued)

legislation (Counci
l action) and can only rescind a fund balance commitment by new legislation requiring the same voting consensus. The City considers a resolution to constitute a formal action of the City Council for the purposes of establishing committed fund balance.

Assigned fund balance
That portion of a
fund balance that includes amounts that are constrained by the City’s intent to be used for specific purposes and do not meet the criteria to be classified as restricted or committed. Constraints imposed on the use of assigned amounts are more easily removed or modified than those imposed on amounts classified as committed. The City’s Reserve Policy gives the City Manager the authority to establish, modify, or rescind a fund balance assignment.

Unassigned fund balance
The residual por
tion of a fund balance that is not otherwise restricted, committed, or assigned. Positive unassigned fund balance is available to be used for any purpose. Only the general fund may report a positive unassigned fund balance. Funds, except the general fund, may report negative unassigned fund balance in certain circumstances.

In the governmental fund statements, when expenditures are incurred for purposes for which both restricted and unrestricted (committed, assigned, or unassigned) fund balances are available, the City uses the most restrictive funds first. The City uses the appropriate funds in the following order: restricted, committed, assigned, and finally unassigned amounts.

q. Estimates

The preparation of
financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of certain assets, deferred outflows of resources, liabilities and deferred inflows of resources, disclosure of contingent assets and liabilities, and the related amounts of revenues and expenditures.

Actual results could differ from those estimates. Management believes that the estimates are reasonable.

r. Pensions

For purposes of measurin
g the net pension liability and deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the City of Newport Beach’s California Public Employees’ Retirement System (CalPERS) plans (Plans) and additions to/deductions from the Plans’ fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized

92 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

r. Pensions (Continu
ed)

when due and pa
yable in accordance with the benefit terms. Investments are reported at fair value.

GASB 68 requires that the reported results must pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used.

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

s. Post-Employment Health Care Benefits (OPEB)

For purposes of
measuring the net OPEB liability and deferred outflows/inflows of resources related to OPEB and OPEB expense, information about the fiduciary net position of the City of Newport Beach’s California Public Employees’ Retirement System (CalPERS) Health Plan and additions to/deductions from the Plans’ fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value.

GASB 75 requires that the reported results must pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used.

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

t. Lease Liabilities and Receivables

Lease liabilities
and receivables are estimated present values of future lease payments.

Estimating present values involves various related estimates, including lease terms and interest rates. The estimated lease term is the time period that the lease is noncancelable, plus extension and termination time periods if based on the lease agreement it is reasonable that the extensions will be exercised, and the terminations will not be exercised. When a lease’s implicit interest rate is not known, estimates are made of either the City’s incremental borrowing rate or the rate the City may charge a lessee. Non-lease components of lease agreements have been treated as separate non-lease agreements when practicable, and are excluded from the City’s estimated lease liabilities and receivables. Leases that do not meet GASB’s definition of a lease liability or receivable (e.g., short-term leases, etc.) are also excluded from the City’s estimated lease liabilities and receivables.

93 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(1) Summary of Significant Accounting Policies (Continued)

u. Subscription-Based
Information Technology (IT) Arrangements

The City is a
participant in subscription-based IT arrangements as detailed in note 7. The City recognizes a subscription liability and intangible right to use subscription assets in the financial statements. At the commencement of the arrangement, the City initially measures the liability at the present value of payments expected to be paid during the arrangement term. Subsequently, the liability is reduced by the principal portion of payments made. The intangible right to use subscription assets are initially measured at the initial amount of the subscription liability. Subsequently, the intangible right to use subscription assets are amortized over the life of the arrangement term.

v. Public-Private Partnerships (PPP)

The City’s public
-private partnership receivable is an estimated present-value of future payments from the operator to the City. The estimated public-private partnership term is the time period that the operator’s right to use the underlying public-private partnership asset is noncancelable, plus extension and termination time periods if based on the public-private partnership arrangement it is reasonable that the extensions will be exercised, and the terminations will not be exercised. When the public-private partnership arrangement’s implicit interest rate is not known an estimate is made of the rate the City may charge an operator. Non-public-private partnership components of public-private partnership arrangements have been treated as separate arrangements when practicable and are excluded from the City’s estimated receivable. Arrangements that do not meet GASB’s definition of a public private partnership (e.g., leases that do not require the operator to improve the City’s existing assets, etc.) are also excluded from the City’s estimated receivable.

(2) Cash and Investments

Cash and invest
ments as of June 30, 2025, are classified in the accompanying financial statements as follows:

Statemen
t of net position:

Cash and investments 410,824,387$
Cash and investments with fiscal agent 27,782,192
Fiduciary funds:

Cash and investments 1,582,522
Cash and investments with fiscal agent 50,991,330
Total ca
sh and investments 491,180,431$
94 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(2) Cash and Investments (Continued)

Cash and investments as of
June 30, 2025, consist of the following:

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

The table below
identifies the investment types that are authorized for the City by the California Government Code (or the City’s investment policy, where more restrictive). The table also identifies certain provisions of the California Government Code (or the City’s investment policy, where more restrictive) that address interest rate risk and concentration of credit risk. Certain investments related to debt proceeds and the City’s OPEB trust are excluded from the table below, because they are governed neither by the California Government Code nor by the City’s investment policy. Debt proceeds held by bond trustees are instead governed by the provisions of debt agreements of the City. Investments in the City’s OPEB trust are governed by the agreement between the City and the trustee.

*Excluding amounts hel
d by bond trustee and by the OPEB trust that are not subject to California Government Code restrictions.

Cash on
hand 24,765$
Deposits with financial institutions 20,223,592
Cash and receivables in investment accounts 52,834
Investments 470,879,240
Total ca
sh and investments 491,180,431$
Maximum Pe
rcentage Investment in Minimum
Authorized Investment Type Maturity* of Portfoli
o* One Issu
er* Rating*
Local Ag
ency Bonds 5 years 30% 5% A-
FHLMC 5 years No Limit 30% None
U.S. Treasury Obligations 5 years No Limit No Limit None U.S. Agency Securities 5 years No Limit 30% None
Commercial Paper 270 days 40% 5% A-1
Negotiable Certificates of Deposit 2 years 30% 5% A-1
Reverse Repurchase Agreements 30 days 10% 5% None
Medium-Term Notes 5 years 30% 5% A-
Mutual Funds N/A 20% 10% AAA
Money Market Mutual Funds N/A 20% 20% AAAm
Mortgage Pass-Through Securities 5 years 20% 5% AAA
LA County Pooled Investment Funds N/A 5% 5%
California Asset Management Program (CAMP) N/A $75 million $75 million None Local Agency Investment Fund (LAIF) N/A $75 million $75 million N/A Supranationals 5 years 20% 10% AA-
95 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(2) Cash and Investments (Continued)

Investments Authorized by D
ebt Agreements

Investments of de
bt proceeds held by bond trustees (i.e., fiscal agents) are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City’s investment policy. The table below identifies the investment types that are authorized for investments held by bond trustees. The table also identifies certain provisions of these debt agreements that address interest rate risk, credit risk, and concentration of credit risk.

Disclosures Relating to Interest Rate Risk

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

Maximum M
aximum
Percentage Investment in
Authorized Investment Type Maximum
Maturity Allowed One Issu
er
U.S. Trea
sury Obligations 6 months - No Limit No Limit No Limit
U.S. Agency Securities 6 months - No Limit No Limit No Limit Banker's Acceptances 6 months - 1 Year 0% - No Limit No Limit Commercial Paper 180 days - 6 months No Limit 10%
Money Market Mutual Funds N/A No Limit No Limit
Investment Agreements 6 months - No Limit No Limit No Limit Certificates of Deposit 6 months - No Limit No Limit No Limit Demand Deposits 6 months - No Limit No Limit No Limit
Time Deposits 6 months - No Limit No Limit No Limit
Local Agency Bonds 6 months - No Limit No Limit No Limit Forward Delivery Agreement 6 months - No Limit 0% - No Limit No Limit Forward Purchase Agreement 6 months - No Limit 0% - No Limit No Limit Repurchase Agreements 6 months - No Limit No Limit No Limit Local Agency Investment Fund (LAIF) N/A No Limit No Limit Municipal Obligations 6 months - No Limit No Limit No Limit County Pooled Investment Funds N/A 0% - No Limit No Limit 96 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(2) Cash and Investments (Continued)

Information about
the sensitivity of the fair values of the City’s investments (including investments held by bond trustees and by the OPEB trust) to market interest rate fluctuations is provided by the following table that shows the distribution of the City’s investments by maturity:

Some of the City’s investments may have call features where the investments’ principal may be paid down before its maturity. Such investments include asset backed securities, U.S. Agency Commercial Mortgage Backed Securities (CMBS), investments with make whole call provisions, and investments with call dates.

The City’s asset backed securities pay monthly coupons, at which time principal may be paid down. As of June 30, 2025, the City held asset backed securities of about $8.8 million.

The City’s U.S. Agency CMBS may pay down principal prior to maturity. As of June 30, 2025, the City held U.S. Agency CMBS of about $19.7 million.

Investments with make whole call provisions generally may be called any time, but the terms of the call price generally mitigate the financial impact of a call. As of June 30, 2025, the City held corporate bonds with make whole call provisions as summarized below:

Investmen
t Maturities (In Years)
Investment Type Fair Value Less than
1 1 to 3 3 to 5 More than 5 Total
Money Mark
et Funds 18,497,696$ 18,497,696$ -$ -$ -$ 18,497,696$ U.S. Treasury Bills 44,745,992 44,745,992 - - - 44,745,992 U.S. Treasuries 80,357,245 47,098,495 30,734,922 2,523,828 - 80,357,245 Commercial Papers 34,094,969 34,094,969 - - - 34,094,969 U.S. Agency Bonds 7,522,679 3,478,549 4,044,130 - - 7,522,679 U.S. Agency CMBS 19,696,669 1,530,905 5,151,995 13,013,769 - 19,696,669 Asset Backed Securities 8,832,728 - 1,545,934 7,286,794 - 8,832,728 Corporate Bonds 54,743,652 10,599,683 13,492,745 30,651,224 - 54,743,652 Municipal Bonds 2,167,119 - - 2,167,119 - 2,167,119 CAMP 54,865,897 54,865,897 - - - 54,865,897 LAIF 66,581,074 66,581,074 - - - 66,581,074 Investments with Fiscal Agent:

Money Market Funds 20,924,102 20,924,102 - - - 20,924,102 U.S. Treasuries 8,379,253 8,379,253 - - - 8,379,253 U.S. Agency Bonds 872,453 872,453 - - - 872,453 LAIF 305,448 305,448 - - - 305,448 Investments with OPEB Trust:

Money Market Funds 929,614 929,614 - - - 929,614 Mutual Funds - Fixed Income 19,080,502 19,080,502 - - - 19,080,502 Mutual Funds - Equity 28,282,148 28,282,14
8 -
-
-
28,282,148

Tot
als 470,879,240$ 360,266,7
80$ 54,969,72
6$ 55,642,73
4$ -$
470,879,24
0$
Assuming
callable securities (if any) will not be called.
97 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(2) Cash and Investments (Continued)

Investments with call dat
es may be called anytime on or after the call date. As of June 30, 2025, the City held corporate bonds with call dates as summarized below:

Investments may have both a make whole call provision and a regular call date. As of June 30, 2025, the City held corporate bonds with both a make whole call provision and a regular call date as summarized below:

Maturity Value
September
2025 4,183,821$
March 2027 1,972,768
January 2029 1,214,226
February 2029 1,227,658
To
tal 8,598,473$
Maturity Value Call Date
May 202
7 2,996,331$ April 2027
April 2029 1,521,192 April 202
8 Total 4,517,523$
Maturity Value Call Date
August
2025 2,418,029$ July 2025
November 2025 1,999,822 September
2025
July 20
26 1,999,691 July 2025
September 2027 1,000,872 August 2027
June 2028 477,855 May 2028
June 2029 1,275,916 May 2029
July 2029 1,744,235 July 2028
August 2029 1,415,038 May 2029
November 2029 1,434,754 August 2029
December 2029 1,502,814 December 2028
February 2030 4,605,710 January 2030
March 2030 1,535,316 February 2030
March 2030 1,446,812 December 2029
May 2030 2,194,517 April 20
30 Total 25,051,381$
98 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(2) Cash and Investments (Continued)

Approximately $13.6
million of the investments that are U.S. Agency CMBS or have either a regular call date or both a make whole call provision and a regular call date, also have interest rate reset dates. If $6.7 million of the securities with interest rate reset dates are not called by their call date, then these securities will convert to floating rate securities tied to a benchmark index. Prior to their call date, these securities pay a fixed rate of interest. An additional $6.9 million of the securities with interest rate reset dates are U.S. Agency CMBS with potentially variable coupon rates.

Investments with Fair Values Highly Sensitive to Interest Rate Fluctuations

As of June 30, 20
25, the City did not have any investments (including investments held by fiscal agents) whose fair values were highly sensitive to interest rate fluctuations.

Disclosures Relating to Credit Risk

Generally, credit risk
is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented in the following schedule is the minimum rating (where applicable) required by the California Government Code, the City’s investment policy, or debt agreements, and the actual rating by Standard & Poor’s as of the June 30, 2025 for each investment type.

Concentration of Credit Risk

The investment poli
cy of the City and the California Government Code limit the amount that can be invested in any one issuer as previously discussed. There were no investments in any one issuer (excluding U.S. treasury bills, U.S. treasuries, mutual funds, and pooled investments) that represented 5% or more of total City investments.

Minimum
Le
gal
Investment Type Fair Value Rating AAA AAAm AA+ AA AA- A-1+ A+ A A-1 A- Not Rated Money Ma
rket Funds 18,497,696$ AAAm - $ 18,497,696$ -$ - $ - $ - $ -$ -$ -$ - $ -$ U.S. Treasury Bills 44,745,992 None - - - - - 44,745,992 - - - - - U.S. Treasuries 80,357,245 None - - 80,357,245 - - - - - - - - Commercial Papers 34,094,969 A-1 - - - - - 25,817,304 - - 8,277,665 - - U.S. Agency Bonds 7,522,679 None - - 7,522,679 - - - - - - - - U.S. Agency CMBS 19,696,669 None 1,956,768 - 17,739,901 - - - - - - - - Asset Backed Securities 8,832,728 AAA 6,746,633 - - - - - - - - - 2,086,095 Corporate Bonds 54,743,652 A- 1,535,316 - 9,600,282 2,999,072 8,746,917 - 11,621,788 9,341,895 - 9,364,123 1,534,259 Municipal Bonds 2,167,119 A- - - 756,612 - 1,410,507 - - - - - - CAMP 54,865,897 None - 54,865,897 - - - - - - - - - LAIF 66,581,074 None - - - - - - - - - - 66,581,074 Investments with Fiscal Agent:

Money Market Funds 20,924,102 AAm - 20,924,102 - - - - - - - - - U.S. Treasuries 8,379,253 None - - 8,379,253 - - - - - - - - U.S. Agency Bonds 872,453 None - - 872,453 - - - - - - - - LAIF 305,448 None - - - - - - - - - - 305,448 Investments with OPEB Trust:

Money Market Funds 929,614 None - 929,614 - - - - - - - - - Mutual Funds - Fixed Income 19,080,502 None - - - - - - - - - - 19,080,502 Mutual Funds - Equity 28,282,148 None -
-
-
-
-
-
-
-
-
-
28,282,1
48 Total
s 470,879,240$ 10,238,717$ 95,217,3
09$ 125,228,4
25$ 2,999,072 $ 10,157,424$
70,563,2
96$ 11,621,788$
9,341,895$
8,277,66
5$ 9,364,12
3$ 117,869,52
6$
99 CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(2) Cash and Investments (Continued)

Custodial Credit Ris
k

Custodial credit risk for
deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the City’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits:

The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The fair value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits. As of June 30, 2025, none of the City’s deposits with financial institutions in excess of federal depository amounts were held in uncollateralized accounts.

For investments identified herein as restricted cash and investments with fiscal agent, the fiscal agent and/or financial advisor selects the investment under the terms of the applicable trust agreement, acquires the investment, and holds the investment on behalf of the reporting government.

Investment in California Asset Management Trust’s Cash Reserve Portfolio (CAMP)

The City voluntaril
y invests in the Cash Reserve Portfolio (CAMP) of the California Asset Management Trust (CAMT). CAMT is an external investment pool that is both a California joint exercise of powers authority regulated by California Government Code Section 6509.7 and a common law trust regulated by CAMT’s bylaws and declaration of trust. Oversight of CAMT is provided by CAMT’s trustees. Other than CAMT’s initial trustees, CAMT’s board of trustees appoints trustees to indefinite terms, and these appointed trustees are subject to approval by participants in CAMT that have executed CAMT’s declaration of trust. Because the City has not executed CAMT’s declaration of trust, the City has no voting rights with CAMT.

One of CAMP’s investment objectives is to maintain a stable net asset value of $1.00 per share.

According to CAMT’s audited financial statements for calendar year 2024, “In accordance with GASB Statement No. 79, Cash Reserve Portfolio securities are valued at amortized cost, which approximates fair value.” CAMP is rated AAAm by S&P Global. Under normal circumstances the City may withdraw from its investment with CAMP “upon proper notice without restrictions”. CAMT may suspend withdrawals in limited circumstances.

100

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(2) Cash and Investments (Continued)

Investment in State I
nvestment Pool

The City voluntarily
invests in the Local Agency Investment Fund (LAIF). LAIF is an external investment pool that is regulated by California Government Code §§16429.1 to 16429.4.

Oversight of LAIF is provided by the Local Investment Advisory Board (LIAB). LIAB’s chairman is the State Treasurer or his or her designee. The State Treasurer or his or her designee also appoints the remaining four members of LIAB to serve two-year terms or at the State Treasurer’s pleasure. California Government Code §16429.2 specifies the required qualifications of the State Treasurer’s appointees to LIAB.

LAIF provides the fair value of the City’s investment in LAIF, which is reported in the accompanying financial statements and is based upon the City’s pro-rata share of the fair value of the entire LAIF portfolio, in relation to the amortized cost of that portfolio. The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis. LAIF’s credit risk is not rated by a nationally recognized statistical rating organization.

Limitations and restrictions apply to the City’s investment in LAIF. Up to 15 transactions with LAIF are permitted each month. Balances in LAIF may not exceed $75 million, with the exception of bond accounts. LAIF requests one day prior notice for transactions of $10 million or more.

Investments in Other Post-Employment Benefits (OPEB) Trust

The City established
a trust account with Public Agency Retirement Services (PARS) to hold assets that are legally restricted for use in administering the City’s OPEB plan. The OPEB Trust’s cash and investments are managed by a third-party portfolio manager under guidelines approved by the City. Those guidelines are as follows:

Risk Tolerance Moderate

Risk Management The portfolio is constructed to control risk through diversification of asset classes (cash, fixed income, and equity), investment styles (large cap, small cap, international, etc.), and securities.

Disciplined mutual fund selection and monitoring processes help to drive return potential while reducing portfolio risk.

Investment Objective To provide growth of principal and income. It is expected that dividend and interest income will comprise a significant portion of total return, although growth through capital appreciation is equally important.

Strategic Ranges 0% - 20% Cash
30% - 50% Fixed Income
50% - 70% Equity
101

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(2) Cash and Investments (Continued)

Fair Value Measurements

The City categorize
s its fair value measurement within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the assets. Level 1 inputs are quoted prices in active markets for identical assets. Level 2 inputs are significant other observable inputs. Level 3 inputs are significant unobservable inputs.

Most of the City’s investments are in Level 2 of the fair value hierarchy. Examples of Level 2 valuation inputs include:

 Quoted prices for similar assets or liabilities in active markets  Quoted prices for identical or similar assets or liabilities in markets that are not active  Inputs other than quoted prices that are observable for the asset or liability  Inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Following are the City’s recurring fair value measurements as of June 30, 2025:

Quoted Pri
ces
Investments in Active Quoted Prices
That Are Not Markets for for Similar Significant
Subject to Fair Identical Assets Assets in Active Unobservable Fair Value Value Hi
erarchy (Level 1
) Markets
(Level 2) Inputs
(Level 3)
Money Ma
rket Funds 18,497,696$ 18,497,696$ -$ -$ -$ U.S. Treasury Bills 44,745,992 - - 44,745,992 - U.S. Treasuries 80,357,245 - - 80,357,245 - Commercial Papers 34,094,969 - - 34,094,969 - U.S. Agency Bonds 7,522,679 - - 7,522,679 - U.S. Agency CMBS 19,696,669 - - 19,696,669 - Asset Backed Securities 8,832,728 - - 8,832,728 - Corporate Bonds 54,743,652 - - 54,743,652 - Municipal Bonds 2,167,119 - - 2,167,119 - CAMP 54,865,897 54,865,897 - - - LAIF 66,581,074 66,581,074 - - - Investments with Fiscal Agent:

Money Market Funds 20,924,102 20,924,102 - - - U.S. Treasuries 8,379,253 - - 8,379,253 - U.S. Agency Bonds 872,453 - - 872,453 - LAIF 305,448 305,448 - - - Investments with OPEB Trust:

Money Market Funds 929,614 929,614 - - - Mutual Funds - Fixed Income 19,080,502 - 4,675,098 14,405,404 - Mutual Funds - Equity 28,282,148 -
13,325,7
39 14,956,4
09 -

To
tals 470,879,240$ 162,103,
831$ 18,000,8
37$ 290,774,
572$ -$

102

CITY OF NEWP

ORT BEACH
Notes to Basic Financial Statements
June 30, 2025

(3) Lease Receivables

City as Lessor

Lease agreements
that meet the requirements of GASB 87 for which the City is the lessor are disclosed as lease receivables on the City’s financial statements. Included in the City’s lease receivables are over 900 agreements related to land and structures. GASB 87 excludes certain inflows (e.g., certain variable payments, etc.) from the measurement of lease receivables. For the fiscal year ending June 30, 2025, the City recognized $3,960,576 of variable payments related to the lease receivables that were excluded from the measurement of the lease receivables. Lease inflows, including inflows excluded from GASB 87, are included on the City’s financial statements as property income. Lease inflows for interest revenue from amortization of the GASB 87 lease receivables totaled $4,519,482. Lease inflows for lease revenue from amortization of the related GASB 87 deferred inflows of resources from leases was $13,227,446. Lease receivables at June 30, 2025, were $276,374,011.

