Agenda packet — Orange City Council, March 11, 2025 (part 2 of 3)

Agenda Item
City Council
Item #: 3.9. 3/11/2025 File #: 25-0115
TO: Honorable Mayor and Members of the City Council
THRU: Tom Kisela, City Manager
FROM: Dan Adams, Interim Chief of Police

1. SUBJECT
Purchase and installation of Mobile Data Computers and vehicle docking stations for Police patrol fleet.

2. SUMMARY
Purchase of 40 Panasonic Toughbooks and docking stations from CDCE, Inc. through NASPO ValuePoint Master Agreement No. MA23019, Addendum No. 7-23-70-55-10.

3. RECOMMENDED ACTION

1. Approve the purchase of 40 Mobile Data Computers and vehicle docking stations from CDCE, Inc. for a total amount of $322,961 representing equipment and labor of $313,961, plus a contingency of $9,000.

2. Authorize the appropriation of $100,000 from the Federal Asset Forfeiture (355) unreserved fund balance to:
355.4011.56032.20335 Federal Asset Forfeiture - Equipment

4. FISCAL IMPACT
The expense for this purchase is $322,961 and will be funded through Federal Asset Forfeiture (355):
355.4011.56032.20335 CIP - Police Vehicle Mobile Data Computer Systems

5. STRATEGIC PLAN GOALS
Goal 1: Maintain Strong Emergency and Safety Services
Objective1.3: Replace mobile data computers in patrol fleet to maintain contemporary technology

6. DISCUSSION AND BACKGROUND
Mobile Data Computers (MDCs) enable patrol units to connect wirelessly to law enforcement computer database systems and provide officers with instant information to complete a number of tasks while on duty. MDCs previously purchased by the department have reached the end of their service life and are no longer covered under warranty.

CDCE, Inc. (CDCE) has been providing rugged notebooks and services to law enforcement agencies for over 15 years. The Police Department, with IT support, conducted a thorough evaluation of the new FZ-40 Toughbook and determined that the FZ-40 model is a suitable replacement. However, the new Panasonic Toughbook is not compatible with existing vehicle docking stations. To avoid compatibility issues from having two different Toughbook models and docking stations, it is necessary City of Orange Printed on 3/5/2025Page 1 of 2
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Item #: 3.9. 3/11/2025 File #: 25-0115
compatibility issues from having two different Toughbook models and docking stations, it is necessary to replace all 40 MDCs and docking stations at one-time. The Panasonic FZ-40 Toughbook provides a complete package that includes a Windows 11 Pro operating system, five-year protection warranty, and corresponding vehicle docking stations.

Capital Improvement Project No. 20335 provides for the replacement of Police Department in-car MDCs. Funds available in CIP No. 20335 are insufficient for Fiscal Year 2024-2025 and will require an appropriation of $100,000 from the Federal Asset Forfeiture (355) unreserved fund balance to fund the computers. The total cost of $322,961 includes equipment, labor, and a contingency fee reserved for additional expenses. The purchase of 40 Panasonic Toughbooks will be completed using NASPO ValuePoint Master Agreement No. MA23019, Addendum No. 7-23-70-55-10, expiring on June 30, 2025. CDCE is an authorized reseller contracting with Panasonic Corporation under participating Addendum No. 7-23-70-55-10 for sales and services.

The Police Department recommends the purchase of 40 Panasonic Toughbooks and corresponding docking stations from CDCE for the amount of $322,961 representing equipment and labor of $313,961, plus a contingency of $9,000. An appropriation of $100,000 from the Federal Asset Forfeiture unreserved fund balance is necessary to cover the cost of the computers.

7. ATTACHMENTS
· CDCE Quotes
· NASPO Master Agreement No. MA23019
· Addendum No. 7-23-70-55-10
· Panasonic Authorized Resellers List
City of Orange Printed on 3/5/2025Page 2 of 2
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Agenda Item
City Council
Item #: 3.9. 3/11/2025 File #: 25-0115
TO: Honorable Mayor and Members of the City Council
THRU: Tom Kisela, City Manager
FROM: Dan Adams, Interim Chief of Police

1. SUBJECT
Purchase and installation of Mobile Data Computers and vehicle docking stations for Police patrol fleet.

2. SUMMARY
Purchase of 40 Panasonic Toughbooks and docking stations from CDCE, Inc. through NASPO ValuePoint Master Agreement No. MA23019, Addendum No. 7-23-70-55-10.

3. RECOMMENDED ACTION

2. Authorize the appropriation of $100,000 from the Federal Asset Forfeiture (355) unreserved fund balance to:
355.4011.56032.20335 Federal Asset Forfeiture - Equipment

4. FISCAL IMPACT
The expense for this purchase is $322,961 and will be funded through Federal Asset Forfeiture (355):
355.4011.56032.20335 CIP - Police Vehicle Mobile Data Computer Systems

5. STRATEGIC PLAN GOALS
Goal 1: Maintain Strong Emergency and Safety Services
Objective1.3: Replace mobile data computers in patrol fleet to maintain contemporary technology

CDCE, Inc. (CDCE) has been providing rugged notebooks and services to law enforcement agencies for over 15 years. The Police Department, with IT support, conducted a thorough evaluation of the new FZ-40 Toughbook and determined that the FZ-40 model is a suitable replacement. However, the new Panasonic Toughbook is not compatible with existing vehicle docking stations. To avoid compatibility issues from having two different Toughbook models and docking stations, it is necessary City of Orange Printed on 3/5/2025Page 1 of 2
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Item #: 3.9. 3/11/2025 File #: 25-0115
compatibility issues from having two different Toughbook models and docking stations, it is necessary to replace all 40 MDCs and docking stations at one-time. The Panasonic FZ-40 Toughbook provides a complete package that includes a Windows 11 Pro operating system, five-year protection warranty, and corresponding vehicle docking stations.

CDCE, Inc.
22641 Old Canal Road
Yorba Linda, CA 92887
City of Orange Police Department
1107 N. Batavia
Orange, CA 92867
United States
City of Orange Police Department
1107 N. Batavia
Orange, CA 92867
United States
Sales Quote
122795-C
CIORANGEPD Customer No.

Sales Quote No.

Ship To Bill To
Contact:

Telephone: Telephone:

Contact:
714-744-7522
Accounts Payable
714-744-7522
Accounts Payable
Payment Method
Customer PO Number F.O.B. Ship Via
Net 30
Installation Destination
Entered By Ordered By Salesperson
Kevin Plog Shane Williams Shane Williams
Order
Qty
Extended
Price
Unit
Price Part # Description
TBD
Quote Date
02/26/25
E-mail: E-mail: [email protected] [email protected] Line
Item
40 223,960.00 5,599.00 FZ-40GZ-0GBM C3C4D192AE Panasonic Toughbook FZ-40 (see details below) 1 BSKU,
Win11 Pro,
Intel Core Ultra 7 165H vPro (up to 5.0GHz),
AMT,

14.0IN FHD Gloved Multi Touch,
32GB,
512GB OPAL SSD,
Intel Wi-Fi 7,
Bluetooth,
5G EM9190 (Sub6+C),
GPS,
COM Splitter,
Quad Pass (BIOS Selectable),
Mic and Infrared 5MP Webcam,
Standard Battery,
TPM 2.0,
Emissive Backlit Keyboard,
Flat,
CF-SVCLTNF3YR - 3 Year Protection Plus Warranty,
CF-SVC512SSD3Y - 3 Year No Return of Defective Drive,
CF-SVCPDEP3Y - 3 Year Premier Deployment,
FZ-SVCFESGEN10 - Field Engineering Support
40 160.00 4.00 FEE-100001 9259E30A18 Recycle Fee for Monitors 4"-15" 2 40 22,760.00 569.00 WR-105014 62B88A83A6 PANASONIC: 4th and 5th years Public Safety Service 3 Bundle Add on (Year 4 & 5 only). Must be purchased in conjunction with PS bundle base unit. Includes Premier, Protection Plus, Disk Image Management. 02/24/25
11:26:35 AM
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Print Time
Print Date
Continued on Next Page
62B88A83A6

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800-373-5353 Telephone:

Sales Quote No.

Ship To Bill To
Contact:

Telephone: Telephone:

Contact:
714-744-7522
Accounts Payable
714-744-7522
Accounts Payable
Payment Method
Customer PO Number F.O.B. Ship Via
Net 30
Installation Destination
Entered By Ordered By Salesperson
Kevin Plog Shane Williams Shane Williams
Order
Qty
Extended
Price
Unit
Price Part # Description
TBD
Quote Date
02/26/25
E-mail: E-mail: [email protected] [email protected] Line
Item
40 30,360.00 759.00 PR-320155 1EF30FD931 Havis FZ-40 Lite Vehicle Dock (no pass). 4 USB-A (3), USB-C (3), Serial, Ethernet (2). Includes diagnostic LED, one front USB-C, rear USB-C's are 10Gbps and 1.5A,
MFG Part Number: HA-40LVDS0
40 5,960.00 149.00 PS-202013 CB3CD55A74 Lind 120 Watt FZ-40 DC Cig Adapter 5 Product ETA 6-12 weeks ARO.

Panasonic Warranty Entitlements:

Robert Hinojosa
[email protected]
714-744-7366
Panasonic NASPO Valuepoint Contract#
Master Agreement: MA23019
California Participating Addendum Number 7-23-70-55-10
Expiration date: 06/30/25
**This quote goes with SQ#123354**
02/24/25
11:26:35 AM
Page No.

Print Time
Print Date
Order Total
Sales Tax 7.750 %
Freight
Subtotal
303,960.70
20,171.70
589.00
283,200.00
CB3CD55A74

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800-373-5353 Telephone:

Sales Quote No.

Ship To Bill To
Contact:

Telephone: Telephone:

Contact:
714-744-7522
Accounts Payable
714-744-7522
Accounts Payable
Payment Method
Customer PO Number F.O.B. Ship Via
Net 30
Installation Destination
Entered By Ordered By Salesperson
Kevin Plog Shane Williams Crystal Beach
Order
Qty
Extended
Price
Unit
Price Part # Description
Quote Date
02/26/25
E-mail: E-mail: [email protected] [email protected] Line
Item
40 10,000.00 250.00 LAB-320001 FC045AF0B1 Installation Customer Site 1 **This quote goes with SQ#122795**
Purchase orders must include the following:

CDCE Quote#
All part numbers
Part Descriptions
Quantities and price
Sales Tax & Freight
Bill to/Ship To
Payment Terms
***This quote is valid for 30 days from the stated Quote Date*** 02/24/25
11:25:16 AM
Page No.

Print Time
Print Date
Order Total
Sales Tax 7.750 %
Freight
Subtotal
10,000.00

0.00 0.00
10,000.00
FC045AF0B1

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NASPO ValuePoint Master Agreement No.: 23019

This Contract is between the State of Minnesota, acting through its Commissioner of Administration (“Lead State”) and Panasonic Connect North America, Division of Panasonic Corporation of North America, whose designated business address is Two Riverfront Plaza, 9th Floor, Newark, NJ 07102-5490 (“Contractor”). State and Contractor may be referred to jointly as “Parties.”
Recitals

1. The State of Minnesota, Department of Administration, Office of State Procurement, on behalf of the State of Minnesota and NASPO ValuePoint Cooperative Procurement Program (“NASPO ValuePoint”) issued a solicitation to establish Minnesota NASPO ValuePoint Master Agreement(s) (“Contract”) with qualified manufacturers for Computer Equipment (Desktops, Laptops, Tablets, Servers, and Storage, including related Peripherals & Services);

2. Contractor provided a response to the Solicitation indicating its interest in and ability to provide the goods or services requested in the Solicitation; and

3. Subsequent to an evaluation in accordance with the terms of the Solicitation and negotiation, the Parties desire to enter into a contract; and

4. That Contractor changed its name from Panasonic Corporation of North America (PNA), doing business as Panasonic System Solutions Company of North America (PSSNA) to Panasonic Connect North America, Division of Panasonic Corporation of North America during negotiations; and

5. All authorized governmental entities in any state or participating US Territory are welcome to use the resulting Master Agreement through NASPO ValuePoint with the approval of the State Chief Procurement Official. Upon final award of the overarching Master Agreement, Contractors are able to sign Participating Addendums (PA) at the option of Participating States. Participating States reserve the right to add state specific terms and conditions and modify the scope of the contract in their Participating Addendum as allowed by the Master Agreement.

Accordingly, the Parties agree as follows:

Contract
Term of Contract
Effective date. July 1, 2023, or the date the Lead State obtains all required signatures under Minn. Stat. § 16C.05, subd. 2, whichever is later.

Expiration date. June 30, 2025. This Master Agreement may be extended for up to an additional 36 months, in increments as determined by the Lead State, through a duly executed amendment.

If, in the judgment of the Lead State, a follow-on, competitive procurement will be unavoidably delayed beyond the planned date of execution of the follow-on master agreement, this Master Agreement may be extended for a DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 291664

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reasonable period of time, not to exceed six months. This subsection shall not be deemed to limit the authority of a Lead State under its state law otherwise to negotiate contract extensions.

Representations and Warranties
Under Minn. Stat. §§ 15.061 and 16C.03, subd. 3, and other applicable law the Lead State is empowered to engage such assistance as deemed necessary.

Contractor warrants that it is duly qualified and shall perform its obligations under this Master Agreement in accordance with the commercially reasonable standards of care, skill, and diligence in Contractor’s industry, trade, or profession, and in accordance with the specifications set forth in this Master Agreement, to the satisfaction of the Lead State.

Contractor warrants that it possesses the legal authority to enter into this Master Agreement and that it has taken all actions required by its procedures, by-laws, and applicable laws to exercise that authority, and to lawfully authorize its undersigned signatory to execute this Master Agreement, or any part thereof, and to bind Contractor to its terms.

Awarded Band(s)
The solicitation included three product Bands: Band 1, Personal Computing Devices – Windows Operating Systems:

Desktops, Laptops, Tablets; and Band 2, Personal Computing Devices – Non-Windows Operating Systems: Desktops, Laptops, Tablets; and Band 3, Servers and Storage. The Contractor is awarded the following Band(s):

Band 1, Personal Computer Devices – Windows Operating Systems Band 2, Personal Computer Devices - Non-Windows Operating Systems

Configuration Dollar Limits
The following configuration limits apply to the Master Agreement. Participating Entities may define their configuration limits in their Participating Addendum. The Participating Entity’s Chief Procurement Official may increase or decrease the configuration limits, as defined in their Participating Addendum. The Participating Entity will determine with the Contractor how to approve these modifications to the Product and Service Schedule.

The dollar limits identified below are based on a SINGLE computer/system configuration. This is NOT a restriction on the purchase of multiple configurations (e.g., an entity could purchase 10 laptops at $15,000 each, for a total purchase price of $150,000).

ITEM CONFIGURATION
Band One $15,000
Band Two $15,000
Band Three $1,000,000
Peripherals $10,000
Services Addressed in the Participating Addendum
Restrictions
The following restrictions apply to the Master Agreement. A Participating Entity may set further restrictions of products in their Participating Addendum. The Participating Entity will determine with the Contractor how to approve these modifications to the Entity’s Product and Service Schedule.

Software
DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 292665

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Software is restricted to operating systems and commercial off-the-shelf (COTS) software and is subject to equipment configuration limits.

Any software purchased must be related to the procurement of equipment.

Software must be pre-loaded or provided as an electronic link with the initial purchase of equipment, except for the exceptions allowed under Paragraph 5.a.4.

Software such as middleware which is not always installed on the equipment, but is related to storage and server equipment (Band 3) purchased, is allowed and may be procured after the initial purchase of equipment.

General Services
Services must be related to the procurement of equipment.

Service limits will be addressed by each State.

Wireless phone and internet service is not allowed.

Managed Print Services are not allowed.

Cloud Services
Cloud Services are restricted to Services that function as operating systems and software needed to support or configure hardware purchased under the scope of the contract and is subject to equipment configuration limits.

Any Cloud Service purchased must be related to the procurement of equipment.

Third-Party Products
Third-Party Products can be offered only in the Bands they have been awarded. All third-party products must meet the definition(s) of the Band(s) in which they are being offered.

Products manufactured by another Contractor holding a Minnesota NASPO ValuePoint Master Agreement for Computer Equipment cannot be offered unless approved by the Lead State.

Additional Product/Services
Hardware and software required to solely support wide area network (WAN) operation and management are not allowed.

Lease/Rentals of equipment may be allowed and will be addressed by each State.

Cellular Phone Equipment is not allowed.

EPEAT Bronze requirement may be waived, on a State case-by-case basis, if approved by the State’s Chief Procurement Officer. EPEAT Bronze requirement does not currently apply to storage.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 293666

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Authorized Representative
Master Agreement Administrator. The Master Agreement Administrator designated by NASPO ValuePoint and the State of Minnesota, Department of Administration is Elizabeth Randa, Acquisition Management Specialist.

Elizabeth Randa, Acquisition Management Specialist
Department of Administration
Office of State Procurement
112 Administration Building
50 Sherburne Avenue
St. Paul, MN 55155
E-mail: [email protected]
Phone: 651.201.3122
Contractor’s Authorized Representative. The Contractor's Authorized Representative is Solomon Surles III, Government Contracts Manager.

Solomon Surles III, Government Contracts Manager
Panasonic Connect North America, Division of Panasonic Corporation of North America Two Riverfront Plaza, 9th Floor
Newark, NJ 07102-5490
Email: [email protected]
Phone: 775.895.2401

If the Contractor’s Authorized Representative changes at any time during this Contract, the Contractor must immediately notify the Lead State.

Notices
If one party is required to give notice to the other under the Master Agreement, such notice shall be in writing and shall be effective upon receipt. Delivery may be by certified United States mail or by hand, in which case a signed receipt shall be obtained. An email shall constitute sufficient notice, provided the receipt of the transmission is confirmed by the receiving party. Either party must notify the other of a change in address for notification purposes. All notices to the Lead State shall be addressed to the Master Agreement Administrator.

Exhibits
The following Exhibits are attached and incorporated into this Contract. In the event of a conflict between the terms of this Contract and its Exhibits, or between Exhibits, the order of precedence is first the Contract, and then in the following order:

Exhibit A: NASPO ValuePoint Terms and Conditions
Exhibit B: Minnesota Terms and Conditions
Exhibit C: Requirement
Exhibit D: Price Schedule

Survival of Terms:

The following clauses survive the expiration or cancellation of this Master Agreement: Indemnification; State Audits; Government Data Practices and Intellectual Property; Publicity and Endorsement; Governing Law, Jurisdiction, and Venue; and Data Disclosure. Any other Contract term that states it shall survive, shall survive.

Entire Agreement
This Contract and any written addenda thereto constitute the entire agreement of the parties to the Master Agreement.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 294667

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1. Contractor
The Contractor certifies that the appropriate
person(s) have executed the Contract on behalf of
the Contractor as required by applicable articles,
bylaws, resolutions, or ordinances.

2. State Agency
With delegated authority
Print name: Print name:

Signature: Signature:

Title: Date: Title: Date:

3. Commissioner of Administration
As delegated to The Office of State Procurement
Print name:

Signature:

Title: Date:

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C Richard Elliot
7/19/2023SVP Finance and Business Operations
7/19/2023
Elizabeth M. Randa
Acquisition Management Specialist
IT Acquisitions Supervisor 7/19/2023
Andy Doran
295668

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Exhibit A: NASPO ValuePoint Master Agreement Terms and Conditions Conflict of Terms/Order of Precedence.

Any order placed under this Master Agreement shall consist of the following documents:

A Participating Entity’s Participating Addendum (“PA”); Minnesota NASPO ValuePoint Master Agreement, as negotiated, including all exhibits; A Purchase Order issued against a PA (terms and conditions set forth in a Purchase Order will not be deemed to modify, diminish, or otherwise derogate the terms and conditions set forth in a Participating Addendum or Minnesota NASPO ValuePoint Master Agreement).

These documents shall be read to be consistent and complementary. Any conflict among these documents shall be resolved by giving priority to these documents in the order listed above. Contractor terms and conditions that apply to this Master Agreement are only those that are expressly accepted by the Lead State and must be in writing and attached to this Master Agreement as an Exhibit or Attachment.

Contractor terms and conditions may be incorporated if expressly accepted by the Lead State and attached to the Master Agreement as an Exhibit or Attachment, or by written reference (including reference to information contained in a URL or referenced policy). A written reference, including by URL or policy, is incorporated into the Master Agreement only if the Master Agreement expressly identifies that reference. URL’s must be explicitly referenced to be incorporated into the Master Agreement. URL’s contained within the URL’s that are explicitly referenced are not incorporated into the Master Agreement. Any Contractor term or condition incorporated by URL or written reference applies to this Master Agreement only to the extent such term or condition is not prohibited by applicable law. Any change to information contained in a URL or referenced policy will not affect any financial obligation, place any additional material obligation on an ordering entity, or materially diminish an ordering entity’s ability to use the product or service.

A written Master Agreement (which may include the contents of the RFP and selected portions of Contractor’s response incorporated therein by reference) will constitute the entire agreement of the parties to the Master Agreement. No other terms and conditions shall apply, including terms and conditions listed in the Contractor’s response to the RFP, or terms listed or referenced on the Contractor's website not otherwise incorporated into the Master Agreement, in the Contractor quotation/sales order, or in similar documents subsequently provided by the Contractor.

Additional Agreement with NASPO. Upon request by NASPO ValuePoint, awarded Contractor shall enter into a direct contractual relationship with NASPO ValuePoint related to Contractor’s obligations to NASPO ValuePoint under the terms of the Master Agreement, the terms of which shall be the same or similar (and not less favorable) than the terms set forth in the Master Agreement.

Definitions.

Acceptance is defined by the applicable commercial code, except Acceptance shall not occur before the completion of delivery in accordance with the Order, installation if required, and a reasonable time for inspection of the Product.

Accessory means a product that enhances the user experience but does not extend the functionality of the computer (e.g., mouse pad or monitor stand). For the purposes of this Contract, accessories are considered peripherals.

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_____ as a Service (_aaS) refers to any good provided in a subscription-based model that is defined in the industry as “_____ as a Service”. Examples are “Software as a Service”, “Infrastructure as a Service”, and “Storage as a Service”, and shall follow the NIST definitions of those services. ____ as a Service are permitted only when they meet the restrictions found in Paragraph 5.c, above.

Band means a category of products. There are three product bands which may be awarded through this Contract. Each product band includes related peripherals and services.

Components are the parts that make up a computer configuration.

Contractor means the person or entity delivering Products or performing services under the terms and conditions set forth in this Master Agreement.

Configuration means the combination of hardware and software components that make up the total functioning system.

Customer (see Purchasing Entity).

Desktop means a personal computer intended for regular use at a single location. A desktop computer typically comes in several units connected together during installation: (1) the processor, 2) display monitor, and 3) input devices usually a keyboard and a mouse. Desktops, including desktop virtualization endpoints such as zero and thin clients, are included in Bands 1 and 2 of this Contract.

Embedded Software means one or more software applications which permanently reside on a computing device.

Energy Star® is a voluntary energy efficiency program sponsored by the U.S. Environmental Protection Agency.

The Energy Star program makes it easy to identify energy efficient computers by labeling products that deliver the same or better performance as comparable models while using less energy and saving money. For additional information on the Energy Star program, including product specifications and a list of qualifying products, visit the Energy Star website at http://www.energystar.gov.

EPEAT is a type-1 ecolabel for identifying and purchasing sustainable IT products. EPEAT-registered products must meet sustainability criteria detailed in voluntary consensus-based standards that are free and publicly available on the Green Electronics Council’s website at www.greenelectronicscouncil.org. Products are classified as Bronze, Silver, or Gold based on meeting criteria that address the life cycle of the products. Product life cycle includes material extraction, hazardous substance reduction, end-of-life management, packaging, and corporate sustainability. Only products listed as Active in the online EPEAT Registry are considered to meet the EPEAT criteria.

FOB Destination means that shipping charges are included in the price of the item and the shipped item becomes the legal property and responsibility of the receiver when it reaches its destination unless there is acceptance testing required.

FOB Inside Delivery means that shipping charges are included in the price of the item, and that the shipped item becomes the legal property and responsibility of the receiver when it reaches the inside delivery point, which is beyond the front door or loading dock. FOB Inside Delivery is a special shipping arrangement that may include additional fees payable by the Purchasing Entity. FOB Inside Delivery must be annotated on the Purchasing Entity ordering document.

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Intellectual Property means any and all patents, copyrights, service marks, trademarks, trade secrets, trade names, patentable inventions, or other similar proprietary rights, in tangible or intangible form, and all rights, title, and interest therein.

Laptop means a personal computer for mobile use. A laptop includes a display, keyboard, point device such as a touchpad, and speakers in a single unit. A laptop can be used away from an outlet using a rechargeable battery.

Laptops include notebooks, ultrabooks, netbooks, Zero and thin client devices, and computers with mobile operating systems. Laptops are included in Bands 1 and 2 of this Contract.

Lead State means the State centrally administering any resulting Master Agreement(s).

Mandatory Requirement is a requirement that the failure to meet results in the rejection of the responder’s proposal unless all responders are unable to meet the mandatory requirement. The terms “must” and “shall” identify a mandatory requirement. Any objection to a mandatory requirement should be identified by responders in the Question and Answer period.

Manufacturer means a company that, as one of its primary business functions, designs, assembles, owns the trademark/patent for, and markets branded computer equipment.

Master Agreement means the underlying agreement executed by and between the Lead State, acting on behalf of NASPO ValuePoint, and the Contractor.

Middleware means the software “glue” that helps programs and databases (which may be on different computers) work together. The most basic function of middleware is to enable communication between different pieces of software.

NASPO ValuePoint is a division of the National Association of State Procurement Officials (“NASPO”), a 501(c)(3) limited liability company. NASPO ValuePoint facilitates administration of the NASPO cooperative group contracting consortium of state chief procurement officials for the benefit of state departments, institutions, agencies, and political subdivisions and other eligible entities (i.e., colleges, school districts, counties, cities, some nonprofit organizations, etc.) for all states, the District of Columbia, and territories of the United States. NASPO ValuePoint is identified in the Master Agreement as the recipient of reports and may perform contract administration functions relating to collecting and receiving reports as well as other contract administration functions as assigned by the Lead State.

Option means an item of equipment or a feature that may be chosen as an addition to or replacement for standard equipment and features.

Order or Purchase Order means any purchase order, sales order, contract or other method used by a Purchasing Entity to order the Products.

Participating Addendum means a bilateral agreement executed by a Contractor and a Participating Entity incorporating this Master Agreement and any other additional Participating Entity specific language or other requirements, e.g. ordering procedures specific to the Participating Entity, other terms and conditions.

Participating Entity means a state (as well as the District of Columbia and U.S territories), city, county, district, other political subdivision of a State, or a nonprofit organization under the laws of some states properly authorized to enter into a Participating Addendum, that has executed a Participating Addendum.

Participating State means a state that has executed a Participating Addendum.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 298671

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Partner means a company, authorized by the Contractor and approved by the Participating Entity, to provide marketing, support, or other authorized contract services on behalf of the Contractor in accordance with the terms and conditions of the Contractor’s Master Agreement. A Partner may include, but is not limited to, an agent, subcontractor, fulfillment partner, channel partner, business partner, servicing subcontractor, etc.

Peripherals means any hardware product that can be attached to, added within, or networked with personal computers, servers, or storage. Peripherals extend the functionality of a computer without modifying the core components of the system.

Per Transaction Multiple Unit Discount means a contractual volume discount based on dollars in a single purchase order or combination of purchase orders submitted at one time by a Participating Entity or multiple entities conducting a cooperative purchase.

Premium Savings Package(s) (PSP) are deeply discounted standard configurations available to Purchasing Entities using the Master Agreement. NASPO ValuePoint reserves the right to expand and modify the PSP throughout the life of the contract. For more information see: https://www.naspovaluepoint.org/portfolio/57/.

Product means any equipment, software (including embedded software), documentation, service, or other deliverable supplied or created by the Contractor pursuant to this Master Agreement. The term Products, supplies and services, and products and services are used interchangeably in these terms and conditions.

Purchasing Entity means a state (including the District of Columbia and U.S. territories), city, county, district, other political subdivision of a state, other public entities domestic or foreign, and nonprofit organizations under the laws of some states if authorized by a Participating Addendum, that issues a Purchase Order under the terms of the Master Agreement, or any Participating Addendum thereto, and becomes financially committed to the purchase.

Ruggedized means equipment specifically designed to operate reliably in harsh usage environments and conditions, such as strong vibrations, extreme temperatures, and wet or dusty conditions. Ruggedized equipment may be proposed under the band that most closely fits the equipment being proposed.

Server means computer hardware dedicated to run one or more services or applications (as a host) to serve the needs of the users of other computers on a network. Servers may be either physical or virtual. Servers, including server appliances, are included in Band 3 of this Contract. Server appliances have their hardware and software preconfigured by the manufacturer, and include embedded networking components such as those found in blade chassis systems.

Services are broadly classified as installation or de-installation, maintenance, support, training, migration, and optimization of products offered or supplied under the Master Agreement. These classifications of services may include, but are not limited to: warranty services, maintenance, installation, de-installation, factory integration (software or hardware components), asset management, recycling or disposal, training and certification, pre- implementation design, disaster recovery planning and support, service desk or helpdesk, imaging, and any other directly related technical support service required for the effective operation of a product offered or supplied.

Contractors may offer limited professional services related ONLY to the equipment and configuration of the equipment purchased through the resulting contracts.

EACH PARTICIPATING ENTITY WILL DETERMINE RESTRICTIONS AND NEGOTIATE TERMS FOR SERVICES THROUGH THEIR PARTICIPATING ADDENDUM.

Software means, for the purposes of this Contract, commercial operating off the shelf machine-readable object code instructions including microcode, firmware, and operating system software that meet the restrictions specified DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 299672

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in Paragraph 5.a. “Software” applies to all parts of software and documentation, including new releases, updates, and modifications of software.

Storage means hardware or a virtual appliance with the ability to store large amounts of data. Storage, including SAN switching necessary for the proper functioning of storage equipment, is included in Band 3 of this Contract Storage Area Network (SAN) is a high-speed special-purpose network (or subnetwork) that interconnects different kinds of data storage devices with associated data servers on behalf of a larger network of users.

Tablet means a mobile computer that provides a touchscreen that acts as the primary means of control. Tablets, including notebooks, ultrabooks, and netbooks with touchscreen capabilities, are included in Bands 1 and 2 of this Contract.

Takeback Program means the Contractor’s process for accepting the return of equipment or other products at the end of the product’s life.

Thin Client is a lightweight computer that has been optimized for establishing a remote connection with a server-based computing environment.

Third Party Product is a good sold by the Contractor that is manufactured by another company. Third Party Products are intended to enhance or supplement a Contractor’s own product line, and are not intended to represent more than a third of any Contractor’s total sales under this Master Agreement.

Upgrade means the replacement of existing software, hardware, or hardware component with a newer version.

Warranty means the Manufacturer’s general warranty tied to the product at the time of purchase.

Wide Area Network (WAN) is a data network that serves users across a broad geographic area and often uses transmission devices provided by common carriers.

Term of the Master Agreement.

The initial term of this Master Agreement is for 2 years. This Master Agreement may be extended beyond the original contract period for 36 additional months at the Lead State’s discretion and by mutual agreement and upon review of requirements of Participating Entities, current market conditions, and Contractor performance.

The Master Agreement may be extended for a reasonable period of time if in the judgment of the Lead State a follow-on, competitive procurement will be unavoidably delayed (despite good faith efforts) beyond the planned date of execution of the follow-on master agreement. This subsection shall not be deemed to limit the authority of a Lead State under its state law otherwise to negotiate contract extensions.