Regulated Lease

While not technic
ally a lease, the City licenses streetlight space for cellphone antennas and related equipment to a cellphone company. Restrictions to the license cause the license to be a GASB 87 regulated lease that is excluded from GASB 87’s present value calculations and notes.

Generally, these licensed streetlight spaces are licensed nonexclusively, but some of these licensed spaces may be licensed exclusively. The total revenue recognized during the fiscal year for this license was $8,182. Below are the expected future minimum payments to the City from this license. License payments by the cellphone company to the City do not secure debt issued by the City.

Year End
ing License
June 30, Payment
s
2026 8,1
86 $
2027 1,500
2028 1,500
2029 1,500
2030 1,500
2031-2035 7,500
2036-2040 5,500
Total 27
,186 $
103

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(4) Interfund Receivables and Payables

At June 30, 2025, interfu
nd receivables and payables were as follows:

The above balances are primarily due to reclassification of negative cash balances in the city- wide cash pool.

At June 30, 2025, interfund advances receivable and payable were as follows:

The General Fund advance to the Tide and Submerged Land – Harbor Capital Fund was utilized for dredging within the City’s Tidelands. Repayment of the advance to the General Fund is funded from incremental revenue increases generated from certain leases, mooring rents, commercial and residential pier rents, and parking meter revenues.

The annual amortization of the repayment of the advance is as follows:

Due From Due To
General Fu
nd 8,718,563$ -$
Debt Service Fund - 6,517,778
Internal Service Fund - 353,001
Other Governmental Funds - 1,847,784 Due From Due To
General F
und 4,426,659$ -$
Tide and Submerged Land - Harbor Capital Fund - 4,426,659 Advance
#1 Advance #2
Dredging Marina Park
Fiscal Projects Project Total
Year Repayment Repayment Repayment
2026 750,
000$ 500,000$ 1,250,000$
2027 750,000 500,000 1,250,000
2028 426,659 500,000 926,659
2029 - 500,000 500,000
2030 - 500,000
500,000

Totals 1,9
26,659$ 2,500,00
0$ 4,426,65
9$
Harbor Ca
pital Fund Advance - Repayment Terms
(Zero-Interest Advance)
104

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(5) Interfund Transfers

Interfund transfers
at June 30, 2025, consisted of the following:

The City typically uses transfers to fund ongoing subsidies and to set aside resources for long- term needs such as capital facilities replacement and major maintenance. The General Fund transferred:

 $12,263,815 to the Tide and Submerged Land – Operating Fund to subsidize the maintenance and operation;
 $5,832,875 to the Tide and Submerged Land – Harbor Capital Fund to cash fund Harbor Capital projects;
 $12,104,412 to the Facilities Financial Planning Reserve Fund to cash fund construction projects for General Fund supported facilities;
 $8,250,735 to the Debt Service Fund for the debt service payments related to the Civic Center Certificates of Participation and the Fire Station No. 2 Certificates of Participation;  $6,160 to the Equipment Maintenance Fund and $15,729 to the Information Technology Fund to fund additional CalPERS expenses; and
 $14,562,692 to Other Governmental Funds, which includes $9,757,055 to the Unrestricted Capital Improvements Fund to fund the purchase of real property and capital improvements, $148 to the Office of Traffic Safety Fund to offset a variance and to claim a reimbursement, $5,489 to the Contributions Fund to reconcile revenues and expenditures related to the Rubberized Pavement Grant, $2,300,000 to the Park Maintenance Fund for the maintenance of parks, and $2,500,000 to the Facilities Maintenance Fund for the maintenance of facilities.

The Tide and Submerged Land – Operating Fund transferred $20,317,944 to the General Fund to reimburse for tidelands related expenditures.

The Facilities Financial Planning Reserve Fund also transferred $11,111,169 to Other Governmental Funds as follows:

 $3,000,000 to the Unrestricted Capital Improvements Fund to fund a new permanent supportive housing project;
General Fund
Tide and
Submer
ged
Land -
Operating
Tide and
Submer
ged
Land - Harbor
Capital
Facilities
Fi
nancial
Planning
Reserve
Debt Servi
ce
Fund
Internal
Serv
ice
Funds
Other
Governm
ental
Funds Total
General Fund -
$ 12,263,815$ 5,832,875$ 12,104,412$ 8,250,735$ 21,889$ 14,562,692$ 53,036,418$ Tide and Submerged Land -
Operating 20,317,944 - - - - - - 20,317,944 Facilities Financial Planning
Reserve -
- - - - - 11,111,169 11,111,169 Internal Service Funds - - - - - - - - Other Governmental Funds - -
-
-
-
-
-
-

Total 20,317,944$ 12,263,815$ 5,832,875$ 12,104,412$ 8,250,735$ 21,889$ 25,673,861$ 84,465,531$

Transfers I
n
Transfers Out
105

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(5) Interfund Transfers (Continued)

 $500,000 to Miscella
neous FFP Projects Fund to fund entitlement process and preliminary studies and outreach on the Lower Castaways Aquatic Center project.  $5,295 to the Junior Lifeguards Fund to fund construction projects related to the Junior Lifeguard building;
 $6,800,000 to the Fire Station Fund to cash fund the construction for replacing Balboa Library/Fire Station No. 1; and
 $805,874 to the Parks and Community Centers Fund to support the Lower Sunset View Park project.

(6) Capital Assets

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

Governmental Activities:

Beginning Ba
lance
Balance Addition
s Deletion
s June 30,
2025
Non-deprec
iable/non-amortizable:

Land and rights of way 1,922,330,399$ 1,646,200$ -$ 1,923,976,599$ Work in progress 22,200,235 9,389,848
(16,602,4
39) 14,987,644

Total
non-depreciable/non-amortizable 1,944,530,634 11,036,048 (16,602,4
39) 1,938,96
4,243
Depreciab
le/amortizable:

Structures 270,180,218 9,090,044 (22,865) 279,247,397 Intangible right to use structures 17,187,099 - - 17,187,099 Equipment 63,520,443 3,867,886 (2,013,301) 65,375,028 Intangible right to use equipment 363,725 - - 363,725 Intangible right to use subscriptions 2,666,852 - (214,474) 2,452,378 Infrastructure 406,394,747 22,784,377
(2,862,98
6) 426,316,1
38 Total
depreciable/amortizable 760,313,084 35,742,307
(5,113,62
6) 790,941,7
65 Less acc
umulated depreciation/amortization for:

Structures (70,504,228) (6,972,478) 22,865 (77,453,841) Intangible right to use structures (3,142,343) (1,221,302) - (4,363,645) Equipment (44,470,285) (4,197,345) 1,962,260 (46,705,370) Intangible right to use equipment (201,404) (84,689) - (286,093) Intangible right to use subscriptions (521,572) (423,693) 214,474 (730,791) Infrastructure (194,915,347) (7,286,22
0) 1,659,85
9 (200,541
,708)
Total
accumulated depreciation (313,755,179) (20,185,72 7) 3,859,45
8 (330,081
,448)
Net d
epreciable/amortizable 446,557,905 15,556,580
(1,254,16
8) 460,860,3
17 Net
capital assets 2,391,088,539$ 26,592,628$
(17,856,6
07)$ 2,399,82
4,560$
106

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(6) Capital Assets (Continued)

Governmental Activities capital
assets net of accumulated depreciation/amortization at June 30, 2025 are comprised of the following:

Business-type Activities:

General Ca
pital Assets, net 2,381,189,972$
Internal Service Fund Capital Assets, net 18,634,588
Total 2
,399,824,560$
Beginnin
g Balance
Balance Addition
s Deletions June 30, 2
025
Non-deprec
iable/non-amortizable:

Land 2,219,450$ -$ - $ 2,219,450$ Work in progress 4,408,443 5,540,23
4 (2,720,157
) 7,228,520

Tot
al non-depreciable/non-amortizable 6,627,893 5,540,23 4 (2,720,157
) 9,447,970

Depreciab
le/amortizable:

Intangible right to use land and right of way 3,883,062 - - 3,883,062 Structures 688,396 - - 688,396 Equipment 380,068 - - 380,068 Intangible rights to use subscription - 146,843 - 146,843 Infrastructure 205,661,153 4,025,16
7 (1,871,208
) 207,815,1
12 Tot
al depreciable/amortizable 210,612,679 4,172,01
0 (1,871,208
) 212,913,4
81 Less acc
umulated depreciation/amortization for:

Intangible right to use land and right of way (127,825) (53,656) - (181,481) Structures (325,569) (15,357) - (340,926) Equipment (254,064) (12,569) - (266,633) Intangible rights to use subscription - (29,866) - (29,866) Infrastructure (79,893,907) (2,477,77
0) 253,220
(82,118,45
7)
Tot
al accumulated depreciation (80,601,365) (2,589,21 8) 253,220
(82,937,36
3)
Ne
t depreciable/amortizable 130,011,314 1,582,79
2 (1,617,988
) 129,976,1
18 N
et capital assets 136,639,207$ 7,123,02
6$ (4,338,145
)$ 139,424,0
88$
107

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(6) Capital Assets (Continued)

Depreciation/amortization
expense was charged in the following functions in the Statement of Activities:

Internal Service Fund depreciation/amortization of $4,275,677 was allocated to the governmental functions above.

(7) Long-Term Liabilities

Changes in Long-Term
Liabilities

The long-term
liabilities for governmental activities for the fiscal year ended June 30, 2025, are as follows:

Governmental Business-ty
pe
Activities Activities
General Government 6,735,860$
-$
Public Safety 3,070,878 -
Public Works 144,478 -
Community Development 450,393 -
Community Service 9,784,118 -
Water - 1,949,684
Wastewater - 639,534

T
otals 20,185,727$ 2,589,218$
Amounts
B
eginning Ending Due Within
Balance Additions Deletion
s Balance One Year
Governme
ntal activities:

Other debt:

Certificates
of participation - Series 2010B 87,800,00
0$ - $ (3,510,000)$ 84,290,000$ 3,675,000$ Certificates of participation - Series 2020A 5,725,000 - (725,000) 5,000,000 755,000 Bond premium - Series 2020A 864,633 - (142,131) 722,502 - Other long-term liabilities:

Workers' compensation payable 23,450,563 7,108,865 (5,069,453) 25,489,975 4,497,885 Claims and judgments payable 10,841,318 7,829,776 (8,070,980) 10,600,114 3,941,299 Compensated absences(1) 13,648,16
6 844,531 - 14,492,697 8,097,760 Lease liability 14,339,382 - (1,272,451) 13,066,931 1,273,326 Subscription liability 1,832,755 -
(289,032)
1,543,723
243,771

Total g
overnmental activities 158,501,8
17$ 15,783,17
2$ (19,079,04
7)$ 155,205,9
42$ 22,484,04
1$
(1) The chan
ge in the compensated absences liability is presented as a net change. 108

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(7) Long-Term Liabilities (Continued)

Internal service funds
predominantly serve the governmental funds. Accordingly, long-term liabilities for them are included as part of the above totals for governmental activities. Also, liabilities for workers’ compensation, claims and judgments, compensated absences, and net OPEB obligation are typically liquidated from the internal service funds through resources collected from individual funds.

The long-term liabilities for business-type activities for the fiscal year ended June 30, 2025, are as follows:

2010 Certificates of Participation

In fiscal year 20
10-11, the City issued $20,085,000 of Series 2010A (Tax Exempt) and $106,575,000 of Series 2010B (Federally Taxable Direct Pay Build America Bonds) Certificates of Participation. The 2010A Certificates were issued to prepay the $3,990,000 principal outstanding on the 1998 Library Certificates of Participation. Accordingly, the 1998 Library Certificates have been defeased and are no longer outstanding. The remaining proceeds from the Series 2010A Certificates were used to finance the acquisition, improvement and equipping of the Civic Center Project. The Series 2010B Certificates were issued to provide additional financing for the Civic Center Project. The proceeds of the Certificates also were applied to pay certain costs of issuance incurred in connection with the Certificates.

The lease payments made by the City are held by a trustee who makes semi-annual payments on the Certificates of Participation. The lease payments began January 1, 2011, and are in amounts sufficient to cover the payment of principal and interest of the Certificates. Interest on the Certificates is payable semiannually on January 1 and July 1 of each year. The 2010A Certificates have been defeased and are no longer outstanding. The 2010B Certificates interest rates range from 4.45% to 7.17%. The City has designated the Series 2010B Certificates as “Build America Bonds” (BABs) under the provisions of the American Recovery and Reinvestment Act of 2009. Thus, the City receives refundable credits from the United States Treasury on the interest paid on the 2010B Certificates. As of June 30, 2025, the City has received $33,530,580 of BABs Subsidy from the United States Treasury and expects to receive subsidy equal to about 33% on future interest payable on the 2010B Certificates. Principal payments are payable annually on July 1 of each year. The remaining principal payments for the Series 2010B Certificates, which are payable through July 1, 2040, range from $3,675,000 to $7,245,000. The total outstanding balance at June 30, 2025, amounted to $84,290,000. The use of the following assets has been pledged as security for the outstanding balance: the Central Library and the Civic Center.

Beginnin
g Ending Due Within
Balance Additions Deletions Balance One Year
Business-t
ype activities:

Lease liability 3,776,654$ - $ (44,364)$ 3,732,290$ 44,608$ Subscription liability - 146,843
(36,460)
110,383
36,593

Total bus
iness-type activities 3,776,654$
146,843$
(80,824)$
3,842,673$
81,201$

109

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(7) Long-Term Liabilities (Continued)

The annual amo
rtization requirements of the outstanding Series 2010B Certificates of Participation are as follows:

2020 Certificates of Participation

In Fiscal Year
2020-21, the City issued $7,860,000 of Series 2020A Certificates of Participation.

The 2020A Certificates were issued to finance the acquisition, improvement, and equipping of Fire Station No. 2. The proceeds of the Certificates also were applied to pay certain costs of issuance incurred in connection with the Certificates.

The lease payments made by the City are held by a trustee who makes semi-annual payments on the Certificates of Participation. The lease payments began June 15, 2021, and are in amounts sufficient to cover the payment of principal and interest of the Certificates. Interest on the Certificates is payable semiannually on January 1 and July 1 of each year. The 2020A Certificates’ interest rate is 4.00%. Principal payments are payable annually on July 1 of each year. The remaining principal payments of the Series 2020A Certificates, which are payable through July 1, 2030, range from $755,000 to $915,000. The total outstanding balance at June 30, 2025, amounted to $5,000,000. The use of the following assets has been pledged as security for the outstanding balance: Fire Station 5 and Fire Station 7.

Year Endi
ng
June 30, Principal Interest Total
2026 3,67
5,000$ 5,889,360$ 9,564,360$
2027 3,850,000 5,623,515 9,473,515
2028 4,025,000 5,345,089 9,370,089
2029 4,210,000 5,053,726 9,263,726
2030 4,405,000 4,748,726 9,153,726
2031-2035 25,220,000 18,624,175 43,844,175
2036-2040 31,660,000 8,476,518 40,136,518
2041 7,245,000 259,661
7,504,66
1 Totals 84
,290,000$ 54,020,7
70$ 138,310,
770$
110

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(7) Long-Term Liabilities (Continued)

The annual amort
ization requirements of the outstanding Series 2020A Certificates of Participation are as follows:

Claims and Judgments

The City retains the risk
of loss for general liability and workers’ compensation claims as described in Note (9). These amounts represent estimates of amounts to be paid for reported general liability and workers' compensation claims including incurred-but-not-reported claims based upon past experience, modified for current trends and information. While the ultimate amount of losses incurred through June 30, 2025, is dependent on future developments based upon information from the City’s attorney, the City's claims administrators, and others involved with the administration of the programs, City management believes the accrual is adequate to cover such losses. The estimated liability at June 30, 2025, for general liability and workers’ compensation was $10,600,114 and $25,489,975, respectively.

Compensated Absences

The City's polici
es relating to compensated absences are described in Note (1). This liability at June 30, 2025, is $14,492,697. Compensated absences are liquidated from the Compensated Absences internal service fund.

Unused Credit

The City has a let
ter of credit in the amount of $300,938.

Year Endi
ng
June 30, Principal Interest Total
2026 755,
000$ 184,900$ 939,900$
2027 785,000 154,100 939,100
2028 815,000 122,100 937,100
2029 850,000 88,800 938,800
2030 880,000 54,200 934,200
2031 915,000 18,300
933,300

Totals 5,
000,000$ 622,400$
5,622,40
0$
111

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(7) Long-Term Liabilities (Continued)

Leases

Lease agreements th
at meet the requirements of GASB 87 for which the City is lessee are disclosed as lease liabilities on the City’s financial statements that are presented on the accrual basis of accounting and with an economic resources measurement focus. Included in the City’s lease liabilities are agreements related to water well easements, lifeguard communication equipment, and part of a homeless shelter. For lease provisions subject to GASB 87 during the fiscal year there were no variable lease payments that were not previously included in the City’s lease liabilities.

Estimates of the future lease payments for the City’s lease liability for governmental activities are as follows:

Year Endin
g
June 30 Principal Interest Total
2026 1,27
3,326$ 69,199$ 1,342,525$
2027 1,212,633 62,367 1,275,000
2028 1,219,317 55,683 1,275,000
2029 1,226,036 48,964 1,275,000
2030 1,232,794 42,206 1,275,000
2031-2035 6,266,636 108,364 6,375,000
2036 636,189 1,312
637,501

Totals 13,
066,931$ 388,095$
13,455,0
26$
112

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(7) Long-Term Liabilities (Continued)

Estimates of the future
lease payments for the City’s lease liability for business-type activities are as follows:

Subscription-Based Information Technology Arrangements

Subscription-based
information technology arrangements (SBITAs) that meet the requirements of GASB 96 for which the City is a subscriber are disclosed as SBITA liabilities on the City’s financial statements that are presented on the accrual basis of accounting with an economic resources measurement focus. Included in the City’s SBITA liabilities are subscriptions related to recreation classes registrations, performance evaluations, public safety, etc. GASB 96 excludes certain outflows (e.g., certain variable payments, etc.) from the measurement of SBITA liabilities.

Year Endi
ng
June 30 Principal Interest Total
2026 44,60
8$ 20,415$ 65,023$
2027 44,854 20,169 65,023
2028 45,101 19,922 65,023
2029 45,350 19,673 65,023
2030 45,600 19,423 65,023
2031-2035 231,800 93,317 325,117
2036-2040 238,262 86,855 325,117
2041-2045 244,904 80,213 325,117
2046-2050 251,730 73,387 325,117
2051-2055 258,747 66,370 325,117
2056-2060 265,960 59,157 325,117
2061-2065 273,374 51,743 325,117
2066-2070 280,993 44,124 325,117
2071-2075 288,827 36,290 325,117
2076-2080 296,877 28,240 325,117
2081-2085 305,153 19,964 325,117
2086-2090 313,660 11,457 325,117
2091-2095 241,933 3,142 245,075
2096 14,557 27
14,584

Totals 3,7
32,290$ 753,888$
4,486,17
8$
113

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(7) Long-Term Liabilities (Continued)

Estimates of the future
subscription payments for the City’s SBITA liabilities for governmental activities are as follows:

Estimates of the future subscription payments for the City’s SBITA liabilities for business-type activities are as follows:

(8) Limited Obligation Bonds

The City has is
sued certain Assessment District and Community Facilities District Bonds.

Although the City collects and disburses funds for these districts, the City has no obligation or duty to pay any delinquency out of any available funds of the City. Neither the faith and credit nor the taxing power of the City is pledged to the payment of the bonds, and therefore the bonded indebtedness is not shown in the financial statements of the City. The City holds reserve funds on behalf of bondholders, and the assets are recorded in the Special Assessment District Custodial Fund. Bonds outstanding at June 30, 2025, for each district under the Bond Acts of 1911 and 1915 are as follows:

Fiscal
Yea
r Ending
June 30, Principal Interest Total
2026 243,
771$ 18,361 $ 262,132$
2027 234,543 6,558 241,101
2028 235,836 5,266 241,102
2029 215,788 3,980 219,768
2030 174,164 2,937 177,101
2031-2033 439,621 3,130
442,751

Totals 1,
543,723$ 40,232 $
1,583,95
5$
Fiscal
Year E
nding
June 30, Principal Interest Total
2026 36,593$
607 $ 37,200$
2027 36,794 406 37,200
2028 36,997 203 37,200

Totals 110
,384$ 1,216 $ 111,600$

114

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(8) Limited Obligation Bonds (Continued)

(9) Risk Management –
General Liability and Workers’ Compensation

The City is e
xposed to various risks of loss related to torts, theft of, damage to, and destruction of assets, errors and omissions, injuries to employees, and natural disasters. The City carries commercial insurance with independent third parties for loss risks associated with real and personal property, crime, fiduciary, and automotive liability. The City also purchases fidelity bonds for employees in key positions. Settled claims from these risks have exceeded commercial insurance coverage within the past three years, for the excess layers of the City’s prior insurance program, which had lower limits than the current limits.

The City utilizes California Insurance Pool Authority (CIPA), a joint powers authority, to provide excess insurance for the general liability and workers' compensation programs with the following limits beyond the City’s self-insured retention:

Type of Coverage Self-Insured Retention Coverage Limits General liability $500,000 $40,000,000 excess of
$3,000,000

Workers’ compensation $500,000 Statutory excess of
$2,000,000

CIPA was establishe
d for the purpose of creating a risk management pool for all California cities in order to stabilize and reduce overall insurance costs for members. CIPA is governed by a Board of Directors consisting of representatives from each member city.