Amendments.

The terms of this Master Agreement shall not be waived, altered, modified, supplemented or amended in any manner whatsoever without a written amendment to the Master Agreement executed by the Contractor and Lead State as required by law. Master Agreement amendments will be negotiated by the Lead State with the Contractor whenever necessary to address changes in the terms and conditions, costs, timetable, or increased or decreased scope of work.

Participants and Scope.

Canadian Participation. Subject to the approval of Contractor, any Canadian provincial government or provincially funded entity in Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 300673

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Nova Scotia, Ontario, Prince Edward Island, Quebec, or Saskatchewan, and territorial government or territorial government funded entity in the Northwest Territories, Nunavut, or Yukon, including municipalities, universities, community colleges, school boards, health authorities, housing authorities, agencies, boards, commissions, and crown corporations, may be eligible to use Contractor's Master Agreement.

Contractor may not deliver Products under this Master Agreement until a Participating Addendum acceptable to the Participating Entity and Contractor is executed. The NASPO ValuePoint Master Agreement Terms and Conditions are applicable to any Order by a Participating Entity (and other Purchasing Entities covered by their Participating Addendum), except to the extent altered, modified, supplemented or amended by a Participating Addendum. By way of illustration and not limitation, this authority may apply to unique delivery and invoicing requirements, confidentiality requirements, defaults on Orders, governing law and venue relating to Orders by a Participating Entity, indemnification, and insurance requirements. Statutory or constitutional requirements relating to availability of funds may require specific language in some Participating Addenda in order to comply with applicable law. The expectation is that these alterations, modifications, supplements, or amendments will be addressed in the Participating Addendum or, with the consent of the Purchasing Entity and Contractor, may be included in the ordering document (e.g. purchase order or contract) used by the Purchasing Entity to place the Order.

Use of specific NASPO ValuePoint Master Agreements by state agencies, political subdivisions and other Participating Entities (including cooperatives) authorized by individual state’s statutes to use state contracts are subject to the approval of the respective State Chief Procurement Official. Issues of interpretation and eligibility for participation are solely within the authority of the respective State Chief Procurement Official.

Obligations under this Master Agreement are limited to those Participating Entities who have signed a Participating Addendum and Purchasing Entities within the scope of those Participating Addenda. States or other entities permitted to participate may use an informal competitive process to determine which Master Agreements to participate in through execution of a Participating Addendum. Financial obligations of Participating Entities who are states are limited to the orders placed by the departments or other state agencies and institutions having available funds. Participating Entities who are states incur no financial obligations on behalf of other Purchasing Entities. Contractor shall email a fully executed PDF copy of each Participating Addendum to [email protected] to support documentation of participation and posting in appropriate data bases.

NASPO and NASPO ValuePoint are not parties to the Master Agreement.

Participating Addenda shall not be construed to amend the following provisions in this Master Agreement between the Lead State and Contractor that prescribe NASPO ValuePoint requirements: Term of the Master Agreement; Amendments; Participants and Scope; Administrative Fee; NASPO ValuePoint Summary and Detailed Usage Reports; NASPO ValuePoint Cooperative Program Marketing and Performance Review; Right to Publish; Price and Rate Guarantee Period; and Individual Customers. Any such language shall be void and of no effect.

Participating Entities who are not states may under some circumstances sign their own Participating Addendum, subject to the consent to participation by the Chief Procurement Official of the state where the Participating Entity is located. Coordinate requests for such participation through NASPO ValuePoint. Any permission to participate through execution of a Participating Addendum is not a determination that procurement authority exists in the Participating Entity; they must ensure that they have the requisite procurement authority to execute a Participating Addendum.

Resale. “Resale” means any payment in exchange for transfer of tangible goods, software, or assignment of the right to services. Subject to any specific conditions included in the Master Agreement, or as explicitly permitted in a Participating Addendum, Purchasing Entities may not resell Products (the definition of which includes services that are deliverables). Absent any such condition or explicit permission, this limitation does not prohibit: payments by employees of a Purchasing Entity for Products; sales of Products to the general public as surplus property; and fees DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 301674

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associated with inventory transactions with other governmental or nonprofit entities and consistent with a Purchasing Entity’s laws and regulations. Any sale or transfer permitted by this subsection must be consistent with license rights granted for use of intellectual property.

Individual Customers.

Except to the extent modified by a Participating Addendum, each Purchasing Entity shall follow the terms and conditions of the Master Agreement and applicable Participating Addendum and will have the same rights and responsibilities for their purchases as the Lead State has in the Master Agreement, including but not limited to, any indemnity or right to recover any costs as such right is defined in the Master Agreement and applicable Participating Addendum for their purchases. Each Purchasing Entity will be responsible for its own charges, fees, and liabilities. The Contractor will apply the charges and invoice each Purchasing Entity individually.

Independent Contractor.

The Contractor is an independent contractor. Contractor shall have no authorization, express or implied, to bind the Lead State, Participating States, other Participating Entities, or Purchasing Entities to any agreements, settlements, liability or understanding whatsoever, and agrees not to hold itself out as an agent except as expressly set forth herein or as expressly agreed in any Participating Addendum.

Contracting Personnel.

Contractor must provide adequate contracting personnel to assist states with the completing and processing Participating Addenda. It is preferred that each Contractor be able to provide each Participating Entity with a primary contact person for that Participating Entity.

Changes in Contractor Representation.

The Contractor must notify the Lead State of changes in the Contractor’s key administrative personnel managing the Master Agreement in writing within 10 calendar days of the change. The Lead State reserves the right to approve changes in key personnel, as identified in the Contractor’s proposal. Such approval shall not be unreasonably withheld.

The Contractor agrees to propose replacement key personnel having substantially equal or better education, training, and experience as was possessed by the key person proposed and evaluated in the Contractor’s proposal.

Contractor Verification.

The Contractor is responsible for delivering products or performing services under the terms and conditions set forth in the Master Agreement. The Contractor must ensure partners utilized in the performance of this contract adhere to all the terms and conditions. The term Partner will be utilized in naming the relationship a Contractor has with another company to market and sell under the contract. Participating Entities will have final determination/approval if a Partner may be approved for that state in the role identified by the Contractor.

Contractor Performance Meeting.

An annual performance meeting may be held each year with the NASPO ValuePoint Sourcing Team. Historically performance meetings have been held in Minnesota, but the Lead State may hold the meetings in person or virtually at the Lead State’s discretion.

All contractors that are invited to participate must send their Primary Account Representative, unless an exception is granted in writing by the Lead State. It is possible that not all contractors will be invited to participate in a performance meeting.

Laws and Regulations.

Any and all Products offered and furnished shall comply fully with all applicable Federal, State, and local laws and regulations, including Minn. Stat. § 181.59 prohibiting discrimination and business registration requirements of the Office of the Minnesota Secretary of State. To the extent any purchase is subject to Federal Acquisition Regulations, as DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 302675

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may be required by the terms of a federal grant, a Participating Entity and Contractor may include in their Participating Addendum terms that reflect such a requirement.

Price and Rate Guarantee Period.

All minimum discounts and rates must be guaranteed for the initial term of the Master Agreement. Following the initial Master Agreement period, any request for minimum discount or rate adjustment must be for a guarantee period as offered by the Contractor, and must be made at least 30 days prior to the effective date. Requests for minimum discount or rate adjustment must include sufficient documentation supporting the request. Any adjustment or amendment to the Master Agreement shall not be effective unless approved by the Lead State. No retroactive adjustments to minimum discounts or rates will be allowed.

Premium Savings Package Program.

The Lead State reserves the right to create a Premium Savings Package Program (PSP) as outlined in the Definitions, Paragraph 2.ee of Exhibit A. Participation by Contractor is voluntary. The details and commitments of the PSP will be detailed as a part of any request for Contractor to participate.

Services.

Participating Entities must explicitly allow services in their Participating Addenda for the approved services to be allowed under that Participating Addendum. The Participating Addendum by each Participating Entity will address service agreement terms and related travel.

Ordering.

Master Agreement and purchase order numbers shall be clearly shown on all acknowledgments, packing slips, invoices, and on all correspondence.

Purchasing Entities may define entity or project-specific requirements and informally compete the requirement among companies having a Master Agreement on an “as needed” basis. This procedure may also be used when requirements are aggregated or other firm commitments may be made to achieve reductions in pricing. This procedure may be modified in Participating Addenda and adapted to the Purchasing Entity’s rules and policies. The Purchasing Entity may in its sole discretion determine which Master Agreement Contractors should be solicited for a quote. The Purchasing Entity may select the quote that it considers most advantageous, cost and other factors considered.

Each Purchasing Entity will identify and utilize its own appropriate purchasing procedure and documentation.

Contractor is expected to become familiar with the Purchasing Entities’ rules, policies, and procedures regarding the ordering of supplies or services contemplated by this Master Agreement.

Contractor shall not begin work without a valid Purchase Order or other appropriate commitment document under the law of the Purchasing Entity.

Orders may be placed consistent with the terms of this Master Agreement during the term of the Master Agreement.

All Orders pursuant to this Master Agreement, at a minimum, shall include:

The service description or supplies being delivered;
The place and requested time of delivery;
A billing address;
DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 303676

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The name, phone number, and address of the Purchasing Entity representative; The price per hour or other pricing elements consistent with this Master Agreement and the contractor’s proposal;
A ceiling amount of the order for services being ordered; The Master Agreement identifier; and
Statement of Work, when applicable.

All communications concerning administration of Orders placed shall be furnished solely to the authorized purchasing agent within the Purchasing Entity’s purchasing office, or to such other individual identified in writing in the Order.

Orders must be placed pursuant to this Master Agreement prior to the termination date thereof, but may have a delivery date or performance period up to 120 days past the then-current termination date of this Master Agreement. Contractor is reminded that financial obligations of Purchasing Entities payable after the current applicable fiscal year are contingent upon agency funds for that purpose being appropriated, budgeted, and otherwise made available.

Notwithstanding the expiration, cancellation or termination of this Master Agreement, Contractor agrees to perform in accordance with the terms of any Orders then outstanding at the time of such expiration or termination.

Contractor shall not honor any Orders placed after the expiration, cancellation or termination of this Master Agreement, or otherwise inconsistent with its terms. Orders from any separate indefinite quantity, task orders, or other form of indefinite delivery order arrangement priced against this Master Agreement may not be placed after the expiration or termination of this Master Agreement, notwithstanding the term of any such indefinite delivery order agreement.

Trade-In.

Any trade-in programs offered during the life of the Master Agreement must be approved by the Lead State.

Participating Entities must explicitly allow trade-in programs in their Participating Addenda for the approved programs to be allowed under that Participating Addendum. Trade-in value shall not decrease the discounts offered through the Master Agreement.

Shipping and Delivery.

The prices are the delivered price to any Purchasing Entity via standard shipping as follows:

For large or custom builds, shipping is 30-45 days after receipt of order (ARO) For in-stock products, shipping is 3-5 days ARO. If deployment services are required, shipping is 3-5 days after such services are rendered.

If an order is requested with expedited shipping, the Contractor must provide a firm “not to exceed” price for the expedited shipping on the quote. All deliveries shall be FOB Destination, freight pre-paid, with all transportation and handling charges paid by the Contractor. Responsibility and liability for loss or damage shall remain the Contractor’s until final inspection and acceptance when responsibility shall pass to the Purchasing Entity except as to latent defects, fraud and Contractor’s warranty obligations. Any order for less than the specified amount is to be shipped with the freight prepaid and added as a separate item on the invoice. Any DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 304677

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portion of an Order to be shipped without transportation charges that is back ordered shall be shipped without charge.

Specific delivery instructions, including FOB Inside Delivery, will be noted on the order form or Purchase Order.

Any damage to the building interior, scratched walls, damage to the freight elevator, etc., will be the responsibility of the Contractor. If damage does occur, it is the responsibility of the Contractor to promptly notify the Purchasing Entity placing the Order.

All products must be delivered in the manufacturer’s standard package. Costs shall include all packing and crating charges. Cases shall be of durable construction, good condition, properly labeled and suitable in every respect for storage and handling of contents. Each shipment shall be marked with the Purchasing Entity’s Purchase Order number and other information sufficient for the Purchasing Entity to properly identify the shipment as outlined in the Participating Addendum of the Purchasing Entity.

Inspection and Acceptance.

Where the Master Agreement, a Participating Addendum, or an Order does not otherwise specify a process for inspection and Acceptance, this section governs. This section is not intended to limit rights and remedies under the applicable commercial code.

Contractor shall provide right of access to the Lead State, or to any other authorized agent or official of the Lead State or other Participating or Purchasing Entity, at reasonable times, in order to monitor and evaluate performance, compliance, and quality assurance requirements under this Master Agreement. Upon delivery, the Purchasing Entity shall have 30 days to inspect. Products that do not meet specifications may be rejected. Failure to reject upon receipt, however, does not relieve the contractor of liability for material (nonconformity that substantially impairs value) latent or hidden defects subsequently revealed when goods are put to use. Acceptance of such goods may be revoked in accordance with the provisions of the applicable commercial code, and the Contractor is liable for any resulting expense incurred by the Purchasing Entity related to the preparation and shipping of Product rejected and returned, or for which Acceptance is revoked.

If any services do not conform to contract requirements, the Purchasing Entity may require the Contractor to perform the services again in conformity with contract requirements, at no increase in Order amount. When defects cannot be corrected by re-performance, the Purchasing Entity may require the Contractor to take necessary action to ensure that future performance conforms to contract requirements; and reduce the contract price to reflect the reduced value of services performed.

The warranty period shall begin upon Acceptance. The Purchasing Entity will make every effort to notify the Contractor, within thirty (30) calendar days following delivery, of non-acceptance of a Product or completion of Service. In the event that the Contractor has not been notified within 30 calendar days from delivery of Product or completion of Service, the Product and Services will be deemed accepted on the 31st day after delivery of Product or completion of Services. This clause shall not be applicable, if acceptance testing and corresponding terms have been mutually agreed to by both parties in writing.

Acceptance Testing may be explicitly set out in a Master Agreement to ensure conformance to an explicit standard of performance. Acceptance Testing means the process set forth in the Master Agreement for ascertaining that the Product meets the standard of performance prior to Acceptance by the Purchasing Entity. If Acceptance Testing is prescribed, this subsection applies to applicable Products purchased under this Master Agreement, including any additional, replacement, or substitute Product(s) and any Product(s) which are modified by or with the written approval of Contractor after Acceptance by the Purchasing Entity. The Acceptance Testing period shall be thirty (30) calendar days or other time period identified in this Master Agreement or the Participating Addendum, starting from the day after the Product is delivered or, if installed, the day after the Product is installed and DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 305678

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Contractor certifies that the Product is ready for Acceptance Testing. If the Product does not meet the standard of performance during the initial period of Acceptance Testing, Purchasing Entity may, at its discretion, continue Acceptance Testing on a day-to-day basis until the standard of performance is met. Upon rejection, the Contractor will have fifteen (15) calendar days to cure the standard of performance issue(s). If after the cure period, the Product still has not met the standard of performance, the Purchasing Entity may, at its option: (a) declare Contractor to be in breach and terminate the Order; (b) demand replacement Product from Contractor at no additional cost to Purchasing Entity; or, (c) continue the cure period for an additional time period agreed upon by the Purchasing Entity and the Contractor. Contractor shall pay all costs related to the preparation and shipping of Product returned pursuant to the section. No Product shall be deemed Accepted and no charges shall be paid until the standard of performance is met. The warranty period shall begin upon Acceptance.

Title of Product.

Upon Acceptance by the Purchasing Entity, Contractor shall convey to Purchasing Entity title to the Product free and clear of all liens, encumbrances, or other security interests. Transfer of title to the Product shall include a license to use any Embedded Software in the Product, as follows:

To the extent that the Software sold under the Master Agreement is Commercial Off-the-Shelf Software, such Software is licensed, not sold, to the Purchasing Entity. The Contractor and its licensors reserve and retain all rights not expressly granted to the Purchasing Entity. No right, title or interest to any trademark, service mark, logo or trade name of Contractor or its licensors is granted to the Purchasing Entity. Licenses to such Software is provided in accordance with the terms of the manufacturer’s written End User License Agreement tied to the product at the time of purchase unless otherwise negotiated between Purchasing Entity and the Contractor or the Licensor in a duly executed contract.

Contractor will perform services for the Purchasing Entity, subject to the following section pursuant to a fully executed Statement of Work entered into between the Purchasing Entity and the Contractor.

The Contractor grants the Purchasing Entity a perpetual, non-exclusive, royalty free the license in Contractor’s pre-existing intellectual property that is contained in the products, materials, equipment or services, excluding software, that are purchased through this Master Agreement.

Any and all licensing, maintenance, cloud services, or order specific agreements referenced within the terms and conditions of this Master Agreement are agreed to only to the extent that the terms do not conflict with the terms of the Participating Addendum or the terms of the Master Agreement as incorporated into the Participating Addendum, and to the extent the terms are not in conflict with the Participating Entities’ applicable laws. In the event of a conflict in the terms and conditions, the conflict shall be resolved as detailed in the Order of Precedence defined herein. Notwithstanding the foregoing, licensing, maintenance, cloud services agreements, or order specific agreements may be further negotiated by the Contractor or, if applicable, the Licensor, and the potential Purchasing Entity, provided the contractual documents are duly executed in writing.

Warranty.

The Contractor must ensure warranty service and maintenance for all equipment, including third party products provided. The Contractor must facilitate the Manufacturer or Publisher warranty and maintenance of third party products furnished through the Master Agreement. The Contractor shall provide the warranty service and maintenance for equipment and all peripherals on the Master Agreement.

System Failure or Damage.

In the event of system failure or damage caused by the Contractor or its Product, the Contractor shall use reasonable efforts to restore or assist in restoring the system to operational capacity. The Contractor shall be responsible under this provision to the extent a 'system' is defined at the time of the Order; otherwise the rights of the Purchasing Entity shall be governed by the Warranty.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 306679

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Payment.

Payment after Acceptance is normally made within 30 days following the date the entire order is delivered or the date a correct invoice is received, whichever is later. After 45 days the Contractor may assess overdue account charges up to a maximum rate of one percent per month on the outstanding balance, unless a different late payment amount is specified in a Participating Addendum, Order, or otherwise prescribed by applicable law.

Payments will be remitted by mail or electronically. Payments may be made via a State or political subdivision “Purchasing Card” with no additional charge.

Prices are exclusive of taxes, duties, and fees, unless otherwise quoted. If a withholding tax is required by law, the tax will be added and identified on the applicable invoice. All applicable taxes, duties, and fees must be identified on the quote.

Leasing or Alternative Financing Methods.

Lease purchase and term leases are allowable only for Purchasing Entities whose rules and regulations permit leasing of software. Individual Purchasing Entities may enter into a lease agreement for the products covered in this Master Agreement, if they have the legal authority to enter into these types of agreements without going through a competitive process and if the applicable PAs permit leasing. No lease agreements will be reviewed or evaluated as part of the RFP evaluation process.

Contract Provisions for Orders Utilizing Federal Funds.

Pursuant to Appendix II to 2 Code of Federal Regulations (CFR) Part 200, Contract Provisions for Non-Federal Entity Contracts Under Federal Awards, Orders funded with federal funds may have additional contractual requirements or certifications that must be satisfied at the time the Order is placed or upon delivery. These federal requirements may be proposed by Participating Entities in Participating Addenda and Purchasing Entities for incorporation in Orders placed under this Master Agreement.

Self Audit.

The Contractor must conduct at a minimum a quarterly self-audit, unless approved by the Lead State. The audit will sample a minimum of one tenth of one percent (.001) of orders with a maximum of 100 audits per quarter conducted.

For example: Up to 1,000 sales = 1 audit; 10,000 sales = 10 audits; Up to 100,000 sales = 100 audits. This will be a random sample of orders and invoices and must include documentation of pricing. Summary findings must be reported to Lead State with actions to correct documented findings.

Assignment/Subcontracts.

Contractor shall not assign, sell, transfer, subcontract or sublet rights, or delegate responsibilities under this Master Agreement, in whole or in part, without the prior written approval of the Lead State.

The Lead State, or Participating Entity, shall not assign, delegate or otherwise transfer all or any part of this Master Agreement without prior written consent from Contractor, except for assignment or delegation to a Participating Entity State agency or eligible Purchasing Entity. The Lead State reserves the right to assign any rights or duties, including written assignment of contract administration duties to NASPO ValuePoint and other third parties.

Insurance.

Contractor shall, during the term of this Master Agreement, maintain in full force and effect, the insurance described in this section. Contractor shall acquire such insurance from an insurance carrier or carriers licensed to conduct business in the Lead State and in each Participating Entity’s state and having a rating of A-, Class VII or better, in the most recently published edition of A.M. Best’s Insurance Reports. Failure to buy and maintain the DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 307680

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required insurance may result in this Master Agreement’s termination or, at a Participating Entity’s option, result in termination of its Participating Addendum.

Coverage shall be written on an occurrence basis. The minimum acceptable limits shall be as indicated below:

Commercial General Liability covering premises operations, independent contractors, products and completed operations, blanket contractual liability, personal injury (including death), advertising liability, and property damage, with a limit of not less than $1 million per occurrence/$2 million general aggregate; Contractor must comply with any applicable statutory State Workers Compensation or Employers Liability Insurance requirements.

Contractor shall pay premiums on all insurance policies. Should any of the described policies be cancelled before the expiration date thereof or not renewed, Contractor will provide to a Participating Entity notice within five (5) business days.

Prior to commencement of performance, Contractor shall provide to the Participating Entity a certificate of insurance showing the Contractor’s general liability insurance policy or other documentary evidence acceptable to the Lead State that (1) names the Participating Entity as an additional insured, (2) provides that written notice of cancellation shall be delivered in accordance with the policy provisions, and (3) provides that the Contractor’s Commercial General liability insurance policy shall be primary, with any liability insurance of any Participating Entity as secondary and noncontributory. Unless otherwise agreed in any Participating Addendum, other state Participating Entities’ rights and Contractor’s obligations are the same as those specified in the first sentence of this subsection except the endorsement is provided to the applicable state.

During the term of this Master Agreement, the Lead State and Participating Entities may request Contractor provide evidence of coverage that meets the requirements of this Section. Failure to provide evidence of coverage may, at the sole option of the Lead State, or any Participating Entity, result in this Master Agreement’s termination or the termination of any Participating Addendum.

Coverage and limits shall not limit Contractor’s liability and obligations under this Master Agreement, any Participating Addendum, or any Purchase Order.

Administrative Fees.

The Contractor shall pay to NASPO ValuePoint, or its assignee, a NASPO ValuePoint Administrative Fee of one- quarter of one percent (0.25% or 0.0025) no later than sixty (60) days following the end of each calendar quarter.

The NASPO ValuePoint Administrative Fee shall be submitted quarterly and is based on all sales of products and services under the Master Agreement (less any charges for taxes or shipping). The NASPO ValuePoint Administrative Fee is not negotiable.

The NASPO ValuePoint Administrative Fee in this section shall be based on the gross amount of all sales (less any charges for taxes or shipping) at the adjusted prices (if any) in Participating Addenda.

Additionally, some states may require an additional fee be paid directly to the state only on purchases made by Purchasing Entities within that state. For all such requests, the fee level, payment method and schedule for such reports and payments will be incorporated into the Participating Addendum that is made a part of the Master Agreement. The Purchasing Entity may allow the Contractor to adjust the Master Agreement pricing to account for these additional fees for purchases made by Purchasing Entities within the jurisdiction of the Participating Entity. All such agreements shall not affect the NASPO ValuePoint Administrative Fee percentage or the prices paid by the Purchasing Entities outside the jurisdiction of the state requesting the additional fee.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 308681

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NASPO ValuePoint Reports
Sales Data Reporting. In accordance with this section, Contractor shall report to NASPO ValuePoint all Orders under this Master Agreement for which Contractor has invoiced the ordering entity or individual, including Orders invoiced to Participating Entity or Purchasing Entity employees for personal use if such use is permitted by this Master Agreement and the applicable Participating Addendum (“Sales Data”). Timely and complete reporting of Sales Data is a material requirement of this Master Agreement. Reporting requirements, including those related to the format, contents, frequency, or delivery of reports, may be updated by NASPO ValuePoint with reasonable notice to Contractor and without amendment to this Master Agreement. NASPO ValuePoint shall have exclusive ownership of any media on which reports are submitted and shall have a perpetual, irrevocable, non-exclusive, royalty free, and transferable right to display, modify, copy, and otherwise use reports, data, and information provided under this section.

Summary Sales Data. “Summary Sales Data” is Sales Data reported as cumulative totals by state. Contractor shall, using the reporting tool or template provided by NASPO ValuePoint, report Summary Sales Data to NASPO ValuePoint for each calendar quarter no later than thirty (30) days following the end of the quarter. If Contractor has no reportable Sales Data for the quarter, Contractor shall submit a zero-sales report.

Detailed Sales Data. “Detailed Sales Data” is Sales Data that includes for each Order all information required by the Solicitation or by NASPO ValuePoint, including customer information, Order information, and line-item details.

Contractor shall, using the reporting tool or template provided by NASPO ValuePoint, report Detailed Sales Data to NASPO ValuePoint for each calendar quarter no later than thirty (30) days following the end of the quarter. Detailed Sales Data shall be reported in the format provided in the Solicitation or provided by NASPO ValuePoint. The total sales volume of reported Detailed Sales Data shall be consistent with the total sales volume of reported Summary Sales Data.

Sales Data Crosswalks. Upon request by NASPO ValuePoint, Contractor shall provide to NASPO ValuePoint tables of customer and Product information and specific attributes thereof for the purpose of standardizing and analyzing reported Sales Data (“Crosswalks”). Customer Crosswalks must include a list of existing and potential Purchasing Entities and identify for each the appropriate customer type as defined by NASPO ValuePoint. Product Crosswalks must include Contractor’s part number or SKU for each Product in Offeror’s catalog and identify for each the appropriate Master Agreement category (and subcategory, if applicable), manufacturer part number, product description, eight-digit UNSPSC Class Level commodity code, and (if applicable) EPEAT value and Energy Star rating.

Crosswalk requirements and fields may be updated by NASPO ValuePoint with reasonable notice to Contractor and without amendment to this Master Agreement. Contractor shall work in good faith with NASPO ValuePoint to keep Crosswalks updated as Contractor’s customer lists and product catalog change.

Executive Summary. Contractor shall, upon request by NASPO ValuePoint, provide NASPO ValuePoint with an executive summary that includes but is not limited to a list of states with an active Participating Addendum, states with which Contractor is in negotiations, and any Participating Addendum roll-out or implementation activities and issues. NASPO ValuePoint and Contractor will determine the format and content of the executive summary.

NASPO ValuePoint Cooperative Program Marketing, Training, and Performance Review.

Contractor agrees to work cooperatively with NASPO ValuePoint personnel. Contractor agrees to present plans to NASPO ValuePoint for the education of Contractor’s contract administrator(s) and sales/marketing workforce regarding the Master Agreement contract, including the competitive nature of NASPO ValuePoint procurements, the Master agreement and participating addendum process, and the manner in which qualifying entities can participate in the Master Agreement.

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Contractor agrees, as Participating Addendums become executed, if requested by ValuePoint personnel to provide plans to launch the program within the Participating Entity. Plans will include time frames to launch the agreement and confirmation that the Contractor’s website has been updated to properly reflect the contract offer as available in the Participating Entity.

Contractor agrees, absent anything to the contrary outlined in a Participating Addendum, to consider customer proposed terms and conditions, as deemed important to the customer, for possible inclusion into the customer agreement. Contractor will ensure that their sales force is aware of this contracting option.

Contractor agrees to participate in an annual contract performance review at a location selected by the Lead State and NASPO ValuePoint, which may include a discussion of marketing action plans, target strategies, marketing materials, as well as Contractor reporting and timeliness of payment of administration fees.

Contractor acknowledges that the NASPO ValuePoint logos may not be used by Contractor in sales and marketing until a logo use agreement is executed with NASPO ValuePoint.

The Lead State expects to evaluate the utilization of the Master Agreement at the annual performance review.

Lead State may, in its discretion, cancel the Master Agreement pursuant to Paragraph 42 of Exhibit A, or not exercise an option to renew, when Contractor utilization does not warrant further administration of the Master Agreement.

The Lead State may exercise its right to not renew the Master Agreement if contractor fails to record or report revenue for three consecutive quarters, upon 60-calendar day written notice to the Contractor. Cancellation based on nonuse or under-utilization will not occur sooner than two years after award of the Master Agreement. This subsection does not limit the discretionary right of either the Lead State or Contractor to cancel the Master Agreement pursuant to Section Paragraph 42 of Exhibit A or to terminate for default pursuant to Paragraph 44 of Exhibit A.

Contractor agrees to notify the Lead State and NASPO ValuePoint of any contractual most-favored-customer provisions in any Cooperative Purchasing Agreements that may affect the promotion of this Master Agreements or whose terms provide for adjustments to future rates or pricing based on rates, pricing in, or Orders from this master agreement. Upon request of the Lead State or NASPO ValuePoint, Contractor shall provide a copy of any such provisions. For the purposes of this paragraph, Cooperative Purchasing Agreement shall mean a cooperative purchasing program facilitating public procurement solicitations and agreements using a lead agency model. This does not include contracts with any federal agency or any federal contract.

Right to Publish.

Throughout the duration of this Master Agreement, Contractor must secure from the Lead State prior approval for the public release of information that pertains to the potential work or activities covered by the Master Agreement. This limitation does not preclude publication about the award of the Master Agreement or marketing activities consistent with any proposed and accepted marketing plan. The Contractor shall not make any representations of NASPO ValuePoint’s opinion or position as to the quality or effectiveness of the services that are the subject of this Master Agreement without prior written consent. Failure to adhere to this requirement may result in termination of the Master Agreement for cause.

Records Administration and Audit.

The Contractor shall maintain books, records, documents, and other evidence pertaining to this Master Agreement and Orders placed by Purchasing Entities under it to the extent and in such detail as shall adequately reflect performance and administration of payments and fees. Contractor shall permit the Lead State, a Participating Entity, a Purchasing Entity, the federal government (including its grant awarding entities and the U.S. Comptroller General), and any other duly authorized agent of a governmental agency, to audit, inspect, examine, copy and transcribe Contractor's books, documents, papers and records directly pertinent to this Master Agreement or orders DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 310683

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placed by a Purchasing Entity under it for the purpose of making audits, examinations, excerpts, and transcriptions.

This right shall survive for a period of six (6) years following termination of this Agreement or final payment for any order placed by a Purchasing Entity against this Agreement, whichever is later, or such longer period as is required by the Purchasing Entity’s state statutes, to assure compliance with the terms hereof or to evaluate performance hereunder.

Without limiting any other remedy available to any governmental entity, the Contractor shall reimburse the applicable Lead State, Participating Entity, or Purchasing Entity for any overpayments inconsistent with the terms of the Master Agreement or Orders or underpayment of fees found as a result of the examination of the Contractor’s records.

The rights and obligations herein exist in addition to any quality assurance obligation in the Master Agreement requiring the Contractor to self-audit contract obligations and that permits the Lead State to review compliance with those obligations.

Indemnification
General Indemnity. Contractor shall indemnify, defend (to the extent permitted by a state’s Attorney General), and hold harmless an Indemnified Party from any third-party claims or causes of action, including reasonable attorney’s fees, to the extent arising from Contractor’s intentional, willful, or grossly negligent acts or omissions; actions that give rise to strict liability; and actions arising from breach of contract or warranty. “Indemnified Party” means NASPO, NASPO ValuePoint, the Lead State, Participating Entities, and Purchasing Entities, along with their officers and employees.