Bonds Outstan
ding
Assessment District Original I
ssue June 30, 2
025
Reassessmen
t District 2012 $ 13,583,436 $ 130,813 Assessment District No. 117 2,955,000 2,135,000 Assessment District No. 116 1,575,000 1,230,000 Assessment District No. 116B 665,000 520,000 Assessment District No. 113 4,565,000 3,945,000 Assessment District No. 111 2,412,000 1,984,000 Assessment District No. 120-2 2,505,000 2,385,000 Assessment District No. 124 23,625,000
2 2,795,000
Totals 51,8
85,436$ 35,124,813$

115

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(9) Risk Management – General Liability and Workers’ Compensation (Continued)

The Insurance Rese
rve Fund was established to account for costs associated with general liability and workers' compensation claims. The Insurance Reserve fund is accounted for as an internal service fund where assets are set aside for risk management, administration, claim settlements, and benefit distribution. A premium is charged to each fund that accounts for part-time or full-time employees. The total charge allocated to each of the funds is calculated using trends in actual experience after considering unexpected and unusual claims.

Fund liabilities are reported when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. Liabilities include an amount for claims that have been incurred but not reported (IBNR). Claims liabilities are calculated considering the effects of inflation, recent claim settlement trends including frequency and amounts of payouts and other economic and social factors. The total claims payable was $36,090,089 at June 30, 2025, which represents the discounted present value of all outstanding claims. The claims are discounted using an interest rate of 3%.

(10) Deferred Compensation Plan

The City offe
rs its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all City employees, permits them to set aside a portion of their salary and defer taxation on the contributions and any investment earnings until future years.

Section 457 plan assets were placed in trust for the exclusive benefit of all employees and their beneficiaries. Therefore, all employee assets held in Section 457 plans are not the property of the City and are not subject to the claims of the City’s general creditors. The assets under the plan, which are not included in the accompanying financial statements, totaled $166,674,731 at June 30, 2025.

June 30, 202
4 June 30, 202
5 June 30, 2
024 June 30, 20
25 Unpaid claims, b
eginning of fiscal year 8,689,061$ 10,841,318$ 16,396,153$ 23,450,563$ Insured claims (including IBNR) 25,766,286 7,829,776 11,588,497 7,108,865 Claim payments (23,614,029) (8,070,980
) (4,534,087
) (5,069,453
)
Unpaid claims, e
nd of fiscal year 10,841,318$ 10,600,114$
23,450,563$
25,489,975$

General Liab
ility Workers' Com
pensation
116

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(11) Pension Plans

a. General Information about
the Pension Plans

Plan Descriptions – All qualified permanent and probationary employees are eligible to participate in the City of Newport Beach’s separate Safety (police and fire) and Miscellaneous (all other) Employee Pension Plans, agent multiple-employer defined benefit pension plans administered by the California Public Employees’ Retirement System (CalPERS), which acts as a common investment and administrative agent for its participating member employers.

Benefit provisions under the Plans are established by State statute and Local Government resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.

Benefits Provided – CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years of total service are eligible to retire at age 50 to 62 with statutorily reduced benefits. PEPRA miscellaneous members become eligible for service retirement upon attainment of age 52 with at least five years of service.

All members are eligible for non-duty disability benefits after five years of service. The death benefit is one of the following: the Basic Death Benefit, the 1959 Survivor Benefit, the Optional Settlement 2W Death Benefit, or the 1957 Survivor Benefit. Safety members can receive a special death benefit if the member dies while actively employed and the death is job-related. Fire members may receive the alternate death benefit in lieu of the Basic Death Benefit or the 1957 Survivor Benefit if the member dies while actively employed and has at least 20 years of total CalPERS service. The cost-of-living adjustments for each plan are applied as specified by the Public Employees’ Retirement Law.

117

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(11) Pension Plans (Continued)

The Plans’ provisi
ons and benefits in effect for the measurement period ended June 30, 2024 are summarized as follows:

Prior to On o
r after On or after
Hire date November 24, 2012 November
24, 2012 January 1
, 2013
Benefit fo
rmula 2.5%@55 2.0%@60 2.0%@62
Benefit vesting schedule 5 years of service 5 years of service 5 years of service Benefit payments monthly for life monthly for life monthly for life Retirement age 50-55 50-63 52-67
Monthly benefits, as a % of eligible compensation 2.0% - 2.5% 1.092% - 2.418% 1.0% - 2.5% Required employee contribution rates 11.5% - 13.0% 11.5% - 13.0% 11.5% - 13.0% Required employer contribution rates 32.59% - 34.09% 29.17% - 30.67% 29.76% - 31.17% Prior to On or after On or after
Hire date November 24, 2012 November
24, 2012 January 1
, 2013
Benefit fo
rmula 3.0%@50 2.0%@50; 3.0%@55 2.7%@57
Benefit vesting schedule 5 years of service 5 years of service 5 years of service Benefit payments monthly for life monthly for life monthly for life Retirement age 50-55 50-55 50-57
Monthly benefits, as a % of eligible compensation 3.0% 2.0% - 2.7%; 2.4% - 3.0% 2.0% - 2.7% Required employee contribution rates 13.5% - 14.6% 13.5% - 14.6% 13.5% - 14.6% Required employer contribution rates 69.03% - 70.13% 69.03% - 70.13% 72.53% - 73.63% Miscellaneous
Safety
118

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(11) Pension Plans (Continued)

Employees Covered –
At the measurement date of June 30, 2024, the following employees were covered by the benefit terms for each Plan:

Contributions – Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially determined rate and the contribution rate of employees.

City contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contributions requirements are classified as plan member contributions.

b. Net Pension Liability

The City’s net pension liability for each Plan is measured as the total pension liability, less the pension plan’s fiduciary net position. The net pension liability of each of the Plans is measured as of June 30, 2024, using an annual actuarial valuation as of June 30, 2023 rolled forward to June 30, 2024 using standard update procedures. The General Fund, Tidelands Funds, Water Fund, and Wastewater Fund have typically been used in prior years to liquidate the net pension liability. A summary of principal assumptions and methods used to determine the net pension liability is shown below.

Miscella
neous Safety
Inactive
employees or beneficiaries
currently receiving benefits 789 488
Inactive employees entitled to
but not yet receiving benefits 710 115
Active employees 547 275

Totals 2,0
46 878

119

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(11) Pension Plans (Continued)

Actuarial Assump
tions – The total pension liabilities in the June 30, 2023, actuarial valuations were determined using the following actuarial assumptions:

All other actuarial a
ssumptions used in the June 30, 2023, valuation were based on the results of an actuarial experience study for the period from 2000 to 2019, including updates to salary increase, mortality and retirement rates. The Experience Study report can be obtained at the CalPERS website under Forms and Publications.

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

The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members.

Miscella
neous Safety
Valuatio
n Date June 30, 2023 June 30, 2023
Measurement Date June 30, 2024 June 30, 2024
Actuarial Cost Method
Actuarial Assumptions:

Discount Rate 6.90% 6.90%
Inflation 2.30% 2.30%
Payroll growth 2.80% 2.80%
Projected salary increases
Investment Rate of Return 6.80% 6.80%
Mortality Rate Table (1)
Post Ret
irement Benefit Increase
data for all funds
The lesser of contract COLA or 2.30%
until Purchasing Power Protection
Allowance Floor on Purchasing Power
applies, 2.3% thereafter
Derived using CalPERS' membership
Entry-Age Normal Cost Method
Varies by Entry Age and Services
(1) The mortal
ity table used was developed based on CalPERS-specific
data. The probabilities of mortality are based on the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. Mortality rates incorporate full generational mortality improvement using 80% of Scale MP- 2020 published by the Society of Actuaries. For more details on this table, please refer to the 2021 experience study report from November 2021 that can be found on the CalPERS website.
120

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(11) Pension Plans (Continued)

Therefore, the long
-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

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

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

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

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

Assumed
As
set Real Return
Allocation Years 1-10(1),(2)
Global e
quity - Cap-weighted 30.00% 4.54%
Global equity - Non-Cap-weighted 12.00% 3.84%
Private Equity 13.00% 7.28%
Treasury 5.00% 0.27%
Mortgage-backed Securities 5.00% 0.50%
Investment Grade Corporates 10.00% 1.56%
High Yield 5.00% 2.27%
Emerging Market Debt 5.00% 2.48%
Private Debt 5.00% 3.57%
Real Assets 15.00% 3.21%
Leverage -5.00% -0.59%
e(1) An expect
ed inflation of 2.30% used for this period.
e(2) Figures a
re based on the 2021 Asset Liability Management study.

Asset Class(1)
121

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(11) Pension Plans (Continued)

c. Changes in the Net
Pension Liability

The changes in the Net Pension Liability for each Plan for the measurement period follow:

Miscella
neous Plan:

Total Pen
sion Plan Fiduciary Net Pension
Liability Net Positi
on Liability
/(Asset)
Balance a
t June 30, 2023 521,082,608$ 400,096,18
2$ 120,986,
426$
Changes
in the Year:

Service cost 8,448,830 - 8,448,830 Interest on the total pension liability 35,431,016 - 35,431,016 Differences between expected and
actual experience 1,976,265 - 1,976,265 Net plan to plan resource movement - (59) 59 Contribution - employer - 21,544,170 (21,544,170) Contribution - employee - 4,541,457 (4,541,457) Net investment income - 38,107,605 (38,107,605) Benefit payments, including refunds
of employee contributions (27,580,605) (27,580,605) - Administrative expense - (325,559)
325,559

Net Change
s 18,275,506 36,287,009
(18,011,
503)
Balance a
t June 30, 2024 539,358,114$ 436,383,19
1$ 102,974,
923$
Increase (
Decrease)
122

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(11) Pension Plans (Continued)

Sensitivity of
the Net Pension Liability to Changes in the Discount Rate – The following presents the net pension liability of the City for each Plan, calculated using the discount rate for each Plan, as well as what the City’s net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower or 1-percentage point higher than the current rate:

Miscella
neous Safety
1% Decrea
se 5.90% 5.90%
Net Pension Liability 174,266,038$ 266,569,562$
Current Discount Rate 6.90% 6.90%
Net Pension Liability 102,974,923$ 173,551,818$
1% Increase 7.90% 7.90%
Net Pension Liability 44,241,390$ 96,648,799$
Safety Pl
an:

Total Pens
ion Plan Fiduciary Net Pension
Liability Net Posi
tion Liabilit
y/(Asset)
Balance
at June 30, 2023 695,885,933$ 499,893,
619$ 195,992,
314$
Changes
in the Year:

Service cost 10,840,966 - 10,840,966 Interest on the total pension liability 47,523,602 - 47,523,602 Differences between expected and
actual experience 7,193,012 - 7,193,012 Net plan to plan resource movement - 59 (59) Contribution - employer - 36,653,740 (36,653,740) Contribution - employee - 3,875,707 (3,875,707) Net investment income - 47,875,335 (47,875,335) Benefit payments, including refunds
of employee contributions (39,503,140) (39,503,140) - Administrative expense - (406,765)
406,765

Net Chan
ges 26,054,440 48,494,9
36 (22,440,4
96)
Balance
at June 30, 2024 721,940,373$ 548,388,
555$ 173,551,
818$
Increase
(Decrease)
123

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(11) Pension Plans (Continued)

Pension Plan Fiduciary
Net Position – Detailed information about each pension plan’s fiduciary net position is available in the separately issued CalPERS financial reports.

d. Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions

For the fiscal year ended June 30, 2025, the City recognized pension expense of $51,381,790 ($20,439,193 Miscellaneous Plan and $30,942,597 Safety Plan). At June 30, 2025, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

Deferred De
ferred
Outflows Inflows
of Resources of Resourc
es
Miscella
neous plan:

Pension contributions subsequent to
measurement date 21,712,457$ -$
Differences between expected and
actual experience 3,244,282 (87,145)
Change in assumptions 977,548 -
Net differences between projected and
actual earnings on plan investments 6,473,421 -

Total mi
scellaneous plan 32,407,708 (87,145)

Safety plan:

P
ension contributions subsequent to
measurement date 37,081,470 -
Differences between expected and
actual experience 10,440,815 (926,141)
Change in assumptions 6,072,755 -
Net differences between projected and
actual earnings on plan investments 7,992,597 -

Total sa
fety plan 61,587,637 (926,141)

Total al
l plans 93,995,345$ (1,013,28
6)$
124

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(11) Pension Plans (Continued)

$58,793,927 repo
rted as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the fiscal year ending June 30, 2026. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:

e. Payable to the Pension Plan

At June 30, 2025, the City had no outstanding contributions to the pension plan required for the year ended June 30, 2025.

f. Plan Description - D
efined Contribution Plan

Pursuant to City
Council Resolution No. 91-106, the City entered into a defined contribution plan administrated by the private administrator known as Public Agency Retirement System ("PARS") for all of its part-time employees, pursuant to the requirements of Section 11332 of the Social Security Act. The City Council has the authority for establishing and amending the plan’s provisions per the Resolution, including establishing and amending contribution requirements. In a defined contribution plan, benefits depend solely on amounts contributed to the plan plus investment earnings. All part-time employees are eligible to participate from the date of employment. Federal legislation requires contributions of at least 7.5% to a retirement plan, and City Council resolved to match the employees' contributions of 3.75%.

The City's contributions for each employee (and interest earned by the accounts) are fully vested immediately.

For the fiscal yea
r ended June 30, 2025, the City's covered payroll for employees participating in the plan was $3,554,314. Employees made contributions of $133,405 (3.75% of current covered payroll), which was matched by the employer in the same amount. Assets of the plan totaled $2,610,514 at June 30, 2025.

Fiscal
Yea
r Ending
June 30, Miscella
neous Safety Total
2026 3,309
,810$ 8,789,078$ 12,098,888$
2027 10,912,787 17,409,634 28,322,421
2028 (1,498,140) 56,059 (1,442,081)
2029 (2,116,351) (2,674,745) (4,791,096)
Thereafter - - -
125

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(12) Post-Employment Health Care Benefits (OPEB)

The following descrip
tion of the City of Newport Beach Retiree Health Savings (“RHS”) Plan provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan’s provisions.

Plan Description

The Retiree Health Savings Pl
an consists of the following post-retirement medical benefits:

PEMHCA

The CalPERS Public Employees' Medical and Hospital Care Act (PEMHCA) plan under the authority of section 22750 to 22948 of the state of California's government code, is an agent multiple employer plan. The City pays the required PEMHCA minimum contribution for all miscellaneous and safety employees retiring directly from the City who enroll in a CalPERS medical plan. The 2025 PEMHCA minimum contribution amount is $158 per month.

Implicit Subsidy

The City provides healthcare benefits to retirees in the form of an implied rate subsidy, which results from the pooling of non-Medicare retirees and active employees for premium purposes.

Therefore, retirees receive the benefit of a lower premium, which would be higher if the premium for retirees was based on age, health status or claims history. The difference between these amounts is the implicit rate subsidy.

Other Retiree Medical Benefits

The City provides other retiree medical benefits in the form of a single-employer defined contribution plan, a single-employer defined benefit plan, and a hybrid of the two. In January 2006, the City and employee associations agreed to major changes in the Post-Employment Health Care Plan. All employees hired after January 1, 2006, and certain employees hired prior to this date, as well as employees who elected to fully convert to a defined contribution formula (hereafter fully converted employees), participate in a program that requires mandatory employee and employer contributions. However, once these contributions have been made to the employee’s account, the City has no further funding obligation to the Plan on their behalf, except for the Public Employees’ Medical and Hospital Care Act (“PEMHCA”) minimum, which is the responsibility of the City. These employees and eligible retirees participate in a Retiree Health Savings (“RHS”) Plan sponsored by the City, the single employer of the plan. Plan assets are held in trust and managed by MissionSquare Retirement (Trustee), under IRS Revenue Ruling 2002-41 (June 26, 2002) and IRS Notice 2002-45 (June 26, 2002).

Certain employees hired prior to January 1, 2006, had the option to retain a hybrid of the former defined benefit plan, or to fully convert to the new Plan. Employees electing to retain a hybrid of the former defined benefit formula participate in a program requiring mandatory defined

126

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(12) Post-Employment Health Care Benefits (OPEB) (Continued)

contributions by
employees and the City, as well as a defined benefit consisting of an ongoing contribution from the City to the participant’s RHS account each month after retirement.

Additionally, these employees are eligible to receive health care benefits under the City’s group health care plans. In order to receive these benefits, these employees are required to pay the City $100 per month up until their retirement to offset the unfunded portion of post-employment health care benefits existing at the inception of the plan.

For fully converted employees, the City made a one-time contribution into their individual RHS account of $100 per month for every month the employee contributed to the previous defined benefit plan up to a maximum of 15 years. For employees who elected to retain a hybrid plan, the City made a one-time contribution into their individual RHS account of $75 per month for every month the employee contributed to the previous defined plan up to a maximum of 15 years. In order to receive these contributions, the employee must retire from the City. At June 30, 2025, the liability for the conversion part of the RHS Plan was $800,925. This amount is not included in the net OPEB liability but is included in the compensated absences liability. See Note (7).

Employees who retired prior to January 1, 2006, continue to receive an ongoing defined benefit consisting of a contribution made by the City to the participant’s RHS account each month. The defined benefit portion of the plan is closed to new participants.

In 2024, the City closed the OPEB Trust with the California Employers’ Retiree Benefit Trust (“CERBT”) Fund and transferred its assets to Public Agency Retirement Services (“PARS”) to prefund its OPEB liability. The assets held by PARS are legally restricted for the City’s OPEB plan under Section 115 of the Internal Revenue Code. The City has made discretionary contributions to the OPEB Trust. Contributions to the OPEB Trust, along with earnings on those contributions, are irrevocable.

The City determines the timing of the distribution of trust assets and whether those assets will be paid directly to the insurance provider or used to reimburse the City for plan benefits and expenses it has paid. The OPEB Trust is reported as a fiduciary fund since it would be misleading to exclude the OPEB Trust Fund from the City’s financial statements. PARS issues a publicly available financial report detailing the fiduciary net position of the OPEB Trust, which is available upon request. The plan itself does not issue a separate financial report. PARS is an agent multiple- employer trust.

127

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(12) Post-Employment Health Care Benefits (OPEB) (Continued)

Employees Covered

As of the measuremen
t date June 30, 2024, the following current and former employees were covered by the benefit terms under the plan:

Contributions

Contribution requireme
nts are established by City policy and may be amended by the City Council. The annual contribution is based on the actuarially determined contribution. For the year ended June 30, 2025, the City’s cash contributions were $10,865,147 to the trust in premium payments and $1,406,824 for the estimated implicit subsidy, resulting in a total payment of $12,271,971.

Net OPEB Liability

The City’s net OPEB liability was measured as of June 30, 2024, and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation dated June 30, 2023.

The General Fund, Tidelands Funds, Water Fund, and Wastewater Fund have typically been used in prior years to liquidate the net OPEB liability. A summary of the principal assumptions and methods used to determine the total OPEB liability is shown below.

Actuarial Assumptions

The total OPEB li
ability as of June 30, 2023 actuarial valuation was determined using the following actuarial assumptions and applied to all periods included in the measurement, unless otherwise specified:

Inactive
employees, spouses, or beneficiaries currently receiving benefits 539 Inactive employees or beneficiaries entitled to but not receiving benefits 365 Active employees 849
Total 1,753
128

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(12) Post-Employment Health Care Benefits (OPEB) (Continued)

The actuarial assumptions used
in the June 30, 2023, valuation were based on a standard set of assumptions the actuary has used for similar valuations, modified as appropriate for the City.

The long-term expected rate of return on OPEB plan investment is assumed to be 6.40%. The OPEB Plan’s target asset allocation as of June 30, 2025 are summarized in the following table.

The discount rate used when the OPEB plan investments are insufficient to pay for future benefit payments are selected from the range of indices as shown in the table on the following page, where the range is given as the spread between the lowest and highest rate shown.

Valuatio
n Date June 30, 2023
Measurement Date June 30, 2024
Actuarial Cost Method Entry-Age Normal Cost Method
Actuarial Assumptions:

Discount Rate 6.40%
Inflation 2.75%
Projected Salary Increase 2.80% per annum, in aggregate Expected long term investment rate of return 6.40%
Healthcare Cost Trend Rates Initial rate of 8.00%, decreasing 0.25% annually to an ultimate rate of 4.50% for
Pre-65 and 6.50% decreasing by 0.25%
annually to an ultimate rate of 4.50% for
Post -65.

Post-Retirement Turnover Derived from CalPERS pension plan Mortality
From Soci
ety of Actuaries Pub-2010 Public
Retirement
Plans Mortality Table Report
Assumed L
ong-Term
Asset Expected Real
Allocation Rate of R
eturn
US Equity 3

6.00% N/A
Non-US Equity 18.00% N/A
US Real Estate 3.00% N/A
Listed Infrastructure 3.00% N/A
Fixed Income 38.00% N/A
Cash 2.00% N/A
Totals 100.00% 6.40%
Asset Class
129

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(12) Post-Employment Health Care Benefits (OPEB) (Continued)

The City’s funding
policy is to fund the recommended actuarially determined contribution (ADC) to fully fund the benefits over a reasonable period of time. The final equivalent single discount rate used for this year’s valuation is 6.40% with the assumption that the City will eventually pay the pay-go costs out of the OPEB trust when the Trust is expected to be able to pay all future projected benefit payments. This discount rate assumes the City continues to fund for its retiree health benefits through PARS under its investment allocation strategy.

Discount Rate

Under GASB 75, the
discount rate used in valuing OPEB liabilities for funded plans as of the Measurement Date must be based on the long-term expected rate of return on OPEB plan investments that are expected to be used to finance future benefit payments to the extents that (a) they are sufficient to pay for the projected benefit payments and (b) the OPEB plan assets are invested using a strategy that will achieve that return. When the OPEB plan investments are insufficient to cover future benefit payments, a yield for 20-year tax exempt general obligation municipal bonds with an average rating of AA/Aa or higher (or equivalent quality on another rating scale) must be used.

June 30,
June 30,
Yield as of 2023 2024
Bond Buye
r Go 20-Bond
Municipal Bond Index 3.65% 3.93%
S&P Municipal Bond 20-Year
High Grade Rate Index 4.13% 4.21%
Fidelity 20-Year Go Municipal
Bond Index 3.86% 3.97%
Bond Index Range 3.65%-4.13% 3.93%-4.21%
130

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(12) Post-Employment Health Care Benefits (OPEB) (Continued)

Changes in the Net OP
EB Liability

The changes in the net OPEB liability are as follows:

Total Plan
Net
OPEB Fiduciary OPEB
Liability Net Posit
ion Liabilit
y
Balance a
t June 30, 2023 53,136,842$ 35,166,8
53$ 17,969,9
89$
Changes
in the Year:

Service cost 800,218 - 800,218
Interest on the total OPEB liability 3,125,813 - 3,125,813 Changes of assumptions (1,705,049) - (1,705,049) Differences between actual and
expected experience 99,265 - 99,265 Contribution - employer - 10,865,147 (10,865,147) Net investment income - 3,933,617 (3,933,617) Benefit payments, including refunds of
employee contributions (3,734,742) (3,734,742) - Administrative expenses - (23,200)
23,200

Net Chan
ges (1,414,495) 11,040,8
22 (12,455,3
17)
Balance a
t June 30, 2024 51,722,347$ 46,207,6
75$ 5,514,67
2$
Increase
(Decrease)
131

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(12) Post-Employment Health Care Benefits (OPEB) (Continued)

Change of Assumptions

There have been
no substantive plan provision changes since the last full valuation, which was for the fiscal year ending June 30, 2024. The City has migrated their OPEB assets from the CERBT trust to the PARS trust.

Interim year valuation results have been projected from the prior year’s valuation with adjustments for:

 Updating the discount rate from 6.00% as of June 30, 2023 to 6.40% as of June 30, 2024.

This update led to a decrease in liabilities.

 Updated pre-65 and post-65 healthcare trend rates with initial rates of 8.00% and 6.50%, respectively, decreasing annually by 0.25% to an ultimate rate of 4.50%. This change caused a slight increase in liabilities.

 Claim cost calculations have been updated to account for the 2025 risk scores from the CalPERS Risk Adjustments. This change caused an increase in liabilities.

 PEMHCA minimum required contribution was updated for 2026, resulting in a decrease in liabilities.

 Claim costs and premiums were updated for 2025, resulting in an increase in liabilities.

Change of Benefit Terms

There was no change of bene
fit terms.

Subsequent Events

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

132

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(12) Post-Employment Health Care Benefits (OPEB) (Continued)

Sensitivity of the To
tal OPEB Liability to Changes in the Discount Rate

The following present
s the total OPEB liability of the City, calculated using the discount rate for the Plan, as well as what the City’s total OPEB liability would be if it were calculated using a discount rate that is 1-percentage point lower or 1-percentage point higher than the current rate:

Sensitivity of the Net OPEB Liability to Changes in Health-Care Cost Trend Rates

The following presents
the total OPEB liability of the City, as well as what the City’s total OPEB liability would be if it were calculated using healthcare cost trend rates that are 1-percentage point lower (7.00% HMO/7.00% PPO) or 1-percentage point higher (9.00% HMO/9.00% PPO) than current healthcare cost trend rates:

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

For the year ended June 30, 2025, the City recognized OPEB expense of $3,019,952. At June 30, 2025, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources:

1% Decrea
se Discount Rate 1% Increase
(5.40%) (6.40%) (7.40%)
Net OPEB
Liability 10,634,856$ 5,514,672$ 1,162,929$
1% Decrea
se Current 1% Increase
(7.00%HMO/7.00%PPO (8.00%HMO/8.00%PPO (9.00%HMO/9.00%PPO decreasing to decreasing to decreasing to

3.5%HMO/3.5%PPO) 4.50%HMO
/4.50%PPO) 5.5%HMO/

5.5%PPO)
Net OPEB L
iability $2,689,087 $5,514,672 $9,287,516
Healthcare Cost Trend Rates
Deferred De
ferred
Outflows of Inflows of
Description Resources Resources
OPEB contri
butions subsequent to measurement date 2,254,152$ - $ Differences between projected and actual experience 4,256,028 (412,725) Change of assumptions 1,882,666 (1,659,982)
Net difference between projected and actual earnings
on OPEB plan investments 413,087 -

Total
s 8,805,933$ (2,072,70
7)$
133

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(12) Post-Employment Health Care Benefits (OPEB) (Continued)

The differences be
tween expected and actual experience, and changes of assumptions are amortized over a six-year period, eight-year period, nine-year period, or a ten-year period, depending on the fiscal year the difference occurred. The net difference between projected and actual earnings on plan investments is amortized over a five-year period.

An amount of $2,254,152, which is reported as deferred outflows of resources related to contributions subsequent to the measurement date, will be recognized as a reduction of the net OPEB liability in the fiscal year ending June 30, 2026.

Amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows:

Payable to the OPEB Plan
At June 30, 2025, the City had no outstanding amount of contributions to the OPEB plan required for the year ended June 30, 2025.

(13) Joint Venture Agreements

Bonita Canyon Publi
c Facilities Financing Authority

The Bonita Can
yon Public Facilities Financing Authority (Authority) is a joint powers authority comprised of the City of Newport Beach and the Newport-Mesa Unified School District. The Authority’s Board is comprised of two members appointed by each of the member agencies. The Authority created Community Facilities District 98-1 to finance public facilities that will benefit the properties within the District’s boundaries. In 1998, the Authority issued $45,000,000 of special tax bonds to be repaid by special assessments. $30,577,712 (81.7%) of the proceeds were used to pay for the costs of the City acquiring and constructing public facilities including parks and road improvements. In Fiscal Year 2011-12, the Authority issued $38,330,000 of special tax refunding bonds to refinance the 1998 Series. In Fiscal Year 2017-18, the Authority issued $28,245,000 of special tax refunding bonds to refinance the 2012 series; the City is not obligated in any manner to repay the bonds. As of June 30, 2025, the contributions from property owners have been fully

Fiscal Y
ear
Ending
June 30, Amount
2026 811,
880$
2027 1,900,651
2028 467,772
2029 492,139
2030 839,258
Thereafter (32,626)
134

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(13) Joint Venture Agreements (Continued)

spent and no funds
are held in trust by the fiscal agent. The City does not make any annual contributions to the Authority and does not include the Authority as a component unit, as the City is not financially accountable for the Authority’s activities and the Authority is not fiscally dependent on the City. The City’s equity interest in the Authority is not readily determinable.

Complete separate financial statements can be obtained at the Newport Mesa Unified School District, 2985 Bear Street, Suite 8M, Costa Mesa, California.

Metro Cities Fire Authority

The City of New
port Beach is a participant in a joint venture consisting of the cities of Anaheim, Brea, Fountain Valley, Fullerton, Huntington Beach, and Orange for the operation of a communication network utilized by fire suppression, emergency medical assistance, and rescue services. The oversight board consists of one voting member and one alternate appointed by the governing body of each member agency. The City of Newport Beach’s costs are based each fiscal year upon the number of recorded incidents attributable to the City divided by the recorded incidents attributable to all members during the year and are recorded in the General Fund as an expenditure for service. Upon termination of the agreement, the proceeds from the sale of the property and assets of the joint venture will be paid to each member agency pursuant to their fair share percentage. Annually, the amounts paid by the City to this joint venture are approximately $887,014. The City’s 10.75% interest in the net equity of this joint venture at June 30, 2025, amounts to $339,272. Complete separate financial statements can be obtained at the Metro Cities Fire Authority offices at 201 S. Anaheim Boulevard, Suite 302, Anaheim, California.

Integrated Law and Justice Agency of Orange County

The City is a
participant in a joint venture with several other public agencies in Orange County for the operation of the Integrated Law and Justice Agency of Orange County (ILJAOC). The ILJAOC was established in fiscal year 2006-07 and consists of 23 member agencies, with an oversight board consisting of 12 members from the participating agencies. Annually, each member agency pays a percentage of the operating and replacement costs for the ILJAOC. The City’s annual contribution and interest in the net equity of this joint venture was immaterial as of June 30, 2025.

The City of Newport Beach acted as the Treasurer/Controller of the ILJAOC from inception through the end of fiscal year 2010-11. Beginning July 1, 2011, the City of Brea, another member agency, was appointed to serve as Treasurer/Controller, and assumed responsibility for all operating activities of the ILJAOC. Complete separate financial statements can be obtained from the City of Brea, 1 Civic Center Circle, Brea, California 92821.

135

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(14) Commitments and Contingencies

Claims and Judgments

Numerous claims and
suits have been filed against the City in the normal course of business. The estimated liability under such claims, based upon information received from the City Attorney, contracted attorneys, and the Risk Manager, has been estimated and recorded as accrued claims and judgments payable. (See Note 7)

Operating Agreements

The City of New
port Beach first entered into an agreement with Visit Newport Beach Inc. (“VNB”), a legally separate non-profit marketing organization, in 1987. The primary responsibility of VNB is to attract additional visitor business by promoting the City as the premier tourist and business destination in Orange County. VNB is governed by an Executive Committee comprised of seven individuals not appointed by the City Council of the City of Newport Beach. The previous agreement was entered into on September 27, 2011, subsequently amended on January 28, 2014, and expired on December 31, 2024. Under this agreement, the City paid VNB 18% of the total transient occupancy tax (TOT) collected during the fiscal year. On January 1, 2025, the City entered into a new agreement with VNB increasing their share to 23% of hotel TOT collected during the fiscal year, and eliminating their share of residential TOT. For the Fiscal Year ending June 30, 2025, the City paid VNB a total $7,736,564 between the two agreements.

Contractual Commitments

Construction and cont
ractual commitments for major construction projects are as follows:

Annual Proj
ect YTD Unexpended
Budget Expenditures Commitments
Irvine Terrace, Shorecliffs, Balboa Peninsula Water Line Replc 8,238,406$ 572$ 8,091,473$ CNG Fueling System 8,550,542 1,272,932 6,491,700 Central Library Lecture Hall 10,415,158 3,836,678 6,256,601 Big Canyon Restoration Phase 3 7,365,960 1,057,903 5,534,856 Cathodic Protection Program 4,147,420 54,398 4,092,555 Balboa Yacht Basin Dredging 3,899,344 - 3,898,344 Balboa Peninsula Trolley 4,037,247 604,212 3,325,504 Water Well Rehabilitation Program 2,127,021 97,135 2,028,183 Bristol St N Pavement Rehab 1,613,000 - 1,613,000 Library/ Fire Station No. 1 Replacement 15,991,120 77,241 1,514,712 Facilities Maintenance Master Plan 2,649,950 38,438 1,487,348 Spyglass Hill Rd Pavement Rehab 1,886,188 11,849 1,405,203 Bay Crossing Water Main Replc 3,086,736 155,131 1,163,121 Von Karman Ave Pvmt Rehab 1,722,373 622,874 733,714 Sewer Main Lining and Repairs 1,655,896 531,934 682,107 Collins Island Bridge Replacement 2,693,848 16,985 662,732 Facilities Maintenance Master Plan 2,388,922 1,703,165 642,916 Balboa Yacht Basin Docks 6,830,453 115,604 622,008 Balboa Island/CDM Transit Service 3,636,581 - 616,335 136

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025
(14) Commitments and Contingencies (Continued)
At fiscal year-end, the City’s encumbrances with contractors were as follows:

Tide and T
ide and Special Capital
Submerged Submerged Revenue Project
General Land - Operating Land - Harbor Capital Funds Funds Total Oceanfront encroachment -$ -$ -$ 300,606$ -$ 300,606$ Cable franchise reserve - - - 7,883 - 7,883
Streets and highways - - - 2,973,396 2,647,359 5,620,755 Parks and community centers - - - - 10,199,616 10,199,616 Facilities - - - 1,574,952 1,353,763 2,928,715 Public arts and culture - - - 32,500 - 32,500 Capital re-appropriations - - - - 9,857,318 9,857,318 Beaches - 710,994 1,659,355 - - 2,370,349
Marinas - 12,591 - - - 12,591
Dredging - - 100,625 - - 100,625
Equipment 684,664 188,990 - - - 873,654 Facilities Replacement - - - - 100 100 Drainage - - - - 454,505 454,505
Miscellaneous and studies - - - - 711,927 711,927 Contract services 1,027,561 - - - - 1,027,561 Supplies and materials 71,520 - - - - 71,520 Maintenance and repairs 791,737 - - - 1,934,019 2,725,756 General 59,250 - - - - 59,250
Total encumbrances 2,634,732$ 912,575$ 1,759,980$ 4,889,337$ 27,158,607$ 37,355,231$ Major Governmental Funds Other Gov
ernmental Funds
137

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(15) Fund Balance

Governmental Fund Balance at
June 30, 2025, is classified as follows:

Governmen
tal Fund Balance
Tide and Tide and Facilities Special Capital
Submerged Submerged Financial Planning Debt Service Revenue Project Permanent General Land - Operating Land - Harbor Capital Reserve Fund Funds Funds Funds Totals Nonspendable:

Prepaid items (legally restricted) 1,371,697$ 63,529$ -$ -$ -$ 17,024$ -$ -$ 1,452,250$ Inventories (legally restricted) 183,978 - - - - - - - 183,978 Long-term loan receivable (form restricted) 4,426,659 - - - - - - - 4,426,659 Permanent endowment (legally restricted) - - - - - - - 4,629,781 4,629,781 Restricted: -
Affordable housing - - - - - 634,021 - - 634,021 Oceanfront encroachment - - - - - 300,606 - - 300,606 Upper Newport bay restoration - 1,871,911 - - - - - - 1,871,911 Cable franchise reserve - - - - - 4,023,412 - - 4,023,412 Community development - - - - - - 3,586 - 3,586 Streets and highways - - - - - 2,973,396 - - 2,973,396 Public safety - - - - - 646,986 - - 646,986 Facilities - - - - - 1,703,264 306,531 - 2,009,795 Transportation - - - - - 314,333 - - 314,333 Environmental liability mitigation - - - - - 8,917,639 - - 8,917,639 Public arts and culture - - - - - 1,273,162 - - 1,273,162 Parking - - - - - 292,979 - - 292,979 Training - - - - - 634,388 - - 634,388 Libraries - - - - - - - 262,160 262,160 Scholarships - - - - - - - 230,819 230,819 Fiin - - - - - 1,226,580 - - 1,226,580 Debt service - - - - 2,024,393 - - - 2,024,393 Capital re-appropriations - 7,702,206 28,023,307 - - 8,877,643 15,880,007 - 60,483,163 Beaches - 710,994 1,659,355 - - - - - 2,370,349 Marinas - 12,591 - - - - - - 12,591 Dredging - - 27,820,484 - - - - 2,062,502 29,882,986 Equipment - 188,990 - - - - - - 188,990 General Plan Maintenance - 160,674 160,674 Committed:

Facilities replacement - - - 23,540,709 - - 723,235 - 24,263,944 Facilities maintenance - - - - - - 1,225,515 - 1,225,515 Civic center and park - - - - - - 526,902 - 526,902 Oil and gas liabilities - 1,258,890 - - - - - - 1,258,890 Parking management - - - - - - 161,767 - 161,767 Neighborhood enhancement - - - - - - 8,084,238 - 8,084,238 Capital re-appropriations 374,822 - - - - - 7,000 - 381,822 Drainage - - - - - - 2,191,405 - 2,191,405 Streets and highways - - - - - - 13,934,462 - 13,934,462 Facilities - - - - - - 17,718,982 - 17,718,982 Miscellaneous and studies - - - - - - 1,561,927 - 1,561,927 Parks and community centers - - - - - - 15,631,073 - 15,631,073 Contract services 1,613,722 - - - - - - - 1,613,722 Supplies and materials 261,671 - - - - - - - 261,671 Maintenance and repairs 791,737 - - - - - 1,934,019 - 2,725,756 Equipment 684,664 684,664
General 59,250 - - - - - - - 59,250 Unassigned 98,379,310 - - - - (11) - - 98,379,299 Total fund balances 108,147,510$ 11,809,111$ 57,503,146$ 23,540,709$ 2,024,393$ 31,996,096$ 79,890,649$ 7,185,262$ 322,096,876$ Other Gov ernmental Funds
138

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(16) Deficit Fund Equity

The following fun
ds reported deficit equity balances:

The OTS DUI Grant Fund is used to account for federal funding for the Selective Traffic Enforcement Program (STEP). These funds are used exclusively for DUI enforcement. The City will receive reimbursement in the following fiscal year, which will eliminate the deficit fund balance.

For the Compensated Absences Fund, the City’s Reserve Policy sets the maximum cash reserve at 50% of the long-term compensated absences liability and targets a lesser amount that is the median between that amount and a three-year average of the actual payments made for the cash- out of accumulated leave balances. Accordingly, this deficit fund balance is intentional and in compliance with the City Council-approved Reserve Policy.

(17) Public-Private Partnerships

Agreements that meet the requ
irements of GASB 94 for which the city is transferor are disclosed as public-private partnerships (PPP) receivables on the City’s financial statements. The City’s PPP receivable is related to the facilities for the Balboa Island Ferry, Inc. (operator). GASB 94 excludes certain inflows (e.g., certain variable payments, etc.) from the measurement of PPP receivables. Payments from the operator to the City include variable payments, because the operator pays the City the greater of a minimum base amount or a specified percentage of the operator’s gross receipts. For the fiscal year ending June 30, 2025, the City recognized $17,763 of payments related to PPP receivables that were excluded from the measurement of the PPP receivables. A discount rate of 1.50% was applied to the measurement of the PPP receivable.

The PPP agreement leases facilities to the operator for the continued operation of a ferry between Balboa Island and Balboa Peninsula. The City retains the right to inspect the property anytime without notice to the operator. Please see the Statement of Net Position for additional information about the nature and amounts of the PPP receivable and PPP deferred inflow.

Special R
evenue Funds:

OTS DUI Grant 11 $
Internal Service Funds:

Compensated Absences 4,909,926
139

CITY OF NEWPORT
BEACH
Notes to Basic Financial Statements
June 30, 2025

(18) Subsequent Event

On November 6, 2025
, the City entered into a cooperative agreement with the cities of Laguna Beach and Fountain Valley to develop a new municipal groundwater well to enhance regional water supply reliability. Under the agreement, Newport Beach will serve as the lead agency for the planning, design and construction of the project. The City has agreed to provide $20 million towards the $30 million estimated total project cost and is expecting to recover the investment over time through reduced water supply costs, as groundwater is less expensive than imported water. Construction is expected to start in 2026 with the new well being fully operational by 2028. 140

REQUIRED SUPPLEMENTARY INFORMATION
141
2025 2024 2023 2022 2021
Measurement Period June 30, 2024
June 30, 2023 June 30, 2022 June 30, 2021 June 30, 2020 Total Pension Liability
Service cost 8,448,830$ 8,045,390$ 8,261,032$ 7,438,050$ 7,347,708$ Interest on total pension liability 35,431,016 34,232,164 32,759,522 31,805,532 30,565,919 Differences between expected and actual experience 1,976,265 5,716,564 (1,394,332) 1,624,975 369,351 Changes in assumptions - - 15,640,771 - - Changes in benefits - 474,137 - - - Benefit payments, including refunds of employee contributions (27,580,605) (26,581,149) (24,940,419) (22,976,493) (21,516,515) Net Change in Total Pension Liability 18,275,506 21,887,106 30,326,574 17,892,064 16,766,463 Total Pension Liability - beginning 521,082,608 499,195,502 468,868,928 450,976,864 434,210,401 Total Pension Liability - ending (a) 539,358,114$ 521,082,608$ 499,195,502$ 468,868,928$ 450,976,864$ Plan Fiduciary Net Position
Contributions - employer 21,544,170$ 20,800,063$ 18,352,430$ 18,612,457$ 16,346,284$ Contributions - employee 4,541,457 4,113,185 3,974,974 4,057,107 4,067,751 Net investment income 38,107,605 23,270,469 (30,856,252) 76,031,841 16,074,793 Administrative expense (325,559) (278,531) (256,962) (336,753) (454,777) Other miscellaneous income/(expense) - - - - - Plan to plan resource movement (59) - - - - Benefit payments (27,580,605) (26,581,149) (24,940,419) (22,976,493) (21,516,515) Net change in Plan Fiduciary Net Position 36,287,009 21,324,037 (33,726,229) 75,388,159 14,517,536 Plan Fiduciary Net Position - beginning 400,096,182 378,772,145 412,498,374 337,110,215 322,592,679 Plan Fiduciary Net Position - ending (b) 436,383,191$ 400,096,182$ 378,772,145$ 412,498,374$ 337,110,215$ Net pension liability - ending (a)-(b) 102,974,923$ 120,986,426$ 120,423,357$ 56,370,554$ 113,866,649$ Plan fiduciary net position as a percentage of the total pension liability 80.91% 76.78% 75.88% 87.98% 74.75% Covered payroll 50,824,016$ 48,099,822$ 45,210,057$ 44,809,856$ 43,902,594$ Net pension liability as percentage of covered payroll 202.61% 251.53% 266.36% 125.80% 259.36% Notes to Schedule:

Benefit Changes:

Change in Assumptions:

SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS Last Ten Fiscal Years

CITY OF NEWPORT BEACH
an Agent Multiple-Employer Defined Bene
fit Pension Plan
As of June 30, 2025
Last 10 Years
Defined Benefit Plan for Miscellaneous Empl
oyees
The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) that occurred after the Valuation Date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary.