The indemnification obligations of this section do not apply in the event the claim or cause of action is the result of the Indemnified Party’s sole negligence. This clause will not be construed to bar any legal remedies the Contractor may have for the Indemnified Party’s failure to fulfill its obligation under this Contract.

Intellectual Property Indemnification. Notwithstanding Paragraph 34.a of Exhibit A, the Contractor shall indemnify; defend, to the extent permitted by the Attorney General; and hold harmless the Purchasing Entity, at the Contractor’s expense, from any third-party action or claim brought against the Purchasing Entity to the extent that it is based on a claim that all or part of the works or documents infringe upon the intellectual property rights of others.

The Contractor will be responsible for payment of any and all such claims, demands, obligations, liabilities, costs, and damages, including but not limited to, reasonable attorney fees.

If such a claim or action arises, or in the Contractor’s or the Purchasing Entity’s opinion is likely to arise, the Contractor must, at the Purchasing Entity’s discretion, either procure for the Purchasing Entity the right or license to use the intellectual property rights at issue or replace or modify the allegedly infringing works or documents as necessary and appropriate to obviate the infringement claim. This remedy of the Purchasing Entity will be in addition to and not exclusive of other remedies provided by law.

Notwithstanding the foregoing, Contractor will not be liable under this section to the extent the infringement was caused by: 1) Contractor modification of the infringing material where such modification is made specifically for the Purchasing Entity, and where the Purchasing Entity has set forth the specific manner in which the modifications shall be made, as opposed to where the Purchasing Entity has requested modifications and given Contractor discretion over how to implement said modifications; 2) Purchasing Entity modification of the infringing material where such modification is not made under the direction of Contractor; 3) Use of the Deliverables or the System in a manner not contemplated by this Contract or as otherwise authorized by the Contractor in writing; 4) use of the Deliverables or the System in combination, operation, or use with other DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 311684

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products in a manner other than as contemplated by the Contract or otherwise authorized by the Contractor in writing.

Limitations of Liability
The Parties agree that neither Contractor nor the indemnified party shall be liable to each other, regardless of the form of action, for consequential, incidental, indirect, or special damages except any claim related to bodily injury or death an unauthorized release or breach of not public data as set forth more fully in Minn. Ch. 13; or a claim or demand based on patent, copyright, or other intellectual property infringement.

Contractor’s liability is limited to the greater of (i) the aggregate annual value amount of all fees paid to the Contractor by the Purchasing Entity under this Master Agreement; and (ii) $5,000,000. This limit on liability does not apply to claims for bodily injury or death or for intellectual property infringement.

Contractor’s obligations under this section shall not extend to any combination of the Product with any other product, system or method, unless the Product, system or method is provided by the Contractor or the Contractor’s subsidiaries or affiliates;
specified by the Contractor to work with the Product; or reasonably required, in order to use the Product in its intended manner, and the infringement could not have been avoided by substituting another reasonably available product, system or method capable of performing the same function; or
It would be reasonably expected to use the Product in combination with such product, system or method.

License of Pre-Existing Intellectual Property.

Contractor grants to the Purchasing Entity a nonexclusive, perpetual, royalty-free, irrevocable, license to use, publish, translate, transfer with any sale of tangible media or Product, perform, and display the Intellectual Property, and its derivatives, used or delivered under this Master Agreement, but not created under it (“Pre-existing Intellectual Property”). The Contractor shall be responsible for ensuring that this license is consistent with any third party rights in the Pre-existing Intellectual Property.

Assignment of Antitrust Rights.

Contractor irrevocably assigns to a Participating Entity who is a state any claim for relief or cause of action which the Contractor now has or which may accrue to the Contractor in the future by reason of any violation of state or federal antitrust laws (15 U.S.C. § 1-15 or a Participating Entity’s state antitrust provisions), as now in effect and as may be amended from time to time, in connection with any goods or services provided in that state for the purpose of carrying out the Contractor's obligations under this Master Agreement or Participating Addendum, including, at the Participating Entity's option, the right to control any such litigation on such claim for relief or cause of action.

Debarment.

The Contractor certifies that neither it nor its principals are presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participation in this transaction (contract) by any governmental department or agency. This certification represents a recurring certification made at the time any Order is placed under this Master Agreement. If the Contractor cannot certify this statement, attach a written explanation for review by the Lead State.

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Governing Law and Venue.

The construction and effect of the Master Agreement after award shall be governed by the law of the state serving as Lead State. The construction and effect of any Participating Addendum or Order against the Master Agreement shall be governed by and construed in accordance with the laws of the Participating Entity’s or Purchasing Entity’s State.

Venue for any claim, dispute or action concerning the terms of the Master Agreement shall be in the state serving as Lead State. Venue for any claim, dispute, or action concerning any Order placed against the Master Agreement or the effect of a Participating Addendum shall be in the Purchasing Entity’s State.

If a claim is brought in a federal forum, then it must be brought and adjudicated solely and exclusively within the United States District Court for (in decreasing order of priority): the Lead State for claims relating to contract performance or administration if the Lead State is a party; a Participating State if a named party; the state where the Participating Entity or Purchasing Entity is located if either is a named party.

Confidentiality, Non-Disclosure, and Injunctive Relief.

Confidentiality. Contractor acknowledges that it and its employees or agents may, in the course of providing a Product under this Master Agreement, be exposed to or acquire information that is confidential to Purchasing Entity or Purchasing Entity’s clients. Any and all information of any form that is marked as confidential or would by its nature be deemed confidential obtained by Contractor or its employees or agents in the performance of this Master Agreement, including, but not necessarily limited to (1) any Purchasing Entity’s records, (2) personnel records, and (3) information concerning individuals, is confidential information of Purchasing Entity (“Confidential Information”).

Any reports or other documents or items (including software) that result from the use of the Confidential Information by Contractor shall be treated in the same manner as the Confidential Information. Confidential Information does not include information that (1) is or becomes (other than by disclosure by Contractor) publicly known; (2) is furnished by Purchasing Entity to others without restrictions similar to those imposed by this Master Agreement; (3) is rightfully in Contractor’s possession without the obligation of nondisclosure prior to the time of its disclosure under this Master Agreement; (4) is obtained from a source other than Purchasing Entity without the obligation of confidentiality, (5) is disclosed with the written consent of Purchasing Entity or; (6) is independently developed by employees, agents or subcontractors of Contractor who can be shown to have had no access to the Confidential Information.

Non-Disclosure. Contractor shall hold Confidential Information in confidence, using at least the industry standard of confidentiality, and shall not copy, reproduce, sell, assign, license, market, transfer or otherwise dispose of, give, or disclose Confidential Information to third parties or use Confidential Information for any purposes whatsoever other than what is necessary to the performance of Orders placed under this Master Agreement.

Contractor shall advise each of its employees and agents of their obligations to keep Confidential Information confidential. Contractor shall use commercially reasonable efforts to assist Purchasing Entity in identifying and preventing any unauthorized use or disclosure of any Confidential Information. Without limiting the generality of the foregoing, Contractor shall advise Purchasing Entity, applicable Participating Entity, and the Lead State immediately if Contractor learns or has reason to believe that any person who has had access to Confidential Information has violated or intends to violate the terms of this Master Agreement, and Contractor shall at its expense cooperate with Purchasing Entity in seeking injunctive or other equitable relief in the name of Purchasing Entity or Contractor against any such person. Except as directed by Purchasing Entity, Contractor will not at any time during or after the term of this Master Agreement disclose, directly or indirectly, any Confidential Information to any person, except in accordance with this Master Agreement, and that upon termination of this Master Agreement or at Purchasing Entity’s request, Contractor shall turn over to Purchasing Entity all documents, papers, and other matter in Contractor's possession that embody Confidential Information. Notwithstanding the foregoing, Contractor may keep DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 313686

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one copy of such Confidential Information necessary for quality assurance, audits and evidence of the performance of this Master Agreement.

Injunctive Relief. Contractor acknowledges that breach of this section, including disclosure of any Confidential Information, will cause irreparable injury to Purchasing Entity that is inadequately compensable in damages.

Accordingly, Purchasing Entity may seek and obtain injunctive relief against the breach or threatened breach of the foregoing undertakings, in addition to any other legal remedies that may be available. Contractor acknowledges and agrees that the covenants contained herein are necessary for the protection of the legitimate business interests of Purchasing Entity and are reasonable in scope and content.

Purchasing Entity Law. These provisions shall be applicable only to extent they are not in conflict with the applicable public disclosure laws of any Purchasing Entity.

The rights granted Purchasing Entities and Contractor obligations under this section shall also extend to the cooperative’s Confidential Information, defined to include Participating Addenda, as well as Orders or transaction data relating to Orders under this Master Agreement that identify the entity/customer, Order dates, line item descriptions and volumes, and prices/rates. This provision does not apply to disclosure to the Lead State, a Participating State, or any governmental entity exercising an audit, inspection, or examination pursuant to Paragraph 33 of Exhibit A. To the extent permitted by law, Contractor shall notify the Lead State of the identity of any entity seeking access to the Confidential Information described in this subsection.

Public Information.

This Master Agreement and all related documents are subject to disclosure pursuant to the Lead State’s public information laws.

Cancellation.

Unless otherwise set forth in this Master Agreement, this Master Agreement may be canceled by either party upon 60 days written notice prior to the effective date of the cancellation. Further, any Participating Entity may cancel its participation upon 30 days written notice, unless otherwise stated in the Participating Addendum. Cancellation may be in whole or in part. Any cancellation under this provision shall not affect the rights and obligations attending orders outstanding at the time of cancellation, including any right of a Purchasing Entity to indemnification by the Contractor, rights of payment for Products delivered and accepted, rights attending any warranty or default in performance in association with any Order, and requirements for records administration and audit. Cancellation of the Master Agreement due to Contractor default may be immediate as set forth in Paragraph 44 of Exhibit A.

Force Majeure.

Neither party to this Master Agreement shall be held responsible for delay or default caused by fire, riot, unusually severe weather, other acts of God, restrictions on the movement of people or goods imposed by public health order or by a declared state of emergency, or war, which are beyond that party’s reasonable control. The Lead State may terminate this Master Agreement upon thirty (30) days’ notice to Contractor for an opportunity to remediate or minimize the impact of such event on Contractor’s performance, after determining such delay or default will reasonably prevent successful performance of the Master Agreement.

Defaults and Remedies.

The occurrence of any of the following events shall be an event of default under this Master Agreement:

Nonperformance of contractual requirements; or
A material breach of this Master Agreement; or
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Any certification, representation or warranty by Contractor in response to the RFP or in this Master Agreement that proves to be untrue or materially misleading; or Institution of proceedings under any bankruptcy, insolvency, court-ordered reorganization or similar law, by or against Contractor, or the appointment of a receiver or similar officer for Contractor or any of its property, which is not vacated or fully stayed within thirty (30) calendar days after the institution or occurrence thereof; or
Any default specified in another section of this Master Agreement.

Upon the occurrence of an event of default, except for material breach, the Lead State shall issue a written notice of default, identifying the nature of the default, and providing a period of 30 calendar days in which Contractor shall have an opportunity to cure the default. The Lead State shall not be required to provide advance written notice or a cure period and may immediately terminate this Master Agreement in whole or in part if the Lead State, in its sole discretion, determines that it is reasonably necessary to preserve public safety or prevent immediate public crisis. Time allowed for cure shall not diminish or eliminate Contractor’s liability for damages, including liquidated damages to the extent provided for under this Master Agreement. The Lead State may immediately terminate this Master Agreement upon material breach of the Master Agreement by Contractor.

If Contractor is afforded an opportunity to cure and fails to cure the default within the period specified in the written notice of default, Contractor shall be in breach of its obligations under this Master Agreement and the Lead State shall have the right to exercise any or all of the following remedies:

Exercise any remedy provided by law; and
Terminate this Master Agreement and any related contracts or portions thereof; and Impose liquidated damages as provided in this Master Agreement; and Suspend Contractor from being able to respond to future bid solicitations; and Suspend Contractor’s performance; and
Withhold payment until the default is remedied.

Unless otherwise specified in the Participating Addendum, in the event of a default under a Participating Addendum, a Participating Entity shall provide a written notice of default as described in this section and shall have all of the rights and remedies under this paragraph regarding its participation in the Master Agreement, in addition to those set forth in its Participating Addendum. Unless otherwise specified in a Purchase Order, a Purchasing Entity shall provide written notice of default as described in this section and have all of the rights and remedies under this paragraph and any applicable Participating Addendum with respect to an Order placed by the Purchasing Entity.

Nothing in these Master Agreement Terms and Conditions shall be construed to limit the rights and remedies available to a Purchasing Entity under the applicable commercial code.

Waiver of Breach.

Failure of the Lead State, Participating Entity, or Purchasing Entity to declare a default or enforce any rights and remedies shall not operate as a waiver under this Master Agreement or Participating Addendum. Any waiver by the Lead State, Participating Entity, or Purchasing Entity must be in writing. Waiver by the Lead State or Participating Entity of any default, right or remedy under this Master Agreement or Participating Addendum, or by Purchasing Entity with respect to any Purchase Order, or breach of any terms or requirements of this Master Agreement, a Participating Addendum, or Purchase Order shall not be construed or operate as a waiver of any subsequent default or breach of such term or DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 315688

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requirement, or of any other term or requirement under this Master Agreement, Participating Addendum, or Purchase Order.

Notices.

If one party is required to give notice to the other under the Master Agreement, such notice shall be in writing and shall be effective upon receipt. Delivery may be by certified United States mail or by hand, in which case a signed receipt shall be obtained. A facsimile or electronic transmission shall constitute sufficient notice, provided the receipt of the transmission is confirmed by the receiving party. Either party must notify the other of a change in address for notification purposes. All notices to the Lead State shall be addressed as follows:

Elizabeth Randa, Acquisition Management Specialist
112 Administration Bldg.
50 Sherburne Avenue
St. Paul, MN 55155
[email protected]

No Waiver of Sovereign Immunity.

In no event shall this Master Agreement, any Participating Addendum or any contract or any Purchase Order issued thereunder, or any act of the Lead State, a Participating Entity, or a Purchasing Entity be a waiver of any form of defense or immunity, whether sovereign immunity, governmental immunity, immunity based on the Eleventh Amendment to the Constitution of the United States or otherwise, from any claim or from the jurisdiction of any court.

This section applies to a claim brought against the Participating Entities who are states only to the extent Congress has appropriately abrogated the state’s sovereign immunity and is not consent by the state to be sued in federal court. This section is also not a waiver by the state of any form of immunity, including but not limited to sovereign immunity and immunity based on the Eleventh Amendment to the Constitution of the United States.

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Exhibit B: Minnesota Terms and Conditions
Change Requests.

The Lead State reserves the right to request, during the term of the Master Agreement, changes to the products offered within the Band(s). Products introduced during the term of the Master Agreement shall go through a formal review process. The process for updating the products offered within a Band is outlined in Paragraph 2 of Exhibit B. The Contractor shall evaluate and recommend products for which agencies have an expressed need. The Lead State shall require the Contractor to provide a summary of its research of those products being recommended for inclusion in the Master Agreement as well as defining how adding the product will enhance the Master Agreement. The Lead State may request that products, other than those recommended, are added to the Master Agreement.

In the event that the Lead State desires to add new products and services that are not included in the original Master Agreement, the Lead State requires that independent manufacturers and resellers cooperate with the already established Contractor in order to meet the Lead State’s requirements. Evidence of the need to add products or services should be demonstrated to the Lead State. The Master Agreement shall be modified via supplement or amendment. The Lead State will negotiate the inclusion of the products and services with the Contractor. No products or services will be added to the Master Agreement without the Lead State’s prior approval.

Product and Service Schedule (PSS).

Creating the Product and Service Schedule (PSS). Contractor will use the attached sample PSS to create and maintain a complete listing of all products and services offered under the Master Agreement. The PSS must conform to the contracted minimum discounts. Contractor may create and maintain a separate PSS for a Participating Entity based on the requirements and restrictions of the Participating Entity.

Contractors are encouraged to provide remote learning bundles for K-12 Education. These bundles can be included in the response to the PSS.

Maintaining the PSS.

In General. Throughout the term of the Master Agreement, on a quarterly basis, Contractor may update the PSS to make model changes, add new products or services, or remove obsolete or discontinued products or services. Any updates to the PSS must conform to the Master Agreement requirements, including the scope of the Master Agreement and contracted minimum discounts.

Process. Contractor must provide notification to the Lead State of any changes to their PSS using the attached Action Request Form (ARF).
a) The Lead State does not need to approve Contractor’s request to make model changes, add their own manufactured products, or remove discontinued or obsolete products or services, and Contractor does not need the Lead State’s approval prior to posting an updated PSS. b) The Lead State must approve Contractor’s request to add new third party manufacturers to Contractor’s PSS. If the proposed third-party manufacturer holds a NASPO Master Agreement for Computer Equipment, Contractor must obtain written authorization from that manufacturer. Contractor must have the Lead State’s approval prior to posting the updated PSS.
c) Contractor must maintain a historic record of all past PSSs on their dedicated NASPO ValuePoint website.

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d) Pursuant to the audit provisions of the Master Agreement, upon the request of NASPO ValuePoint, the Lead State, or a Participating Entity, Contractor must provide an historic version of any Baseline Price List.

Purchase Orders.

There will be no minimum order requirements or charges to process an individual purchase order. The Participating Addendum number and the PO number must appear on all documents (e.g., invoices, packing slips, etc.). The Ordering Entity’s purchase order constitutes a binding contract.

Risk of Loss or Damage.

The Purchasing Entity is relieved of all risks of loss or damage to the goods or equipment during periods of transportation, and installation by the Contractor and in the possession of the Contractor or their authorized agent.

Payment Card Industry Data Security Standard and Cardholder Information Security.

Contractor assures all of its Network Components, Applications, Servers, and Subcontractors (if any) comply with the Payment Card Industry Data Security Standard (“PCIDSS”). “Network Components” shall include, but are not limited to, Contractor’s firewalls, switches, routers, wireless access points, network appliances, and other security appliances; “Applications” shall include, but are not limited to, all purchased and custom external (web) applications. “Servers” shall include, but are not limited to, all of Contractor’s web, database, authentication, DNS, mail, proxy, and NTP servers. “Cardholder Data” shall mean any personally identifiable data associated with a cardholder, including, by way of example and without limitation, a cardholder’s account number, expiration date, name, address, social security number, or telephone number.

Subcontractors (if any) must be responsible for the security of all Cardholder Data in its possession; and will only use Cardholder Data for assisting cardholders in completing a transaction, providing fraud control services, or for other uses specifically required by law. Contractor must have a business continuity program which conforms to PCIDSS to protect Cardholder Data in the event of a major disruption in its operations or in the event of any other disaster or system failure which may occur to operations; will continue to safeguard Cardholder Data in the event this Agreement terminates or expires; and ensure that a representative or agent of the payment card industry and a representative or agent of the Purchasing Entity shall be provided with full cooperation and access to conduct a thorough security review of Contractor’s operations, systems, records, procedures, rules, and practices in the event of a security intrusion in order to validate compliance with PCIDSS.

Foreign Outsourcing of Work.

Upon request, the Contractor is required to provide information regarding the location of where services, data storage, and location of data processing under the Master Agreement will be performed.

State Audits (Minn. Stat. § 16C.05, subd. 5).

The books, records, documents, and accounting procedures and practices of the Contractor or other party, that are relevant to the Master Agreement or transaction are subject to examination by the contracting agency and either the Lead State’s Legislative Auditor or State Auditor as appropriate for a minimum of six years after the end of the Master Agreement or transaction. The Lead State reserves the right to authorize delegate(s) to audit this Master Agreement and transactions.

Certification of Nondiscrimination (in accordance with Minn. Stat. § 16C.053).

If the value of this Contract, including all extensions, is $50,000 or more, Contractor certifies it does not engage in and has no present plans to engage in discrimination against Israel, or against persons or entities doing business in Israel, when making decisions related to the operation of the contractor's business. For purposes of this section, "discrimination" includes but is not limited to engaging in refusals to deal, terminating business activities, or other actions that are intended to limit commercial relations with Israel, or persons or entities doing business in Israel, when such actions are taken in a manner that in any way discriminates on the basis of nationality or national origin and is not based on a valid business reason.

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Human Rights/Affirmative Action.

The Lead State requires affirmative action compliance by its Contractors in accordance with Minn. Stat. § 363A.36 and Minn. R. 5000.3400 to 5000.3600.

Covered Contracts and Contractors. If the Contract exceeds $100,000 and the Contractor employed more than 40 full-time employees on a single working day during the previous 12 months in Minnesota or in the state where it has its principal place of business, then the Contractor must comply with the requirements of Minn. Stat. § 363A.36 and Minn. R. 5000.3400-5000.3600.

Minn. R. 5000.3400-5000.3600 implement Minn. Stat. § 363A.36. These rules include, but are not limited to, criteria for contents, approval, and implementation of affirmative action plans; procedures for issuing certificates of compliance and criteria for determining a contractor’s compliance status; procedures for addressing deficiencies, sanctions, and notice and hearing; annual compliance reports; procedures for compliance review; and contract consequences for noncompliance. The specific criteria for approval or rejection of an affirmative action plan are contained in various provisions of Minn. R. 5000.3400 5000.3600 including, but not limited to, parts 5000.3420- 5000.3500 and parts 5000.3552 5000.3559.

Disabled Workers. Minn. R. 5000.3550 provides the Contractor must comply with the following affirmative action requirements for disabled workers.

AFFIRMATIVE ACTION FOR DISABLED WORKERS
(a) The Contractor must not discriminate against any employee or applicant for employment because of physical or mental disability in regard to any position for which the employee or applicant for employment is qualified. The Contractor agrees to take affirmative action to employ, advance in employment, and otherwise treat qualified disabled persons without discrimination based upon their physical or mental disability in all employment practices such as the following: employment, upgrading, demotion or transfer, recruitment, advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. (b) The Contractor agrees to comply with the rules and relevant orders of the Minnesota Department of Human Rights issued pursuant to the Minnesota Human Rights Act. (c) In the event of the Contractor’s noncompliance with the requirements of this clause, actions for noncompliance may be taken in accordance with Minn. Stat. § 363A.36 and the rules and relevant orders of the Minnesota Department of Human Rights issued pursuant to the Minnesota Human Rights Act.
(d) The Contractor agrees to post in conspicuous places, available to employees and applicants for employment, notices in a form to be prescribed by the commissioner of the Minnesota Department of Human Rights. Such notices must state the Contractor’s obligation under the law to take affirmative action to employ and advance in employment qualified disabled employees and applicants for employment, and the rights of applicants and employees. (e) The Contractor must notify each labor union or representative of workers with which it has a collective bargaining agreement or other contract understanding, that the Contractor is bound by the terms of Minn. Stat. § 363A.36 of the Minnesota Human Rights Act and is committed to take affirmative action to employ and advance in employment physically and mentally disabled persons.

Consequences. The consequences of a Contractor’s failure to implement its affirmative action plan or make a good faith effort to do so include, but are not limited to, suspension or revocation of a certificate of compliance by DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 319692

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the commissioner, refusal by the commissioner to approve subsequent plans, and termination of all or part of the Contract by the commissioner or the State.

Certification. The Contractor hereby certifies that it is in compliance with the requirements of Minn. Stat. § 363A.36, subd. 1 and Minn. R. 5000.3400-5000.3600 and is aware of the consequences for noncompliance. It is agreed between the parties that Minn. Stat. 363.36 and Minn. R. 5000.3400 to 5000.3600 are incorporated into any contract between these parties based upon this specification or any modification of it. A copy of Minn. Stat. § 363A.36 and Minn. R. 5000.3400 to 5000.3600 are available upon request from the contracting agency.

Equal Pay Certification.

If required by Minn. Stat. §363A.44, the Contractor must have a current Equal Pay Certificate prior to Contract execution. If Contractor's Equal Pay Certificate expires during the term of this Contract, Contractor must promptly re- apply for an Equal Pay Certificate with the Minnesota Department of Human Rights and notify the State's Authorized Representative once the Contractor has received the renewed Equal Pay Certificate. If Contractor claims to be exempt, the Lead State may require Contractor to verify its exempt status.

Americans with Disabilities Act (ADA).

Products provided under the Master Agreement must comply with the requirements of the Americans with Disabilities Act (ADA). The Contractor’s catalog and other marketing materials utilized to offer products under the Master Agreement must state when a product is not in compliance. If any descriptive marketing materials are silent as to these requirements, the Contractor agrees that the customer can assume the product meets or exceeds the ADA requirements.

Nonvisual Access Standards.

Pursuant to Minn. Stat. § 16C.145, the Contractor shall comply with the following nonvisual technology access standards:

That the effective interactive control and use of the technology, including the operating system applications programs, prompts, and format of the data presented, are readily achievable by nonvisual means; That the nonvisual access technology must be compatible with information technology used by other individuals with whom the blind or visually impaired individual must interact; That nonvisual access technology must be integrated into networks used to share communications among employees, program participants, and the public; and
That the nonvisual access technology must have the capability of providing equivalent access by nonvisual means to telecommunications or other interconnected network services used by persons who are not blind or visually impaired.

These standards do not require the installation of software or peripheral devices used for nonvisual access when the information technology is being used by individuals who are not blind or visually impaired.

Accessibility Standards.

Contractor acknowledges and is fully aware that the Lead State (Executive branch state agencies) has developed IT Accessibility Standard effective September 1, 2010. The standard entails, in part, the Web Content Accessibility Guidelines (WCAG) and Section 508 which can be viewed at: https://mn.gov/mnit/government/policies/accessibility/ .

The Standards apply to web sites, software applications, electronic reports and output documentation, training delivered in electronic formats (including, but not limited to, documents, videos, and webinars), among others. As upgrades are made to the software, products, or subscriptions available through this Contract, the Contractor agrees to DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 320693

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develop functionality which supports accessibility. If any issues arise due to nonconformance with the above-mentioned accessibility Standards, the Contractor agrees to provide alternative solutions upon request at no additional charge to the State.

When updates or upgrades are made to the products or services available through this Contract, the Contractor agrees to document how the changes will impact or improve the product’s or service’s accessibility and usability. This documentation, upon request, must be provided to the Lead State in advance of the change, occurring within an agreed upon timeframe sufficient for the state to review the changes and either approve them or request a remediation plan from the Contractor. Contractor warrants that its Products comply with the above-mentioned accessibility Standards and agrees to indemnify, defend, and hold harmless the Lead State against any claims related to non-compliance of Contractor’s Product with the above-mentioned accessibility Standards. If agreed-upon updates fail to improve the product or service’s accessibility or usability as planned, the failure to comply with this requirement may be cause for contract cancellation or for the Lead State to consider the Contractor in default.

Conflict Minerals.

Contractor agrees to provide information upon request regarding adherence to the Conflict Minerals section of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Section 1502).

See: http://beta.congress.gov/111/bills/hr4173/111hr4173enr.pdf#page=838 http://www.sec.gov/news/press/2012/2012-163.htm
Hazardous Substances.

To the extent that the goods to be supplied by the Contractor contain or may create hazardous substances, harmful physical agents or infectious agents as set forth in applicable state and federal laws and regulations, the Contractor must provide Material Safety Data Sheets regarding those substances. A copy must be included with each delivery.

Copyrighted Material Waiver.

The Lead State reserves the right to use, reproduce and publish proposals in any manner necessary for State agencies and local units of government to access the responses, including but not limited to photocopying, State Intranet/Internet postings, broadcast faxing, and direct mailing. In the event that the response contains copyrighted or trademarked materials, it is the responder’s responsibility to obtain permission for the Lead State to reproduce and publish the information, regardless of whether the responder is the manufacturer or reseller of the products listed in the materials. By signing its response, the responder certifies that it has obtained all necessary approvals for the reproduction and distribution of the contents of its response and agrees to indemnify, protect, save and hold the Lead State, its representatives and employees harmless from any and all third-party claims arising from the violation of this section and agrees to pay all legal fees incurred by the Lead State in the defense of any such action.

Publicity.

The Contractor shall make no representations of the State’s opinion or position as to the quality or effectiveness of the products or services that are the subject of the Master Agreement without the prior written consent of the State’s Assistant Director or designee of Office of State Procurement. Representations include any publicity, including but not limited to advertisements, notices, press releases, reports, signs, and similar public notices.

Performance While Dispute is Pending.

Notwithstanding the existence of a dispute, the parties shall continue without delay to carry out all of their responsibilities under the Master Agreement that are not affected by the dispute. If a party fails to continue without delay to perform its responsibilities under the Master Agreement, in the accomplishment of all undisputed work, any additional cost incurred by the other parties as a result of such failure to proceed shall be borne by the responsible party.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 321694

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Organizational Conflicts of Interest.

An organizational conflict of interest exists when, because of existing or planned activities or because of relationships with other persons:
the Contractor is unable or potentially unable to render impartial assistance or advice to the State; the Contractor’s objectivity in performing the work is or might be otherwise impaired; or the Contractor has an unfair competitive advantage.

The Contractor agrees that if an organizational conflict of interest is discovered after award, an immediate and full disclosure in writing shall be made to the Assistant Director of the Lead State’s Department of Administration’s Office of State Procurement that shall include a description of the action the Contractor has taken or proposes to take to avoid or mitigate such conflicts. If an organizational conflict of interest is determined to exist, the Lead State may, at its discretion, cancel the Master Agreement. In the event the Contractor was aware of an organizational conflict of interest prior to the award of the Master Agreement and did not disclose the conflict to the Master Agreement Administrator, the Lead State may terminate the Master Agreement for default. The provisions of this clause shall be included in all subcontracts for work to be performed, and the terms “Contract,” “Contractor,” “Master Agreement”, “Master Agreement Administrator” and “Contract Administrator” modified appropriately to preserve the State’s rights.

Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion Certification regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion – Lower Tier Covered Transactions. Instructions for certification:

By signing and submitting this proposal, the prospective lower tier participant [responder] is providing the certification set out below.

The certification in this clause is a material representation of fact upon which reliance was placed when this transaction was entered into. If it is later determined that the prospective lower tier participant knowingly rendered an erroneous certification, in addition to other remedies available to the federal government, the department or agency with which this transaction originated may pursue available remedies, including suspension and debarment.

The prospective lower tier participant shall provide immediate written notice to the person to whom this proposal [response] is submitted if at any time the prospective lower tier participant learns that its certification was erroneous when submitted or had become erroneous by reason of changed circumstances.

The terms covered transaction, debarred, suspended, ineligible lower tier covered transaction, participant, person, primary covered transaction, principal, proposal, and voluntarily excluded, as used in this clause, have the meaning set out in the Definitions and Coverages section of rules implementing Executive Order 12549. You may contact the person to which this proposal is submitted for assistance in obtaining a copy of those regulations.

The prospective lower tier participant agrees by submitting this response that, should the proposed covered transaction be entered into, it shall not knowingly enter into any lower tier covered transaction [subcontract equal to or exceeding $25,000] with a person who is proposed for debarment under 48 CFR part 9, subpart 9.4, debarred, suspended, declared ineligible, or voluntarily excluded from participation in this covered transaction, unless authorized by the department or agency with which this transaction originated.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 322695

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The prospective lower tier participant further agrees by submitting this proposal that it will include this clause titled, “Certification Regarding Debarment, Suspension, Ineligibility, and Voluntary Exclusion – Lower Tier Covered Transaction,” without modification, in all lower tier covered transactions and in all solicitations for lower tier covered transactions.