Effective with the June 30, 2021 valuation date (2022 measurement date), the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. In addition, demographic assumptions and the price inflation assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The accounting discount rate was 7.15% for measurement dates June 30, 2017 through June 30, 2021, 7.65% for measurement dates June 30, 2015 through June 30, 2016. 142
2020 2019 2018 2017 2016
June 30, 2019 June 30, 2018 June 30, 2017
June 30, 2016 June 30, 2015
Total Pension Liability
Service cost 7,084,444$ 7,334,861$ 7,151,754$ 6,303,642$ 6,087,960$ Interest on total pension liability 29,409,624 28,226,598 27,069,673 26,375,073 25,427,094 Differences between expected and actual experience 403,676 2,243,854 (4,912,853) (2,686,814) (4,736,006) Changes in assumptions - (2,522,093) 22,616,424 - (6,309,248) Changes in benefits - - - - - Benefit payments, including refunds of employee contributions (20,129,701) (18,458,539) (17,249,398) (16,714,022) (16,374,370) Net Change in Total Pension Liability 16,768,043 16,824,681 34,675,600 13,277,879 4,095,430 Total Pension Liability - beginning 417,442,358 400,617,677 365,942,077 352,664,198 348,568,768 Total Pension Liability - ending (a) 434,210,401$ 417,442,358$ 400,617,677$ 365,942,077$ 352,664,198$ Plan Fiduciary Net Position
Contributions - employer 15,700,833$ 15,797,595$ 10,509,243$ 9,904,636$ 6,615,920$ Contributions - employee 3,955,144 3,979,337 4,134,130 4,206,942 4,321,646 Net investment income 19,895,019 23,855,196 28,349,491 1,241,432 5,687,908 Administrative expense (216,502) (435,499) (375,172) (155,791) (287,862) Other miscellaneous income/(expense) 700 (827,021) - - - Plan to plan resource movement 1,570 (700) - (2,387) 26,981 Benefit payments (20,129,701) (18,458,539) (17,249,398) (16,714,022) (16,374,370) Net change in Plan Fiduciary Net Position 19,207,063 23,910,369 25,368,294 (1,519,190) (9,777) Plan Fiduciary Net Position - beginning 303,385,616 279,475,247 254,106,953 255,626,143 255,635,920 Plan Fiduciary Net Position - ending (b) 322,592,679$ 303,385,616$ 279,475,247$ 254,106,953$ 255,626,143$ Net pension liability - ending (a)-(b) 111,617,722$ 114,056,742$ 121,142,430$ 111,835,124$ 97,038,055$ Plan fiduciary net position as a percentage of the total pension liability 74.29% 72.68% 69.76% 69.44% 72.48% Covered payroll 42,153,383$ 41,468,634$ 41,727,563$ 40,031,404$ 38,512,011$ Net pension liability as percentage of covered payroll 264.79% 275.04% 290.32% 279.37% 251.97%

SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS Last Ten Fiscal Years

CITY OF NEWPORT BEACH
an Agent Multiple-Employer Defined Bene
fit Pension Plan
As of June 30, 2025
Last 10 Years
Defined Benefit Plan for Miscellaneous Empl
oyees

143
2025 2024 2023 2022 2021
Actuarial
ly determined contribution 16,708,777$ 15,211,001$ 15,250,219$ 14,432,250$ 14,600,178$ Contributions in relation to the actuarially determined contributions (21,712,457) (21,537,720) (20,794,397) (18,372,473) (18,730,840) Contribution deficiency (excess) (5,003,680)$ (6,326,719)$ (5,544,178)$ (3,940,223)$ (4,130,662)$ Covered payroll 53,975,509$ 50,824,016$ 48,099,822$ 45,210,057$ 44,809,856$ Contributions as a percentage of covered payroll 40.23% 42.38% 43.23% 40.64% 41.80% Notes to Schedule:

Valuation date: 6/30/2022 6/30/2021 6/30/2020 6/30/2019 6/30/2018 Methods and assumptions used to determine contribution rates:

Actuarial cost method Entry age Entry age Entry age Entry age Entry age Amortization method (1) (1) (1) (1) (1)
Asset valuation method Market Value Market Value Market Value Market Value Market Value Inflation 2.30% 2.30% 2.50% 2.50% 2.50%
Salary increases (2) (2) (2) (2) (2)
Investment rate of return 6.80% (3) 6.80% (3) 7.00% (3) 7.00% (3) 7.00% (3) Retirement age (4) (4) (4) (4) (4)
Mortality (5) (5) (5) (5) (5)
(1
) Level percentage of payroll for bases established prior to June 30, 2019 and level dollar amount for bases established after June 30, 2019 (2) Depending on age, service, and type of employment
(3) Net of pension plan investment and administrative expense; includes inflation (4)
(5)

CITY OF NEWPORT BEACH
an Agent Multiple-Employer Defined Benefit Pension Plan As of June 30, 2025
Last 10 Years
Retirement assumptions are based on retirement rates resulting from the most recent CalPERS Experience Study adopted by the CalPERS Board Mortality assumptions are based on mortality rates resulting from the most recent CalPERS Experience Study adopted by the CalPERS Board Defined Benefit Plan for Miscellaneous Employees

SCHEDULE OF CONTRIBUTIONS
Last Ten Fiscal Years

144
2020 2019 2018 2017 2016
Actuarial
ly determined contribution 13,080,630$ 12,374,026$ 11,924,053$ 10,412,963$ 9,943,342$ Contributions in relation to the actuarially determined contributions (16,351,592) (15,713,898) (15,742,587) (10,412,963) (9,943,342) Contribution deficiency (excess) (3,270,962)$ (3,339,872)$ (3,818,534)$ -$ -$ Covered payroll 43,902,594$ 42,153,383$ 41,468,634$ 41,727,563$ 40,031,404$ Contributions as a percentage of covered payroll 37.25% 37.28% 37.96% 24.95% 24.84% Notes to Schedule:

Valuation date: 6/30/2017 6/30/2016 6/30/2015 6/30/2014 6/30/2013 Methods and assumptions used to determine contribution rates:

Actuarial cost method Entry age Entry age Entry age Entry age Entry age Amortization method (1) (1) (1) (1) (1)
Asset valuation method Market Value Market Value Market Value Market Value Market Value Inflation 2.625% 2.75% 2.75% 2.75% 2.75%
Salary increases (2) (2) (2) (2) (2)
Investment rate of return 7.25% (3) 7.375% (3) 7.5% (3) 7.5% (3) 7.5% (3) Retirement age (4) (4) (4) (4) (4)
Mortality (5) (5) (5) (5) (5)
CI

TY OF NEWPORT BEACH
an Agent Multiple-Employer Defined Benefit Pension Plan As of June 30, 2025
Last 10 Years
Defined Benefit Plan for Miscellaneous Employees

SCHEDULE OF CONTRIBUTIONS
Last Ten Fiscal Years
145
2025 2024 2023 2022 2021
Measurement Period June 30, 2024 June 30,
2023 June 30, 2022 June 30, 2021 June 30, 2020 Measurement Period Total Pension Liability
Service cost 10,840,9
66$ 10,727,817$ 10,918,046$ 9,817,913$ 9,622,985$ Interest on total pension liability 47,523,602 45,793,334 43,860,290 42,760,906 41,449,511 Differences between expected and actual experience 7,193,012 9,833,536 (3,451,985) 196,690 957,686 Changes in assumptions - - 22,634,816 - - Changes in benefits - 268,557 - - - Benefit payments, including refunds of employee contributions (39,503,140) (37,885,623) (35,654,758) (33,765,218) (32,285,653) Net Change in Total Pension Liability 26,054,440 28,737,621 38,306,409 19,010,291 19,744,529 Total Pension Liability - beginning 695,885,933 667,148,312 628,841,903 609,831,612 590,087,083 Total Pension Liability - ending (a) 721,940,373$ 695,885,933$ 667,148,312$ 628,841,903$ 609,831,612$ Plan Fiduciary Net Position
Contributions - employer 36,653,740$ 35,285,332$ 32,394,203$ 32,367,091$ 28,539,301$ Contributions - employee 3,875,707 3,577,340 3,417,660 3,347,740 3,249,005 Net investment income 47,875,335 28,993,124 (38,537,209) 93,813,435 19,685,354 Administrative expense (406,765) (345,814) (317,056) (413,178) (556,832) Plan to plan resource movement 59 - - - - Benefit payments (39,503,140) (37,885,623) (35,654,758) (33,765,218) (32,285,653) Other miscellaneous income/(expense) - - - - - Net change in Plan Fiduciary Net Position 48,494,936 29,624,359 (38,697,160) 95,349,870 18,631,175 Plan Fiduciary Net Position - beginning 499,893,619 470,269,260 508,966,420 413,616,550 394,985,375 Plan Fiduciary Net Position - ending (b) 548,388,555$ 499,893,619$ 470,269,260$ 508,966,420$ 413,616,550$ Net pension liability - ending (a)-(b) 173,551,818$ 195,992,314$ 196,879,052$ 119,875,483$ 196,215,062$ Plan fiduciary net position as a percentage of the total pension liability 75.96% 71.84% 70.49% 80.94% 67.82% Covered payroll 38,168,411$ 36,538,774$ 35,231,003$ 34,863,204$ 34,279,062$ Net pension liability as percentage of covered payroll 454.70% 536.40% 558.82% 343.85% 572.40% Notes to Schedule:

Benefit Changes:

Change in Assumptions:

CITY OF NEWPORT BEACH
an Agent Multiple-Employ
er Defined Benefit Pension Plan
As of June 30, 2025
Last 10 Years
Defined Benefit Plan for Safety Employees
The fi
gures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes) that occurred after the Valuation Date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary.

Effective with the June 30, 2021 valuation date (2022 measurement date), the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. In addition, demographic assumptions and the price inflation assumption w
ere changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. The accounting discount rate was 7.15% for measurement dates June 30, 201
7 through June 30, 2021, 7.65% for measurement dates June 30, 2015 through June 30, 2016.

SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS Last Ten Fiscal Years
146
2020 2019 2018 2017 2016
Measurement Period June 30, 2019 June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015
Total Pension Liability
Service cost 9,292,715$ 9,223,465$ 9,015,985$ 8,075,553$ 8,077,826$ Interest on total pension liability 40,081,524 38,458,387 37,083,966 36,239,226 35,098,055 Differences between expected and actual experience 4,798,077 3,278,018 (2,192,667) (1,613,985) (316,827) Changes in assumptions - (1,630,045) 30,110,384 - (8,359,009) Changes in benefits - - - - - Benefit payments, including refunds of employee contributions (30,443,097) (29,183,598) (28,074,414) (27,447,982) (25,838,982) Net Change in Total Pension Liability 23,729,219 20,146,227 45,943,254 15,252,812 8,661,063 Total Pension Liability - beginning 566,357,864 546,211,637 500,268,383 485,015,571 476,354,508 Total Pension Liability - ending (a) 590,087,083$ 566,357,864$ 546,211,637$ 500,268,383$ 485,015,571$ Plan Fiduciary Net Position
Contributions - employer 28,344,445$ 26,779,897$ 19,260,537$ 18,496,776$ 21,529,513$ Contributions - employee 3,162,044 3,104,318 2,967,318 2,826,831 2,969,503 Net investment income 24,254,890 29,064,749 34,814,011 1,561,480 7,049,577 Administrative expense (263,991) (532,480) (462,427) (193,780) (357,866) Plan to plan resource movement (1,570) (855) - 2,387 - Benefit payments (30,443,097) (29,183,598) (28,074,414) (27,447,982) (25,838,982) Other miscellaneous income/(expense) 855 (1,011,188) - - - Net change in Plan Fiduciary Net Position 25,053,576 28,220,843 28,505,025 (4,754,288) 5,351,745 Plan Fiduciary Net Position - beginning 369,931,799 341,710,956 313,205,931 317,960,219 312,608,474 Plan Fiduciary Net Position - ending (b) 394,985,375$ 369,931,799$ 341,710,956$ 313,205,931$ 317,960,219$ Net pension liability - ending (a)-(b) 195,101,708$ 196,426,065$ 204,500,681$ 187,062,452$ 167,055,352$ Plan fiduciary net position as a percentage of the total pension liability 66.94% 65.32% 62.56% 62.61% 65.56% Covered payroll 33,935,043$ 32,866,620$ 32,450,020$ 30,816,246$ 30,189,633$ Net pension liability as percentage of covered payroll 574.93% 597.65% 630.20% 607.03% 553.35%

SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS Last Ten Fiscal Years

CITY OF NEWPORT BEACH
an Agent Multiple-Employ
er Defined Benefit Pension Plan
As of June 30, 2025
Last 10 Years
Defined Benefit Plan for Safety Employees
147
2025 2024 2023 2022 2021
Actuarial
ly determined contribution 28,178,830$ 25,872,229$ 25,952,201$ 25,115,878$ 25,341,788$ Contributions in relation to the actuarially determined contributions (37,081,471) (36,635,838) (35,283,235) (32,317,538) (32,251,903) Contribution deficiency (excess) (8,902,641)$ (10,763,609)$ (9,331,034)$ (7,201,660)$ (6,910,115)$ Covered payroll 40,866,717$ 38,168,411$ 36,538,774$ 35,231,003$ 34,863,204$ Contributions as a percentage of covered payroll 90.74% 95.98% 96.56% 91.73% 92.51% Notes to Schedule:

Valuation date: 6/30/2021 6/30/2021 6/30/2020 6/30/2019 6/30/2018 Methods and assumptions used to determine contribution rates:

Actuarial cost method Entry age Entry age Entry age Entry age Entry age Amortization method (1) (1) (1) (1) (1)
Asset valuation method Market Value Market Value Market Value Market Value Market Value Inflation 2.30% 2.30% 2.50% 2.50% 2.50%
Salary increases (2) (2) (2) (2) (2)
Investment rate of return 6.80% (3) 6.80% (3) 7.00% (3) 7.00% (3) 7.00% (3) Retirement age (4) (4) (4) (4) (4)
Mortality (5) (5) (5) (5) (5)
(1
) Level percentage of payroll for bases established prior to June 30, 2019 and level dollar amount for bases established after June 30, 2019 (2) Depending on age, service, and type of employment
(3) Net of pension plan investment and administrative expense; includes inflation (4)
(5)

CITY OF NEWPORT BEACH
an Agent Multiple-Employer Defined Benefit Pension Plan As of June 30, 2025
Last 10 Years
Defined Benefit Plan for Safety Employees

SCHEDULE OF CONTRIBUTIONS
Last Ten Fiscal Years
Retirement assumptions are based on retirement rates resulting from the most recent CalPERS Experience Study adopted by the CalPERS Board Mortality assumptions are based on mortality rates resulting from the most recent CalPERS Experience Study adopted by the CalPERS Board

148
2020 2019 2018 2017 2016
Actuarial
ly determined contribution 22,980,289$ 22,227,698$ 21,524,636$ 19,338,360$ 18,466,207$ Contributions in relation to the actuarially determined contributions (28,531,744) (28,346,069) (26,620,697) (19,338,360) (18,466,207) Contribution deficiency (excess) (5,551,455)$ (6,118,371)$ (5,096,061)$ -$ -$ Covered payroll 34,279,062$ 33,935,043$ 32,866,620$ 32,450,020$ 30,816,246$ Contributions as a percentage of covered payroll 83.23% 83.53% 81.00% 59.59% 59.92% Notes to Schedule:

Valuation date: 6/30/2017 6/30/2016 6/30/2015 6/30/2014 6/30/2013 Methods and assumptions used to determine contribution rates:

Actuarial cost method Entry age Entry age Entry age Entry age Entry age Amortization method (1) (1) (1) (1) (1)
Asset valuation method Market Value Market Value Market Value Market Value Market Value Inflation 2.625% 2.75% 2.75% 2.75% 2.75%
Salary increases (2) (2) (2) (2) (2)
Investment rate of return 7.25% (3) 7.375% (3) 7.5% (3) 7.5% (3) 7.5% (3) Retirement age (4) (4) (4) (4) (4)
Mortality (5) (5) (5) (5) (5)
CI

TY OF NEWPORT BEACH
an Agent Multiple-Employer Defined Benefit Pension Plan As of June 30, 2025
Last 10 Years
Defined Benefit Plan for Safety Employees

SCHEDULE OF CONTRIBUTIONS
Last Ten Fiscal Years
149
2025 2024 2023 2022
Measurement P
eriod June 30, 2024 June 30, 2023 June 30, 2022 June 30, 2021 Total OPEB Liability
Service cost 800,218$ 635,096$ 530,843$ 529,600$ Interest 3,125,813 3,150,800 3,237,390 2,909,400 Differences between expected and actual experience 99,265 (393,810) 1,120,534 6,159,865 Changes in assumptions (1,705,049) 292,126 2,473,450 (302,512) Changes in benefits terms - - - - Benefit payments, including refunds of member contributions (3,734,742) (4,781,574) (4,731,846) (3,786,232) Net change in Total OPEB Liability (1,414,495) (1,097,362) 2,630,371 5,510,121 Total OPEB Liability - beginning 53,136,842 54,234,204 51,603,833 46,093,712 Total OPEB Liability - ending (a) 51,722,347$ 53,136,842$ 54,234,204$ 51,603,833$ Plan fiduciary net position
Contributions - employer 10,865,147$ 6,327,150$ 6,185,537$ 5,785,342$ Contributions - member - - - - Net investment income 3,933,617 2,061,410 (4,845,154) 7,184,241 Benefit payments, including refunds of member contributions (3,734,742) (4,781,574) (4,731,846) (3,786,232) Administrative expense (23,200) (9,385) (9,000) (9,908) Other expense - - - - Net change in plan fiduciary net position 11,040,822 3,597,601 (3,400,463) 9,173,443 Plan fiduciary net position - beginning 35,166,853 31,569,252 34,969,715 25,796,272 Plan fiduciary net position - ending (b) 46,207,675$ 35,166,853$ 31,569,252$ 34,969,715$ City's Net OPEB liability - ending (a)-(b) 5,514,672$ 17,969,989$ 22,664,952$ 16,634,118$ Plan fiduciary net position as a percentage of the total OPEB liability 89.34% 66.18% 58.21% 67.77% Covered-employee payroll (1) 88,433,576$ 81
,451,477$ 79,636,594$ 78,621,426$
City's Net OPEB liability as percentage of covered-employee payroll 6.24% 22.06% 28.46% 21.16% Notes to Schedule:
(1) Covered-employee payroll is used because contributions are not entirely based on a measure of pay. * Fiscal year 2018 was the first year of implementation, therefore only eight years are shown.

CITY OF NEWPORT BEACH
Post-Employment Health Care Benef
its (OPEB) Retirement Plan
As of June 30, 2025
Last 10 Years *

SCHEDULE OF CHANGES IN THE CITY'S NET OPEB LIABILITY AND RELATED RATIOS Last Ten Fiscal Years*
150
2021 2020 2019 2018
Measurement P
eriod June 30, 2020 June 30, 2019 June 30, 2018 June 30, 2017 Total OPEB Liability
Service cost 521,285$ 524,717$ 509,434$ 478,341$ Interest 2,944,050 2,795,490 2,814,685 2,830,153 Differences between expected and actual experience (219,772) 2,532,319 - - Changes in assumptions - 114,311 - - Changes in benefits terms - - - - Benefit payments, including refunds of member contributions (3,787,663) (3,627,695) (3,641,715) (3,513,406) Net change in Total OPEB Liability (542,100) 2,339,142 (317,596) (204,912) Total OPEB Liability - beginning 46,635,812 44,296,670 44,614,266 44,819,178 Total OPEB Liability - ending (a) 46,093,712$ 46,635,812$ 44,296,670$ 44,614,266$ Plan fiduciary net position
Contributions - employer 4,674,814$ 4,460,937$ 4,675,193$ 4,594,772$ Contributions - member - - - - Net investment income 900,087 1,495,861 1,605,114 1,875,536 Benefit payments, including refunds of member contributions (3,787,663) (3,627,695) (3,641,715) (3,513,406) Administrative expense (12,037) (4,980) (11,076) (9,452) Other expense - - (25,258) - Net change in plan fiduciary net position 1,775,201 2,324,123 2,602,258 2,947,450 Plan fiduciary net position - beginning 24,021,071 21,696,948 19,094,690 16,147,240 Plan fiduciary net position - ending (b) 25,796,272$ 24,021,071$ 21,696,948$ 19,094,690$ City's Net OPEB liability - ending (a)-(b) 20,297,440$ 22,614,741$ 22,599,722$ 25,519,576$ Plan fiduciary net position as a percentage of the total OPEB liability 55.96% 51.51% 48.98% 42.80% Covered-employee payroll (1) 77,637,171$ 75
,814,626$ 73,999,059$ 74,484,613$
City's Net OPEB liability as percentage of covered-employee payroll 26.14% 29.83% 30.54% 34.26%

SCHEDULE OF CHANGES IN THE CITY'S NET OPEB LIABILITY

AND RELATED RATIOS
Last Ten Fiscal Years*

CITY OF NEWPORT BEACH
Post-Employment Health Care Benefits (OPEB) Retirement Plan As of June 30, 2025
Last 10 Years *

151
2025 2024 2023 2022
Actuarially determined contribution 2,155,209$ 3,289,777$ 4,359,593$ 4,124,923$ Contributions in relation to the actuarially determined cont ributions (2,254,152) (12,311,540) (7,154,265) (4,950,445) Contribution deficiency (excess) (98,943)$ (9,021,763)$ (2,794,672)$ (825,522)$ Covered-employee payroll (1) 93,299,224$ 88,433,576$ 81,451,477$ 79,636,594$
Contributions as a percentage of covered-employ
ee payroll -2.42% -13.92% -8.78% -6.22%
Notes to Schedule:

Valuation date: June 30, 2023 June 30, 2023 June 30, 2021 June 30, 2019 (1) Covered-employee payroll is used because c
ontributions are not entirely based on a measure of pay. * Fiscal year 2018 was the first year of
implementation, therefore only eight years are shown.