A participant in a covered transaction may rely upon a certification of a prospective participant in a lower tier covered transaction that it is not proposed for debarment under 48 CFR part 9, subpart 9.4, debarred, suspended, ineligible, or voluntarily excluded from covered transactions, unless it knows that the certification is erroneous. A participant may decide the method and frequency by which it determines the eligibility of its principals. Each participant may, but is not required to, check the list of parties excluded from federal procurement and nonprocurement programs.

Nothing contained in the foregoing shall be construed to require establishment of a system of records in order to render in good faith the certification required by this clause. The knowledge and information of a participant is not required to exceed that which is normally possessed by a prudent person in the ordinary course of business dealings.

Except for transactions authorized under paragraph 5 of these instructions, if a participant in a covered transaction knowingly enters into a lower tier covered transaction with a person who is proposed for debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, ineligible, or voluntarily excluded from participation in this transaction, in addition to other remedies available to the Federal government, the department or agency with which this transaction originated may pursue available remedies, including suspension and debarment.

Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion – Lower Tier Covered Transactions.

The prospective lower tier participant certifies, by submission of this proposal, that neither it nor its principals is presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participation in this transaction by any Federal department or agency.

Where the prospective lower tier participant is unable to certify to any of the statements in this certification, such prospective participant shall attach an explanation to this proposal.

Government Data Practices.

The Contractor and the Lead State must comply with the Minnesota Government Data Practices Act, Minn. Stat. Ch. 13, (and where applicable, if the Lead State contracting party is part of the judicial branch, with the Rules of Public Access to Records of the Judicial Branch promulgated by the Minnesota Supreme Court as the same may be amended from time to time) as it applies to all data provided by the Lead State to the Contractor and all data provided to the Lead State by the Contractor. In addition, the Minnesota Government Data Practices Act applies to all data created, collected, received, stored, used, maintained, or disseminated by the Contractor in accordance with the Master Agreement that is private, nonpublic, protected nonpublic, or confidential as defined by the Minnesota Government Data Practices Act, Ch. 13 (and where applicable, that is not accessible to the public under the Rules of Public Access to Records of the Judicial Branch).

In the event the Contractor receives a request to release the data referred to in this article, the Contractor must immediately notify the Lead State. The Lead State will give the Contractor instructions concerning the release of the data to the requesting party before the data is released. The civil remedies of Minn. Stat. § 13.08, apply to the release of the data by either the Contractor or the Lead State.

The Contractor agrees to indemnify, save, and hold the Lead State, its agent and employees, harmless from all claims arising out of, resulting from, or in any manner attributable to any violation of any provision of the Minnesota DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 323696

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Government Data Practices Act (and where applicable, the Rules of Public Access to Records of the Judicial Branch), including legal fees and disbursements paid or incurred to enforce this provision of the Master Agreement. In the event that the Contractor subcontracts any or all of the work to be performed under the Master Agreement, the Contractor shall retain responsibility under the terms of this article for such work.

Survivability.

Certain rights and duties of the Lead State and Contractor will survive the expiration or cancellation of the RFP and resulting Master Agreement. These rights and duties include but are not limited to paragraphs: Indemnification; Limitations of Liability; State Audits; Government Data Practices; Governing Law and Venue; Publicity; and Administrative Fees.

Severability.

If any provision of the Master Agreement, including items incorporated by reference, is found to be illegal, unenforceable, or void, then both the Lead State and the Contractor shall be relieved of all obligations arising under such provisions. If the remainder of the Master Agreement is capable of performance it shall not be affected by such declaration or finding and shall be fully performed.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 324697

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Exhibit C: Requirements
Contractor Verification.

Contractor must be a manufacturer of a Product in the Band(s) it is awarded a Master Agreement. “Re-branding” a product that is manufactured by another company does not meet this requirement. If the Contractor ceases production, sells or assigns their manufacturing to another vendor, or otherwise no longer manufactures a product during the life of the Master Agreement the Lead State reserves the right to terminate the Contractor’s Master Agreement.

Warranty and Maintenance.

Contractor must ensure warranty service and maintenance for all equipment, including third party products provided.

The Contractor must facilitate the Manufacturer or Publisher warranty and maintenance of third party products furnished through the Master Agreement. The Contractor shall provide the warranty service and maintenance for equipment and all peripherals on the Master Agreement.

Website.

Contractor must develop and maintain a URL to a web site specific to the awarded Master Agreement. Contractor’s Master Agreement website must offer twenty-four (24) hours per day, seven (7) days per week availability, except for regularly scheduled maintenance times. The website must be separate from the Contractor’s commercially available (i.e., public) on-line catalog and ordering systems. No other items or pricing may be shown on the website without written approval from the Lead State
Mandatory Specifications:
• Designated Baseline Price List(s) (e.g., MSRP, List, or Education) • Product and Service Schedule (PSS)
• Product specifications, pricing, and configuration aids for the major product categories proposed that can be used to obtain an on-line quote,
• Service options and service agreements available on the contract. Please refer to Paragraph 5. • Contact information for order placement, service concerns (warranty and maintenance), problem reporting, and billing concerns
• Sales representatives for participating entities
• Links to environmental certification, including but not limited to take-back/recycling programs, EPEAT, Energy Star, etc.

Desirable Specifications:
• Purchase order tracking
• Information on accessibility and accessible products
• Signed Master Agreement
• Online ordering capability with the ability to remember multiple ship to locations (if applicable to product) • List of approved partners, if applicable
Within 30 calendar days of the notice of intent to award a Master Agreement, Contractor must provide a sample URL of the Master Agreement webpage to the Lead State for review and approval. The Lead State will review and determine acceptability of the website format and data. If the information is determined to be unacceptable or incorrect, the Contractor will have 15 calendar days to provide revisions to the Lead State. After the Lead State approves the website, Contractor may not make material changes to the website without notifying the Lead State through the ARF process and receiving written approval of the changes.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 325698

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Environmental Certifications.

Contractor must include environmental or supply chain responsibility certifications and registrations for products sold through this Contract on their website. Contractor must provide these certifications and registrations for specific products to Participating Entities upon request.

EPEAT Registration.

Contractor agrees that applicable products offered that have EPEAT Standards provided under the Master Agreement must have achieved a minimum EPEAT Bronze registration. This requirement does not apply to Band 3.

Contractor may propose the addition of a product that has not yet achieved a minimum EPEAT Bronze registration. The Lead State, in its sole discretion may require Contractor to provide the following documentation to support the addition of the proposed product:
• A letter from the Green Electronics Council (GEC) on GEC’s letterhead confirming that the verification process is underway; or
• A copy of Contractor’s GEC contract, Conformity Assurance Board (CAB) contract, and a letter from Contractor’s CAB stating that the relevant product has been registered with the CAB and that verification is underway.

The Lead State reserves the right to reject the inclusion of such product, or if approved, require Contractor to remove the product at a later date if the product does not achieve a minimum EPEAT Bronze registration. The Contractor must remove any products that subsequently exit the verification process without achieving EPEAT Bronze or greater from the Master Agreement.

Third-Party Products.

Some products offered may be manufactured by a third party. Contractor, however, must provide or facilitate the warranty service and maintenance for all Third-Party Products on the Master Agreement either directly or pass-through from the manufacturer. Contractor may not offer products manufactured by another Contractor holding a Minnesota NASPO ValuePoint Master Agreement for Computer Equipment without approval from the Lead State. Warranty for third-party products must be provided by the Contractor. Warranty documents for products manufactured by a third party are preferred to be delivered to the Participating Entity with the products. Contractor can only offer Third-Party Products in a Band they have been awarded.

Third-Party Products are intended to enhance or supplement a Contractor’s own product line, and are not intended to represent more than a third of Contractor’s total sales under this Master Agreement. The Lead State may limit the sale of Third-Party Products through the Master Agreement during the life of the Master Agreement should Third-Party Product sales be determined to consistently exceed one third of the total sales under this Master Agreement. Such limitation may take the form of any action the Lead State so chooses, up to and including non-renewal or cancellation of the Master Agreement.

Partner Utilization.

If utilizing partners, the Contractor is responsible for the partners providing products and services, as well as warranty service and maintenance for equipment the partner provides. Participating Entities have the option of utilizing partners.

Contractor must provide a Participating Entity a copy of its plan for partner utilization upon request. Contractor must make available a list of approved partners for each Participating Entity. Participating Entities must approve specific Partners as outlined within the relevant Participating Addendum, and only partners approved by the Participating Entity may be deployed. The Participating Entity will define the process to add and remove partners in their Participating Addendum.
2019 National Defense Authorization Act, Section 889(f)(3).

Under the 2019 National Defense Authorization Act, Section 889(f)(3), the US military is prohibited from purchasing video surveillance and telecommunications equipment from certain Chinese-owned technology firms. While US state are DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 326699

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not subject to this act, there is increasing concern for the security of state data. Contractor certifies for the term of this Master Agreement that it is not subject to laws, rules, or policies potentially requiring disclosure of, or provision of access to, customer data to foreign governments or entities controlled by foreign governments, and that Contractor's Products do not contain, include, or utilize components or services supplied by any entity subject to the same.

Contractor also certifies that its Products do not contain, include, or utilize any covered technology prohibited under Section 889 of the National Defense Authorization Act, as amended.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 327700

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Exhibit D: Pricing Schedule
Attached and incorporated into this Master Agreement as Exhibit D is the Price Schedule.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 328701
Exhibit D: Price Schedule
NASPO ValuePoint Computer Equipment (2023-2028)

CONTROL SET
Master Agreement: 23019
Contractor Name: Panasonic Connect North America, Division of Panasonic Corporation of North America Awarded Bands:

X Band 1: Personal Computing Devices (Windows)
X Band 2: Personal Computing Devices (Non-Windows)
Band 3: Servers and Storage
Band Category Code Category Description Discount off
Baseline List
1 1B Band 1 - Minimum Discount 0.0%
1 1B-1 Fully Rugged TOUGHBOOK Computer 16.0%
1 1B-2 Semi-Rugged TOUGHBOOK Computer 13.0%
1 1B-3 TOUGHBOOK Tablet 12.0%
1 1B-4 TOUGHBOOK Handheld 9.0%
1 1B-5 Accessory 11.0%
1 1B-6 Peripheral: Professional Video 5.0%
1 1B-7 Peripheral: Professional Audio 10.0%
1 1B-8 Peripheral: Display 22.0%
1 1B-9 Peripheral: Display Accessory 10.0%
1 1B-10 Peripheral: Projector (Large Venue, Installation) 48.0% 1 1B-11 Peripheral: Projector (Portable, Short Throw, Space Player) 38.0% 1 1T Band 1 - Third Party Product Minimum Discount 2.0% 1 1T-1 Absolute Software/Licenses 0.0%
1 1T-2 Agora Peripherals and Related Accessories 11.0%
1 1T-3 Airgain Peripherals and Related Accessories 11.0% 1 1T-4 Brother Peripherals and Related Accessories 11.0% 1 1T-5 CradlePoint Peripherals and Related Accessories 11.0% 1 1T-6 Crossmatch Software/Licenses 0.0%
1 1T-7 Gamber-Johnson Peripherals and Related Accessories 11.0% 1 1T-8 Havis Peripherals and Related Accessories 11.0%
1 1T-9 Ikey Peripherals and Related Accessories 11.0%
1 1T-10 Lind Peripherals and Related Accessories 11.0%
1 1T-11 Nuance Peripherals/Accessories 11.0%
1 1T-12 Nuance Software/Licenses 0.0%
1 1T-13 Panasonic i-Pro Sensing Solution Peripherals and Related Accessori 11.0% 2 2B Band 2 - Minimum Discount 0.0%
2 2B-1 TOUGHBOOK Tablet 12.0%
2 2B-2 TOUGHBOOK Handheld 9.0%
2 2B-3 Accessory 11.0%
2 2B-4 Peripheral: Professional Video 5.0%
2 2B-5 Peripheral: Professional Audio 10.0%
2 2B-6 Peripheral: Display 22.0%
DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 329702
Exhibit D: Price Schedule
Band Category Code Category Description Discount off
Baseline List
2 2B-7 Peripheral: Display Accessory 10.0%
2 2B-8 Peripheral: Projector (Large Venue, Installation) 48.0% 2 2B-9 Peripheral: Projector (Portable, Short Throw, Space Player) 38.0% 2 2T Band 2 - Third Party Product Minimum Discount 2.0% 2 2T-1 Absolute Software/Licenses 0.0%
2 2T-2 Agora Peripherals and Related Accessories 11.0%
2 2T-3 Airgain Peripherals and Related Accessories 11.0% 2 2T-4 Brother Peripherals and Related Accessories 11.0% 2 2T-5 CradlePoint Peripherals and Related Accessories 11.0% 2 2T-6 Crossmatch Software/Licenses 0.0%
2 2T-7 Gamber-Johnson Peripherals and Related Accessories 11.0% 2 2T-8 Havis Peripherals and Related Accessories 11.0%
2 2T-9 Ikey Peripherals and Related Accessories 11.0%
2 2T-10 Lind Peripherals and Related Accessories 11.0%
2 2T-11 Nuance Peripherals/Accessories 11.0%
2 2T-12 Nuance Software/Licenses 0.0%
2 2T-13 Panasonic i-Pro Sensing Solution Peripherals and Related Accessori 11.0% S Installation 0.0%
S Extended Warranty 0.0%
S Training 0.0%
S Complimentary software 0.0%
DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 330703
Exhibit D: Price Schedule Discount Structure
Master Agreement: 23019
Contractor Name: Panasonic Connect North America, Division of Panasonic Corporation of North America Baseline Price List: Posted on Contractor's dedicated NASPO ValuePoint website Band 1: Personal Computer Equipment (Windows OS)
Band Category Code Category Description Discount off
Baseline List
1 1B Band 1 - Minimum Discount 0.0%
1 1B-1 Fully Rugged TOUGHBOOK Computer 16.0%
1 1B-2 Semi-Rugged TOUGHBOOK Computer 13.0%
1 1B-3 TOUGHBOOK Tablet 12.0%
1 1B-4 TOUGHBOOK Handheld 9.0%
1 1B-5 Accessory 11.0%
1 1B-6 Peripheral: Professional Video 5.0%
1 1B-7 Peripheral: Professional Audio 10.0%
1 1B-8 Peripheral: Display 22.0%
1 1B-9 Peripheral: Display Accessory 10.0%
1 1B-10 Peripheral: Projector (Large Venue, Installation) 48.0% 1 1B-11 Peripheral: Projector (Portable, Short Throw, Space Player) 38.0% 1 1T Band 1 - Third Party Product Minimum Discount 2.0% 1 1T-1 Absolute Software/Licenses 0.0%
1 1T-2 Agora Peripherals and Related Accessories 11.0%
1 1T-3 Airgain Peripherals and Related Accessories 11.0% 1 1T-4 Brother Peripherals and Related Accessories 11.0% 1 1T-5 CradlePoint Peripherals and Related Accessories 11.0% 1 1T-6 Crossmatch Software/Licenses 0.0%
1 1T-7 Gamber-Johnson Peripherals and Related Accessories 11.0% 1 1T-8 Havis Peripherals and Related Accessories 11.0%
1 1T-9 Ikey Peripherals and Related Accessories 11.0%
1 1T-10 Lind Peripherals and Related Accessories 11.0%
1 1T-11 Nuance Peripherals/Accessories 11.0%
1 1T-12 Nuance Software/Licenses 0.0%
1 1T-13 Panasonic i-Pro Sensing Solution Peripherals and Related Accessorie 11.0% Band 2: Personal Computer Equipment (Non-Windows OS)
Band Category Code Category Description Discount off
Baseline List
2 2B Band 2 - Minimum Discount 0.0%
2 2B-1 TOUGHBOOK Tablet 12.0%
2 2B-2 TOUGHBOOK Handheld 9.0%
2 2B-3 Accessory 11.0%
2 2B-4 Peripheral: Professional Video 5.0%
2 2B-5 Peripheral: Professional Audio 10.0%
2 2B-6 Peripheral: Display 22.0%
2 2B-7 Peripheral: Display Accessory 10.0%
2 2B-8 Peripheral: Projector (Large Venue, Installation) 48.0% 2 2B-9 Peripheral: Projector (Portable, Short Throw, Space Player) 38.0% 2 2T Band 2 - Third Party Product Minimum Discount 2.0% DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 331704
Exhibit D: Price Schedule Discount Structure
Band 2: Personal Computer Equipment (Non-Windows OS)
Band Category Code Category Description Discount off
Baseline List
2 2T-1 Absolute Software/Licenses 0.0%
2 2T-2 Agora Peripherals and Related Accessories 11.0%
2 2T-3 Airgain Peripherals and Related Accessories 11.0% 2 2T-4 Brother Peripherals and Related Accessories 11.0% 2 2T-5 CradlePoint Peripherals and Related Accessories 11.0% 2 2T-6 Crossmatch Software/Licenses 0.0%
2 2T-7 Gamber-Johnson Peripherals and Related Accessories 11.0% 2 2T-8 Havis Peripherals and Related Accessories 11.0%
2 2T-9 Ikey Peripherals and Related Accessories 11.0%
2 2T-10 Lind Peripherals and Related Accessories 11.0%
2 2T-11 Nuance Peripherals/Accessories 11.0%
2 2T-12 Nuance Software/Licenses 0.0%
2 2T-13 Panasonic i-Pro Sensing Solution Peripherals and Related Accessorie 11.0% DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 332705
Exhibit D: Price Schedule Volume-Based Discounts
Master Agreement: 23019
Contractor Name:

All Awarded Bands

1. Per Transaction Multiple Unit Discount(s)

2. Cumulative Discount(s)

3. Other Discount(s)
Additional discount(s) available.

Panasonic Connect North America, Division of Panasonic Corporation of North America Panasonic offers promotional pricing in which deeper discounts—an additional percentage off contract pricing—are available on specified products based on inventory and sales. Such promotional pricing is offered for a defined period (e.g., quarterly, defined as approximately 3 months).

Panasonic also provides piggyback pricing to local entities within States that have signed a NASPO Participating Addendum.

Contractor provides a contractual volume discount program as follows based on dollars in a single purchase order or combination of purchase orders submitted at one time by a Purchasing Entity, or multiple entities conducting a cooperative purchase.

Contractor provides a cumulative volume discount as follows based on dollars resulting from the cumulative purchases by all purchases made by Purchasing Entities for the duration of the Master Agreement.

Panasonic's volume discount applies to fully ruggedized TOUGHBOOK computers and tablets. It is calculated not on purchase price but on the quantity of the same model of TOUGHBOOK equipment purchased by each specific end-user customer per transaction.

An end-user customer purchasing 50 to 99 units of the same TOUGHBOOK model will receive a 2-percent discount off contract pricing.

An end-user customer purchasing 100 units or more will receive a 4-percent discount off contract pricing.

Cumulative discounts are not available at this time; however, in the instance that a State defines standardization of a Panasonic equipment model for use across the State, and multiple State entities or local entities within the State subsequently purchase the equipment model per State standardization, Panasonic may work with the State to provide additional discounts to the end-user purchasers.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 333706
Exhibit D: Price Schedule Services
Master Agreement: 23019
Contractor Name: Panasonic Connect North America, Division of Panasonic Corporation of North America Travel for Services will be negotiated with each Participating Entity in the Participating Addendum.

All Awarded Bands
Category Code Description of Service Percent Discount
S Installation 0.0%
S Extended Warranty 0.0%
S Training 0.0%
S Complimentary software 0.0%
Each Purchasing Entity will determine if and how services will be offered in the Participating Addendum.

DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 334707
Exhibit D: Price Schedule Lease Rates
Master Agreement: 23019
Contractor Name: Panasonic Connect North America, Division of Panasonic Corporation of North America All Awarded Bands
Optional: Lease Rates
0% Financing
Short-term rental available
DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 335708
Exhibit D: Price Schedule Prompt Payment Discount
Master Agreement: 23019
Contractor Name: Panasonic Connect North America, Division of Panasonic Corporation of North America in 30
in 15, Net 30
in 10, Net 30
XN e t 30
X Other (specify): Pansonic sales are indirect, executed through its authorized reseller partners; therefore, prompt payment discounts do not apply to Panasonic. However, reseller partners may individually provide this discount to the end‐user customer.

All Awarded Bands
DocuSign Envelope ID: F95706BF-7282-4AB8-B0D8-6298E823225C 336709
337
338
339
340
341
342
343
344
345
346
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Participating Addendum:

Title:

Contractor Name:

Revision Date:

Authorized Reseller Name Ordering Address Ordering Email Customer Service Phone
Sales Contact
(if applicable)
California
Certification #
(SB/DVBE)
Contract ID (For Fi$Cal
purposes only)
CDCE, Inc. 22641 Old Canal Road
Yorba Linda CA 92887 [email protected] (800) 373-5353 Lori Lundin N/A 7-23-70-55-10.01 CDW Government LLC 200 N Milwaukee Avenue
Vernon Hills, IL 60061 [email protected] (847) 419-7416 Luke Anderson N/A 7-23-70-55-10.02 Code 3 Technology LLC 9855 E Southern Avenue, #50882
Mesa, AZ 85209
[email protected]
[email protected] (480) 888-6401 Clay Jeppsen N/A 7-23-70-55-10.03 Department of General Services - Procurement Division

APPROVED AUTHORIZED RESELLERS
7-23-70-55-10
Computer Equipment, Peripherals & Related Services (2023-2028) Panasonic Corporation of North America
10/29/2024
Refer to the Cooperative Agreement User Instructions posted at the link above for additional information and usage rules.

The following table identfies State-approved Authorized Resellers for the Participating Addendum referenced above.

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Agenda Item
City Council
Item #: 3.10. 3/11/2025 File #: 25-0114
TO: Honorable Mayor and Members of the City Council
THRU: Tom Kisela, City Manager
FROM: Trang Nguyen, Finance Director

1. SUBJECT
Annual Comprehensive Financial Report and Related Financial Reports for the Fiscal Year ended June 30, 2024.

2. SUMMARY
Financial Reports and Statements provided by Lance, Soll, Lunghard, LLP, independent auditors, as a result of the annual financial audit for the fiscal year ended June 30, 2024.

3. RECOMMENDED ACTION
Receive and file the following documents for the fiscal year ended June 30, 2024:

1. Annual Comprehensive Financial Report

2. Audit Communication Letter

3. Independent Accountants’ Report on Agreed-Upon Procedures Applied to the Appropriations Limit Worksheets

4. Independent Accountants’ Report on Agreed-Upon Procedures Applied to the Investment Portfolio

5. Air Pollution Reduction Fund Financial Statements and Independent Auditors’ Report

6. Independent Auditors’ Report on Internal Control Over Financial Reporting

7. Housing Successor Fund Financial Statements

4. FISCAL IMPACT
None.

5. STRATEGIC PLAN GOALS
Goal 2: Enhance Economic Development and Achieve Fiscal Sustainability Objective 2.9: Create a fiscal sustainability plan

6. DISCUSSION AND BACKGROUND
Lance, Soll, and Lunghard, LLP (LSL), an independent certified public accounting firm, provided audit services to the City for the fiscal year ended June 30, 2024. The audited financial statements follow the requirements of Generally Accepted Accounting Principles (GAAP) as set forth by the Governmental Accounting Standards Board (GASB).

The City’s audit was performed in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in the Government Auditing Standards, issued by the Comptroller General of the United States. Such audits City of Orange Printed on 3/5/2025Page 1 of 3
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Government Auditing Standards, issued by the Comptroller General of the United States. Such audits utilize sampling of data, inquiries of staff and management, testing of procedures and transactions, confirmation with outside parties, and checking of internal files and documents. The audit resulted in an unmodified or “clean”audit opinion. This provides assurance that the City’sfinancial transactions are presented fairly, in all material respects, and can be relied upon not only for proper reporting of past financial results in the City’sFiscal Year (FY) 2023-24 Annual Comprehensive Financial Report (ACFR), but also on a go-forward basis as we craft the FY 2025-26 Budget. This is important given the results reflected in the ACFR include fixed assets, non-spendable assets such as inventory, and restricted fund balances such as catastrophic reserve that are not readily available to City for appropriation in operating costs, debt services, and capital infrastructure improvements.

The following Reports, Letter, and Statements are presented for fiscal year ended June 30, 2023:

1. Annual Comprehensive Financial Report (ACFR) - This report is divided into three major sections: the Introductory Section, the Financial Section, and the Statistical Section. The Introductory Section includes a Letter of Transmittal. The Financial Section comprises the Audit Opinion, Management’s Discussion and Analysis, and the Basic Financial Statements. The Statistical Section provides important historical and trend information about the City. The Audit opinion is an “unmodified opinion”, which states that, in the auditor’sopinion, the basic financial statements of the City are presented fairly in all material respects and are in conformity with generally accepted accounting principles (GAAP).

2. Audit Communication Letter - a report on recommendations made to management by the auditors to improve internal controls and/or operating efficiencies within the City.

3. Independent Accountants’ Report on Agreed-Upon Procedures Applied to the Appropriations Limit Worksheets - procedures performed solely to assist the City in meeting the requirements of Section 1.5 of the Article XIIIB of the California Constitution.

4. Independent Accountants’ Report on Agreed-Upon Procedures Applied to the Investment Portfolio - independent review of investment operations and compliance with the City’s investment policy.

5. Air Pollution Reduction Fund Financial Statements and Independent Auditors’Report - audited financial statements in accordance with Generally Accepted Auditing Standards and the standards applicable to the financial audits contained in Government Auditing Standards.

6. Independent Auditors’Report on Internal Control Over Financial Reporting - a report to describe the scope of testing of the City’sinternal control over financial reporting and the results of that testing.

7. Housing Successor Fund Financial Statements- audited financial statements in accordance with Generally Accepted Auditing Standards and the standards applicable to the financial audits contained in Government Auditing Standards.

A single audit, a compliance audit of federally assisted grant programs, is required if federal grant expenditure exceeds $750,000. While the City’sfederal grant expenditures met this requirement, the final report is still pending from the auditors. Therefore, the single audit report for the fiscal year ended June 30, 2024, is not included with this staff report. There are no audit findings noted at this City of Orange Printed on 3/5/2025Page 2 of 3
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350
Item #: 3.10. 3/11/2025 File #: 25-0114
time and staff will return to the City Council with the final single audit report at a future meeting.

7. ATTACHMENTS
· City of Orange Annual Comprehensive Financial Report and Summary of Audit Results · Audit Communication Letter
· Independent Accountants’ Report on Agreed-Upon Procedures Applied to the Appropriations Limit Worksheets
· Independent Accountants’ Report on Agreed-Upon Procedures Applied to Investment Portfolio
· Air Pollution Reduction Fund Financial Statements and Independent Auditors’ Report · Independent Auditors’ Report on Internal Control Over Financial Reporting · Housing Successor Fund Financial Statements
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Agenda Item
City Council
Item #: 3.10. 3/11/2025 File #: 25-0114
TO: Honorable Mayor and Members of the City Council
THRU: Tom Kisela, City Manager
FROM: Trang Nguyen, Finance Director

1. SUBJECT
Annual Comprehensive Financial Report and Related Financial Reports for the Fiscal Year ended June 30, 2024.

2. SUMMARY
Financial Reports and Statements provided by Lance, Soll, Lunghard, LLP, independent auditors, as a result of the annual financial audit for the fiscal year ended June 30, 2024.

3. RECOMMENDED ACTION
Receive and file the following documents for the fiscal year ended June 30, 2024:

1. Annual Comprehensive Financial Report

2. Audit Communication Letter

3. Independent Accountants’ Report on Agreed-Upon Procedures Applied to the Appropriations Limit Worksheets

4. Independent Accountants’ Report on Agreed-Upon Procedures Applied to the Investment Portfolio

5. Air Pollution Reduction Fund Financial Statements and Independent Auditors’ Report

6. Independent Auditors’ Report on Internal Control Over Financial Reporting

7. Housing Successor Fund Financial Statements

4. FISCAL IMPACT
None.

5. STRATEGIC PLAN GOALS
Goal 2: Enhance Economic Development and Achieve Fiscal Sustainability Objective 2.9: Create a fiscal sustainability plan

The City’s audit was performed in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in the Government Auditing Standards, issued by the Comptroller General of the United States. Such audits City of Orange Printed on 3/5/2025Page 1 of 3
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352
Item #: 3.10. 3/11/2025 File #: 25-0114
Government Auditing Standards, issued by the Comptroller General of the United States. Such audits utilize sampling of data, inquiries of staff and management, testing of procedures and transactions, confirmation with outside parties, and checking of internal files and documents. The audit resulted in an unmodified or “clean”audit opinion. This provides assurance that the City’sfinancial transactions are presented fairly, in all material respects, and can be relied upon not only for proper reporting of past financial results in the City’sFiscal Year (FY) 2023-24 Annual Comprehensive Financial Report (ACFR), but also on a go-forward basis as we craft the FY 2025-26 Budget. This is important given the results reflected in the ACFR include fixed assets, non-spendable assets such as inventory, and restricted fund balances such as catastrophic reserve that are not readily available to City for appropriation in operating costs, debt services, and capital infrastructure improvements.

The following Reports, Letter, and Statements are presented for fiscal year ended June 30, 2023:

2. Audit Communication Letter - a report on recommendations made to management by the auditors to improve internal controls and/or operating efficiencies within the City.

4. Independent Accountants’ Report on Agreed-Upon Procedures Applied to the Investment Portfolio - independent review of investment operations and compliance with the City’s investment policy.

A single audit, a compliance audit of federally assisted grant programs, is required if federal grant expenditure exceeds $750,000. While the City’sfederal grant expenditures met this requirement, the final report is still pending from the auditors. Therefore, the single audit report for the fiscal year ended June 30, 2024, is not included with this staff report. There are no audit findings noted at this City of Orange Printed on 3/5/2025Page 2 of 3
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Item #: 3.10. 3/11/2025 File #: 25-0114
time and staff will return to the City Council with the final single audit report at a future meeting.

7. ATTACHMENTS
· City of Orange Annual Comprehensive Financial Report and Summary of Audit Results · Audit Communication Letter
· Independent Accountants’ Report on Agreed-Upon Procedures Applied to the Appropriations Limit Worksheets
· Independent Accountants’ Report on Agreed-Upon Procedures Applied to Investment Portfolio
· Air Pollution Reduction Fund Financial Statements and Independent Auditors’ Report · Independent Auditors’ Report on Internal Control Over Financial Reporting · Housing Successor Fund Financial Statements
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City of Orange
C a l i f o r n i a
Annual Comprehensive Financial Report
For the Year Ended June 30, 2024
Prepared by:

FINANCE DEPARTMENT
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CITY OF ORANGE, CALIFORNIA

Annual Comprehensive Financial Report

For the Year Ended June 30, 2024

Table of Contents

Page
Number

INTRODUCTORY SECTION:

Letter of Transmittal ........................................................................................................................................ i Organization Chart .............................................................................................................................................. vi Elected Positions and Ad ministrative Personnel ............................................................................................... vii

FINANCIAL SECTION:

Independent Auditors' Report ............................................................................................................................. 1

Management's Discussion and Analysis (Requ ired Supplementary Information)............................................ 7

Basic Financial Statements:

Government-wide Financial Statements:

Statement of Net Position .................................................................................................................... 21 Statement of Activities .......................................................................................................................... 22

Fund Financial Statements:

Governmental Funds:

Balance Sheet ............................................................................................................................... 28 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position .............................................................................................................. 31 Statement of Revenues, Expenditures and Changes in Fund Balances ..................................... 32 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities ................... 35

Proprietary Funds:

Statement of Net Position .............................................................................................................. 36 Statement of Revenues, Expenses and Changes in Net Position .............................................. 38 Statement of Cash Flows .............................................................................................................. 39

Fiduciary Funds:

Statement of Fiduciary Net Position ............................................................................................. 40 Statement of Changes in Fi duciary Net Position .......................................................................... 41

Notes to the Basic Financial Statements .................................................................................................... 47

Required Supplementary Information:

Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget to Actual - General Fund ............................................................................................................. 91 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget to Actual - Proposition 172 .......................................................................................................... 92 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget to Actual - Measure M ................................................................................................................. 93 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget to Actual - Federal, State & Local Grants .................................................................................... 94 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Budget to Actual - Housing Successor .................................................................................................... 95

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CITY OF ORANGE, CALIFORNIA

Annual Comprehensive Financial Report

For the Year Ended June 30, 2024

Table of Contents

Page
Number

OPEB Plan
Schedule of Changes in Total OPEB Lia bility and Related Ratios ..................................................... 96

Pension Plan
Miscellaneous Plan:

Schedule of Changes in the Net Pension Liability and Related Ratios ....................................... 98 Safety Plan:

Schedule of Changes in the Net Pens ion Liability and Related Ratios ..................................... 100 Schedule of Plan Cont ributions ......................................................................................................... 102

Notes to Required Supple mentary Information ....................................................................................... 103

Supplementary Schedules:

Non-Major Governmental Funds:

Combining Balance Sheet ................................................................................................................. 108 Combining Statement of Revenues, Expenditures and Changes in Fund Balances ................................................................................................................................... 114

Schedule of Revenues, Expenditures, and Changes in Fund Balances – Non-major Special Revenue Funds:

EMT Transport ................................................................................................................................... 120 1% PEG Program ............................................................................................................................... 121 Certified Access Specialist Program (CASP) Certification & Training ............................................. 123 Headstart Building Maintenance ........................................................................................................ 124 Air Pollution Reduction ...................................................................................................................... 124 Gas Tax .............................................................................................................................................. 125 Road Maintenance Rehabilitation Acc ount (RMRA) ........................................................................ 126 Transportation System Improv ement Program (TSIP) ..................................................................... 127 Landscape Maintenance Assessment Districts ................................................................................ 128 Asset Seizure ..................................................................................................................................... 129 SB2- Building Homes and Jobs Act. ................................................................................................. 130 Housing in-Lieu .................................................................................................................................. 131

Schedule of Revenues, Expenditures, and Changes in Fund Balances – Capital Projects Funds:

Capital Improvement .......................................................................................................................... 134 Park Acquisition, Development and Maintenance ............................................................................. 135 Drainage District ................................................................................................................................. 136 Fire Facilities Fees ............................................................................................................................. 137 Police Facilities Fees ......................................................................................................................... 138 Library Facilities Fees ........................................................................................................................ 139

358

CITY OF ORANGE, CALIFORNIA

Annual Comprehensive Financial Report

For the Year Ended June 30, 2024

Table of Contents

Page
Number

Internal Service Funds:

Combining Statement of Net Position ................................................................................................ 142 Combining Statement of Revenues, Expenses and Changes in Net Position ................................... 144 Combining Statement of Cash Flows ................................................................................................. 146

STATISTICAL SECTION:

Net Position by Component - Last Ten Fiscal Years ..................................................................................... 152 Changes in Net Position - Governmental Acti vities - Last Ten Fiscal Years ................................................ 154 Changes in Net Position - Business-type Ac tivities - Last Ten Fiscal Years ................................................ 156 Fund Balances of Governmental Fu nds - Last Ten Fiscal Years ................................................................ 158 Changes in Fund Balances of Governmental Funds - Last Ten Fi scal Years ............................................. 160 Assessed Value and Estimated Actual Value of Taxable Property – Last Ten Fiscal Years ....................... 162 Direct and Overlapping Property Tax Ra tes - Last Ten Fiscal Years ........................................................... 164 Principal Property Taxpayers - Cu rrent Year and Nine Years Ago ............................................................... 166 Property Tax Levies and Collections - Last Ten Fiscal Years ....................................................................... 167 Ratios of Outstanding Debt by Type - Last Ten Fiscal Years ........................................................................ 168 Direct and Overlapping Property Tax Rate - Last Ten Fiscal Years .............................................................. 171 Legal Debt Margin Information - Last Ten Fiscal Years ................................................................................ 172 Pledged-Revenue Coverage - La st Ten Fiscal Years .................................................................................... 174 Demographic and Economic Statisti cs - Last Ten Fiscal Years .................................................................... 175 Principal Employers - Current Year and Nine Years Ago .............................................................................. 176 Full-Time Equivalents by Func tion - Last Ten Fiscal Years .......................................................................... 177 Operating Indicators by Department - Last Ten Fiscal Years ........................................................................ 178 Capital Asset Statistics by Departm ent - Last Ten Fiscal Years ................................................................... 180 359
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0DUFK3, 2025
Honorable Mayor, Members of the City Council, City Manager, and Residents of the City of Orange, California:

The Annual Comprehensive Financial Report (ACFR) of the City of Orange (City) for the fiscal year ended June 30, 2024, is hereby submitted. These statements have been prepared in conformity with generally accepted accounting principles (GAAP) and audited in accordance with generally accepted auditing standards by an independent public accounting firm of licensed certified public accountants.

The report consists of management’s representations concerning the finances of the City.

Management assumes full responsibility for the accuracy, completeness, and reliability of the information contained in this report, based upon a comprehensive framework of internal controls that have been established for this purpose. Because the cost of internal controls should not exceed the anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements. To the best of our knowledge and belief, the enclosed data is accurate in all material respects and is rep orted in a manner designed to present fairly the financial position and results of operations of the City of Orange. All disclosures necessary to enable the reader to gain an understanding of the City’s financial activities have also been included.

The City’s financial statements have been audited by LSL, LLP, an independent public accounting firm. The a uditors have issued an unmodified opinion on the City’s financial statements for the year ended June 30, 2024. Their report is included at the front of the financial sectio n of this report.

The Management Discussion and Analysis (MD&A) immediately fo llows the independent auditors’ report and provides a narrative introduction, overview, and analysis of the basic financial statements. The MD&A complements this letter of transmittal and should be read in conjunction with it.

PROFILE OF THE CITY OF ORANGE
The City of Orange, with a present population estimated at 13 8,621, is situated in central Orange County, approximately 32 miles southeast of Los Angeles. The City’s land area is 24 square miles.

Its planning area or "sphere of influence" is 62 square miles. i 363
The City was incorporated in 1888 under the general laws of the State of California. Under a council-manager form of government, a mayor is elected every two years and, beginning with the November 2020 election, six council members are elected by district to four-year terms alternating on a two-year basis. The City Manager, who is the administrative official of the City, is appointed by the City Council. The City Manager is responsible for implementing policies and ordinances approved by the City Council, overseeing the day-to-day operations of the City, and appointing the heads of the various City departments.

The City provides a full range of services for its citizens. These services include police, fire, paramedic, emergency transportation, library, recreation and parks, senior services, planning and development, street improvements and lighting, and general administration. The City also operates a water utility and contracts for refuse collection services. In addition, the City provides aid to its citizens in the form of residential and commercial rehabilitation loans and economic development.

The former Orange Redevelopment Agency was a component unit of the City until the implementation of AB IX 26, which dissolved California Redevelopment Agencies effective January 31, 2012 (dissolution date). All funds remaining as of that date were transferred to the Successor Agency public trust fund. The City, per Resolution No. 10625, is the Successor Agency to the former Redevelopment Agency. The Successor Agency’s (City Council) approvals are subject to review and confirmation by the Oversight Board (OB) and State Department of Finance (DOF). All transactions effective from the dissolution date and through the “wind- down” period, will be reported in the Successor Agency trust fund.

The annual budget is adopted by July 1
st for all funds of the City on a basis consistent with generally accepted accounting principles. The budget is monitored to ensure compliance with legal provisions embodied in the appropriated budget as approved or amended by the City Council throughout the year. City staff is responsible for monitoring the appropriated budgets for all funds.

The budget is prepared by fund, department (e.g. police), and activity (e.g. patrol). Transfers of appropriations between funds, between departments within a fund, and between capital outlay or debt service and another object group classification within a department, require City Council approval. All other transfers of appropriations can be made with City management approval.

LOCAL ECONOMY
The City of Orange, located in the heart of Southern California, boasts a vibrant and diverse economy. With a strategic location in Orange County, Orange offers easy access to major highways, airports, and ports, making it an ideal place for businesses of all sizes and sectors. iL 364
Orange is home to several institutions, including UCI Irvine Healthcare, Children’s Hospital of Orange County (CHOC) Children’s Hospital, St. Joseph Hospital, and Chapman University, providing numerous employment opportunities.

The City also features a dynamic retail and automotive market, attracting both local and international businesses. The city's healthcare sector is a significant contributor to the local economy. This concentration of medical facilities supports further healthcare development, as well as retail, dining, and housing development. Old Towne Orange is a hub of antique and collectibles dealers, specialty shops, art galleries, and restaurants.

The local economy in the City of Orange has seen a modest improvement. The City’s General Fund revenues, which include sales tax, property tax, transient occupancy tax, licenses and permits, and fees for services, ended the 2023-24 fiscal year with an overall increase of $4.1 million, or 2.9%, compared to fiscal year 2022-23.

The top two sources of revenue for the City are sales tax and property tax. Property tax revenue increased by $1.5 million, or 3.8%, over FY 2022-23, due to increased assessed property values related to the annual inflation adjustment and due to changes in ownership and price appreciation.

The City’s sales tax base is primarily generated from three industry groups – fuel and service stations, autos and transportation, and general consumer goods. The City experienced fluctuating sales tax revenue over the last fiscal year. Declines were seen in the three primary industry groups.

However, strong performances was noted in building and construction, business and industry, and restaurants and hotels. Overall, sales tax revenue increased by $1.7 million, or 3.0%, compared to the prior fiscal year. Economic factors such as interest rates, inflation, and consumer spending patterns significantly influenced sales tax revenue, with the Federal Reserve’s actions noted as a key factor affecting future revenue growth. The modest growth in revenues presents fiscal challenges, especially with the rising costs of goods and services. The ongoing uncertainty due to high inflation and interest rates will continue to impact the City’s revenue sources.

FINANCIAL POLICIES
In February 2024, the City Council adopted Resolution No. 11528, establishing a Financial Reserve Policy and Pension Funding Policy. These policies were adopted to establish adequate reserves to continue to meet its financial obligations in the event of economic uncertainty, catastrophes, or other unforeseen circumstances; and to establish a method to proactively manage future unfunded pension liabilities.

In the General Fund, this policy provides for a year-end commitment of fund balance of a minimum of 16.6% of annual General Fund expenditures. In addition, it provides for a year-end assignment of fund balance equal to the carryover of encumbered and unencumbered appropriations and the fund balances of certain funds within the General Fund reporting group.

LLi 365

LONG-TERM FINANCIAL PLANNING AND MAJOR INITIATIVES
Pursuant to the California Public Employees’ Pension Reform Act of 2013 (PEPRA) and related statutory changes, the City implemented a two-tiered retirement system with the California Public Employees Retirement System (CalPERS). This system provides for a second tier of reduced retirement benefits, effective for employees hired after January 1, 2013 who are also new to CalPERS. It includes a retirement benefit of 2% at 62 for miscellaneous employees and 2.7% at 57 for safety employees, and requires employee contribution rates of 6.75% and 12%, respectively.

Over the long term, this reduced benefit tier is designed to decrease retirement costs for the City.

As of the July 2024 CalPERS Annual Valuation Report, there are 373 of the City’s 658 active employees (56.7%) at this lower tier of retirement benefits.

Sales Tax Sharing Program: In May 2013, the City Council adopted Ordinance No. 4-13 establishing a Sales Tax Sharing Program as a new economic development incentive to promote business growth and job creation, and to enhance the economic base through increased sales tax revenue in the City of Orange. Under the Sales Tax Sharing Program, the City may enter into a Participation Agreement with the owners of existing or new local businesses that generate sales tax revenue to provide for economic development incentives. Currently, the City has Participation Agreements with one entity.

Providing for Internal Service Funding (ISF): The City maintains several Internal Service Funds (ISFs), which are replenished by annual charges or transfers from the General Fund. ISF allocations include funding for General Liability, Workers Compensation, the Employee Accrued Liability Fund (see below), Equipment Maintenance, Equipment Replacement, Information Systems, and Computer Replacement Funds. These funds are critical for the replacement and maintenance of the City’s aging equipment and vehicles. It is also used to fund Workers’ Compensation claims, litigation settlements, and insurance premiums. The City strives to maintain adequate reserves for these funds and staff will continue to put forth recommendations for fully funding these reserves into the future.

Retirement Cost Increases and Pension Obligation Bond Issuance: As part of their plan to fully fund all retirement plans within 30 years, CalPERS established a plan to dramatically increase contribution rates over a five-year period, beginning in FY 2015-16. In addition, changes in actuarial assumptions based on life expectancy have increased retirement costs for all agencies. In FY 2012-13, City Council established a contingency reserve in the Employee Accrued Liability Fund which set-aside monies to be used to offset future retirement costs. $7.4 million has been set aside as of June 30, 2024.

On March 15, 2021, the City successfully issued 2.7% Pension Obligation Bonds (POBs), in the amount of $286.5 million, to effectively refinance the City’s Unfunded Accrued Liability (UAL) with CalPERS as of that date.
iY 366
The UAL represented ongoing expenditures with a 7% interest/discount rate, coupled with increasing annual contributions to reduce the overall balance. The balance of the outstanding bonds as of June 30, 2024, is $257,515,000.

ACKNOWLEDGEMENTS
The preparation of the ACFR was accomplished through the ongoing dedication and cooperation of the Finance Department staff and the City’s independent auditors, LSL, LLP. Special appreciation is extended to the Accounting division staff who contributed to and participated in the coordination and preparation of the ACFR. Additionally, we appreciate the assistance and support from the City departments in planning and conducting the financial operations of the City during this fiscal year, as well as the Mayor and Councilmembers for their steadfast support for maintaining the highest standards of professionalism in the management of the City's finances.

Respectfully submitted,
Trang Nguyen
Finance Director
p y ,
Trang Nguyennnnn
Y 367

CITY OF ORANGE
Organization Chart at June 30, 2024

CITIZENS OF ORANGE
City Clerk
City Attorney City Manager
Assistant City Manager Fire Department
Community Services
Department
Human Resources
Department
Police Department Finance Department
Commissions &
Committees
City Treasurer
ix
Dan Slater, Mayor
Arianna Barrios, Mayor pro tem
Jon Dimitru, Councilmember
Kathy Tavoularis, Councilmember
Denis Bilodeau, Councilmember
Ana Gutierrez, Councilmember
John Gyllenhammer, Councilmember
Community Development
Department
Library Services
Department
Public Works
Department
Information Technology
Department
YL 368
Dan Slater
Mayor
John Gyllenhammer
Councilmember
District 6
Ana Gutierrez
Councilmember
District 5
Denis Bilodeau
Councilmember
District 4
Arianna Barrios
Mayor pro tem
District 1
Jon Dumitru
Councilmember
District 2
Kathy Tavoularis
Councilmember
District 3
YLL 369
Richard A. Rohm
City Treasurer
Pamela Coleman
City Clerk
Elected Officials
YLLL 370
AT JUNE 30, 2024

ELECTED POSITIONS
Dan Slater.…………...…………………………………………….…………………Mayor
Arianna Barrios.……………...……………………………...……..….........Mayor Pro Tem Jon Dumitru.…………………………………………………….Council Member District 2 Kathy Tavoularis.……………………………………………….Council Member District 3 Denis Bilodeau.…………………………………………………Council Member District 4 Ana Gutierrez.…………………………………………………..Council Member District 5 John Gyllenhammer.……………………………………………Council Member District 6 Richard A. Rohm..………..……………………………………..………..….City Treasurer Pamela Coleman………………....…………………………………………..…...City Clerk

ADMINISTRATIVE PERSONNEL
Tom Kisela……...…………………………………….………………………City Manager
Mike Viglitotta…………………………………………………………….….City Attorney
Susan Galvan….....………………………...…….…………………Assistant City Manager Trang Nguyen...………………..…….…………..………………………...Finance Director Leslie Hardy......……...……………………...………..……..Community Services Director Dan Adams……………………...…………………..…………...……..………Police Chief Christopher Cash.………………….…...……………..…..……........Public Works Director Sean Demetropolis...………………..…….…………..…………………………..Fire Chief Russell Bunim………..……..………………………….Community Development Director Monica Espinoza………………………………………………..Human Resources Director L[ 371
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LSLCPAS.COM
INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and Members of the City Council
City of Orange, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Orange, California (the “City”), as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the City’s basic financialstatements as listed in the table of contents.

In our opinion, the financial statements referred to a bove present fairly, in all material respects, the respective financial position of the governmental activities, the busine ss-type activities, each major fund, and the aggregate remaining fund information of the City, as of June 30, 2024, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance wi th accounting principles generally accepted in the United States of America.

Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States. Our responsi bilities under those standards are further described in the Auditors’Responsibilities for the Audit of the F inancial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

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

Auditors’ Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions.

Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted au diting standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. 1 375
To the Honorable Mayor and Members of the City Council
City of Orange, Californi
a
Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

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

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

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

Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The accompanying combining and individual fund financial statements and schedules (“supplementary information”) are presented for purposes of additio nal analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements.

The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic finan cial statements or to the basic financial statements themselves, and other additional procedures in accordan ce with auditing standards generally accepted in the United States of America. In our opinion, the supplementary information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.
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To the Honorable Mayor and Members of the City Council
City of Orange, California
Other Information
Management is responsible for the other information included in the annual report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditor’s report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon.

In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 03, 2025, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provis ions of laws, regulations, contracts, and grant agreements and other matters.

The purpose of that report is solely to describe the scope of our testing of internal c ontrol over financ ial reporting and compliance and the results of that tes ting, and not to provide an opinion on the effectiv eness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in c onsidering the City’s internal control over financial reporting and compliance.

Irvine, California
March 03, 2025
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MANAGEMENT’S DISCUSSION AND ANALYSIS
As management of the City of Orange, we offer readers of th e City of Orange’s financial statements this
narrative overview and analysis of the financial activitie s of the City of Orange for the fiscal year ended June 30, 2024. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal, which can be found on pages i-v of this report.

Financial Highlights
x The assets of the City exceeded its liabilities, on June 30, 2024, by over $718.9 million (net position). Of this amount, $570.6 million or 79.4% is in the governmental funds and $148.3 million or 20.6% is in the enterprise funds.
x As of June 30, 2024, the City's governmental funds reported combined ending net position of $570.6 million, an increase of $13.0 million, or 2.3%, in comparison with the prior year.

OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis are intended to serve as an introduction to the City’s Basic Financial Statements, which are comprised of three components: (1) Government-wide Financial Statements; (2) Fund Financial Statements; and (3) Notes to the Financial Statements. This report also contains other supplementary information in addition to the Basic Financial Statements.

Government-wide Financial Statements. These statements are designed to provide readers with a broad overview of the City’s financial position, in a manner similar to a private-sector business. These statements are reported on the full accrual basis of accounting. There are two government-wide financial statements:
the Statement of Net Position and the Statement of Activities. Thus, revenues and expenses are reported for some items that will not affect cash flow until future fiscal periods.

The Government-wide Financial Statements sepa rate Governmental Activities that are principally supported by taxes and revenues from other agencies, from Business-type Activities that are intended to recover all, or a significant portion, of their costs through user fees and charges. The Governmental Activities of the City include General Government, Public Safety, Public Works, Community Development, Parks and Library, Economic Development, and Interest on Long-Term Debt, when applicable. The City’s two Business-type Activities are Water and Sanitation.

The Statement of Net Position presents information on all the City’s assets and deferred outflows of resources, and liabilities and deferred inflows of resources; the difference between the four is reported as net position. Total assets include all capital items including infrastructure. Evaluating increases or decreases in net position over time will serve as a useful indicator of whether the financial position of the City is improving or declining.

The Statement of Activities presents information on the net cost of each governmental function (activity) during the fiscal year. This statement also identifies the amount of general revenues needed to fully fund each governmental function.
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Fund Financial Statements
. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to demonstrate compliance with finance-related legal requirements. All the funds of the City can be divided into three categories: Governmental Funds, Proprietary Funds, and Fiduciary Funds.

Governmental Funds (General Fund, Special Revenue, Debt Service and Capital Projects Funds) are used to account for the same functions reported as Governmental Activities in the Government-wide Financial Statements. However, unlike the Government-wide Financial Statements, Fund Financial Statements focus on short-term inflows and outflows of spendable resources. These funds are reported using the modified accrual basis of accounting, which measures cash and all other financial assets that can readily be converted to cash. This information is useful in evaluating the City’s short-term financing requirements.

The focus of the Fund Financial Statements is narrower than that of the Government-wide Financial Statements. The governmental fund Balance Sheets and the Statement of Revenues, Expenditures, and Changes in Fund Balance, require a reconciliation to facilitate the comparison between the Fund Statements and the Government-wide Statements. This reconciliation is required because the Government-wide Statements are prepared on the full accrual basis of accounting while the Fund Statements are prepared on the modified accrual basis of accounting. These reconciliations can be found in the Fund Financial Statements on pages 31 and 35.

Proprietary Funds are Enterprise and Internal Service Funds. The City uses Enterprise Funds to account for its Water Utility and Sanitation services. Internal Service Funds are used to accumulate and allocate costs internally to various functions. The City uses Internal Service Funds to allocate equipment expenses, equipment replacements, major building improvements, information systems, computer replacements, employee accrued liability, and workers’ compensation, general liability and dental self-insurance costs.

All the Internal Service Funds are combined into a single, aggregated presentation in the Proprietary Fund Financial Statements. Individual fund data for the Internal Service Funds is provided in the form of combining statements found on pages 142-147.

Fiduciary Funds ( Custodial and Private-Purpose Trust Funds) are used to account for resources held for the benefit of parties outside of the City such as the collection and fees for various assessment districts for which the City acts as an agent for debt service activity.

The Fiduciary Fund resources are not available to support City programs. Fiduciary Funds are reported in Fiduciary Fund Statements of the basic Financial Statements section and are also reported in the Supplementary Schedules section.

Notes to the Financial Statements. The notes provide additional information that is essential to the reader for a full understanding of the data provided in the Government-wide and Fund Financial Statements.
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Other Information. In addition to the Basic Financial Statements and accompanying notes, this report also presents certain Supplementary Information such as Budgetary Comparison Schedules for the General Fund and all Major Special Revenue Funds, Schedules of Changes in the Net Pension Liability and Related Ratios and Schedules of Plan Contributions (Required Supplementary Information). In addition, Budgetary Comparison Schedules for all the Non-Major Special Revenue, Capital Projects Funds, and Combining Non-Major Statements are provided (Supplementary Schedules). The Statistical Section provides users with statistical information covering five categories, including financial trends, revenue capacity, debt capacity, demographic and economic information, and operating information.

GOVERNMENT-WIDE FINANCIAL HIGHLIGHTS AND ANALYSIS

Governmental Activities:

The total assets exceeded the total liabilities by $570.6 million at the close of Fiscal Year 2023-24. The total assets increased by $32.6 million, or 3.6%, from $895.0 million to $927.7 million. This is due to a combination of increases in long-term receivables and capital assets. Total liabilities show a slight increase of $9.8 million compared to prior year, primarily due to an increase in pension liability.

The unrestricted net position is a negative $195 million, virtually no change compared to the prior year.

The negative unrestricted net position is primarily due to long-term liabilities such as the pension obligation bond. The restricted net position decreased by almost $2 million, or 1.8%. The restricted net position is stipulated from agreements with external parties.

2024 2023 2024 2023 2024 2023
ASSETS
Current and Other Assets 191,015 170,784 50,587 43,975 241,602 214,759 Capital Assets 736,639 724,213 133,580 128,338 870,219 852,551 Total Assets 927,654 894,997 184,167 172,313 1,111,821 1,067,310 Deferred Outflows of Resources 92,627 100,865 7,835 8,775 100,462 109,640

LIABILITIES
Current Liabilties 22,643 20,468 8,473 6,646 31,116 27,114 Non- current Liabilities 411,695
404,027 31,972 31,693 443,667 435,720 Total Liabilities 434,338 424,495 40,445 38,339 474,783 462,834 Deferred Inflows of Resources 15,385 13,802 3,219 2,951 18,604 16,753

NET POSITION
Net Investment Capital Assets 698,636 684,072 132,909 127,758 831,545 811,830 Restricted 66,910 68,868 - - 66,910 68,868 Unrestricted (194,988)
(195,375) 15,429 12,040 (179,559) (183,335) Total Net Position 570,558 557,565 148,338 139,798 718,896 697,363 Governmental Activities Business-Type Activities Total
City of Orange
Summary of Net Position
For Fiscal Year Ended June 30, 2024 and 2023
(in thousands)
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Business Ty
pe Activities:

Similar to governmental activities, the total assets exceeded the total liabilities by $148.3 million at the close of the fiscal year.

More than 90%, or over $133 million, of the net position is invested in capital assets. The remaining 10%, or $15 million, is unrestricted and is available. The total assets increased approximately $12 million from last year primarily due to increases in cash and investments and capital assets. Total liabilities increased by about $2.1 million from the prior year, due primarily to pension liability.

GOVERNMENTAL FUND HIGHLIGHTS AND ANALYSIS
Governmental Fund Revenues:

The graph below shows a summary of Governmental F
und type revenues. This includes revenues from
the General Fund, Special Revenue Funds, Debt Service Funds and Capital Project Funds for the Fiscal Year ended June 30, 2024.
x The governmental fund revenues totaled $217 million, an increase of $24.4 million, or 12.7%, over the prior year.
x Approximately 64.9% of the governmental fund revenues came from the following categories:
o Property Tax at $55.6 million, or 25.
6%,
o Sales and Use Tax at $51.8 million, or 23.9%, and
o Charges for Services at $33.3 million, or 15.4%.
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Governmental Fund Expenditures:

The graph below shows a summary of
Governmental Fund type expenditures which includes the various departments, such as Public Safety, Public Works, Parks and Library and General Government (e.g. City Manager,
City Clerk, Finance, Human Resources, Information Technology, etc.) that are used to provide services to the community.

The governmental fund expenditures ended the 2023-24 fiscal year at $204 million, an increase of $10 million, or 5.1%, to prior year.
x $124 million of 61% is used for Public Safety
x $22.4 million or 11% is used for Public Works
x $22.2 Million or 11% is used for Parks and Library
x $16.7 million or 8% is used for General Government
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The chart above is a summary of net position for the governmental activities for revenues and expenditu
res compared to the prior year.

The significant variances in revenues compared to prior year were increases in Capital Grants and Contributions by $6.2 million and Other Revenues by $14.5 million.

Amount
Increase
REVENUES: 2024 2023 (Decrease)
Program Revenues:

Charges for Services 33,304 33,276 28 O
perating Grants and Contributions 7,266 6,117 1,149 Capital Grants and Contributions 15,250 8,934 6,316 General Revnues:

Taxes
Property Taxes 55,610 53,784 1,826
Sales and Used Taxes 51,892 51,389 503 Transient Occupancy Taxes 6,093 6,080 13 F
ranchise Taxes 3,201 3,149 52
O
ther Taxes 3,419 3,897 (478)
Use of Money and Property 7,292 4,287 3,005 Other Revenues 35,888 21,366 14,522 Gain on Sale of Capital Asset 53
- -
Transfers (2,310) 153 (2,463)
Total Revenues 216,958 192,432 24,473
EXPENSES:

Program Activities
General Government 16,723 24,084 (7,361) Public Safety 124,980 110,206 14,774
Public Works 22,452 19,716 2,736
Community Development 7,696 4,113 3,583 Parks & Library 22,280 20,277 2,003 Economic Development 1,723 8,311 (6,588) Debt Services - - -
Interest on Long-term Debts 8,125 7,745 380 Total Expenses 203,979 194,452 9,527
Changes in Net Position 12,979 (2,020) 14,946 Governmental Activities
City of Orange
Summary of Net Position
For Fiscal Year Ended June 30, 2024 and 2023
(in thousands)
12 386

The increase in Capital Grant and Contributions was primarily due to reimbursements for completed street projects and a reimbursement for expenses related to the SB2 Building Homes and Jobs Act. Overall, the net increase in governmental revenues totaled $24.4 million compared to the prior year. The increase in Other Revenues was mainly attributed to a change in accounting estimates for loan receivables to align with the Generally Accepted Accounting Principles (GAAP).

Overall expenditures increased by almost $9.5 million, or 4.9%, compared to the prior fiscal year. While we show an increase in Public Safety, Public Works, Community Development and Parks and Library totaling almost $21.1 million these increases were offset by decreases in General Government and Economic Development of $14.0 million. The decrease was due to one-time expenses incurred related to a development project and a close out of a fund in FY 2022-23. The increase in Public Safety costs was primarily due to increases in personnel costs.

The FY 2023-24 net position of $13 million is an increase of almost $15 million compared to the negative $2.0 million in the prior year. This change was driven by an increase in revenues of $24.4 million, or

12.7%, and moderate growth of $9.5 million, or 4.9%, in expenditures.

FUND BALANCE ANALYSIS OF THE GOVERNMENTAL FUNDS

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

Governmental Funds. The focus of the statements presenting the City’s governmental funds is to provide information on the short-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City’s current financial requirements. Unassigned fund balance may serve as a useful measurement of a government’s net resources available for spending during the subsequent fiscal year.

At the end of the fiscal year, the City’s governmental funds reported combined ending fund balances of $130 million, an increase of $21 million as compared to the prior fiscal year’s fund balances. This increase is primarily due to the change in accounting estimate of the outstanding loans receivable.

The General Fund is the major operating fund of the City and the total fund balance at year end was $28.5 million, an increase of $2.7 million over the prior year. This included the Building Record Management Fund.

Other General Fund highlights include:

x Restricted fund balance of $23.9 million was 16.6% of total General Fund expenditures. x General Fund revenues increased $4.1 million over prior year. This increase is mainly due to an increase in Property Tax and Use of Money and Property. x General Fund operating expenditures totaled $144.3 million, an increase of $5.9 million compared to the prior fiscal year due to an increase in Public Safety. x General Fund made no transfers out in fiscal year 2024. 13 387
2024 Percent of 2023 Percent of Increase
Actuals Total Actuals Total (Decrease)
Taxes 111,273 76% 108,953 77% 2,320
Franchise Fees 2,981 2% 2,622 2% 359
Licenses and Permits 6,761 5% 6,583 5% 178
Fines and Forfeitures 1,748 1% 2,007 1% (259)
Use of Money and Property 4,816 3% 2,409 2% 2,407 Intergovernmental Revenues 4,012 3% 1,247 1% 2,765 Charges for Services 11,136 8% 10,900 8% 236
Other Revenues 1,632 1% 5,501 4% (3,869)
Total Revenues 144,359 98% 140,222 99% 4,137
Other Financing Sources 2,629 2% 2,000 1% 629
Total Revenues &
Other Financing Sources 146,988 100% 142,222 100% 4,766 City of Orange
General Fund Revenues and Other Financing Sources
For Fiscal Year Ended June 30, 2024 and 2023
(in thousands)
2024 Percent of 2023 Percent of Increase
Actuals Total Actuals Total (Decrease)
General Government 12,488 9% 14,805 9% (2,317) Public Safety 96,249 67% 91,458 57% 4,791
Public Works 10,168 7% 9,800 6% 368
Parks and Library 17,055 12% 16,543 10% 512 Community Development 6,252 4% 3,649 2% 2,603 Economic Development 148 0% 138 0% 10 Debt Services 1,782 1% 1,872 1% (90)
Other Expenses 115 0% 73 0% 42
Total Expenditures 144,257 100% 138,338 86% 5,919 Other Financing Uses -
0% 23,277 14% (23,277)
Extraordinary Items - 0% - 0% -
Total Expenditures &
Other Financing Sources 144,257 100% 161,615 100% (17,358) City of Orange
General Fund Expenditures and Other Financing Uses
For Fiscal Year Ended June 30, 2024 and 2023
(in thousands)
14 388

PROPRIETARY FUND HIGHLIGHTS AND ANALYSIS
The Proprietary Funds of the City consist of the Enterprise F unds (Water Fund and Sanitation Fund) and
the Internal Service Funds. The Enterprise Funds are reported as Business-Type Activity on the Government-wide Financial Statements. The Internal Service Funds are Governmental Activities and as such, are combined with other Governmental Activities (Governmental Funds) when presented on the Government-wide Financial Statements. The following are highlights of the Proprietary Funds:

Enterprise Fund – Revenues and Expenses . Operating revenues increased $3.9 million, or 8%, and expenditures had a slight increase of $1.9 million, or 4%. The increase in revenue is due to water rate increases. A 7% rate increase was effective April 2023 and a 6% increase was effective January 2024. The Water Fund shows a slight increase in expenditures due to vacancies in the prior year that have been filled, the Sanitation Fund had an increase of almost $1 million over the prior year due to pension and depreciation expenses.