Last 10 Years *

SCHEDULE OF CONTRIBUTIO
NS
Last Ten Fiscal Years*

CITY OF NEWPORT BEACH
Post-Employment Healt
h Care Benefits (OPEB) Retirement Plan
As of June 30, 2025
152
2021 2020 2019 2018
Actuarially determined contribution 4,108,719$ 3,834,916$ 3,827,337$ 3,925,087$ Contributions in relation to the actuarially determined cont ributions (6,511,545) (5,379,799) (5,133,062) (5,309,626) Contribution deficiency (excess) (2,402,826)$ (1,544,883)$ (1,305,725)$ (1,384,539)$ Covered-employee payroll (1) 78,621,426$ 77,637,171$ 75,814,626$ 73,999,059$
Contributions as a percentage of covered-employ
ee payroll -8.28% -6.93% -6.77% -7.18%
Notes to Schedule:

Valuation date: June 30, 2019 June 30, 2017 June 30, 2017 June 30, 2015 Last 10 Years *

SCHEDULE OF CONTRIBUTIO
NS
Last Ten Fiscal Years*

CITY OF NEWPORT BEACH
Post-Employment Healt
h Care Benefits (OPEB) Retirement Plan
As of June 30, 2024
153
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:

Taxes and ass
essments:

Property 149,296,403$ 152,582,263$ 154,182,579$ 1,600,316$ Sales 45,299,626 45,200,159 45,934,260 734,101 Transient occupancy 32,625,873 32,670,435 33,174,268 503,833 Other taxes 9,587,638 9,587,638 10,385,818 798,180 Intergovernmental 3,593,906 6,665,558 5,670,490 (995,068) Licenses, permits and fees 5,952,271 5,952,271 6,350,277 398,006 Charges for services 25,230,457 25,743,157 26,966,719 1,223,562 Fines and forfeitures 3,996,299 3,996,299 4,344,836 348,537 Investment income 1,402,120 1,402,120 3,771,565 2,369,445 Net increase in fair value of investments 502,805 502,805 1,129,325 626,520 Property income 17,897,004 17,905,504 19,808,736 1,903,232 Donations 375,321 561,100 795,959 234,859 Other (228,676) 537,364
1,202,884 665,520

Total revenues 295,531,047 303,306,673 313,717,716 10,411,043 Expenditures:

General gov
ernment:

City council 931,993 937,514 670,060 267,454 City clerk 1,310,158 1,328,375 1,146,406 181,969 City attorney 2,661,605 2,635,777 2,402,707 233,070 City manager 7,383,432 7,398,394 4,095,692 3,302,702 Finance 10,494,379 10,713,622 9,839,278 874,344 Human resources 3,947,492 4,063,492
3,765,892 297,600

Total general government 26,729,059 27,077,174 21,920,035 5,157,139
Public safety:

Police 78,156,707 82,104,977 77,309,265 4,795,712 Fire 65,865,961 69,749,033
68,498,140 1,250,893

Total public safety 144,022,668 151,854,010 145,807,405 6,046,605 Public works:

Public works - general services 34,629,137 37,023,633 35,362,361 1,661,272 Public works 14,051,846 14,064,912 13,629,170 435,742 Utilities 6,156,003 6,334,661
6,245,152 89,509

Total public works 54,836,986 57,423,206
55,236,683 2,186,523

CITY OF NEWPORT BEACH
Budgetary
Comparison Schedule
General Fund
For the Year Ended June 30, 2025

Budgeted Amounts
See accompanying notes to required sup
plementary information
154
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Communit
y development:

Community development 15,943,481 16,116,984 15,236,583 880,401 Code and water quality enforcement 1,289,886 1,293,007 1,270,045 22,962

Total community development 17,233,367 17,409,991 16,506,628 903,363
Communit
y services:

Parking operations 2,210,923 2,920,724 2,521,425 399,299 Library services 10,818,892 11,515,373 10,212,303 1,303,070 Recreation and senior services 16,151,132 16,547,903 15,727,677 820,226

Total community services 29,180,947 30,984,000 28,461,405 2,522,595
Debt service:

Principal - - 1,283,576 (1,283,576) Interest and fiscal charges - - 77,188
(77,188)

Total debt service - -
1,360,764 (1,360,764)

Total expenditures 272,003,027 284,748,381 269,292,920 15,455,461

Excess of revenues
over expenditures 23,528,020 18,558,292
44,424,796 25,866,504
Other financing sources (uses):

Transfers in 19,767,775 20,317,944 20,317,944 - Transfers out (39,255,611) (56,036,418) (53,036,418) 3,000,000

Total other financing
sources (uses) (19,487,836) (35,718,474) (32,718,474) 3,000,000

Net change in fund balance 4,040,184 (17,160,182) 11,706,322 28,866,504 Fund balance, beginning 96,441,188 96,441,188 96,441,188 -

Fund balance, ending 100,481,372$
79,281,006$ 108,147,510$ 28,866,504$ Budgeted Amounts

CITY OF NEWPORT BEACH
Budgetary
Comparison Schedule
General Fund
For the Year Ended June 30, 2025

See accompanying notes to required sup
plementary information
155
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:

Licens
es, permits and fees 92,200$ 92,200$ 110,943$ 18,743$ Charges for services 25,300 25,300 65,341 40,041 Fines and forfeitures 31,000 31,000 37,814 6,814 Investment income 134,976 134,976 332,181 197,205 Net increase in fair value of investments - - 52,743 52,743 Property income 14,476,011 14,624,011 16,739,019 2,115,008 Other - -
78 78

Total revenues 14,759,487 14,907,487 17,338,119 2,430,632 Expenditures:

Genera
l government 576,031 576,031 576,031 - Public works 1,415,449 1,726,356 1,546,690 179,666 Community development 2,280 15,580 29,506 (13,926) Community services 2,817,875 2,811,808 2,709,858 101,950 Capital outlay - 5,561,871 1,160,516 4,401,355

Total expenditures 4,811,635 10,691,646 6,022,601 4,669,045

Excess (deficiency) of revenues
over expenditures 9,947,852 4,215,841 11,315,518 7,099,677 Other financing sources:

Tran
sfers in 12,256,805 12,263,815 12,263,815 - Transfers out (19,767,775) (20,317,944) (20,317,944) -

Total other financing sources (7,510,970) (8,054,129) (8,054,129) -

Net change in fund balance 2,436,882 (3,838,288) 3,261,389 7,099,677 Fund balance, beginning 8,547,722 8,547,722 8,547,722 -

Fund balance, ending 10,984,604$
4,709,434$ 11,809,111$ 7,099,677$

CITY OF NEWPORT BEACH
Budge
tary Comparison Schedule
Tide and Submerged Land - Operating
For the Year Ended June 30, 2025
Budgeted Amounts
See accompanying notes to required supplem
entary information
156
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:

Taxes and assessmen
ts:

Investment income 707,038$ 707,038$ 2,170,732$ 1,463,694$ Net increase in fair value of investments - - 625,833 625,833 Property income 5,954,462 5,954,462 6,711,452 756,990 Total revenues 6,6
61,500 6,661,500 9,508,017 2,846,517
Expenditures:

Capital ou
tlay - 10,422,952 945,092 9,477,860 Excess (deficiency
) of revenues
over expenditures 6,661,500 (3,761,452) 8,562,925 12,324,377 Other financing sources:

Transfers in 5,832,875 5,832,875 5,832,875 - Net change in fund bal
ance 12,494,375 2,071,423 14,395,800 12,324,377 Fund balance, beginning 43,107,346 43,107,346 43,107,346 - Fund balance, ending 55,601,7
21$ 45,178,769$ 57,503,146$ 12,324,377$

CITY OF NEWPORT BEA
CH
Budgetary Comparison Schedule
Tide and Submerged Land - Harbor Capital
For the Year Ended June 30, 2025
Budgeted Amounts
See accompanying notes to
required supplementary information
157

CITY OF NEWPORT
BEACH
Notes to Required Supplementary Information
June 30, 2025

(1) Budgetary Control and Compliance

The City adheres
to the following general procedures in establishing the budgetary data reflected in the financial statements:

 During May, the City Manager submits to the City Council a proposed operating budget for the fiscal year commencing the following July 1. The operating budget includes proposed expenditures and the means of financing them. Public hearings are conducted at City Council meetings to obtain citizen comments. Prior to July 1, the budget is legally adopted through passage of an appropriation resolution.

 Budgets are adopted on an annual basis consistent with generally accepted accounting principles for General and Special Revenue Funds, except for the Opioid Remediation Fund, for which no budget was adopted.

 The City does not present budget information on Capital Projects Funds since the City approves project-length budgets. These project-length budgets authorize total expenditures over the duration of a construction project rather than through year-by-year budgeting.

 The City does not present budget information on Debt Service and Permanent Funds since the City is not required to and does not adopt an annual budget for these funds.

 The budget is formally integrated into the accounting system and employed as a management control device during the year.

 The legal level of budgetary control is at the fund level. The City Manager is authorized to transfer budgeted amounts between departments within any fund; however, any revisions which alter the total appropriations of any fund must be approved by the City Council.

 At fiscal year-end, budget appropriations lapse. Budget appropriations for incomplete capital projects are re-budgeted in the following fiscal year by City Council action and are included in the revisions noted above. Projects that are not started during the budget year are re-evaluated in the following year.

 Encumbrances represent commitments related to unperformed contracts for goods and services. The City utilizes an encumbrance system as a management control technique to assist in controlling expenditures. Under this system, encumbrance accounting for the expenditure of funds is recorded in order to indicate outstanding commitments and is employed in the governmental fund types. Encumbrances outstanding at year-end are reported as committed or restricted fund balances since they do not constitute expenditures or liabilities. Encumbrances and their related budgets are honored in the subsequent year to fulfill these commitments and are presented in the original adopted budget.

158

CITY OF NEWPORT
BEACH
Notes to Required Supplementary Information
June 30, 2025

(1) Budgetary Control and Compliance (Continued)

Expenditures exceeded
appropriations in the following governmental fund:

Appropriations Expenditures Variance
Supplemental Law Enforceme
nt Services $250,000 $250,045 $(45)

159

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160

FINANCIAL SECTION

SUPPLEMENTARY INFORMATION

OTHER GOVERNMENTAL FUNDS
161

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162

OTHER GOVERNMENTAL FUNDS

Other Special Revenue Funds

Special Revenue Funds are used to account for the proceeds of specific revenue sources which are legally restricted to expenditures for specified purposes. The City of Newport Beach Special Revenue Funds are as follows:

The State Gas Tax Fund accounts for all State Gas Tax related revenues and expenditures, including street repair, construction, and maintenance. State law requires that these funds be used exclusively for maintenance of the street and highway system.

The SB1 Gas Tax RMRA Fund accounts for all Road Maintenance and Rehabilitation Account related revenues and expenditures. State law requires that these funds be used exclusively for the transportation system. RMRA revenues are from fuel and vehicle registration taxes imposed by the state’s Road Repair and Accountability Act of 2017.

The Asset Forfeiture Fund was established to account for all revenues resulting from the seizure of assets in conjunction with criminal cases (primarily drug trafficking) in which judicial proceedings have been completed . All such funds are property of the City, and i t is the City's policy that these funds shall be used for enhancement of law enforcement programs.

The Office of the Traffic Safety (OTS) DUI Grant Fund is used to account for federal funding of the Selective Traffic Enforcement Program (STEP). These funds are used exclusively for DUI enforcement.

The Circulation and Transportation Fund is used to account for fair share revenues collected from developers and restricted for capital improvement projects meeting the circulation element of the City’s General Plan.

The Building Excise Tax Fund is used to account for revenues received from builders or developers on building or remodeling projects within the City. Expenditures from this fund are used exclusively for public safety, libraries, parks, beaches, or recreational activities.

The Community Development Block Grant Fund is used to account for revenues and expenditures relating to the City's Community Development Block Grant program. These funds are received from the Federal Department of Housing and Urban Development and must be expended exclusively on programs for low or moderate income individuals/families.

The Air Quality Management District Fund is used to account for revenues received from the South Coast Air Quality Management District restricted for the use of reducing air pollution.

The Environmental Liability Fund is used to account for solid waste fees restricted for mitigation of future environmental liability relating to the handling of solid waste.

The Supplemental Law Enforcement Services Fund (SLESF) is used to account for revenues received from the county to be used exclusively for front line law enforcement services.

The Opioid Remediation Fund is used to account for revenues received from various settlements related to opioid manufacturing and distribution to be used exclusively for opioid remediation activities.
163
The Contributions Fund is used to account for revenues received from other government agencies or private developers and expended for specific streets, highway, construction, or water quality projects.

The Fostering Interest in Nature (FIIN) Fund is restricted for recreation and education programming as a mitigation effort by the California Coastal Commission.

The Restricted Programs Fund is used to account for revenues received that are restricted for affordable housing, public arts and culture, parking improvements, and disability access training.

The Measure M Fund is used to account for the revenues and expenditures of funds received from the Orange County Transportation Authority. Expenditures from this fund are used exclusively for transportation related purposes.

The Oceanfront Encroachment Fund is restricted for ocean front restoration and improvement and maintenance to enhance public access and use of ocean beaches as restricted by the Local Coastal Program.

The PEG Fees Fund is used to account for cable franchise fees received from cable providers for support of Public, Education, and Government access programming only.

The Park Fees Fund is used to account for park in-lieu fees collected in conjunction development agreements and can only be used for specific acquisition, development, or improvement of public parks and recreational facilities.

Other Capital Projects Funds

Capital Projects Funds are used to account for resources used for the acquisition and construction of capital facilities by the City, except those financed by Enterprise Funds.

The City of Newport Beach Capital Projects Funds are as follows:

The Assessment District Fund is used to account for the receipt and expenditure of funds received from 1911 Act and 1915 Act Assessment Districts for capital improvement projects.

The Fire Station Fund is used to account for the design and construction of new fire stations.

The Civic Center and Park Fund is used to account for the design and construction of a new Civic Center Complex. In prior years, this fund was called City Hall Improvements Fund.

The Police Facility Fund is used to account for the purchase, design and construction of a new police station.

The Newport Uptown Undergrounding Fund is used to account for the receipt and expenditures related to the development within the Newport Uptown Planned Community Development Plan.

The Parks and Community Centers Fund is used to account for expenditures for park and community center rehabilitation, expansion and/or replacement in accordance with the Facilities Financing Planning Program.

The Balboa Village Parking Management District Fund is used to account for revenues and expenditures associated with parking management improvements in Balboa Village.

The Facilities Maintenance Fund is used to account for revenues and expenditures associated with the maintenance of existing facilities.
164
The Neighborhood Enhancement Fund is used to account for projects that will enhance neighborhood aesthetics and functionality.

The Miscellaneous FFP Projects Fund is used to account for expenditures for small scale facility rehabilitation, expansion and/or replacement in accordance with the Facilities Financing Planning Program.

The Junior Lifeguards Fund is used to account for capital improvement projects related to the Junior Lifeguards program.

The Unrestricted Capital Improvements Fund is used to separately account for general fund capital improvement projects.

The Park Maintenance Fund is used to account for capital improvement projects associated with the maintenance of existing parks.

Other Permanent Funds

Permanent Funds are used to report resources that are legally restricted for the extent that only earnings, not principal, may be used for purposes that support the reporting government’s programs. The City of Newport Beach Permanent Funds are as follows:

The Bay Dredging Fund is used to account for the receipt of permanent endowments intended to fund the ongoing cost of maintaining and dredging of the Upper Newport Bay.

The Ackerman Fund is used to account for the receipt of permanent endowments intended as follows: 75% of the fund’s investment proceeds will be used for the purchase of high- tech library equipment while the remaining 25% will be used for scholarships for needy students.

165
SB1 Gas Tax Circulati
on and
State Gas Tax RMRA Asset Forfeiture OTS DUI Grant Transportation Assets
Cash and investmen
ts 4,112,410$ 1,397,293$ 646,928$ -$ 1,218,284$ Receivables:

Accounts (net of allowance) - - - - - Interest 18,719 6,360 1,711 - 5,547 Intergovernmental receivables 204,277 409,218 - 76,000 - Lease receivables - - - - - Restricted cash and investments with fiscal agent - - - - - Prepaid items - -
-
-
-

Total assets 4,335,406$ 1,812,871$
648,639$
76,000$
1,223,831$

Liabilities, Deferred Infl
ows of Resources
and Fund Balances
Liabilities:

Accounts payable 51,191$ 133,786$ 1,653$ -$ -$ Accrued payroll - - - - - Unearned revenue - - - - - Due to other funds - -
-
76,011
-

Total liab
ilities 51,191 133,786
1,653
76,011
-

Deferred inflows of resources:

Unavailable revenue - - - - - Deferred amount from leases - - -
-
-

Total d
eferred inflows of resources - - -
-
-

Fund balances (deficits)
:

Nonspendable:

Prepaid items - - - - - Permanent endowment - - - - - Restricted 4,284,215 1,679,085 646,986 - 1,223,831 Committed - - - - - Unassigned -
-
-
(11)
-

Total f
und balances (deficits) 4,284,215 1,679,085 646,986
(11)
1,223,831

Total liab
ilities, deferred inflows of resources
and fund balances 4,335,406$ 1,812,871$ 648,639$
76,000$
1,223,831$

(continued)

CITY OF N

EWPORT BEACH
Other Governmental Funds
Combining Balance Sheet
June 30, 2025

Special Revenue
166
Community Air Quality Suppl
emental
Building Excise Development Management Environmental Law Enforcement Tax Block Grant District Liability Services
Assets
Cash and investmen
ts 446,514$ 65,752$ 1,926,464$ 10,264,864$ -$ Receivables:

Accounts (net of allowance) - - - 5,582 - Interest 2,032 - 8,770 46,705 - Intergovernmental receivables - - 28,688 - - Lease receivables - 3,268,884 - - - Restricted cash and investments with fiscal agent - - - - - Prepaid items - -
-
17,024
-

Total assets 448,546$ 3,334,636$
1,963,922$
10,334,175$
-$

Liabilities, Deferred Infl
ows of Resources
and Fund Balances
Liabilities:

Accounts payable 197,097$ 102,881$ -$ 79,752$ -$ Accrued payroll - - - 4,327 - Unearned revenue - 26,297 - - - Due to other funds - -
-
-
-

Total liab
ilities 197,097 129,178
-
84,079
-

Deferred inflows of resources:

Unavailable revenue - - 28,688 - - Deferred amount from leases - 3,162,503 -
-
-

Total d
eferred inflows of resources - 3,162,503 28,688
-
-

Fund balances (deficits)
:

Nonspendable:

Prepaid items - - - 17,024 - Permanent endowment - - - - - Restricted 251,449 42,955 1,935,234 10,233,072 - Committed - - - - - Unassigned -
-
-
-
-

Total f
und balances (deficits) 251,449 42,955 1,935,234
10,250,096
-

Total liab
ilities, deferred inflows of resources
and fund balances 448,546$ 3,334,636$ 1,963,922$
10,334,175$
-$

(continued)

CITY OF N

EWPORT BEACH
Other Governmental Funds
Combining Balance Sheet
June 30, 2025

Special Revenue
167
Opioid Restricted
Remediation Contributions FIIN Programs Measure M
Assets
Cash and investmen
ts 1,407,988$ 2,469,601$ 1,221,021$ 2,981,649$ 489,405$ Receivables:

Accounts (net of allowance) - 412,212 - 7,800 - Interest - - 5,559 13,575 3,913 Intergovernmental receivables - - - - 1,282,940 Lease receivables - - - - - Restricted cash and investments with fiscal agent - - - - - Prepaid items - -
-
-
-

Total assets 1,407,988$ 2,881,813$
1,226,580$
3,003,024$
1,776,258$

Liabilities, Deferred Infl
ows of Resources
and Fund Balances
Liabilities:

Accounts payable -$ 705,175$ -$ -$ 104,238$ Accrued payroll - - - - - Unearned revenue 1,407,988 188,779 - - 394,810 Due to other funds - 696
-
-
-

Total liab
ilities 1,407,988 894,650
-
-
499,048

Deferred inflows of resources:

Unavailable revenue - 412,211 - 7,800 806,435 Deferred amount from leases - - -
-
-

Total d
eferred inflows of resources - 412,211 -
7,800
806,435

Fund balances (deficits)
:

Nonspendable:

Prepaid items - - - - - Permanent endowment - - - - - Restricted - 1,574,952 1,226,580 2,995,224 470,775 Committed - - - - - Unassigned -
-
-
-
-

Total f
und balances (deficits) - 1,574,952 1,226,580
2,995,224
470,775

Total liab
ilities, deferred inflows of resources
and fund balances 1,407,988$ 2,881,813$ 1,226,580$
3,003,024$
1,776,258$

(continued)

CITY OF N

EWPORT BEACH
Special Revenue
Other Governmental Funds
Combining Balance Shee
t
June 30, 2025

168
Oceanfront Assessment
Enc
roachment PEG Fees Park Fees District Fire Station
Assets
Cash and investmen
ts 1,276,211$ 3,935,844$ 127,731$ -$ 9,585,255$ Receivables:

Accounts (net of allowance) 18,355 69,652 - - - Interest 5,809 17,916 581 121,120 43,633 Intergovernmental receivables - - - - - Lease receivables - - - - - Restricted cash and investments with fiscal agent - - - 19,933,423 306,531 Prepaid items - -
-
-
-

Total assets 1,300,375$ 4,023,412$
128,312$
20,054,543$
9,935,419$

Liabilities, Deferred Infl
ows of Resources
and Fund Balances
Liabilities:

Accounts payable 37,374$ -$ -$ 2,403,459$ 28,503$ Accrued payroll - - - - - Unearned revenue - - - - - Due to other funds - -
-
1,771,077
-

Total liab
ilities 37,374 -
-
4,174,536
28,503

Deferred inflows of resources:

Unavailable revenue - - - - - Deferred amount from leases - - -
-
-

Total d
eferred inflows of resources - - -
-
-

Fund balances (deficits)
:

Nonspendable:

Prepaid items - - - - - Permanent endowment - - - - - Restricted 1,263,001 4,023,412 128,312 15,880,007 306,531 Committed - - - - 9,600,385 Unassigned -
-
-
-
-

Total f
und balances (deficits) 1,263,001 4,023,412 128,312
15,880,007
9,906,916

Total liab
ilities, deferred inflows of resources
and fund balances 1,300,375$ 4,023,412$
128,312$
20,054,543$
9,935,419$

(continued)

June 3
0, 2025

CITY OF NEWPORT BEACH
Other Governmental Funds
Combining Balance Sheet
Special Revenue Capital Projects
169
Balboa Village
Parks a
nd Parking
Civic Center Newport Uptown Community Management
and Park Police Facility Undergrounding Centers District Assets
Cash and investmen
ts 524,741$ 719,958$ 3,570$ 14,301,823$ 169,874$ Receivables:

Accounts (net of allowance) - - - - - Interest 2,161 3,277 16 65,101 768 Intergovernmental receivables - - - - - Lease receivables - - - - - Restricted cash and investments with fiscal agent - - - - - Prepaid items - -
-
-
-

Total assets 526,902$ 723,235$
3,586$
14,366,924$
170,642$

Liabilities, Deferred Infl
ows of Resources
and Fund Balances
Liabilities:

Accounts payable -$ -$ -$ 970,917$ -$ Accrued payroll - - - - - Unearned revenue - - - - - Due to other funds - -
-
-
-

Total liab
ilities - -
-
970,917
-

Deferred inflows of resources:

Unavailable revenue - - - - - Deferred amount from leases - - -
-
-

Total d
eferred inflows of resources - - -
-
-

Fund balances (deficits)
:

Nonspendable:

Prepaid items - - - - - Permanent endowment - - - - - Restricted - - 3,586 - - Committed 526,902 723,235 - 13,396,007 170,642 Unassigned -
-
-
-
-

Total f
und balances (deficits) 526,902 723,235 3,586
13,396,007
170,642

Total liab
ilities, deferred inflows of resources
and fund balances 526,902$ 723,235$
3,586$
14,366,924$
170,642$

(continued)
Capital Projects

CITY OF NEWPORT BEA
CH
Other Governmental Funds
Combining Balance Sheet
June 30, 2025

170
Miscellaneous U
nrestricted
Facilities Neighborhood Facilities Junior Capital
Maintenance Enhancement Financing Lifeguards Improvements Assets
Cash and investmen
ts 4,198,589$ 8,844,258$ 7,168,328$ 56,181$ 19,555,928$ Receivables:

Accounts (net of allowance) - - - - - Interest 19,114 40,258 32,630 256 - Intergovernmental receivables - - - - - Lease receivables - - - - - Restricted cash and investments with fiscal agent - - - - - Prepaid items - -
-
-
-

Total assets 4,217,703$ 8,884,516$
7,200,958$
56,437$
19,555,928$

Liabilities, Deferred Infl
ows of Resources
and Fund Balances
Liabilities:

Accounts payable 1,177,585$ 69,355$ 20,404$ -$ 1,099,910$ Accrued payroll - - - - - Unearned revenue - - - - - Due to other funds - -
-
-
-

Total liab
ilities 1,177,585 69,355
20,404
-
1,099,910

Deferred inflows of resources:

Unavailable revenue - - - - - Deferred amount from leases - - -
-
-

Total d
eferred inflows of resources - - -
-
-

Fund balances (deficits)
:

Nonspendable:

Prepaid items - - - - - Permanent endowment - - - - - Restricted - - - - - Committed 3,040,118 8,815,161 7,180,554 56,437 18,456,018 Unassigned -
-
-
-
-

Total f
und balances (deficits) 3,040,118 8,815,161 7,180,554
56,437
18,456,018

Total liab
ilities, deferred inflows of resources
and fund balances 4,217,703$ 8,884,516$ 7,200,958$
56,437$
19,555,928$

(continued)
Capital Projects

CITY OF NEWPORT BEA
CH
Other Governmental Funds
Combining Balance Sheet
June 30, 2025

171
Total
Other
Park Ackerm
an Governmental
Maintenance Bay Dredging Donation Funds
Assets
Cash and investmen
ts 2,225,058$ 5,892,680$ 1,264,903$ 108,499,105$ Receivables:

Accounts (net of allowance) - - - 513,601 Interest 10,128 26,822 5,758 508,239 Intergovernmental receivables - - - 2,001,123 Lease receivables - - - 3,268,884 Restricted cash and investments with fiscal agent - - - 20,239,954 Prepaid items - -
-
17,024

Total assets 2,235,186$ 5,919,502$
1,270,661$
135,047,930$

Liabilities, Deferred Infl
ows of Resources
and Fund Balances
Liabilities:

Accounts payable 500,120$ -$ 4,901$ 7,688,301$ Accrued payroll - - - 4,327 Unearned revenue - - - 2,017,874 Due to other funds - -
-
1,847,784

Total liab
ilities 500,120 -
4,901
11,558,286

Deferred inflows of resources:

Unavailable revenue - - - 1,255,134 Deferred amount from leases - - -
3,162,503

Total d
eferred inflows of resources - - -
4,417,637

Fund balances (deficits)
:

Nonspendable:

Prepaid items - - - 17,024 Permanent endowment - 3,857,000 772,781 4,629,781 Restricted - 2,062,502 492,979 50,724,688 Committed 1,735,066 - - 63,700,525 Unassigned -
-
-
(11)

Total f
und balances (deficits) 1,735,066 5,919,502 1,265,760
119,072,007

Total liab
ilities, deferred inflows of resources
and fund balances 2,235,186$ 5,919,502$ 1,270,661$
135,047,930$

Capital Projects Permanent Funds

CITY OF NEWPORT BEA
CH
Other Governmental Funds
Combining Balance Sheet
June 30, 2025

172
SB1 Gas Tax Circulation and
State Gas Tax RMRA Asset Forfeiture OTS DUI Grant Transportation Revenues:

Other tax
es -$ -$ -$ -$ -$ Intergovernmental 2,396,189 2,322,193 28,708 289,817 - Charge for services - - - - - Licenses, permits and fees - - - - 246,773 Property income - - - - - Investment income 138,825 50,637 29,759 - 46,290 Net increase in fair value of investments 37,164 11,313 8,966 - 12,619 Donations - - - - - Other - -
-
-
-

T
otal revenues 2,572,178 2,384,143
67,433
289,817
305,682

Expenditures:

Current:

General government - - - - - Public safety - - 237,845 289,817 - Public works - - - - - Community development - - - - - Community services - - - - - Capital outlay 1,085,764 1,531,057 -
-
-

T
otal expenditures 1,085,764 1,531,057 237,845
289,817
-

Ex
cess (deficiency) of revenues
over expenditures 1,486,414 853,086 (170,412)
-
305,682

Other financing sources:

Transfer
s in - -
-
148
-

Total ot
her financing sources - - -
148
-

Net ch
ange in fund balances 1,486,414 853,086 (170,412) 148 305,682 Fund balances (deficits), beginning 2,797,801 825,999 817,398
(159)
918,149

Fund balances (deficits),
ending 4,284,215$ 1,679,085$
646,986$
(11)$
1,223,831$

(continued)
Special Revenue
Expenditures and Changes in Fund Balance
s
For the Year Ended June 30, 2025

Other Governmental Funds

CITY OF NEWPORT BEACH
Combining Statement of Revenues,
173
Community Air Quality Supplemental
Bu
ilding Excise Development Management Environmental Law Enforcement Tax Block Grant District Liability Services
Revenues:

Other tax
es -$ -$ -$ 1,021,443$ -$ Intergovernmental - 256,812 109,233 - 250,045 Charge for services - - - - - Licenses, permits and fees 116,386 - - - - Property income - 419,494 - - - Investment income 15,700 5,029 71,265 402,385 - Net increase in fair value of investments 4,409 - 20,454 116,159 - Donations - - - - - Other - -
-
48,261
-

T
otal revenues 136,495 681,335
200,952
1,588,248
250,045

Expenditures:

Current:

General government - - - - - Public safety - - - - 250,045 Public works - - - 411,971 - Community development - 197,235 - - - Community services - - - - - Capital outlay 255,865 211,523
10,987
887,170
-

T
otal expenditures 255,865 408,758 10,987
1,299,141
250,045

Ex
cess (deficiency) of revenues
over expenditures (119,370) 272,577 189,965
289,107
-

Other financing sources:

Transfer
s in - -
-
-
-

Total ot
her financing sources - - -
-
-

Net ch
ange in fund balances (119,370) 272,577 189,965 289,107 - Fund balances (deficits), beginning 370,819 (229,622) 1,745,269
9,960,989
-

Fund balances (deficits),
ending 251,449$ 42,955$
1,935,234$
10,250,096$ -$

(continued)
Special Revenue
Expenditures and Changes in Fund Balance
s
For the Year Ended June 30, 2025

CITY OF NEWPORT BEACH
Combining Statement of Revenues,
Other Governmental Funds
174
Opioid Restricted
Remediation Contributions FIIN Programs Measure M
Revenues:

Other tax
es -$ -$ -$ -$ -$ Intergovernmental - 1,931,959 - - 2,912,762 Charge for services - - - 92,129 - Licenses, permits and fees - - - 75,000 - Property income - - - 26,700 - Investment income - 24 45,978 106,242 59,134 Net increase in fair value of investments - 10 13,453 30,155 28,380 Donations - 3,324,078 278,407 123,539 - Other - -
-
71,894
-

T
otal revenues - 5,256,071 337,838
525,659
3,000,276

Expenditures:

Current:

General government - - - - - Public safety - - - - - Public works - - - - - Community development - - - 23,411 - Community services - - 206,058 17,586 - Capital outlay - 7,883,088 -
-
5,061,553

T
otal expenditures - 7,883,088 206,058
40,997
5,061,553

Ex
cess (deficiency) of revenues
over expenditures - (2,627,017) 131,780
484,662
(2,061,277)

Other financing sources:

Transfer
s in - 5,489
-
-
-

Total ot
her financing sources - 5,489 -
-
-

Net ch
ange in fund balances - (2,621,528) 131,780 484,662 (2,061,277) Fund balances (deficits), beginning - 4,196,480 1,094,800
2,510,562
2,532,052

Fund balances (deficits),
ending -$ 1,574,952$
1,226,580$
2,995,224$
470,775$

(continued)

CITY OF NEWPORT BEACH
Ot
her Governmental Funds
Combining Statement of Revenues,
Expenditures and Changes in Fund Balances
Special Revenue
For the Year Ended June 30, 2025

7 175
Oceanfront Assessment
Encroachment PEG Fees Park Fees District Fire Station
Revenues:

Other tax
es -$ -$ -$ -$ -$ Intergovernmental - - - - - Charge for services - - - - - Licenses, permits and fees - 287,312 125,786 - - Property income 279,559 - - - - Investment income 47,784 144,787 2,155 1,023,092 199,245 Net increase in fair value of investments 13,732 41,307 371 222,273 45,705 Donations - - - - - Other - -
-
-
-

T
otal revenues 341,075 473,406
128,312
1,245,365
244,950

Expenditures:

Current:

General government - - - - - Public safety - - - - - Public works - - - 10,327,269 - Community development - - - - - Community services - - - - - Capital outlay 261,626 -
-
-
425,123

T
otal expenditures 261,626 -
-
10,327,269
425,123

Ex
cess (deficiency) of revenues
over expenditures 79,449 473,406 128,312
(9,081,904)
(180,173)

Other financing sources:

Transfer
s in - -
-
-
6,800,000

Total ot
her financing sources - - -
-
6,800,000

Net ch
ange in fund balances 79,449 473,406 128,312 (9,081,904) 6,619,827 Fund balances (deficits), beginning 1,183,552 3,550,006 -
24,961,911
3,287,089

Fund balances (deficits),
ending 1,263,001$ 4,023,412$
128,312$
15,880,007$
9,906,916$

(continued)

CITY OF NEWPORT BEACH
Ot
her Governmental Funds
Combining Statement of Revenues,
Special Revenue Capital Projects

For the Year Ended June 30,
2025
Expenditures and Changes in Fund Balances
176
Balboa Village
Parks and Parking
Civic Center Newport Uptown
Community Management
and Park Police Facility Undergrounding Centers District Revenues:

Other tax
es -$ -$ -$ -$ -$ Intergovernmental - - - - - Charge for services - - - - - Licenses, permits and fees - - - - - Property income - - - - - Investment income 18,105 27,402 136 798,122 8,007 Net increase in fair value of investments 5,241 7,925 39 252,696 3,353 Donations - - - - - Other - -
-
-
-

T
otal revenues 23,346 35,327
175
1,050,818
11,360

Expenditures:

Current:

General government 1,610 - - - - Public safety - - - - - Public works - - - - - Community development - - - - - Community services - - - - - Capital outlay - -
-
4,568,234
151,311

T
otal expenditures 1,610 -
-
4,568,234
151,311

Ex
cess (deficiency) of revenues
over expenditures 21,736 35,327 175
(3,517,416)
(139,951)

Other financing sources:

Transfer
s in - -
-
805,874
-

Total ot
her financing sources - - -
805,874
-

Net ch
ange in fund balances 21,736 35,327 175 (2,711,542) (139,951) Fund balances (deficits), beginning 505,166 687,908 3,411
16,107,549
310,593

Fund balances (deficits),
ending 526,902$ 723,235$
3,586$
13,396,007$
170,642$

(continued)
Other Governmental Fund
s

CITY OF NEWPORT BEACH
Combining Statement of Revenues,
Capital Projects
Expenditures and Changes in Fund Balance
s
For the Year Ended June 30, 2025

177
Miscellaneous Unrestricted
Faciliti
es Neighborhood Facilities Junior Capital
Maintenance Enhancement Financing Lifeguards Improvements Revenues:

Other tax
es -$ -$ -$ -$ -$ Intergovernmental - - - - - Charge for services - - - - - Licenses, permits and fees - - - - - Property income - - - - - Investment income 219,646 403,858 266,597 2,746 - Net increase in fair value of investments 68,496 125,543 76,346 1,234 - Donations - - - - - Other - -
-
-
-

T
otal revenues 288,142 529,401
342,943
3,980
-

Expenditures:

Current:

General government - - - - - Public safety - - - - - Public works - - - - - Community development - - - - - Community services - - - - - Capital outlay 3,916,165 3,445,072 185,216
74,984
10,021,184

T
otal expenditures 3,916,165 3,445,072 185,216
74,984
10,021,184

Ex
cess (deficiency) of revenues
over expenditures (3,628,023) (2,915,671) 157,727
(71,004)
(10,021,184)

Other financing sources:

Transfer
s in 2,500,000 -
500,000
5,295
12,757,055

Total ot
her financing sources 2,500,000 -
500,000
5,295
12,757,055

Net ch
ange in fund balances (1,128,023) (2,915,671) 657,727 (65,709) 2,735,871 Fund balances (deficits), beginning 4,168,141 11,730,832 6,522,827
122,146
15,720,147

Fund balances (deficits),
ending 3,040,118$ 8,815,161$
7,180,554$
56,437$
18,456,018$

(continued)

CITY OF NEWPORT BEACH
Ot
her Governmental Funds
Combining Statement of Revenues,
Expenditures and Changes in Fund Balances
For the Year Ended June 30, 2025

Capital Projects
178
Total
Other
Park Ackerman Governmental
Maintenance Bay Dredging Donation Funds
Revenues:

Other tax
es -$ -$ -$ 1,021,443$ Intergovernmental - - - 10,497,718 Charge for services - - - 92,129 Licenses, permits and fees - - - 851,257 Property income - - - 725,753 Investment income 103,050 224,280 48,181 4,508,461 Net increase in fair value of investments 34,123 64,865 13,969 1,260,300 Donations - - - 3,726,024 Other - -
-
120,155

T
otal revenues 137,173 289,145
62,150
22,803,240

Expenditures:

Current:

General government - - - 1,610 Public safety - - - 777,707 Public works - - - 10,739,240 Community development - - 4,900 225,546 Community services - - 7,422 231,066 Capital outlay 1,661,709 -
-
41,637,631

T
otal expenditures 1,661,709 -
12,322
53,612,800

Ex
cess (deficiency) of revenues
over expenditures (1,524,536) 289,145 49,828
(30,809,560)

Other financing sources:

Transfer
s in 2,300,000 -
-
25,673,861

Total ot
her financing sources 2,300,000 -
-
25,673,861

Net ch
ange in fund balances 775,464 289,145 49,828 (5,135,699) Fund balances (deficits), beginning 959,602 5,630,357 1,215,932
124,207,706

Fund balances (deficits),
ending 1,735,066$ 5,919,502$
1,265,760$
119,072,007$
Capital Projects Permanent Funds
Other Governmental Funds
Combining Statement
of Revenues,
Expenditures and Changes in Fund Balances
For the Year Ended June 30, 2025

CITY OF NEWPORT BEACH
179

Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:

Intergover
nmental 2,153,871$ 2,153,871$ 2,396,189$ 242,318$ Investment income 95,646 95,646 138,825 43,179 Net increase in fair value of investments - - 37,164 37,164

Total revenues 2,249,517 2,249,517 2,572,178 322,661 Expenditures:

Capital outlay -
3,635,129 1,085,764 2,549,365

Net change in fund balance 2,249,517 (1,385,612) 1,486,414 2,872,026 Fund balance, beginning 2,797,801 2,797,801 2,797,801 -

Fund balance, ending 5,047,318$ 1,412,189$ 4,284,215$ 2,872,026$

CITY OF NEWPORT BEACH
Budge
tary Comparison Schedule
State Gas Tax Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
180

Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:

Intergover
nmental 2,063,464$ 2,063,464$ 2,322,193$ 258,729$ Investment income 16,378 16,378 50,637 34,259 Net increase in fair value of investments - - 11,313 11,313

Total revenues 2,079,842 2,079,842 2,384,143 304,301 Expenditures:

Capital outlay -
2,038,000 1,531,057 506,943

Net change in fund balance 2,079,842 41,842 853,086 811,244 Fund balance, beginning 825,999 825,999 825,999 -

Fund balance, ending 2,905,841$
867,841$ 1,679,085$ 811,244$

CITY OF NEWPORT BEACH
Budge
tary Comparison Schedule
SB1 Gas Tax RMRA Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
181
Variance with
Final Budget
Positive
O
riginal Final Actual (Negative)
Revenues:

Intergover
nmental - $ - $ 28,708$ 28,708$ Investment income - - 29,759 29,759 Net increase in fair value of investments - - 8,966 8,966

Total revenues - - 67,433 67,433 Expenditures:

Public safety 311,000
311,000 237,845 73,155

Net change in fund balance (311,000) (311,000) (170,412) 140,588 Fund balance, beginning 817,398 817,398 817,398 -

Fund balance, ending 506,398$ 506,398$ 646,986$ 140,588$

CITY OF NEWPORT BEACH
Budgetary Com
parison Schedule
Asset Forfeiture Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
182
Variance with
Final Budget
Posit
ive
Original Final Actual (Negative)
Revenues:

Intergovernmental - $
522,434$ 289,817$ (232,617)$
Total revenues -
522,434 289,817 (232,617)
Expenditures:

Public safety -
522,434 289,817 232,617
Excess (deficiency) of revenues

over expenditures - - - - Other financing sources:

Transfers in - 148 148 - Net change in fund balance -
148 148 -
Fund balance (deficit), beginning (159) (159) (159) - Fund balance (deficit), ending (159)$ (11)$ (11)$ -$

CITY OF NEWPORT BEACH
Budge
tary Comparison Schedule
OTS DUI Grant Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
183
Variance with
Final Budget
Positive
O
riginal Final Actual (Negative)
Revenues:

Li
censes, permits and fees 33,462$ -$ 246,773$ 246,773$ Investment income 1,386 1,386 46,290 44,904 Net increase (decrease) in fair value of investments (1,747) (1,747) 12,619
14,366

Total revenues 33,101 (361)
305,682 306,043

Expenditures:

Capital outlay - 159,798
-
159,798

Net change in fund balance 33,101 (160,159) 305,682 465,841 Fund balance, beginning 918,149 918,149
918,149 -

Fund balance, ending 951,250$ 757,990$
1,223,831$ 465,841$

CITY OF NEWPORT BE
ACH
Budgetary Comparison Schedule
Circulati
on and Transportation Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
184
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:

Licenses, permits and fees 17
9,843$ 179,843$ 116,386$ (63,457)$ Investment income 4,748 4,748 15,700 10,952 Net increase in fair value of investments - - 4,409 4,409 Total revenues 18
4,591 184,591 136,495 (48,096) Expenditures:

Capital ou
tlay - 507,772 255,865 251,907 Net change in fund bal
ance 184,591 (323,181) (119,370) 203,811 Fund balance, beginning 370,819 370,819 370,819 - Fund balance, ending 555,410$
47,638$ 251,449$ 203,811$

CITY OF NEWPORT BEA
CH
Budgetary Comparison Schedule
Building Excise Tax Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
185
Variance with
Final Budget
Positi
ve
Original Final Actual (Negative)
Revenues:

Int
ergovernmental 385,974$ 836,956$ 256,812$ (580,144)$ Property income 305,000 305,773 419,494 113,721 Net increase in fair value of investments - - 5,029
5,029

Total revenues 690,974 1,142,729
681,335 (461,394)

Expenditures:

Communit
y development 183,586 491,976 197,235 294,741 Capital outlay - 657,648 211,523 446,125 Debt service:

Principal 208,000 888 - 888 Interest and fiscal charges 2,548 -
-
-

Total expenditures 394,134 1,150,512
408,758 741,754

Net change in fund balance 296,840 (7,783) 272,577 280,360 Fund balance (deficit), beginning (229,622) (229,622) (229,622) -

Fund balance (deficit), ending 67,
218$ (237,405)$
42,955$ 280,360$

CITY OF NEWPORT BEACH
Budg
etary Comparison Schedule
Community Development Block Grant Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
186
Variance with
Final Budget
Positive
Origina
l Final Actual (Negative)
Revenues:

Intergovernmental 109,900$
109,900$ 109,233$ (667)$
Investment income 31,872 31,872 71,265 39,393 Net increase in fair value of investments - - 20,454 20,454 Total revenues 141
,772 141,772 200,952 59,180
Expenditures:

Capital outl
ay - 986,616 10,987 975,629 Net chan
ge in fund balance 141,772 (844,844) 189,965 1,034,809 Fund balance, beginning 1,745,269 1,745,269 1,745,269 - Fund balance, ending 1,887,
041$ 900,425$ 1,935,234$ 1,034,809$

CITY OF NEWPORT BEA
CH
Budgetary Comparison Schedule
Air Quality Management District Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
187
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:

Other taxes 71
1,563$ 711,563$ 1,021,443$ 309,880$ Investment income 153,829 153,829 402,385 248,556 Net increase in fair value of investments - - 116,159 116,159 Other revenue 68,409 68,409
48,261 (20,148)

Total revenues 933,801 933,801
1,588,248 654,447
Expenditures:

Public work
s 469,961 470,504 411,971 58,533 Capital outlay - 1,635,454 887,170 748,284

Total expenditures 469,961 2,105,958 1,299,141 806,817

Net change in fund balance 463,840 (1,172,157) 289,107 1,461,264 Fund balance, beginning 9,960,989 9,960,989 9,960,989 -

Fund balance, ending 10,424,829$
8,788,832$ 10,250,096$ 1,461,264$

CITY OF NEWPORT BEACH
Budge
tary Comparison Schedule
Environmental Liability Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
188
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:

Intergovernmental 250,0
00$ 250,000$ 250,045$ 45$
Expenditures:

Public s
afety 250,000 250,000 250,045 (45) Net change in fund bal
ance - - - - Fund balance, beginning - - - - Fund balance, ending -$ -$ - $ - $