Enterprise Fund - Net Position. An
increase in revenues and stable expenditures increased the net position over the prior year by $1.8 million ; with the overall net position ending at $4.2 million for the fiscal year ended June 30, 2024.

Amount
Increase
REVENUES: 2024 2023 (Decrease)
Program Revenues:

Charges for Services 50,662 46,762 3,900
General Revenues:

Taxes
Sales and Used Taxes - - -
Use of Money and Property -
324 (324)
Other Revenues 440 478 (38)
Transfers - (153) 153
Total Revenues 51,102 47,411 3,691
EXPENSES:

Program Activities
Water 37,751 34,894 2,857
Sanitation 9,104 10,062 (958)
Total Expenses 46,855 44,956 1,899
Changes in Net Position 4,247 2,455 1,792
City of Orange
Summary of Net Position
For Fiscal Year Ended June 30, 2024 and 2023
(in thousands)
Business-Type Activities
Business- Type Activities
15 389
Internal Service Funds -
During FY 2023-24, the Internal Service Funds had total revenues of $21.0 million. This represents a decrease of $14.8 million over the prior year, mainly due to a one-time in transfers from the General Fund. On the expense side, these funds had a combined decrease of $2.5 million. This was due to a one-time transfer from the Internal Service Funds to the General Fund and Capital fund which occurred in FY 2022-23. The decrease in operating expenses was due to a decrease in depreciation expense and accrued leave payouts incurred in FY 2022-23 Internal Service Funds - Net Position. Due to
the reduction in transfers from the General Fund these
funds show a net position decrease of slightly more than $12.2 million which results in a negative net position of $768k.

CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets. The City’s Five-Year Capital Improvement Plan estimates spending $123.0 million in Fiscal Years 2023-24 through 2027-28. Funding will come from current fund balances, contribution from the General Fund, and projected revenues from grants, and private donations. The following chart shows capital assets at June 30, 2024.

More detailed information on the City’s capital asset activity can be found in note 5 of the Notes to the Financial Statements.

Amount
Increase
REVENUES: 2024 2023 (Decrease)
Operating Revenues 18,344 16,860 1,484
Other Revenues 1,682 2,676 (994)
Transfers 1,000 16,280 (15,280)
Total Revenues 21,026 35,816 (14,790)
EXPENSES:

Operating Expenses 21,794 23,098 (1,304)
Transfers Out - 1,250 (1,250)
Total Expenses 21,794 24,348 (2,554)
Changes in Net Position (768) 11,468 (12,236)
City of Orange
Summary of Net Position
Inte rnal Se rvice Funds
For Fiscal Year Ended June 30, 2024 and 2023
(in thousands)
Internal Service Activities
2024 2023 2024 2023 2024 2023
Land and Improvements 82,133 80,626 2,647 2,647 84,780 83,273 Projects in Progress 372,227 366,786 11,193 5,116 383,420 371,902 Buildings 108,667 110,578 1,522 791 110,189 111,369 Furniture, Fixture & Equipment 14,455 15,617 7,564 8,100 22,019 23,717 Infrastructures 152,513 142,513 109,848 110,969 262,361 253,482 Lease Assets 111 129 - - 111 129 Subscription Assets 6,534 7,964 806 715 7,340 8,679 Total Capital Assets 736,640 724,213 133,580 128,338 870,220 852,551 City of Orange
Summary of Captial Assets (Net of Depreciation)
For Fiscal Year Ended June 30, 2024 and 2023
(in thousands)
Governmental Activities Business-Type Activities Total
16 390
Long-Term Liabilities.

The long-term liabilities of the City consist of loan agreements with Southern California Edison for LED retrofit, leases, lease revenue bonds for city infrastructure improvements, pension obligation bonds to pay off unfunded pension liabilities, liabilities for compensated absences, insurance claims and the newly implemented GASB No. 96 subscriptions. The following is a reconciliation of these liabilities for the year ended June 30, 2024:

More detailed informatio
n on the City’s long-term liabilities can be found in Note 11 of the Notes to the Financial Statements.

REQUEST FOR INFORMATION
This financial report is designed to provide a general overview of the City’s finances. This financial report can also be found on the City’s website at www.cityoforange.org. Questions concerning any of the information provided in this report or request for additional financial information should be addressed to the Finance Department, City of Orange, 300 East Chapman Avenue, Orange, California 92866.

Balance Balance
June 30, June 30, Due Within
Government Activities 2023 Additions Reduction 2024 One-Year Loans Payable 148 - 70 78 50

Lease Payable 121 84 94
111 55
Subscription Payable 7,075 563 1,072 6,566 812 Lease Revenue Bond 28,860 - 570
28,290 595
Premium on Lease Revenue Bond 3,938 - 146
3,792 -
Pension Obligation Bond 248,970 - 10,337
238,633 10,402
Compensated Absences 9,596 5,983 4,189 11,390 4,972 Claims Payable 15,780 2,864 4,250 14,394 5,270 Total Government Activities 314,488 9,494 20,728 303,254 22,156 Business-type Activies
Compensated Absences 769 288 159 898 185 Pension Obligation Bond 19,700 - 818
18,882 823
Subscription Payable 579 208 186 601 131 Total Business-type Actvities 21,048 496 1,163 20,381 1,139 Total Government-wide 335,536 9,990 21,891 323,635 23,295 City of Orange
Summary of Changes in Long-Term Liabilities
(in thousands)
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CITY OF ORANGE, CALIFORNIA
Statement of Net Position
Governmental Business-Type
Activities Activities Total
ASSETS
Cash and investments 117,899,881$ 40,584,462 $ 158,484,343$ Receivables (net of uncollectibles):

Accounts 6,859,248 8,888,302 15,747,550
Taxes 11,554,179 - 11,554,179
Ac
crued interest 928,173 306,023 1,234,196 Due from
other governments 516,910 - 516,910
Notes
and loans 44,540,325 - 44,540,325
Leas
es 1,518,118 - 1,518,118
Restricted assets:

Cash with fiscal agent 5,354,631 - 5,354,631
Inventories 903,122 765,257 1,668,379 Prepaid costs 939,946 43,427 983,373 Capital assets (not being depreciated/amortized) 454,359,839 13,839,941 468,199,780 Capital assets (net of accumulated depreciation/amortization) 282,279,323 119,740,069 402,019,392 Total assets 927,653,695 184,167,481 1,111,821,176

DEFERRED OUTFLOWS OF RESOURCES
Pension-related 86,780,453 6,373,314 93,153,767 OPEB-related 5,847,078 1,461,770 7,308,848 Total deferred outflows of resources 92,627,531 7,835,084 100,462,615

LIABILITIES
Accounts payable 11,334,364 8,345,704 19,680,068 Pass-through payable 671,111 - 671,111
Accrued liabilities 6,042,296 - 6,042,296
Accrued interest 732,794 - 732,794
Deposits payable 2,825,044 127,074 2,952,118 Unearned revenue 1,037,640 - 1,037,640
Noncurrent liabilities:

Due within one year:

Total OPEB liability 472,000 - 472,000
B
onds, loans, leases, subscriptions, claims, and
compensated absences 22,155,472 1,138,851 23,294,323 Due in more than one year:

Net pension liability 82,212,139 5,031,473 87,243,612 Total OPEB liability 25,757,855 6,439,464 32,197,319 Bonds, loans, leases, subscriptions, claims, and
compensated absences 281,097,320 19,244,102 300,341,422 Total liabilities 434,338,035 40,326,668 474,664,703

DEFERRED INFLOWS OF RESOURCES
Pension-related 1,869,883 203,794 2,073,677 OPEB-related 12,061,520 3,015,380 15,076,900 Lease-related 1,453,897 - 1,453,897
Total deferred inflows of resources 15,385,300 3,219,174 18,604,474

NET POSITION
Net investment in capital assets 697,803,590 132,978,321 830,781,911 Restricted:

Public safety 3,220,192 - 3,220,192
F
ederal & state grants 8,472,514 - 8,472,514
Hous
ing 28,615,840 - 28,615,840
Str
eets/roads/transportation improv. 8,417,893 - 8,417,893 Dev
elopment related transport improv. 4,208,775 - 4,208,775 Air
quality 206,396 - 206,396
As
set forfeiture operations 4,114,987 - 4,114,987
As
sessment district landscape maint. 2,161,880 - 2,161,880 Go
v. access/local access programming 411,389 - 411,389 Affordabl
e housing units 6,465,622 - 6,465,622
Trai
ning/certifying building inspect. 567,013 - 567,013 Unrestricted (194,108,200) 15,360,402 (178,747,798) Total net position 570,557,891$ 148,338,723 $ 718,896,614 $ June 30, 2024
Primary Government
See accompanying notes to financial statements.
21 395

CITY OF ORANGE, CALIFORNIA
Statement of Activities
For the Year Ended June 30, 2024
Operating Capital
Charges for Contributions Contributions
Expenses Services and Grants and Grants
Functions/Programs:

Primary government:

Governmental activities:

General government 16,723,060$ 8,412,017$ 4,740,139$ -$ Public safety 124,980,249 11,657,313 1,193,208 - Community development 7,696,354 1,976,021 - 257,361 Parks and l
ibrary 22,279,842 5,081,854 1,333,069 - Public works 22,436,985 6,176,990 - 14,992,324 Economi
c development 1,723,275 - - -
Interest on long-term debt 8,124,874 - - -
Total governmental activities 203,964,639 33,304,195 7,266,416 15,249,685 Business-type activities:

Sanitation 9,286,085 9,121,934 - -
Water 38,089,991 41,539,708 721,295 - Total business-type activities 47,376,076 50,661,642 721,295 - Total primary government 251,340,715$ 83,965,837$ 7,987,711$ 15,249,685$ General revenues and transfers:

General revenues:

Property taxes
Sales taxes
Transient occupancy taxes
Franchise taxes
Other taxes
Use of money and property
Other
Gain on sale of capital asset
Transfers
Total general revenues and transfers
Change in net position
Net position-beginning
Net position-ending
Program Revenues
See accompanying notes to financial statements.
22 396
Governmental Business-Type
Activities Activities Total
(3,570,904)$ - $ (3,570,904)$
(112,129,728) - (112,129,728)
(5,46
2,972) - (5,462,972)
(15,
864,919) - (15,864,919)
(1,26
7,671) - (1,267,671)
(1,72
3,275) - (1,723,275)
(8,12
4,874) - (8,124,874)
(148,144,343) - (148,144,343)
- (164,151) (164,151)
- 4,171,012 4,171,012
- 4,006,861 4,006,861
(148,144,343) 4,006,861 (144,137,482)
55,610,096 - 55,610,096
51,
891,628 - 51,891,628
6,092,659 - 6,092,659
3,201,234 - 3,201,234
3,418,634 - 3,418,634
7,292,376 1,782,865 9,075,241
35,
888,378 440,327 36,328,705
52,
948 - 52,948
(2,31
0,270) 2,310,270 -
161,137,683 4,533,462 165,671,145
12,993,340 8,540,323 21,533,663
557,564,551 139,798,400 697,362,951
570,557,891$ 148,338,723 $ 718,896,614 $
Primary Government
Net (Expenses) Revenues and
Changes in Net Position
See accompanying notes to financial statements.
23 397
7+,63$*(,17(17,21$//</()7%/$1.
24 398
25 399
7+,63$*(,17(17,21$//</()7%/$1.
26 400
Governmental Funds
Major Gove
rnmental Funds
Individual funds whose assets, liabilities, revenues, or expenditures are at least 10% of the total assets, liabilities, revenues, or expenditures of the governmental funds and at least 5% of the total assets, liabilities, revenues, or expenditures of the governmental and enterprise funds combined, will be classified as major funds.

General Fund must be classified as a major fund and is used to account for revenues and expenditures that are not required to be accounted for in another fund.

Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than for major capital projects) that are legally restricted to expenditure for specified purposes. The following Special Revenue Funds have been classified as major funds in the accompanying financial statements:
x Proposition 172
x Measure M
x Federal, State & Local Grants
x Housing Successor
Capital Projects Funds are used to account for the acquisition and construction of capital facilities. The following Capital Projects Funds have been classified as major funds in the accompanying financial statements:
x Capital Improvement
x Park Acquisition Development and Maintenance
Non-Major Governmental Funds
Other Governmental Funds - These funds constitute all other governmental funds that do not meet the major fund test described above. These funds include Special Revenue Funds and several smaller Capital Projects Funds. 27 401

CITY OF ORANGE, CALIFORNIA
Balance Sheet
Governmental Funds
June 30, 2024
General
ASSETS
Cash and investments 29,673,526$ 745,632 $ 6,217,301$ Receivables (net of allowance for uncollectible):

Accounts 2,283,600 - -
Taxes 10,493,725 98,892 -
Accrued interest 438,390 5,724 47,019
Due from other governments 516,910 - -
Notes and loans - - -
Leases 1,396,353 - -
Prepaid expense 165,928 - -
Due from other funds 838,151 - -
Inventories 105,756 - -
Restricted assets:

Cash and investments with fiscal agents 18,747 - - Total assets 45,931,086$ 850,248$ 6,264,320$

LIABILITIES
Accounts payable 6,312,737$ 8,455 $ 914,104$ Contracts payable - - 131,435
Accrued liabilities 6,014,808 - -
Deposits payable 2,821,904 - 1,450
Due to other funds - - -
Unearned revenues 134,479 - -
Total liabilities 15,283,928 8,455 1,046,989

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues 858,846 - -
Lease-related 1,330,754 - -
Total deferred inflows of resources 2,189,600 - -

FUND BALANCES
Nonspendable 271,684 - -
Restricted - 841,793 5,217,331
Committed 23,891,358 - -
Assigned 3,568,489 - -
Unassigned 726,027 - -
Total fund balances 28,457,558 841,793 5,217,331 Total liabilities, deferred inflows
of resources, and fund balances 45,931,086$ 850,248$ 6,264,320$ Proposition
172 Measure M
Special Revenue Funds
See accompanying notes to financial statements.
28 402

CITY OF ORANGE, CALIFORNIA
Balance Sheet
Governmental Funds
June 30, 2024
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Taxes
Accrued interest
Due from other governments
Notes and loans
Leases
Prepaid expense
Due from other funds
Inventories
Restricted assets:

Cash and investments with fiscal agents
Total assets

LIABILITIES
Accounts payable
Contracts payable
Accrued liabilities
Deposits payable
Due to other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows
of resources, and fund balances
Capital
Projects Fund
1,334,198$ 946,831 $ 17,321,033$
1,170 2,501 4,404,612
- - -
19,575 7,269 158,787
- - -
7,264,662 28,921,145 3,000,000
- - -
- - -
- - 47,536
- - -
- - 5,335,884
8,619,605$ 29,877,746 $ 30,267,852 $
107,291$ 11,906 $ 1,350,311$
39,800 - 375,072
- - -
- - -
- - -
- - 442,050
147,091 11,906 2,167,433
- 1,250,000 5,616,870
- - -
- 1,250,000 5,616,870
- - -
8,472,514 28,615,840 -
- - -
- - 22,483,549
- - -
8,472,514 28,615,840 22,483,549
8,619,605$ 29,877,746 $ 30,267,852 $
Capital
Improvement
Federal, State
& Local Grants
Housing
Successor
Special Revenue Funds
See accompanying notes to financial statements.
29 403

CITY OF ORANGE, CALIFORNIA
Balance Sheet
Governmental Funds
June 30, 2024
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Taxes
Accrued interest
Due from other governments
Notes and loans
Leases
Prepaid expense
Due from other funds
Inventories
Restricted assets:

Cash and investments with fiscal agents
Total assets

LIABILITIES
Accounts payable
Contracts payable
Accrued liabilities
Deposits payable
Due to other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows
of resources, and fund balances
Capital
Projects Fund
9,722,343$ 22,933,098 $ 88,893,962$
10,420 58,819 6,761,122
- 961,562 11,554,179
74,636 176,773 928,173
- - 516,910
646,045 4,708,473 44,540,325
- 121,765 1,518,118
- - 165,928
- - 885,687
- - 105,756
- - 5,354,631
10,453,444$ 28,960,490 $ 161,224,791 $
66,563$ 1,108,775$ 9,880,142$
- 124,804 671,111
- 27,488 6,042,296
- 1,690 2,825,044
- 704,443 704,443
- 461,111 1,037,640
66,563 2,428,311 21,160,676
646,045 116,454 8,488,215
- 123,143 1,453,897
646,045 239,597 9,942,112
- - 271,684
- 23,715,023 66,862,501
- - 23,891,358
9,740,836 2,578,172 38,371,046
- (613) 725,414
9,740,836 26,292,582 130,122,003
10,453,444$ 28,960,490 $ 161,224,791 $
Total
Nonmajor
Funds
Total
Governmental
Funds
Park
Acquisition,
Development
and
Maintenance
See accompanying notes to financial statements.
30 404
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position
June 30, 2024
Amounts reported for governmental activities in the Statement of Net Position are different because:

Total fund balances - governmental funds 130,122,003$
711,604,294
Deferred outflows-pension related 85,505,790
Deferred outflows-OPEB related 5,554,724
Deferred inflows-pension related (1,829,124)
Deferred inflows-OPEB related (11,458,444)
Total deferred outflows and inflows related to postemployment benefits 77,772,946 8,488,215
28,286,113
Bonds payable (263,146,566)
Loan payable (77,145)
Leases and subscriptions payable (452,924)
Compensated absences (11,389,986)
Accrued interest payable on long-term debt (732,794)
Net pension liability (81,205,844)
Net OPEB liability (24,918,362)
Total long-term liabilities (381,923,621)
(3,792,059)
Net position of governmental activities 570,557,891$
Long-term liabilities that are not due and payable in the current period, and therefore, are not reported in the funds.

Governmental funds report the effect of premiums, discounts, and refundings and similar items when debt is first issued, whereas, these amounts are deferred and amortized in the Statement of Activities.

CITY OF ORANGE, CALIFORNIA
Capital assets, net of accumulated depreciation/amortization, used in governmental activities are not financial resources and, therefore, are not reported in the funds.

Differences between expected and actual experiences, assumption changes and net differences between projected and actual earnings, and contributions subsequent to the measurement date for the postretirement benefits (pension and OPEB) are recognized as deferred outflows of resources and deferred inflows of resources on the Statement of Net Position.

Other long-term assets that are not available to pay for current period expenditures and, therefore, are either labeled unavailable or not reported in the funds.

Internal service funds provide services to other funds on a cost-reimbursement basis. The assets, deferred outflows of resources, liabilities, and deferred inflows of resources of the internal service funds are included in governmental activities in the Statement of Activities.

See accompanying notes to financial statements.
31 405

CITY OF ORANGE, CALIFORNIA
Statement of Revenues, Expenditures,
and Changes in Fund Balances
Governmental Funds
For the Year Ended June 30, 2024
General

REVENUES
Taxes 111,273,077$ 1,281,262 $ 3,389,302$
Franchise fees 2,981,298 - -
Licenses and permits 6,760,790 - -
Intergovernmental 4,011,532 - 123,777
Charges for services and fees 11,135,922 - -
Use of money and property 4,816,261 30,443 321,198 Fines and forfeitures 1,747,537 - -
Miscellaneous 1,631,796 - -
Total revenues 144,358,213 1,311,705 3,834,277

EXPENDITURES
Current:

General government 12,489,030 28,006 - Public safety 96,249,747 657,126 -
Community development 6,251,653 - -
Parks and library 17,054,804 - 404,288
Public w
orks 10,168,341 - 936,415
Economic dev
elopment 147,731 - -
Capital outlay 115,047 35,556 3,473,596 Debt service:

Principal 640,095 - -
Interest and fiscal charges 1,141,460 - -
Total expenditures 144,257,908 720,688 4,814,299 Excess (deficiency) of revenues
over (under) expenditures 100,305 591,017 (980,022)

OTHER FINANCING SOURCES (USES)
Transfers in 2,629,049 - -
Transfers out - - -
Total other financing sources (uses) 2,629,049 - - Net change in fund balances 2,729,354 591,017 (980,022) Fund balances-beginning 25,728,204 250,776 6,197,353 Fund balances-ending 28,457,558$ 841,793$ 5,217,331$ Special Revenue Funds
Measure M
Proposition
172
See accompanying notes to financial statements.
32 406

CITY OF ORANGE, CALIFORNIA
Statement of Revenues, Expenditures,
and Changes in Fund Balances
Governmental Funds
For the Year Ended June 30, 2024

REVENUES
Taxes
Franchise fees
Licenses and permits
Intergovernmental
Charges for services and fees
Use of money and property
Fines and forfeitures
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community development
Parks and library
Public works
Economic development
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures

OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Total other financing sources (uses)
Net change in fund balances
Fund balances-beginning
Fund balances-ending
Capital
Projects Fund
-$ - $ -$
- - -
- - -
2,766,999 - 4,748,576
154,800 - 3,253,450
183,509 242,751 339,475
- - -
2,908,212 12,531,973 -
6,013,520 12,774,724 8,341,501
- 27,178 276,981
406,214 - -
- 151,415 -
- - -
- - -
1,361,111 30,051 -
264,455 - 9,407,536
- - -
- - -
2,031,780 208,644 9,684,517
3,981,740 12,566,080 (1,343,016)
- - -
(129,049) - (5,810,270)
(129,049) - (5,810,270)
3,852,691 12,566,080 (7,153,286)
4,619,823 16,049,760 29,636,835
8,472,514$ 28,615,840 $ 22,483,549 $
Special Revenue Funds
Capital
Improvement
Housing
Successor
Federal, State
& Local Grants
See accompanying notes to financial statements.
33 407

CITY OF ORANGE, CALIFORNIA
Statement of Revenues, Expenditures,
and Changes in Fund Balances
Governmental Funds
For the Year Ended June 30, 2024

REVENUES
Taxes
Franchise fees
Licenses and permits
Intergovernmental
Charges for services and fees
Use of money and property
Fines and forfeitures
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community development
Parks and library
Public works
Economic development
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures

OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Total other financing sources (uses)
Net change in fund balances
Fund balances-beginning
Fund balances-ending
Capital
Projects Fund
Total Total
Nonmajor Governmental
Funds Funds
-$ 1,289,312$ 117,232,953$
- - 2,981,298 - - 6,760,790 - 10,687,297 22,338,181
4,141,103 7,723,918 26,409,193
462,411 896,328 7,292,376
- - 1,747,537 13 18,847,586 35,919,580
4,603,527 39,444,441 220,681,908
- 308,160 13,129,355
- 3,546,589 100,859,676
- 64,521 6,467,589
- 889,256 18,348,348
8,002 4,032,530 15,145,288
- - 1,538,893 2,037,902 6,514,223 21,848,315
- 10,762,933 11,403,028
- 6,595,804 7,737,264
2,045,904 32,714,016 196,477,756
2,557,623 6,730,425 24,204,152
- - 2,629,049 - - (5,939,319) - - (3,310,270) 2,557,623 6,730,425 20,893,882
7,183,213 1,310,992 90,976,956
9,740,836$ 26,292,582 $ 130,122,003 $
Park
Acquisition,
Development
and
Maintenance
See accompanying notes to financial statements.
34 408
Reconciliation of the Statement of Revenues, Expenses and Changes in Fund Balances of Governmental Funds to the Statement of Activities For the Year Ended June 30, 2024
Amounts reported for governmental activities in the Statement of Activities are different because:

Net change in fund balances - total governmental funds: 20,893,882$ Capital outlay 22,130,232
Depreciation/amortization expense (10,036,838)
Total adjustment 12,093,394
Earned but unavailable grant revenues (1,466,607)
Total adjustment (1,466,607)
Loss on disposal of capital assets (17,319)
Total adjustment (17,319)
Amortization of bond premiums and discounts (300,138)
Principal payments 11,403,028
Total adjustment 11,102,890
(767,729)
Accrued interest on long-term debt 9,256
Com
pensated absences (1,794,429)
Changes in pension liabilities and related deferred outflows and inflows of resources (26,591,186) Changes in OPEB liabilities and related deferred outflows and inflows of resources (468,812) Total adjustment (28,845,171)
Change in net position of governmental activities 12,993,340$ Internal service funds provide services to other funds on a cost-reimbursement basis. The net revenue of certain activities of internal service funds is reported with governmental activities.

Some expenses reported in the Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds.

CITY OF ORANGE, CALIFORNIA
Governmental funds report capital outlays are expenditures. However, in the Statement of Activities, the cost of these assets is allocated over their estimated useful lives and reported as depreciation/amortization expense. This is the amount by which capital outlays exceeded depreciation/amortization expense in the current period.

Revenues in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds.

The net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, and donations) is to increase/(decrease) net position.

Bond and other debt proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the Statement of Net Position. Repayment of bond and other debt principal is an expenditure in the governmental funds, but repayment reduces long-term liabilities in the Statemen t of Net Position. Also, governmental funds report the effect of premiums, discounts, and similar items when debt is first issued, whereas these amounts are deferred and amortized in the Statement of Activities.

See accompanying notes to financial statements.
35 409

CITY OF ORANGE, CALIFORNIA
Statement of Net Position
Proprietary Funds
June 30, 2024
Governmental
Activities
Total
Enterprise Internal
Funds Service Funds
ASSETS
Current assets:

Cash and investments 11,977,733$ 28,606,729$ 40,584,462$ 29,005,919$ Receivables (net of uncollectibles):

Accounts 877,804 8,010,498 8,888,302 98,126 Accrued interest 91,957 214,066 306,023 - Prepaid costs - 43,427 4 3,427 774,018
Inventories - 765,257 765,
257 797,366
Total current assets 12,947,494 37,639,977 50,587,471 30,675,429 Noncurrent:

Capital assets, net 61,111,159 72,468,851 133,580,010 25,034,868 Total noncurrent assets 61,111,159 72,468,851 133,580,010 25,034,868 Total assets 74,058,653 110,108,828 184,167,481 55,710,297

DEFERRED OUTFLOWS OF RESOURCES
Pension-related 1,911,994 4,461,320 6,373,314 1,274,663 OPEB-related 438,531 1,023,239 1,461,770 292,354 Total deferred outflows of resources 2,350,525 5,484,559 7,835,084 1,567,017

LIABILITIES
Current liabilities:

Accounts payable 144,834 8,200,870 8,345,704 1,454,222 Deposits payable - 127,074
127,074 -
Due to other funds - - - 181,244
Compensated absences, due in one year 44,011 141,226 185,237 - Claims and judgments, due in one year - - - 5,269,580
Subscriptions, due in one year 15,332 115,220 130,552 711,518 Bonds, due in one year 246,919 576,143 823,062 164,612 Total OPEB liability, due in one year 35,400 82,600 118,000 23,600 Total current liabilities 486,496 9,243,133 9,729,629 7,804,776 Noncurrent liabilities:

Compensated absences 215,671 498,328 713,999 - Claims and judgments - - - 9,124,682
Subscriptions 182,872 288,265 471,137 5,511,926 Bonds, notes, and loans 5,417,689 12,641,277 18,058,966 3,611,794 Net pension liability 1, 509,442 3,522,031 5,031,473 1,006,295 Total OPEB liability 1, 931,839 4,507,625 6,439,464 1,287,893 Total noncurrent liabilities 9,257,513 21,457,526 30,715,039 20,542,590 Total liabilities 9,744,009 30,700,659 40,444,668 28,347,366

DEFERRED INFLOWS OF RESOURCES
Pension-related 61,138 142,656 203,794 40,759 OPEB-related 904,614 2,110,766 3,015,380 603,076 Total deferred inflows of resources 965,752 2,253,422 3,219,174 643,835

NET POSITION
Net investment in capital assets 60,912,955 72,065,366 132,978,321 18,811,424 Unrestricted 4,786,462 10,573,940 15,360,402 9,474,689 Total net position 65,699,417$ 82,639,306$ 148,338,723 28,286,113$ Business-Type Activities
Sanitation Water
See accompanying notes to financial statements.
36 410

CITY OF ORANGE, CALIFORNIA
Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds
For the Year Ended June 30, 2024
Governmental
Activities
Total
Enterprise Internal
Funds Service Funds

OPERATING REVENUES
Water sales and services -$ 41,416,856$ 41,416,856$ -$ Charges for services and fees 9,121,934 122,852 9,244,786 18,344,034 Other revenues 225,040 215,287 440,327 1,726,011 Total operating revenues 9,346,974 41,754,995 51,101,969 20,070,045

OPERATING EXPENSES
Salaries and wages 3,576,837 5,456,482 9,033,319 4,252,394 Maintenance and operations 896,716 20,681,969 21,578,685 5,249,076 Contractual services 1,239,678 4,899,662 6,139,340 2,252,803 Interfund charge for administrative services 727,565 2,954,108 3,681,673 - Insurance claims and charges - - - 7,615,209
Depreciation/amortization 2,663,382 2,502,827 5,166,209 2,424,512 Other expenses - 1,256,401 1,256,401 -
Total operating expenses 9,104,178 37,751,449 46,855,627 21,793,994 Operating income (loss) 242,796 4,003,546 4,246,342 (1,723,949)

NONOPERATING REVENUES (EXPENSES)
Intergovernmental - 721,295 721,295 -
Use of money and property 595,868 1,186,997 1,782,865 - Interest expense (145,088) (338,542) (4 83,630) (96,728) Gain (loss) on disposal of capital assets (36,819) - (36,819) 52,948 Total nonoperating revenues (expenses) 413,961 1,569,750 1,983,711 (43,780) Income (loss) before transfers 656,757 5,573,296 6,230,053 (1,767,729) Transfers in 1,160,503 1,149,767 2,310,270 1,000,000 Change in net position 1,817,260 6,723,063 8,540,323 (767,729) Net position-beginning 63,882,157 75,916,243 139,798,400 29,053,842 Net position-ending 65,699,417$ 82,639,306$ 148,338,723$ 28,286,113$ Business-Type Activities
Sanitation Water
See accompanying notes to financial statements.
37 411

CITY OF ORANGE, CALIFORNIA
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2024
Governmental
Activities
Internal
Totals Service Funds

CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers 9,194,846$ 41,002,645 $ 50,197,491 $ -$ Receipts from interfund charges - - - 20,061,381 Payments to suppliers and service providers (5,614,033) (28,244,468) (33,858,501) (11,352,849) Payments to employees for salaries and benefits (183,619) (3,490,252) (3,673,871) (581,751) Other receipts (payments) - - - (9,000,952) Net cash provided by (used for)
operating activities 3,397,194 9,267,925 12,665,119 (874,171)

CASH FLOWS FROM NONCAPITAL

FINANCING ACTIVITIES
Transfers from other funds 1,160,503 1,149,767 2,310,270 1,000,000 Principal paid on non-capital debt (245,379) (572,550) (817,929) (163,586) Interest paid on on-capital debt (145,088) - (145,088) (96,728) Payments from other funds on interfund borrowings - - - 170,495 Taxes 1,101 - 1,101 - Operating grants and contributions - 721,295 721,295 - Net cash provided by (used for)
noncapital financing activities 771,137 1,298,512 2,069,649 910,181

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES
Acquisition and construction of capital assets (5,129,489) (5,315,479) (10,444,968) (3,321,298) Principal paid on capital debt 58,981 (36,877) 22,104 (376,217) Interest paid on capital debt - (338,542) (338,542) - Proceeds from sales of assets - - - 599,552 Net cash provided by (used for)
capital and related financing activities (5,070,508) (5,690,898) (10,761,406) (3,097,963)

CASH FLOWS FROM INVESTING ACTIVITIES
Interest on investments 567,170 1,082,762 1,649,932 - Net cash provided by (used for)
investing activities 567,170 1,082,762 1,649,932 - Net increase (decrease) in
cash and cash equivalents (335,007) 5,958,301 5,623,294 (3,061,953) Cash and cash equivalents-beginning 12,312,740 22,648,428 34,961,168 32,067,872 Cash and cash equivalents-ending 11,977,733$ 28,606,729$ 40,584,462$ 29,005,919$ Business-Type Activities
Sanitation Water
See accompanying notes to financial statements.
38 412

CITY OF ORANGE, CALIFORNIA
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2024
Governmental
Activities
Internal
Totals Service Funds
Business-Type Activities
Sanitation Water

RECONCILIATION OF OPERATING INCOME (LOSS)

TO NET CASH PROVIDED BY (USED FOR)

OPERATING ACTIVITIES
Operating income (loss) 242,796$ 4,003,546 $ 4,246,342 $ (1,723,949)$ Adjustments to reconcile operating income (loss) to
net cash provided by (used for) operating activities:

Depreciation/amortization expense 2,663,382 2,502,827 5,166,209 2,424,512 (Increase) decrease in accounts receivable (100,527) (750,098) (850,625) (10,794) (Increase) decrease in inventories - 36,794 3
6,794 (350,186)
(Increase) decrease in prepaid items - (43,427) (4
3,427) (732,518)
Increase (decrease) in accounts payable (35,235) 1,916,010 1,880,775 473,797
Increase (decrease) in deposits payable (51,601) (2,252) (53,853) - Increase (decrease) in compensated absences 32,310 97,030 129,340 - Increase (decrease) in claims and judgments - - - (1,385,743) Increase (decrease) in net pension liability 6 09,058 1,421,135 2,030,193 406,036 Increase (decrease) in net OPEB liability 37,011 86,360 123,371 24,674 Total adjustments 3,154,398 5,264,379 8,418,777 849,778 Net cash provided by (used for)
operating activities 3,397,194$ 9,267,925$ 12,665,119$ (874,171)$ See accompanying notes to financial statements.
39 413
Private
Purpose Custodial
Trust Funds Funds
ASSETS
Cash and cash equivalents 7,135,999$ 3,627,706$
Investments:

Cash and investments with fiscal agent 1,749 1,527,363 Receivables:

Accounts 6,112 -
Accrued interest 42,094 -
Taxes - 35,927
Notes and loans 422,063 -
Total assets 7,608,017 5,190,996

DEFERRED OUTFLOWS OF RESOURCES
Deferred charge on refunding 27,241 -
Total deferred outflows of resources 27,241 -

LIABILITIES
Accrued interest 351,116 -
Long-term liabilities:

Due in one year 1,432,564 -
Due in more than one year 23,253,208 -
Total liabilities 25,036,888 -

NET POSITION
Restricted for:

Individuals, organizations, and other governments (17,401,630) 5,190,996 Total net position (17,401,630)$ 5,190,996 $

CITY OF ORANGE, CALIFORNIA
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2024
See accompanying notes to financial statements.
40 414
Private
Purpose Custodial
Trust Funds Funds

ADDITIONS
Investment earnings 258,244 (15,840)
Taxes 2,999,096 3,587,118
Miscellaneous 438,355 -
Total additions 3,695,695 3,571,278

DEDUCTIONS
Administrative expenses 13,260 24,723
Contractual services 13,989 -
Payments to external parties 749,729 3,995,540 Total deductions 776,978 4,020,263
Net increase (decrease) in fiduciary net position 2,918,717 (448,985) Net position-beginning (20,320,347) 5,639,981
Net position-ending (17,401,630)$ 5,190,996 $

CITY OF ORANGE, CALIFORNIA
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
For the Year Ended June 30, 2024
See accompanying notes to financial statements.
41 415
7+,63$*(,17(17,21$//</()7%/$1.
42 416
43 417
7+,63$*(,17(17,21$//</()7%/$1.
44 418

CITY OF ORANGE
In Order of Presentation
For the Year Ended June 30, 2024
Note Description Page
1 Si gnificant Accounting Policies 47
2 Cash and Investments 57
3 Leases 61
4 Subscription-Based Technology Arrangements 62
5 Capital Assets 63
6 Taxes 65
7 Other Revenues 65
8 Retirement Plan 66
9 Insurance Pro grams 74
10 Other Post Emplo yment Benefits (OPEB) 75
11 Lon g- Term Liabilities 77
12 Community Facilities and Assessment Districts and Other Revenue Bond Issues
79 13
Joint Ventures 80
14 Loans Receivable 80
15 Due To/From Other Funds 81
16 Transfers 81
17 Deficit Fund Balance or Net Position 82
18 Governmental Fund Balances 82
19 Contin gencies 82
20 21
Successor Agency Trust for Assets of Former Redevelopment Agency Construction and Commitments and Contingencies
82 85
22 Subsequent Events 85
45 419
7+,63$*(,17(17,21$//</()7%/$1.
46 420

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 1: SIGNIFICANT ACCOUNTING POLICIES

A. Description of the Reporting Entity

The City of Orange (City) was incorporated in April 1888 under the general laws of the State of California. The City operates under a Council-Manager form of government and provides the following services: public safety, public works, community development and redevelopment, parks and library, sanitation, and general administrative services.

B. Basis of Accounting and Measurement Focus

The basic financial statements of the City are composed of the following:

x Government-wide Financial Statements
x Fund Financial Statements
x Notes to the Financial Statements

The accounting and financial reporting treatment is determined by the applicable measurement focus and basis of accounting. Measurement focus indicates the type of resources being measured such as current financial resources or economic resources. The basis of accounting indicates the timing of transactions or events for recognition in the financial statements.

1. Government-wide Financial Statements

Government-wide Financial Statements display information about the reporting government as a whole, except for its fiduciary activities. All fiduciary activities are reported only in the fund financial statements. The Government-wide statements include separate columns for the governmental and business-type activities of the primary government. 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. Also, certain eliminations have been made in regard to interfund transfers, payables, and receivables. Internal service fund activity has been eliminated and net balances are included in the governmental activities. Interfund services provided and used, if any, are not eliminated in the consolidation process.

Government-wide Financial Statements are presented using the economic resources measurement focus and the full 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. The 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, operating grants and contributions, capital grants and contributions, special assessments, and payments made by parties outside of the reporting government's citizenry, if that money is restricted to a particular pr ogram. Program revenues are netted with program expenses in the Statement of Activities to present the net cost of each program. Charges for services include revenues from customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function. Grants and contributions include revenues restricted to meeting the operational or capital requirement of a particular function. Taxes and other items not properly included among program revenues are reported instead as general revenues.

Amounts paid to acquire capital assets are capitalized as assets in the Government-wide Financial Statements, rather than reported as an expense. 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 expense.
47 421

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 1: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

2. Fund Financial Statements
The underlying accounting 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 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 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.

3. Gover
nmental Funds
In the Fund Financial Statements, governmental funds are presented using the modified - accrual basis of accounting. Their revenues are recognized when they become measurable and available. 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. Major revenue sources that are susceptible to accrual are sales tax, property tax, motor vehicle in-lieu fees, franchise fees, license and permit fees, charges for services and interest earnings.

Exchange transactions are recognized as revenues in the period in which they are earned (i.e., the related goods or services are provided). Locally imposed 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.

Reimbursement grants are those grants for which the recipient govern ment must first incur allowable costs in order to qualify for the reimbursement. For these grants, funds received in advance of incurring the allowable costs are recorded as unearned revenue in both the Fund Financial Statements and the Government-wide Financial Statements. A receivable (and related revenue) is recorded for costs incurred during the year for which reimbursement has not yet been received. In the Fund Financial Statements of governmental funds, however, unavailable revenue (rather than revenue) is recorded at the establishment of this receivable if the amount of the reimbursement is not expected to be received during the recipient's availability period.

Allocations are voluntary non-exchange transactions received from other governments that are not in the form of reimbursement grants. The entitlement of the recipient government for the receipt of these funds is not based upon the recipient government first incurring allowable expenditures. These amounts are recorded as revenue when the recipient government becomes entitled to the allocation. Unearned revenue is not recorded in either the Fund Financial Statements or in the Government-wide Financial Statements for receipt of allocations prior to the recording of related expenditures. In some cases, the amounts not spent within a specified number of years (the spending period) must be returned to the providing agency. The requirement to return unspent funds within the spending period is not considered to be a requirement pertaining to the eligibility of funding and does not affect the recognition of revenue for this funding. This is because there is no requirement to spend the allocated resources in specific amounts or proportions for each of the fiscal years covered by the spending period. The entire allocation may be spent in any of the fiscal years covered by the spending period. Any amounts returned at the end of the spending period are required by generally accepted accounting principles to be recorded at that time as an expenditure.
48 422

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 1: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
In the Fund Financial Statements, governmental funds are presented using the current financial resources measurement focus. This means that only current assets, 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 and are offset by restricted fund balance. In addition, certain loans have a forgiveness component and/or have a repayment term greater than that of conventional loans. For these loans, an allowance has been recorded to more accurately present the net present value of these receivables.

Due to the nature of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by non-current liabilities. Since they do not affect fund balance, 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 another financing source rather than as a fund liability. Amounts paid to reduce long-term indebtedness are reported as fund expenditures.

4. Proprietary and Fiduciary Funds
The City's Enterprise Funds (Water and Sanitation) and Internal Service Funds are proprietary funds. Proprietary Fund Financial Statements include a Statement of Net Position, a Statement of Revenues, Expenses, and Changes in Fund Net Position, and a Statement of Cash Flows. A column representing internal service funds is also presented in these statements. However, internal service balances and activities have been combined with the governmental activities in the Government-wide Financial Statements.

In the Fund Financial Statements, proprietary funds and fiduciary funds are presented using the full 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 and fiduciary funds are presented using the economic resources measurement focus . This means that all assets, deferred outflows of resources, 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. Operating expenses include the cost of sales, maintenance, administration and depreciation on capital assets which are essential to the primary operations of the fund. All other expenses are reported as non-operating expenses.

Amounts paid to acquire capital assets are capitalized as assets in both the Proprietary and Fiduciary Fund Financial Statements, rather than reported as an expense. Also in these funds, proceeds of long-term debt are recorded as a liability rather than as an "other financing source" and amounts paid to reduce long-term indebtedness are reported as a reduction of the related liability, rather than as an expenditure. 49 423

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 1: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
C. Fund
Classifications
The fund
s designated as major funds are determined by a mathematical calculation consistent with GASB Statement No. 34. Generally, however, once a fund has met the criteria for becoming a major fund, it will continue to be reported as a major fund by management, regardless of its calculation, in order to provide consistency and comparability between the years. The City reports the following major governmental funds:

General Fund. This is the primary operating fund of the City. It is used to account for all revenues and expenditures that are not required to be accounted for in another fund.

Proposition 172 Fund. This fund is used to account for sales tax restricted by voter mandate for public safety service enhancements. The primary source of revenue in this fund is sales tax.

Measure M Fund. This fund is used to account for receipts and expenditures relating to transportation improvement projects and programs, funded by local ½ cent sales tax.

Federal, State & Local Grants Fund. This fund is used to account for grant programs such as Community Development Block Grant, Housing and Urban Development Grant, California Parklands Grant, Citizens Option for Public Safety (COPS) Grant, Traffic Safety Grant, Justice Assistance Grant, and others. The major source of revenue for these funds is proceeds from various federal, state, and local grants.

Housing Successor Fund. This fund is used to account for low and moderate housing activities as of February 1, 2012, when the City became the successor housing agency to the former Redevelopment Agency, upon its dissolution. Prior to that, these activities were accounted for in the Redevelopment Agency Housing Fund. The primary source of revenue for these funds is principal housing loan repayments.

Capital Improvement Fund. This fund is used to account for general-purpose capital improvement and cooperatively funded projects.

Park Acquisition, Development and Maintenance Fund. This fund is used to account for the acquisition, development and maintenance of parks that are financed by developer fees.

The City reports the following major enterprise funds:

Water Fund. This fund is used to account for the provision of water services to residential, commercial, and industrial customers.

Sanitation Fund. This fund is used to account for the provision of sanitation and sewer services to residential, commercial, and industrial customers.

The City's fund structure also includes the following fund types:

Special Revenue Funds. These funds are used to account for the proceeds of specific revenue sources that are restricted by law or administrative action for a specified purpose. These funds include:

Debt Service Fund. This fund is used to account for the accumulation of resources for, and payment of, general long-term debt principal, interest, and related costs.

Capital Project Funds. These funds are used to account for financial resources segregated for the acquisition and construction of major capital facilities (other than those financed by the proprietary funds). 50 424

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 1: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Internal Service Funds. These funds are used to account for the financing of special activities that provide services within the City. Such activities include equipment maintenance, equipment replacement, major building improvements, information systems, computer replacement, employee accrued liability, and dental and workers' compensation self - insurance costs.

Private-Purpose Trust Fund. This fund accounts for the assets, deferred outflows of resources, liabilities, and deferred inflows of resources of the former Redevelopment Agency. Tax increment revenue, which was formerly allocated by the County to the Redevelopment Agency, is now allocated to the Successor Agency Private-Purpose Trust Fund to fund payments of enforceable obligations until obligations of the former Redevelopment Agency are paid in full and assets have been liquidated.

Custodial Funds. These funds are used to account for money and property held by the City as trustee or custodian. These funds include various assessment districts for which the City acts as an agent for debt service activity.

Cash and Cash Equivalents
For purpo
ses of the Statement of Cash Flows, the City considered cash and cash equivalents (investments with maturities of three months or less at the time of purchase) as short term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. The City follows the practice of pooling the cash and investments of all funds, including the City's Enterprise and Internal Service Funds and Fiduciary Funds, except for assets held by fiscal agents. As amounts are available to these funds on demand, all cash and investments are considered to be cash and cash equivalents for Statement of Cash Flows purposes.

Changes in fair value that occur during a fiscal year are recognized as revenues from use of money reported for that fiscal year. Use of money and property includes interest earnings, changes in fair value (realized/unrealized), gains or losses realized upon liquidation, maturity, or sale of investments, and rental income.

The City pools cash and investments for all funds, except for assets held by fiscal agents. Each fund's share in the pool is displayed in the accompanying financial statements as cash and investments. Investment income earned by the pooled investments is allocated monthly to the various funds based on each fund's prior month-end cash and investment balance.

E. Invento
ries and Prepaids
Invento
ries of office supplies, gasoline and oil are maintained by the General and Internal Service Funds. The inventory maintained by the Water Utility Enterprise Fund consists primarily of water meters, water pipes, valves, and fittings. Proprietary Fund inventories are priced at the lower of cost or market, determined on a first-in, first-out basis, utilizing the consumption method of accounting for inventories. The General Fund and Internal Service Funds inventories are valued at cost, determined on a weighted average basis utilizing the consumption method of accounting for inventories.

Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid, utilizing the consumption method.

F. Loans
Receivable
Non
-current portions of long-term receivables due are reported on the Governmental, Government-wide, and Fiduciary financial statements. For loans that have a forgiveness component and/or a repayment term greater than that of conventional loans, an allowance is recorded to more accurately present the collectability of these receivables.
51 425

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 1: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
G. C
apital Assets
Capital a
ssets (including infrastructure) are recorded at cost where historical records are available and at an estimated original cost where no historical records exist. Contributed capital assets are valued at their acquisition value at the date of contribution. Generally, capital asset purchases in excess of $10,000 are capitalized if they have an expected useful life of two years or more.

Capital assets include additions to public domain (infrastructure), certain improvements including pavement, curb and gutter, sidewalks, traffic control devices, streetlights, sewers, storm drains, bridges, right-to-use leased assets, and right-of-way within the City. The City has valued and recorded all infrastructure assets, in excess of $50,000, in their entirety as of June 30, 2024.

Capital assets used in operations are depreciated/amortized over their estimated useful lives using the straight-line method in the Government-wide Financial Statements and in the Fund Financial Statements of the Enterprise Funds. Depreciation/amortization is charged as an expense against operations and accumulated depreciation is reported on the respective balance sheets. The lives used for depreciation/amortization purposes for each capital asset class are:

Structures and improvements 20-50 ye
ars
Infrastructure 30-65 years
Well
s, reservoirs, and tanks 40 years
Re
servoirs and tanks 60 years
Wate
r lines/pipelines 60 years
Pumps & boo
ster pumps 60 years
Vehicle
s and other equipment 2-25 years
Subscri
ption and leased assets Term of arrangement
H. Pensions
For pu
rposes of measuring the net pension liability, deferred outflows/inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the City's California Public Employees' Retirement System (CalPERS) plans (Plans) and additions to/deductions from the Plan's 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 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, 2022
Measurement Date (MD) June 30, 2023
Measurement Period (MP) July 1, 2022 to June 30, 2023
I.

Deferred Outflows/Inflows of Resources
In addition to asset
s, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to future periods and so will not be recognized as an outflow of resources (expense/expenditure) until then. The City has four types of items in this category. All four relate to Pension and/or OPEB liabilities. 1) Deferred outflows from changes in the net pension liability/total OPEB liability are the results of contributions made after the measurement period, which are applied against the related net/total liability in the following year; 2) Changes of Assumptions is an amount that is deferred and amortized using an Expected 52 426

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 1: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Average Remaining Service Lifetime (EARSL); 3) Differenc es between expected and actual experience are amortized over a closed period equal to the average of the expected remaining service lives of all employees that are provided with pensions through the plans; and 4) Net difference between expected and actual earnings on pension plan investments. Deferred outflows are reported only in the statement of net position, arising under the full accrual basis of accounting.

In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to future periods and so will not be recognized as an inflow of resources (revenue) until that time. The City has four types of items that qualify for reporting in this category. The first item, unavailable revenues from various sources: taxes and grant monies, is reported only in the governmental funds balance sheet, and arises under a modified accrual basis of accounting. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available. The second item are deferred inflows related to lease receivables. These are reported on both the governmental funds balance sheet and the statement of net position, and are amortized over the life of the lease using the straight-line method. The other three items relate to inflows from changes in net pension liability and total OPEB liability, and are reported only in the statement of net position, arising under the full accrual basis of accounting. These inflows related to pension and OPEB liabilities are the result of:
x Differences between Expected and Actual Experiences are deferred and amortized using an EARSL. x Changes in assumptions is an amount that is deferred and amortized using an Expected Average Remaining Service Lifetime (EARSL).
x Net difference between project and actual earning on pension plan investments.

J. Co
mpensated Absences
The emplo
yee benefits payable liability is recorded for unused vacation and similar compensatory leave balances.

The employees' entitlement to these balances is attributable to services already rendered and it is probable that virtually all of these balances will be liquidated by either paid time off or payments upon termination or retirement.

A liability is recorded for unused sick leave balances only to the extent that it is probable that the unused balances will result in termination payments. Other amounts of unused sick leave are excluded from the liability since their payment is contingent solely upon the occurrence of a future event (illness) that is outside the control of the City and the employee.

These leave balances are accrued when incurred in the government-wide, proprietary, and fiduciary fund financial statements. A liability for these amounts is reported in the governmental funds only if they have matured, for example, as a result of employee resignations and retirements.

K. Net
Position
Net position i
s the excess of all the City's assets and deferred outflows of resources over all its liabilities and deferred inflows of resources, regardless of fund. Net position is divided into three captions. These captions apply only to net position, which is determined only at the government-wide level and in the proprietary funds and fiduciary funds. These captions are described on the following pages.

Net investment in capital assets: the portion of net position which is represented by the current net book value of the City's capital assets, less the outstanding balance of any debt issued to finance these assets, net of any unspent debt proceeds.

Restricted: the portion of net position which is restricted as to use by the terms and conditions of agreements with outside parties, governmental regulations, laws, or other restrictions which the City cannot unilaterally alter. These principally include developer fees received for use on capital projects, debt service requirements, funds restricted for low-and moderate housing, grant funds and legally restricted sales tax revenues. 53 427

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 1: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Unrestricted: the portion of net position which does not meet the definition of "net investment in capital assets" or "restricted net position".

L. Net Position Flow Assumption

Sometimes the government will fund outlays for a particular purpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted - net position and unrestricted - net position in the government-wide and proprietary fund financial statements, a flow assumption must be made about the order in which the resources are considered to be applied. When a fund consists of both restricted and unrestricted resources, expenses are considered to be applied first to the restricted, then to the unrestricted.

M. Fund Balance Flow Assumptions

Sometimes the government will fund outlays for a particular purpose from both restricted and unrestricted resources (the total of committed, assigned, and unassigned fund balance). In order to calculate the amounts to report as restricted, committed, assigned, and unassigned fund balance in the governmental fund financial statements a flow assumption must be made about the order in which the resources are considered to be applied.

When a fund consists of a combination of resources, expenses are considered paid first from restricted resources, then from committed resources, followed by assigned resources. Unassigned fund balance is applied last.

N. Fund Equity

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

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

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

Committed includes amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of the government's highest authority, City Council. The formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is through the City's budget, which is adopted annually through a City Council Resolution.

Assigned includes amounts that are constrained by the government's intent to be used for specific purposes, but are neither restricted nor committed. By reporting particular amounts that are not restricted or committed in a particular fund, the government has assigned those amounts to the purposes of the respective funds. The formal action that is required to be taken to establish, modify, or rescind a fund balance assignment is through the City's budget, which is adopted annually through a City Council Resolution.

Unassigned includes the residual amounts that have not been restricted, committed, or assigned to specific purposes. Any negative amounts in governmental funds are reported in unassigned fund balance. Only the General Fund can have a positive unassigned fund balance.

O. Use of Estimates

The preparation of basic financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and deferred inflow/outflows of resources at the reporting date and revenue and expenses during the reporting period. Actual results could differ from those estimates.

54 428

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 1: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
P. L
eases
Lesse
e: The City is a lessee for a non-cancellable lease of equipment and vehicles. The City recognizes a lease liability and an intangible right -to-use lease asset (lease asset) in the government -wide financial statements. The City recognizes lease liabilities with an initial, individual value of $5,000 or more.

At the commencement of a lease, the City initially measures the lease liability at the present value of payments expected to be made during the lease term. Subsequently, the lease liability is reduced by the principal portion of lease payments made. The lease asset is initially measured as the initial amount of the lease liability, adjusted for lease payments made at or before the lease commencement date, plus certain initial direct costs. Subsequently, the lease asset is amortized on a straight -line basis over its useful life. Key estimates and judgments related to leases include how the City determines (1) the discount rate it uses to discount the expected lease payments to present value, (2) lease term, and (3) lease payments.
x The City uses the interest rate charged by the lessor as the discount rate. When the interest rate charged by the lessor is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for leases.
x The lease term includes the non-cancellable period of the lease. Lease payments included in the measurement of the lease liability are composed of fixed payments and purchase option price that the City is reasonably certain to exercise.

The City monitors changes in circumstances that would require a remeasurement of its lease and will remeasure the lease asset and liability if certain changes occur that are expected to significantly affect the amount of the lease liability.

Lease assets are reported with other capital assets and lease liabilities are reported with long-term debt on the statement of net position.

Lessor: The City is a lessor for a noncancellable lease of City-owned buildings. The City recognizes a lease receivable and a deferred inflow of resources in the government -wide and governmental fund financial statements.

At the commencement of a lease, the City initially measures the lease receivable at the present value of payments expected to be received during the lease term. Subsequently, the lease receivable is reduced by the principal portion of lease payments received. The deferred inflow of resources is initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date.

Subsequently, the deferred inflow of resources is recognized as revenue over the life of the lease term.

Key estimates and judgments include how the City determines (1) the discount rate it uses to discount the expected lease receipts to present value, (2) lease term, and (3) lease receipts. x The City uses its estimated incremental borrowing rate as the discount rate for leases. x The lease term includes the non-cancellable period of the lease. Lease receipts included in the measurement of the lease receivable are composed of fixed payments from the lessee.

The City monitors changes in circumstances that would require a remeasurement of its lease, and will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable.
55 429

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 1: SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Q. Subscription-Based Information Technology Arrangements

The City is a subscriber for a noncancellable subscription of information technology services. The City recognizes a subscription liability and an intangible right -to-use subscription asset (subscription asset) in the government-wide financial statements. The City of Orange recognizes subscription liabilities with an initial, individual value of $5,000 or more.

At the commencement of a subscription, the City initially measures the subscription liability at the present value of payments expected to be made during the subscription term. Subsequently, the subscription liability is reduced by the principal portion of subscription payments made. The subscription asset is initially measured as the initial amount of the subscription liability, adjusted for subscription payments made at or before the subscription commencement date, plus certain initial direct costs. Subsequently, the subscription asset is amortized on a straight-line basis over its useful life. Key estimates and judgments related to subscriptions include how the City determines (1) the discount rate it uses to discount the expected subscription payments to present value, (2) lease term, and (3) subscription payments.

x The City uses the interest rate charged by the vendor as the discount rate. When the interest rate charged by the vendor is not provided, the City generally uses its estimated incremental borrowing rate as the discount rate for subscriptions.

x The subscription term includes the non-cancellable period of the subscription. Subscription payments included in the measurement of the subscription liability are composed of fixed payments that the City is reasonably certain to exercise.

The City monitors changes in circumstances that would require a remeasurement of its subscriptions and will remeasure the subscription asset and liability if certain changes occur that are expected to significantly affect the amount of the subscription liability.

Subscription assets are reported with other capital assets and subscription liabilities are reported with long-term debt on the statement of net position.

R. New Accounting Pronouncement

The following Government Accounting Standards Board (GASB) pronouncements were effective for and/or early implemented for the fiscal year ended June 30, 2024:

1. GASB Statement No. 100, Accounting Changes and Error Corrections

The requirements of this Statement will improve the clarity of the accounting and financial reporting requirements for accounting changes and error corrections, which will result in greater consistency in application in practice. In turn, more understandable, reliable, relevant, consistent, and comparable information will be provided to financial statement users for making decisions or assessing accountability. In addition, the display and note disclosure requirements will result in more consistent, decision useful, understandable, and comprehensive information for users about accounting changes and error corrections.

56 430

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NOT
E 2: CASH AND INVESTMENTS
Cash and investments are presented in the accompanying statements as follows:

Cash and investments at June 30, 2024 consisted of the following:

A.

Investments Authorized by the California Government Code and the City's Investment Policy Und
er the provisions of the City's investment policy as amended periodically by Council, and in accordance with Section 53601 of the California Government Code, the City may invest in the following types of investments:
x United States Treasury notes, bonds, bills or certificates of indebtedness, or other securities for which the full faith and credit of the United States are pledged for the payment of principal and interest (Limits: Maximum time to maturity at purchase 5 years).
x Obligations or other instruments issued by any federal agency, or United States government-sponsored enterprise. In every case, any issue purchased must be fully guaranteed as to principal and interest by the full faith and credit of the United States or the issuing federal agency (Limits: Maximum time to maturity at purchase 5 years; maximum concentration 75% of portfolio with no more than 30% of total portfolio in any single agency at time of purchase; maximum percent of agency callable securities in the portfolio will be 20%; and completely excluding Government National Mortgage Association bonds). x Money market mutual funds that invest only in securities and obligations of the United States government (Limits: Maximum 90 days weighted average maturity; maximum $15 million or 20% of portfolio, whichever is less).
x State of California Local Agency Investment Fund, limited to $75 million per account. x Certificates of Deposit approved by the California AB 2011 (Limits: maximum concentrate of 30% of total portfolio).
x Commercial Paper of prime quality having the highest ranking, or the highest letter and number rating provided by a national rating agency (Limits: Maximum maturity of 270 days or less, maximum 20% of portfolio and no more than 5% of the book value of the portfolio to a single issuer at time of purchase). x Medium-term notes issued by corporations or depository institutions organized and operating within the United States (Limits: Maximum time to maturity at purchase 5 years; maximu m concentration 30% of portfolio and no more than 5% of the book value of the portfolio finds to a single issuer at time of purchase; minimum "A" credit rating).

Statement of Net Position
Cash and investments 158,484,343 $
Cash and inv estments with fiscal agent 5,354,631
Statement of Fiduciary Net Position
Cash and investments 10,763,705
Cash and inv estments with fiscal agent 1,529,112
Total cash and inv estments 176,131,791 $
Petty Cash 13,000$
Bank balances (net of outstanding checks
and timing differences (1,998,202)
Inv estments 178,116,993
Total 1
76,131,791$
57 431

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NOT
E 2: CASH AND INVESTMENTS (CONTINUED)
x Municipal bonds including those issued by any State and any local agency within any State, including bonds payable solely out of the revenues from a revenue producing property owned, controlled, or operated by a state or local agency or by a department, board, agency, or authority of a state or local agency. (Limits: Maximum maturity at purchase 5 years; minimum "A" credit rating; maximum concentration 20% of portfolio and no more than 5% of the book value of the portfolio funds to a single issuer at time of purchase.) x Asset-Backed, Mortgage-Backed, Mortgage Pass-Through Securities, and Collateralized Mortgage Obligations limited to mortgage-backed pass-through securities issued by a US government agency or consumer receivable pass-through certificates or bonds. (Limits. Maximum maturity at purchase of 5 years; minimum "AA" credit rating, The aggregate investment in mortgage-backed and asset-backed securities described shall not exceed 20% of the portfolio; no more than 5% held in any one issuer that is not a US government agency.)
x Supranational securities, senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank which are eligible for purchase in the United States. (Limits: Maximum remaining maturity of five years or less; minimum "AA" credit rating; maximum concentration of 30% of the portfolio with no more than 10% invested in any one issuer.) The City is a participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. The fair value of the City's investment in this pool is reported in the accompanying financial statements at amounts based upon the City's pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio. The balance available for withdrawal is based on the accounting records maintained by LAIF. The LAIF investment portfolio consists primarily of U.S. treasuries, federal agency securities, certificates of deposit, time deposits, and commercial paper.

Investments Authorized by Debt Agreements
Inve
stments of debt proceeds held by bond trustees 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 investments authorized by these debt agreements include Money Market Mutual Funds, Federal Agencies with maturity dates not to exceed 5 years, Treasury Bonds and Guaranteed Investment Contracts and have maturity dates of up to 30 years.

C. Risk
Disclosures
Market Risk. While the Cit
y recognizes that longer term portfolios achieve higher returns, longer term portfolios have higher volatility of total return. The City will limit market risk by limiting the concentrations, volume, and duration of its longer-term investments, as well as limiting them to funds which are not needed for current year cash flow purposes.

1. Maturities selected shall provide for stability of income and liquidity and shall not exceed 5 years from the date of purch
ase. Funds not required for purposes of meeting specific cash flow needs shall be invested in permitted securities so that securities will mature periodically across the maturity spectrum with a maximum of five ye
ars.