CITY OF NEWPORT BEA
CH
Budgetary Comparison Schedule
Supplemental Law Enforcement Services Special Revenue Fund For the Year Ended June 30, 2025
Budgeted Amounts
189
Variance with
Final Budget
Posit
ive
Original Final Actual (Negative)
Revenues:

Other - $ 350,790$ - $ (350,790)$ Expenditures:

General Governm
ent - 350,790 - 350,790 Net change in fund balance -
- - -
Fund balance, beginning - - - - Fund balance, ending - $ -$ - $ -$

CITY OF NEWPORT BEACH
Budge
tary Comparison Schedule
Opioid Remediation Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
190
Variance with
Final Budget
Positi
ve
Original Final Actual (Negative)
Revenues:

Intergovernmental -
$ 2,578,076$ 1,931,959$ (646,117)$ Investment income 2,945 2,945 24 (2,921) Net increase in fair value of investments - - 10 10 Donations - 3,740,336 3,324,078 (416,258) Other - 42,650
-
(42,650)

Total revenues 2,945 6,364,007
5,256,071 (1,107,936)
Expenditures:

Capital
outlay - 14,242,874 7,883,088 6,359,786

Excess (deficiency) of revenues
over expenditures 2,945 (7,878,867)
(2,627,017) 5,251,850
Other financing sources:

Transfers in - 5,489
5,489
-

Total other financing sources - 5,489
5,489
-

Net change in fund balance 2,945 (7,873,378) (2,621,528) 5,251,850 Fund balance, beginning 4,196,480 4,196,480
4,196,480 -

Fund balance (deficit), ending 4,
199,425$ (3,676,898)$ 1,574,952$ 5,251,850$

CITY OF NEWPORT BEACH
Budg
etary Comparison Schedule
Contributions Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
191
Variance with
Final Budget
Positive
Origin
al Final Actual (Negative)
Revenues:

Investment
income 21,727$ 21,727$ 45,978$ 24,251$ Net increase in fair value of investments 3,612 3,612 13,453 9,841 Donations - - 278,407 278,407

Total revenues 25,339 25,339 337,838 312,499 Expenditures:

Community
services 223,759 224,830 206,058 18,772

Net change in fund balance (198,420) (199,491) 131,780 331,271 Fund balance, beginning 1,094,800 1,094,800 1,094,800 - Fund balance, ending 896,380$ 895,309$ 1,226,580$ 331,271$

CITY OF NEWPORT BEACH
Budgetary Comparison S
chedule
FIIN Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
192

Variance with
Final Budget
Positiv
e
Original Final Actual (Negative)
Revenues:

Charges for servi
ces - $ -$ 92,129$ 92,129$ Licenses, permits and fees 150,000 150,000 75,000 (75,000) Property income 31,749 31,749 26,700 (5,049) Investment income - - 106,242 106,242 Net increase in fair value of investments - - 30,155 30,155 Donations 35,000 35,000 123,539 88,539 Other - - 71,894 71,894 Total rev
enues 216,749 216,749 525,659 308,910 Expenditures:

Community
development - 35,000 23,411 11,589 Community services - 50,086 17,586 32,500 Total ex
penditures - 85,086 40,997 44,089 Net change in f
und balance 216,749 131,663 484,662 352,999 Fund balance, beginning 2,510,562 2,510,562 2,510,562 - Fund balance, endin
g 2,727,311$ 2,642,225$ 2,995,224$ 352,999$

CITY OF NEWPORT BEACH
Budgetary Compa
rison Schedule
Restricted Programs Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
193
Variance with
Final Budget
Positi
ve
Original Final Actual (Negative)
Revenues:

Int
ergovernmental 2,831,037$ 7,938,425$ 2,912,762$ (5,025,663)$ Investment income 48,285 48,285 59,134 10,849 Net increase in fair value of investments - - 28,380
28,380

Total revenues 2,879,322 7,986,710
3,000,276 (4,986,434)
Expenditures:

Cap
ital outlay - 9,995,630
5,061,553 4,934,077

Net change in fund balance 2,879,322 (2,008,920) (2,061,277) (52,357) Fund balance, beginning 2,532,052 2,532,052
2,532,052 -

Fund balance, ending 5,411,374$
523,132$
470,775$ (52,357)$

CITY OF NEWPORT BEACH
Budg
etary Comparison Schedule
Measure M Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
194
Variance with
Final Budget
Positive
Origina
l Final Actual (Negative)
Revenues:

Property income 272,000$
272,000$ 279,559$ 7,559$
Investment income 21,787 21,787 47,784 25,997 Net increase in fair value of investments - - 13,732 13,732 Total revenues 293
,787 293,787 341,075 47,288 Expenditures:

Capital outl
ay - 1,126,814 261,626 865,188 Net chan
ge in fund balance 293,787 (833,027) 79,449 912,476 Fund balance, beginning 1,183,552 1,183,552 1,183,552 - Fund balance, ending 1,477,
339$ 350,525$ 1,263,001$ 912,476$

CITY OF NEWPORT BEA
CH
Budgetary Comparison Schedule
Oceanfront Encroachment Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
195
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:

Licens
es, permits and fees 360,000$ 360,000$ 287,312$ (72,688)$ Investment income 2,931 2,931 144,787 141,856 Net increase in fair value of investments - - 41,307 41,307

Total revenues 362,931 362,931
473,406 110,475
Expenditures:

Genera
l government - 7,883
-
7,883
Net ch
ange in fund balance 362,931 355,048 473,406 118,358 Fund balance, beginning 3,550,006 3,550,006 3,550,006 - Fund balance, ending 3,912,937$
3,905,054$ 4,023,412$ 118,358$

CITY OF NEWPORT BEACH
Budge
tary Comparison Schedule
PEG Fees Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
196
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:

Licens
es, permits and fees -$ 558,389$ 125,786$ (432,603)$ Investment income - - 2,155 2,155 Net increase in fair value of investments - - 371
371

Total revenues - 558,389
128,312 (430,077)
Expenditures:

Genera
l government - -
-
-
Net ch
ange in fund balance - 558,389 128,312 (430,077) Fund balance, beginning - -
-
-
Fund balance, ending -$
558,389$ 128,312$ (430,077)$

CITY OF NEWPORT BEACH
Budge
tary Comparison Schedule
Park Fees Special Revenue Fund
For the Year Ended June 30, 2025
Budgeted Amounts
197

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198

FINANCIAL SECTION

SUPPLEMENTARY INFORMATION

INTERNAL SERVICE FUNDS
199
This page left blank intentionally.
200

INTERNAL SERVICE FUNDS

The Internal Service Funds are used to allocate the cost of providing goods and services by one department to other departments on a cost reimbursement basis.

The City of Newport Beach Internal Service Funds are listed below:

The Insurance Reserve Fund is used to account for the City's self- insured general liability and workers' compensation program.

The Compensated Absences Fund is used to account for the City’s accumulated liability for compensated absences.

The Retiree Insurance Fund is used to account for the cost of providing post-employment health care benefits.

The Equipment Maintenance Fund is used to account for the cost of maintaining and replacing the City’s ro lling stock fleet, parking equipment, coordinated communications system equipm ent, fire equipment and recreation equipment.

The Information Technology Fund is used to account for the cost of maintaining and replacing the City’s computers, printers, copiers and telecommunication services to other departments.

201
Total
Insurance Compensated Retiree Equipm
ent Information Internal
Assets Reserve Absences Insurance Maintenance Technology Service Funds Current assets:

Cash and investments 38,243,734$ 9,662,553$ 1,000,934$ 17,809,845$ 14,850,371$ 81,567,437$ Receivables:

A
ccounts (net of allowance) - - 5,909 28,750 - 34,659 Interest 161,728 43,317 4,034 80,845 67,041 356,965 Intergovernmental receivables - - - 195,387 - 195,387 Inventories - - - 502,830 - 502,830 Prepaid items - - 68,414 4,896,627 733,051 5,698,092

Total current assets 38,405,462 9,705,870 1,079,291 23,514,284 15,650,463 88,355,370

Noncurrent assets:

Capital assets:

Equipment - - - 46,823,756 3,568,652 50,392,408

Intangible right to use equipment - - - - 363,725 363,725 Structures - - - 39,581 - 39,581 Software - - - - 4,360,625 4,360,625 Intangible right to use subscriptions - - - 1,723,597 375,566 2,099,163 Less accumulated depreciation/amortization - - - (31,198,677) (7,422,237) (38,620,914)

Total capital assets (net of accumulated
depreciation/amortization) - - - 17,388,257 1,246,331 18,634,588 Total assets 38,405,462 9,705,870 1,079,291 40,902,541 16,896,794 106,989,958 Deferred outflows of resources:

Deferred amount from pension plans - - - 599,572 1,201,767 1,801,339 Deferred amount from OPEB - - - 100,442 201,328 301,770 Total deferred outflows of resources - - - 700,014 1,403,095 2,103,109 Liabilities
Current liabilities:

Accounts payable 263,325 - - 541,557 150,885 955,767 Accrued payroll 14,833 123,099 183,122 63,202 125,614 509,870 Due to other funds - - 353,001 - - 353,001 Workers' compensation - current 4,497,885 - - - - 4,497,885 General liability - current 3,941,299 - - - - 3,941,299 Compensated absences - current - 8,097,760 - - - 8,097,760 Lease liability - current - - - - 67,339 67,339 Subscription liability - current - - - 170,375 - 170,375 Total current liabilities 8,717,342 8,220,859 536,123 775,134 343,838 18,593,296 Noncurrent liabilities:

Workers' compensation 20,992,090 - - - - 20,992,090 General liability 6,658,815 - - - - 6,658,815 Compensated absences - 6,394,937 - - - 6,394,937 Subscription liability - - - 1,130,571 - 1,130,571 Net pension liability - - - 1,905,114 3,818,611 5,723,725 Net OPEB liability - - - 60,711 121,697 182,408 Total noncurrent liabilities 27,650,905 6,394,937 - 3,096,396 3,940,308 41,082,546 Total liabilities 36,368,247 14,615,796 536,123 3,871,530 4,284,146 59,675,842 Deferred inflows of resources:

Deferred amount from pension plans - - - 1,613 3,231 4,844 Deferred amount from OPEB - - - 23,656 47,414 71,070 Total deferred inflows of resources - - - 25,269 50,645 75,914 Net Position
Invested in capital assets - - - 15,805,661 1,178,992 16,984,653 Unrestricted 2,037,215 (4,909,926) 543,168 21,900,095 12,786,106 32,356,658 Total net position 2,037,215$ (4,909,926)$ 543,168$ 37,705,756$ 13,965,098$ 49,341,311$

CITY OF NEWPORT BEACH
Internal Service Funds
Combining Statem
ent of Net Position
June 30, 2025
202
Total
Insurance Compe
nsated Retiree Equipment Information Internal
Reserve Absences Insurance Maintenance Technology Service Funds Operating revenue
s:

Charges for services 18,475,042$ 3,262,108$ 395,002$ 8,614,875$ 8,365,963$ 39,112,990$ Intergovernmental - - - 195,387$ - 195,387 Employee contributions - - 22,086 - - 22,086 Other 3,679,765 -
2,705,816
10,453
112
6,396,146

Tot
al operating revenues 22,154,807 3,262,108
3,122,904
8,820,715
8,366,075
45,726,609
Operating expenses
:

Salaries and wages 1,531 - - 1,408,150 3,244,603 4,654,284 Depreciation/amortization - - - 3,635,505 640,172 4,275,677 Professional services - - - 250,663 745,620 996,283 Maintenance and supplies - - - 2,260,337 1,842,503 4,102,840 Fleet parts and supplies - - - 545,348 - 545,348 Telecommunication - - - - 188,617 188,617 System maintenance - - - 27,692 - 27,692 Hardware - - - - 534,370 534,370 Software - - - - 369,728 369,728 Workers' compensation 7,107,333 - - - - 7,107,333 Claims and judgments 10,384,659 - - - - 10,384,659 Compensated absences - 2,576,984 - - - 2,576,984 OPEB - - 847,328 - - 847,328 Other - -
2,227,349
-
-
2,227,349

Tot
al operating expenses 17,493,523 2,576,984
3,074,677
8,127,695
7,565,613
38,838,492
Ope
rating income (loss) 4,661,284 685,124
48,227
693,020
800,462
6,888,117

Nonoperating rev
enues:

Investment income 1,315,623 334,620 19,677 697,625 548,867 2,916,412 Net increase in fair value of investments 459,747 92,326 7,872 231,339 155,388 946,672 Gain on sale of capital assets - - - 425,594 - 425,594 Interest expense - -
-
(7,660)
(643)
(8,303)

Tot
al nonoperating revenues 1,775,370 426,946
27,549
1,346,898
703,612
4,280,375

Income (l
oss) before transfers 6,436,654 1,112,070
75,776
2,039,918
1,504,074
11,168,492

Transfers in -
-
-
6,160
15,729
21,889

Chan
ge in net position 6,436,654 1,112,070 75,776 2,046,078 1,519,803 11,190,381

Net position, beginning (4,399,439)
(6,021,996) 467,392
35,659,678 12,445,295 38,150,930
Net position, ending 2,0
37,215$ (4,909,926)$ 543,168$ 37,705,756$ 13,965,098$ 49,341,311$

CITY OF NEWPORT BEACH
I
nternal Service Funds
Combining Statement of Revenues, Expenses
and Changes in Net Position
For the Year Ended June 30, 2025
203
Total
Insurance Compensated Retiree Eq
uipment Information Internal
Reserve Absences Insurance Maintenance Technology Service Funds Cash flows from operating
activities:

Receipts from user
departments 18,501,258$ 3,262,108$ 389,950$ 8,586,125$ 8,365,963$ 39,105,404$ Payments to employ
ees (5,066,472) (1,760,961) -
(1,387,212) (3,226,564) (11,441,209)
Payments to supp
liers (24,678,245) -
(3,075,692) (7,910,764) (3,666,047) (39,330,748) Other operatin
g cash receipts 3,679,765 -
2,727,902 10,453 112
6,418,232
Net cash provided (used) b
y operating activities (7,563,694) 1,501,147 42,160 (701,398) 1,473,464 (5,248,321) Cash flows from noncapital
financing activities:

Cash received from other
funds - -
-
6,160 15,729 21,889

Net cash provided by non
capital financing activities - -
-
6,160 15,729 21,889

Cash flows from capital and r
elated financing activities:

Acquisition of cap
ital assets -
-
-
(3,401,778) (55,061) (3,456,839)
Lease liabili
ties and related -
-
-
-
(73,663) (73,663)
Subscription l
iabilities and related -
-
-
(177,101) (35,446) (212,547)
Proceeds from sale of capital
assets - -
-
425,594 -
425,594
Net cash (used) for capi
tal and related financing activities - - -
(3,153,285) (164,170) (3,317,455)
Cash flows from investin
g activities:

Investment
income 1,754,280 408,418 26,746 914,987 678,610 3,783,041 Net cash provided by in
vesting activities 1,754,280 408,418 26,746 914,987 678,610 3,783,041 Net increase (decrease) in cash
and cash equivalents (5,809,414) 1,909,565 68,906 (2,933,536) 2,003,633 (4,760,846) Cash and cash equival
ents, beginning 44,053,148 7,752,988 932,028 20,743,381 12,846,738 86,328,283 Cash and cash equival
ents, ending 38,243,734$ 9,662,553$ 1,000,934$ 17,809,845$ 14,850,371$ 81,567,437$ Reconciliation to t
he statement of net position:

Cash and investm
ents reported on statement of net position 38,243,734$ 9,662,553$ 1,000,934$ 17,809,845$ 14,850,371$ 81,567,437$ Cash and cash
equivalents 38,243,734$ 9,662,553$ 1,000,934$ 17,809,845$ 14,850,371$ 81,567,437$ Reconciliation of operat
ing income to net cash
provided by op
erating activities:

Operating i
ncome 4,661,284$ 685,124$ 48,227$ 693,020$ 800,462$ 6,888,117$ Adjustments to reconcil
e operating income
to net cash prov
ided by operating activities:

Depreciation -
-
-
3,635,505 640,172 4,275,677
Changes i
n operating assets and liabilities:
(In
crease) decrease in accounts receivable 26,216 - (5,052) (28,750) -
(7,586)

(In
crease) in inventories -
-
-
(39,048) -
(39,048)
(In
crease) decrease in prepaid items -
-
1,451 (4,838,790) (64,855) (4,902,194) In
crease (decrease) in accounts payable and accrued
pay
roll (14,049,402) (28,508)
(2,466) 70,455 94,486 (13,915,435) Increase
in workers' compensation 2,039,412 -
-
-
-
2,039,412
(Decrease) i
n general liability (241,204) -
-
-
-
(241,204)
Increase
in compensated absences -
844,531 -
-
-
844,531
(Decrease) i
n net pension liability and deferred cash flows -
-
-
(23,676) (47,456) (71,132)
Increase
in net OPEB liability and deferred cash flows - - -
25,273 50,655 75,928

Total adjustments (12,224,978) 816,023 (6,067) (1,394,418) 673,002 (12,136,438)

Net cash provided (used) by operating activities (7,563,694)$ 1,501,147$ 42,160$ (701,398)$ 1,473,464$ (5,248,321)$ Noncash financing an
d investing activities:

Capital asset
s financed by ending accounts payable - - -
281,650 -
281,650

Total of noncash activities -$ -$ -$ 281,650$ -$ 281,650$

CITY OF NEWPORT BEACH
Combi
ning Statement of Cash Flows
For the Year Ended June 30, 2025
Internal Service Funds
204

FINANCIAL SECTION

SUPPLEMENTARY INFORMATION

CUSTODIAL FUNDS
205

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206

CUSTODIAL FUNDS

Custodial Funds are used to account for assets held by the City in a trustee capacity, or as an agent for othe r government entities, private organizations, or individuals.

The City of Newport Beach Custodial Funds are listed below:

The Special Assessment District Fund is used to account for funds received from affected property owners and payab le to holders of 1911 Act and 1915 Act special assessment bonds.

The Tourism Business Improvement Fund is used to account for the Newport Beach Tourism Business Improvement Dis trict’s special assessment on short term room rental revenue collected by the City for Visit Newport Beach Inc.

The Other Business Improvement Fund is used to account for monies collected from local business districts for district property improvements and business enhancement.

The Police Custodial Fund is used to account for monies received by the City’s police department in a custodial capacit y, such as warrant s and items pending adjudication.

207
Custodial Funds
Special Tourism Other T
otal
Assessment Business Business Police Custodial
District Improvement Improvement Custodial Funds
Assets
Cash and investments 1,332,953$ 6,420$ 4,106$ 239,043$ 1,582,522$ Restricted cash and investments w
ith fiscal agent 2,699,066 -
-
-
2,699,066
Receivable:

Interest 15,167 -
-
-
15,167
Intergovernmental r
eceivable 34,320 -
-
-
34,320
Total assets 4,081,506
6,420 4,106 239,043 4,331,075 Liabilities
Due to oth
ers 1,944 6,420 4,106 23,146 35,616 Total
liabilities 1,944 6,420 4,106 23,146 35,616 Net Position
Restricted for:

Individu
als, organizations, and other governments 4,079,562 - -
215,897 4,295,459
Total net position 4,079,562$ -$ -$ 215,897$ 4,295,459$

CITY OF NEWPORT BEACH
Custodi
al Funds
Combining Statement of Fiduciary Net Position
June 30, 2025
208
Special Tourism Other T
otal
Assessment Business Business Police Custodial
District Improvement Improvement Custodial Funds
Additions
Special assessments 3,022,899$ -$ -$ -$ 3,022,899$ Investment earnings 154,493 -
-
700
155,193
Other -
-
-
101,760 101,760
Total additions 3,177,392
-
-
102,460 3,279,852
Deductions
Debt service 3,317,230 -
-
-
3,317,230
Administrative 97,408 -
-
-
97,408
Other -
-
-
133,537 133,537
Total deductions 3,414,638
-
-
133,537 3,548,175
Net change in
fiduciary net position (237,246) -
-
(31,077) (268,323)
Net position, beginn
ing of year 4,316,808 -
-
246,974 4,563,782
Net position, end of year 4,079,
562$ -$ -$ 215,897$ 4,295,459$

CITY OF NEWPORT BEACH
Custodi
al Funds
Combining Statement of Changes in Fiduciary Net Position For the Year Ended June 30, 2025
Custodial Funds
209
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210

STATISTICAL SECTION
211
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212

FINANCIAL TRENDS

This section of the City of Newport Beach’s Annual Comprehensive Financial Report (ACFR) presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City’s overall financial health. The statistical information presented herein is un-audited.

The following schedules contain trend information illustrating how the City’s financial performance and well-being have changed over time:
• Net Position by Component
• Changes in Net Position
• Fund Balances of Governmental Funds
• Changes in Fund Balance of Governmental Funds

Sources: Unless otherwise noted, the information in these schedules is derived from the A nnual Comprehensive Financial Reports and underlying accounting records for the relevant years.

213
20161 20172 20183 2019 2020
Net investment in capital assets 2,193,773,102$ 2,201,552,683$ 2,208,832,391$ 2,218,040,304$ 2,217,852,660$ Restricted 44,033,677 45,753,736 49,791,908 56,426,811 67,708,225 Unrestricted (130,468,268) (133,461,197) (122,024,754) (102,035,181) (90,214,086) 2,107,338,511$ 2,113,845,222$ 2,136,599,545$ 2,172,431,934$ 2,195,346,799$ Business-type activities:

Net investment in capital assets 117,055,576$ 116,238,944$ 119,375,596$ 119,346,350$ 120,291,689$ Unrestricted 23,430,189 28,890,311 29,183,382 30,331,669 30,276,662 140,485,765$ 145,129,255$ 148,558,978$ 149,678 ,019$ 150,568 ,351$ Primary government:

Net investment in capital assets 2,310,828,678$ 2,317,791,627$ 2,328,207,987$ 2,337,386,654$ 2,338,144,349$ Restricted 44,033,677 45,753,736 49,791,908 56,426,811 67,708,225 Unrestricted (107,038,079) (104,570,886) (92,841,372) (71,703,512) (59,937,424) 2,247,824,276$ 2,258,974,477$ 2,285,158,523$ 2,322,109,953$ 2,345,915,150$ (continued)
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