2. The City may, on occasion, sell a security prior to its maturity (recording a gain or loss) in order to diminish the portfolio's exposure to market risk or reinvest into a better opportunity providing more potential earning to the City's portfolio.
58 432

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 2: CASH AND INVESTMENTS (CONTINUED)

At June 30, 2024, the City Treasury had the following investment maturities:

At June 30, 2024, the City Treasury had the following investment ratings:

Credit Risk. Credit risk is the risk that the issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. It is the City's policy to limit its investments to the investment types with ratings identified under the Authorized Investments sections above.

At June 30, 2024, the City's credit risks, expressed on a percentage basis, are as follows:

Inv estment Type Total <1 1 to 2 2 to 5
Asset Backed Securities 5,150,603$ -$ 87,916$ 5,062,687$ Federal Agency Securities 43,692,893 17,019,157 10,011,510 16,662,226 Supranational Bond 3,635,650 - 1,708,568 1,927,082 Medium-Term Notes 26,093,718 274,887 10,671,109 15,147,722 U.S. Treasury Bond 21,211,520 - - 21,211,520 Local Agency Investment Fund 43,538,889 43,538,889 - - Money Market Mutual Funds 27,909,976 27,909,976 - - Held by Trustee:

Money Market Mutual Funds 6,883,744 6,883,744 - - Total 178,116,993$ 95,626,653$ 22,479,103$ 60,011,237$ Inv estment Maturity (in Years)
Investment Type AAA AA A Not Rated Total
Asset Backed Securities 3,703,797$ -$ -$ 1,446,806$ 5,150,603$ Federal Agency Securities - 43,692,890 - - 43,692,890 Medium-Term Corporate Notes - 4,051,378 22,042,340 - 26,093,718 Money Market Fund 27,909,979 - - - 27,909,979 Supranational Bond 3,635,650 - - - 3,635,650 US Treasury Securities - - - 21,211,520 21,211,520 State Investment Pool (LAIF) - - - 43,538,889 43,538,889 Held by Trustee:

Money Market Mutual Fund 6,883,744 - - - 6,883,744 42,133,170$ 47,744,268$ 22,042,340$ 66,197,215$ 178,116,993$ Investment Type Minimum Rating S&P Rating % of Investments Asset Backed Securities Not applicable AA+ 2.9%
Federal Agency Securities Not applicable AA+ 24.5%
Supranational Bond Not applicable Not Rated 2.0%
Medium-Term Notes Various Various 14.6%
U.S. Treasury Bond Exempt AA+ 11.9%
Local Agency Inv estment Fund Not Rated Not Rated 24.4% Money Market Mutual Funds Not applicable AAA 15.7%
Held by Trustee:

Money Market Mutual Funds Not Applicable AAA 3.9%
100.0%
59 433

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 2: CASH AND INVESTMENTS (CONTINUED)

Concentration of Credit Risk. Concentration of credit risk is the risk of loss attributed to the magnitude of an entity's investment in a single issuer. The City's policy as to limitations on the amount that can be invested in any one issuer is identified under the Authorized Investments section above. Investments in any one issuer (excluding U.S. Treasury securities and external investment pools which are exempt) can be identified in the table above under Credit Risk.

Custodial Credit Risk. Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The California Government Code requires California banks and savings and loan associations to secure a city's deposits by pledging government securities as collateral. The fair value of pledged securities must equal at least 110% of a city's deposits. California law also allows financial institutions to secure city deposits by pledging first trust deed mortgage notes having a value of 150% of a city's total deposits. Cities may waive collateral requirements for deposits that are fully insured up to $250,000 by federal depository insurance. The City has not waived this requirement.

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 City's policy is for all securities owned by the City to be held in safekeeping by the City's custodial bank, a third-party bank trust department, acting as agent for the City under the terms of a custody agreement.

The City follows the practice of pooling cash and investments of all funds except for funds required to be held by outside fiscal or other agents under provisions of the U.S. Department of Housing and Urban Development or provisions of bond indentures.

D. Fair Value Measurements

The City categorizes 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 1inputs are quoted prices in active markets for identical assets, Level 2 inputs are quoted prices for similar assets in active markets, and Level 3 inputs are significant unobservable inputs.

The City has the following recurring fair value measurements as of June 30, 2024:

Quoted Prices Observable Unobservable
Investment Type Level 1 Inputs Level 2 Inputs Level 3 Total Asset Backed Securities - $ 5,150,603$ - $ 5,150,603$ Federal Agency Securities - 43,692,893 - 43,692,893 Supranational Bond - 3,635,650 - 3,635,650 Medium-Term Notes - 26,093,718 - 26,093,718 Total Leveled Investments -$ 78,572,864$ -$ 78,572,864 Not Subject to Categorization:

U.S. Treasury Bond 21,211,520
Local Agency Investment Fund 43,538,889
Money Market Mutual Funds 27,909,976
Held by Trustee:

Money Market Mutual Funds 6,883,744
Total Inv estment Portfolio 178,116,993$
60 434

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NOT
E 3: LEASES
A.

Leases Receivable and Deferred Inflows of Resources
As of Ju
ne 30, 2024, the City had four active leases as lessor. The leases have receipts that range from $6,000 to $102,534 and interest rates that range from 2.09% to 6.75%. As of June 30, 2024, the total combined value of the lease receivable is $1,518,118, the total combined value of the short-term lease receivable is $105,993, and the combined value of the deferred inflow of resources is $1,453,897. There were no variable or other receipts not included in the lease receivable, within the fiscal year.

The principal and interest payments that are expected to maturity are as follows:

Lease
s Payable and Right to Use Lease Assets
As of June 30, 2024, the City had sixteen active leases as lessee. The leases have payments that range from $0 to $10,259 and interest rates that range from 0.02% to 4.44%. As of June 30, 2024, the total combined value of the lease liability is $110,732, the total combined value of the short-term lease liability is $55,426. The combined value of the right to use asset, as of June 30, 2024 of $276,251 with accumulated amortization of $165,589 is included within the table found below. There were no variable or other receipts not included in the lease liability, within the fiscal year.

Right-to-use leased assets include the following at June 30, 2024:

Future principal and interest requirements to maturity for each lease liability are included in governmental activities as follows:

Fiscal Year
Principal
Payments
Interest
Payments
Total
Payments
2025 105,994$ 41,199 $ 147,193$
2026 112,735 38,232 150,967
2027 119,779 35,033 154,812
2028 124,289 31,635 155,924
2029 128,262 28,062 156,324
2030 - 2034 707,176 80,140 787,316
2035 - 2036 219,883 4,558 224,441
1,518,118$ 258,859$ 1,776,977$
Governmental Activities
Asset Class
Lease Asset
Value
Accumulated
Amortization
Equipment 28,014$ 21,451$
Vehicles 248,237 144,138
Total 276,251$ 165,589$
Fiscal Year
Principal
Payments
Interest
Payments
Total
Payments
2025 $ 55,426 $ 2,434 $ 57,860 2026 32,980 1,082 34,062 2027 22,326 281
22,607
Total 110,732$ 3,797$ 114,529$
61 435

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 4: SUBSCRIPTION-BASED TECHNOLOGY ARRANGEMENTS

As of June 30, 2024, the City had twenty-three active subscriptions. The subscriptions have payments that range from $0 to $629,328 and interest rates that range from 1.71% to 3.31%. As of June 30, 2024, the total combined value of the subscription liability is $7,167,327, and the total combined value of the short-term subscription liability is $942,264. The combined value of the right to use as set, as of June 30, 2024, of $9,747,541 with accumulated amortization of $2,407,824 is included within the table found below. There were no variable or other receipts not included in the subscription liability, within the fiscal year.

The future principal and interest subscription payments as of June 30, 2024, were as follows:

Asset Class
Subscription
Asset Value
Accumulated
Amortization
Software 9,747,541 $ 2,407,824 $
Fiscal Year Principal Interest Total
2025 811,712$ 185,676$ 997,388$
2026 1,174,744 162,812 1,337,556
2027 782,494 129,273 911,767
2028 802,988 107,237 910,225
2029 685,536 84,634 770,170
2030 - 2034 2,308,162 132,133 2,440,295
Total 6,565,636$ 801,765$ 7,367,401$
Fiscal Year Principal Interest Total
2025 130,552$ 15,489$ 146,041$
2026 138,945 12,303 151,248
2027 36,619 8,909 45,528
2028 39,877 7,927 47,804
2029 43,336 6,858 50,194
2030 - 2034 212,360 14,793 227,153
Total 601,689$ 66,279$ 667,968$
Gov ernmental Activ ities
Business-type Activ ities
62 436

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 5: CAPITAL ASSETS

Capital asset activity for the year ended June 30, 2024 was as follows:

Balance Balance
July 1, 2023 Transfers of CIP Increases Decreases June 30, 2024 Governmental activities:

Capital assets, not being depreciated/amortized
Land 80,625,726$ -$ 1,507,400$ -$ 82,133,126$ Rights of way 347,258,096 - - - 347,258,096 Construction-in-progress 19,527,723 - 14,198,197 (8,757,303) 24,968,617 Total capital assets, not being depreciated/amortized 447,411,545 - 15,705,597 (8,757,303) 454,359,839 Capital assets, being depreciated/amortized
Infrastructure 242,795,367 - 14,543,049 (1,274,204) 256,064,212 Structures and improvements 159,948,758 - 1,764,717 (70,044) 161,643,431 Furniture, fixtures and equipment 51,419,649 - 2,195,470 (1,258,042) 52,357,077 Lease asset 217,780 - 58,471 - 276,251 Subscription asset 9,533,710 - 123,111 (994,167) 8,662,654 Total capital assets, being depreciated/amortized 463,915,264 - 18,684,818 (3,596,457) 479,003,625 Less accumulated depreciation/amortization
Infrastructure 100,282,085 - 4,319,860 (1,050,484) 103,551,461 Structures and improvements 49,370,400 - 3,676,464 (70,044) 52,976,820 Furniture, fixtures and equipment 35,802,754 - 2,835,178 (736,257) 37,901,675 Lease asset 89,271 - 76,318 - 165,589 Subscription asset 1,569,394 - 1,553,530 (994,167) 2,128,757 Total accumulated depreciation/amortization 187,113,904 - 12,461,350 (2,850,952) 196,724,302 Total
capital assets, being depreciated/amortized, net 276,801,360 - 6,223,468 (745,505) 282,279,323 Total gov ernmental activ ities capital assets 724,212,905$ -$ 21,929,065$ (9,502,808)$ 736,639,162$ 63 437

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 5: CAPITAL ASSETS (CONTINUED)
Balance Balance
July 1, 2023 Transfers Increase Decrease June 30, 2024
Business-type activities:

Capital assets, not being depreciated/amortized
Land 2,646,932$ -$ -$ -$
2,646,932$
Construction-in-progress 5,116,132 - 6,714,341 (
637,464) 11,193,009
Total capital assets, not being depreciated/amortized 7,763,064 - 6,714,341 ( 637,464) 13,839,941
Capital assets, being depreciated/amortized
Buildings and structures 2,928,522 - 854,194 - 3,782,716 I
mprovements other than buildings
Wells 10,600,614 - - - 10,600,614
Water tank 16,572,565 - - - 16,572,565 Water lines 108,147,607 - - - 108,147,607 Sewer 74,711,455 - 2,513,295 (
173,049) 77,051,701
Storm drains 112,751,143 - 727,075 - 113,478,218
Machinery and equipment 12,245,973 - 21,523 - 12,267,496 Subscription asset 841,280 - 246,145 (2,538) 1,084,887 T
otal capital assets, being depreciated/amortized 338,799,159 - 4,362,232 ( 175,587) 342,985,804
Less accumulated depreciation/amortization
Buildings and structures 2,137,388 - 123,179 - 2,260,567 I
mprovements other than buildings
Wells 4,031,611 - 254,736 - 4,286,347
W
ater tank 9,013,774 - 258,752 - 9,272,526
W
ater lines 69,457,440 - 1,187,337 - 7 0,644,777
Sewer 46,659,829 - 900,620 (136,229) 47,424,220 Storm drains 82,651,357 - 1,723,831 -
84,375,188
Machinery and equipment 4,146,171 - 556,872 - 4,703,043 S
ubscription asset 126,583 - 155,022 (2,538) 279,067 T
otal accumulated depreciation/amortization 218,224,153 - 5,160,349 ( 138,767) 223,245,735
Total capital assets, being depreciated/amortized, net 120,575,006 - (798,117) ( 36,820) 119,740,069
Total business-type activities capital assets 128,338,070$ -$ 5,916,224$
(674,284)$ 133,580,010$
64 438

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 5: CAPITAL ASSETS (CONTINUED)
Depreciation/amortization expense was charged to the following functions in the Statement of Activities:
*Business-Type activities depreciation does not agree to the additions of capital assets due to a $5,860 adju
stment when the City moved to Debtbook to track subscriptions.

NOT
E 6: TAXES
Property taxes are attached as an enforceable lien on property as of January 1. Taxes are levied on July 1 and are payable in two installments on December 10 and April 10.

Any unpaid amounts at the end of the fiscal year are recorded as taxes receivable in accordance with the City's accrued revenue policy as stated in Note 1. The County of Orange bills and collects the property taxes and subsequently remits the amount due to the City of Orange in installments during the year. Historically, the City has received substantially all of the taxes levied within two years from the date they are levied.

The County is permitted by State Law (Article XIII A of the California Constitution) to levy property taxes at one percent (1%) of full market value at time of purchase and can increase the property's value no more than two percent (2%) per year. The City receives a share of this basic levy proportionate to what it received in the 1976 to 1978 period.

The City entered into a participation agreement to abate sales tax with a local business under the City of Orange Municipal Code Section 3.25 Sales Tax Sharing Program. Under the code, the City may grant sales tax abatements of the amount of sales tax a business generates within the City, for the purpose of attracting or retaining businesses within their jurisdictions. For the year ended June 30, 2024, the City abated sales taxes totaling $9,239,654.

NOTE 7: OTHER REVENUES
Other revenues in the General Fund consist mainly of reimbursement for the Annual Street Fair and reimbursements from other agencies for emergency services provided.

Governmental
Activ ities
Business-Type
Activ ities
General government 1,336,570 $ - $
P
ublic safety 1,866,094 -
Public works 5,056,251 -
Parks and library 1,655,173 -
Economic development 122,750 -
Internal serv ice funds 2,424,512 -
Water - 2,502,827
Sanitation - 2,663,382
Total 1
2,461,350$ 5,166,209$
65 439

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 8: RETIREMENT PLAN
A.

Plan Description, Benefits Provided and Employees Covered The Cit
y contributes to the California Public Employees' Retirement System (CalPERS), an agent multiple-employer public employee defined benefit pension plan (the Plan). CalPERS provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and their beneficiaries.

CalPERS acts as a common investment and administrative agent for participating public entities within the State of California. Benefit provisions and all other requirements are established by state statute and memoranda of understanding with employee bargaining units. A full description of the pension plan regarding the number of employees covered, benefit provisions, assumptions (for funding, but not accounting purposes), and membership information are listed in the CalPERS June 30, 2022 Valuation Report. Details of the benefits provided can be obtained in Appendix B of the actuarial valuation report. This report and CalPERS' audited financial statements are publicly available reports that can be obtained at CalPERS' website under Employers.

The Plan provides benefits for two membership classifications, Miscellaneous and Safety, and those benefits are tiered based upon date of CalPERS membership. Safety membership is extended to those in active law enforcement and fire suppression, while all others are classified as Miscellaneous members. Assembly Bill (AB) 340, also known as the Public Employees' Pension Reform Act (PEPRA), created new benefit formulas and a final compensation period as well as new contribution requirements for new employees. For the purpose of PEPRA, "new employees" are those hired on or after January 1, 2013, and had never been a member of CalPERS previously. All employees hired prior to January 1, 2013, or whom, regardless of their hire date had previously been a member of CalPERS, will continue to be covered under the pre-PEPRA plan. All "new employees", per PEPRA, will not be eligible for this plan, and instead will be covered under the PEPRA tiered plan. A summary of the plan benefits in effect at June 30, 2024 is provided below and on the following page.

Hire Date Prior to January 1, 2013 On or After January 1, 2013 Benefit Formula 2.7% @ 55 2% @ 62
Benefit Vesting Schedule 5 Years of Service 5 Years of Service Benefit Payments Monthly for Life Monthly for Life
Retirement Age 50 - 67 52 - 67
Monthly Benefits, as a % of Eligible Compensation 2.0% - 2.7% 1.0% - 2.5% Required Employee Contribution Rates 8% 7.75%
Required Employer Contribution Rates:

Normal Cost Rate 12.68% 12.68%
Miscellaneous
66 440

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 8: RETIREMENT PLAN (CONTINUED)

At the June 30, 2022 valuation date, the following employees were covered by the benefit terms of the Plan:

B. Contribution Description

Section 20814(c) of the California Public Employees' Retirement Law (PERL) requires that the employer contribution rates for all public employers are determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the cost of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The employer is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change if plan contracts are amended. Payments made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan member contributions requirements are classified as plan member contributions. It is the responsibility of the employer to make necessary accounting adjustments to reflect the impact due to any Employer Paid Member Contributions or situations where members are paying a portion of the employer contribution.

Hire Date Prior to January 1, 2013 On or After January 1, 2013 Benefit Formula 3.0% @ 50 2.7% @ 57
Benefit Vesting Schedule 5 Years of Service 5 Years of Service Benefit Payments Monthly for Life Monthly for Life
Retirement Age 50 - 55 50 - 57
Monthly Benefits, as a % of Eligible Compensation 3.00% 2.0% - 2.7% Required Employee Contribution Rates 9% 12.75%
Required Employer Contribution Rates:

Normal Cost Rate 21.36% 21.36%
Safety
Misc. Safety
Inactive employees or beneficiaries currently receiving benefits 730 498 Inactiv e employees entitled to but not yet receiv ing benefits 587 131 Active employees 391 267
Total 1,708 896
67 441

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 8: RETIREMENT PLAN (CONTINUED)
C.

Actuarial Methods and Assumptions Used to Determine Total Pension Liability The City's n
et 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, 2023, using an annual actuarial valuation as of June 30, 2022 rolled forward to June 30, 2023 using standard update procedures.

A summary of principal assumptions and methods used to determine the net pension liability is shown below:

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

Long-term Expected Rate of Return
The long-t
erm 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.

Miscellaneous Safety
Valuation Date June 30, 2022 June 30, 2022
Measurement Date June 30, 2023 June 30, 2023
Actuarial Cost Method
Entry Age Normal Cost
Method
Entry Age Normal Cost
Method
Actuarial Assumptions
Discount Rate 6.90% 6.90%
Inflation 2.50% 2.50%
Projected Salary Increases (1) (1)
Mortality Rate Table (2) (2)
Post Retirement Benefits Increase (3) (3)
(1) D
epending on age, service and type of employment
(3) C
ontract COLA up to 2.3% until Purchasing Power Protection Allowance Floor (2) The probabilities of mortality are based on the 2017 CalPERS Experience Study for the period from 1997 to 2015. Pre-retirement and post-retirement mortality rates include 15 years of projected mortality improvement using 90% of Scale MP-2016 published by the Society of Actuaries. 68 442

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 8: RETIREMENT PLAN (CONTINUED)

In determining the long-term expected rate of return, CalPERS staff took into account both short-term and long-term market return expectations as well as the expected pension fund cash flows. Using historical returns of all the funds' asset classes, expected compound (geometric) returns were calculated over the short-term (first 10 years) and. the long-term (11+ years) using a building-block approach. Using the expected nominal returns for both short-term and long-term, the present value of benefits was calculated for each fund. The expected rate of return was set by calculating the rounded single equivalent expected return that arrived at the same present value of benefits for cash flows as the one calculated using both short-term and long-term returns.

The expected rate of return was then set equal to the single equivalent rate calculated above and adjusted to account for assumed administrative expenses. The expected real rates of return by asset class are as follows:

F. Pension Plan Fiduciary Net Position

The plan fiduciary net position disclosed in the GASB 68 accounting valuation report may differ from the plan assets reported in the funding actuarial valuation report due to several reasons. First, for the accounting valuations, CalPERS must keep items such as deficiency reserves and fiduciary self-insurance included as assets. These amounts are excluded for rate setting purposes in the funding actuarial valuation. In addition, differences may result from early Comprehensive Annual Financial Report closing and final reconciled reserves.

New Strategic
Allocation Real Return 1, 2
Global Equity - Cap-weighted 30.00% 4.54%

12.00% 3.84%

13.00% 7.28%

5.00% 0.27%

5.00% 0.50%

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%
100.00%
1 An expected price inflation of 2.30% used for this period. 2 Figures are based on the 2021-22 Asset Liability Management study.

Asset Class 1
Global Equity Non-Cap-weighted
Priv ate Equity
Treasury
Mortgage-Backed Securities
Investment Grade Corporates
69 443

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 8: RETIREMENT PLAN (CONTINUED)
G.

Changes in the Net Pension Liability-Miscellaneous Plan The follo
wing table shows the changes in net pension liability for the Miscellaneous Plan recognized over the measurement period.

Sensitivity of the Miscellaneous Plan Net Pension Liability to Changes in the Discount Rate The following presents the net pension
liability of the Miscellaneous Plan as of the measurement date, calculated using the discount rate of 6.90 percent, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage- point lower (5.90 percent) or 1 percentage-point higher (7.90 percent) than the current rate:

Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability/(Asset)
(a) (b) (c ) =
(a) - (b)
Balance at June 30, 2022 402,930,185$ 387,123,170$ 15,807,015$ Changes recognized for the
measurement period:

Serv ice cost 6,124,048 - 6,124,048
Interest on total pension liability 27,585,423 - 27,585,423 Changes of assumptions 459,186 - 459,186
D
ifferences between expected and - -
actual experience 4,733,966 - 4,733,966
Contributions from the employer - 4,123,707 (4,123,707) Contributions from the employees - 2,357,110 (2,357,110) Net investment income - 23,356,128 (23,356,128)
Benefit payments, including refunds of
employee contributions (22,793,273) (22,793,273) -
Administrative expense - (284,672)
284,672
Net changes during 2022-23 16,109,350 6,759,000 9,350,350 Balance at June 30, 2023 419,039,535$ 393,882,170$ 25,157,365$ Discount Rate Current Discount Rate
-1 Percent Discount Rate +1 Percent
(5.90%) (6.90%) (7.90%)
Plan's net pension liability/(asset) 79,077,376$ 25,157,365$ (19,328,419)$ 70 444

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 8: RETIREMENT PLAN (CONTINUED)

I. Changes in the Net Pension Liability/(Assets)-Safety Plan

The following table shows the changes in net pension liability for the Safety Plan recognized over the measurement period.

J. Sensitivity of the Safety Plan Net Pension Liability/(Assets) to Changes in the Discount Rate

The following presents the net pension liability of the Safety Plan as of the measurement date, calculated using the discount rate of 6.90 percent, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower (5.90 percent) or 1 percentage-point higher (7.90 percent) than the current rate:

K. Recognition of Gains and Losses

Under GASB 68, gains and losses related to changes in total pension liability and fiduciary net position are recognized in pension expense systematically over time.

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

Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability/(Asset)
(a) (b) (c) = (a) - (b)
Balance at June 30, 2022 645,022,369 $ 598,056,526 $ 46,965,843 $ Changes recognized for the
measurement period:

Serv ice cost 10,646,420 - 10,646,420 Interest on total pension liability 44,229,279 - 44,229,279 Changes of assumptions 260,657 - 260,657 Differences between expected and
actual experience 7,299,176 - 7,299,176 Contributions from the employer - 7,904,822 (7,904,822) Contributions from the employees - 3,670,921 (3,670,921) Net investment income - 36,179,168 (36,179,168) Benefit payments, including refunds of
employee contributions (33,802,706) (33,802,706) - Administrative expense - (439,783) 439,783 Net changes during 2022-23 28,632,826 13,512,422 15,120,404 Balance at June 30, 2023 673,655,195 $ 611,568,948 $ 62,086,247 $ Increase (Decrease)
Discount Rate Current Discount Rate
-1 Percent Discount Rate +1 Percent
(5.90%) (6.90%) (7.90%)
Plan's net pension liability/(asset) 153,722,030$ 62,086,247 $ (12,914,583) $ 71 445

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 8: RETIREMENT PLAN (CONTINUED)
The amortization period differs depending on the source of the gain or loss:

The expected average remaining service lifetime (EARSL) is calculated by dividing the total future service years by the total number of plan participants (active, inactive, and retired). Note that inactive employees and retirees have remaining service lifetimes equal to 0. Also note that total future service is based on the members' probability of decrementing due to an event other than receiving a cash refund.

The EARSL for the Miscellaneous Plan for the 2022-23 measurement period is 2.5 years, which was obtained by dividing the total service years of 4,135 (the sum of remaining service lifetimes of the active employees) by 1,644 (the total number of participants: active, inactive, and retired).

The EARSL for the Safety Plan for the 2022-23 measurement period is 3.8 years, which was obtained by dividing the total service years of 3,270 (the sum of remaining service lifetimes of the active employees) by 870 (the total number of participants: active, inactive, and retired).

Pension Expense and Deferred Outflows and Deferred Inflows of Resources Related to Pensions For the me
asurement period ending June 30, 2023 (the measurement date), the City of Orange incurred a pension expense of $15,152,477 for the Miscellaneous Plan and $28,431,897 for the Safety Plan, allocated as follows:

As of the end of the measurement period (June 30, 2023) and as presented in the June 30, 2024 Statement of Net Position, the net pension liability is $25,157,365 for the Miscellaneous Plan and $62,086,247 for the Safety Plan, allocated as follows:

Difference between projected and actual earnings 5-year straight-line amortization All other amounts Straight-line amortization over the average expected remaining service lives of all members
that are provided with benefits (active, inactive, and
retired) as of the beginning of the measurement
period
Governmental
Activ ities
Business-Type
Activ ities Total
Miscellaneous Plan 12,121,982 $ 3,030,495 15,152,477 $ Safety Plan 28,431,897 - 28,431,897
Total Pension Expense 40,553,879$ 3,030,495$ 43,584,374$ Governmental
Activ ities
Business-Type
Activ ities Total
Miscellaneous Plan 20,125,892 $ 5,031,473 $ 25,157,365 $ Safety Plan 62,086,247 - 62,086,247
Total Net Pension Liability 82,212,139$ 5,031,473 $ 87,243,612 $ 72 446

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 8: RETIREMENT PLAN (CONTINUED)

As of the fiscal year ended June 30, 2024, the City reports deferred outflows and deferred inflows of resources related to pensions as follows:

The $13,162,278 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2025.

Amounts reported as deferred outflows and deferred inflows of resources related to pensions will be recognized in future pension expenses as shown below.

At June 30, 2024, the City had no outstanding amount of contributions to the pension plan required for the year ended June 30, 2024.

Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions subsequent to the measurement date Current year pension contributions 4,517,941 $ - $ Changes of assumptions 2,157,519 -
Differences between expected and actual experience 2,840,380 1,018,971 Net difference between projected and actual earnings on pension plan investments 22,350,733 -
Total 31,866,573 $ 1,018,971 $
Miscellaneous Plan
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions subsequent to the measurement date Current year pension contributions 8,644,337 $ - $ Changes of assumptions 10,471,406 -
Differences between expected and actual experience 6,833,128 1,054,706 Net difference between projected and actual earnings on pension plan investments 35,338,323 -
Total 61,287,194 $ 1,054,706 $
Safety Plan
Miscellaneous Plan Safety Plan
Deferred Deferred
Fiscal year Outflows/(Inflows) Outflows/(Inflows)
ended June 30, of Resources of Resources
2025 8,043,137$ 16,426,237 $
2026 4,847,470 12,852,403
2027 12,887,218 21,449,245
2028 551,836 860,266
Total 26,329,661$ 51,588,151 $
73 447

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 9: INSURANCE PROGRAMS
The City is exposed to various risks of loss related to torts, theft, damage and destruction of assets, errors and omissions, road and walkway design hazards, vehicle accidents, and natural disasters for which the City maintains various insurance programs. The City has entered into contracts with outside vendors to supervise and administer these programs. In addition, the City completes an annual actuarial analysis for the Workers' Compensation and Liability Funds to determine appropriate funding levels.

A. General Liability
The
City is self-insured for General and Auto Liability claims up to $350,000 per occurrence. For amounts in excess of $350,000 and up to $3,000,000 the City participates in a public entity risk pool maintained through the California Insurance Pool Authority (CIPA). CIPA is a consortium of California cities under one joint powers authority agreement, which was established to pool resources, share risks, purchase excess insurance, and to share costs for professional risk management and claims administration. For amounts in excess of $3,000,000, the pool purchases commercial insurance and has coverage up to $33,000,000.

B. Work
ers’ Compensation
The City ha
s a self-insurance program for any liability to City employees arising under the Workers' Compensation laws of the State of California. The City pays up to $500,000 per occurrence. For amounts in excess of $500,000 and up to $2,000,000, the City participates in CIPA. For amounts in excess of $2,000,000, the pool purchases commercial insurance and has coverage up to $52,000,000 per occurrence. There were no changes in insurance coverage from the prior year.

Liabilities are recorded 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). The liability for claims and judgments is reported in the appropriate Internal Service Fund. The amount for current claims payable is calculated based on the current year’s expenses and the remainder is shown as noncurrent claims payable. There were no claims paid in excess of insurance coverage. Changes in claims payable for the years ended June 30, 2023 and June 30, 2024 are outlined below.

General Workers' Total
Liability Compensation Claims
Liability - June 30, 2022 1,373,458$ 14,857,043$ 16,230,501$ Claims incurred 889,691 1,507,120 2,396,811 Claims payments (489,729) (2,357,578) (2,847,307) Unpaid Claims - June 30, 2022 1,773,420 14,006,585 15,780,005 Less current portion of unpaid claims (869,584) (4,461,341) (5,330,925) Noncurrent unpaid claims - June 30, 2023 903,836 9,545,244 10,449,080 Liability - June 30, 2023 1,773,420 14,006,585 15,780,005 Claims incurred 747,855 2,116,634 2,864,489 Claims payments (493,982) (3,756,250) (4,250,232) Unpaid Claims - June 30, 2024 2,027,293 12,366,969 14,394,262 Less current portion of unpaid claims (876,603) (4,392,977) (5,269,580) Noncurrent unpaid claims - June 30, 2024 1,150,690$ 7,973,992$ 9,124,682$ 74 448

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 10: OTHER POST EMPLOYMENT BENEFITS (OPEB)

A. Plan Description

The City administers a single employer defined benefit post-employment healthcare plan for eligible City retirees and their dependents through the California Public Employees' Retirement System (CalPERS). Retirees from the City enrolled in the Public Employees Medical and Hospital Insurance Program (PEMHCA), who retire at age 50 or later and have at least 5 years of service in the CalPERS system are eligible for these benefits. These health insurance benefits are authorized through City Resolutions/Memorandums of Understanding defining health care benefits and contribution levels and through the contractual agreement between the City and CalPERS. The City currently contributes $149 per month for each retiree and the retiree is responsible for the balance of the premium amount. There are no assets accumulated in a trust that meet the criteria in paragraph 4 of GASB Statement 75.

B. Employees Covered

As of the June 30, 2023 actuarial valuation, the following current and former employees were covered by the benefit terms under the plan:

C. Total OPEB Liability

The City’s OPEB liability of $32,787,319 was measured as of June 30, 2023 and was determined by an actuarial valuation as of June 30, 2023.

D. Actuarial Assumptions and Other Inputs

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

Inactive employees or beneficiaries currently receiving benefits 466 Active employees 662
Total 1,128
Valuation Date June 30, 2023
Measurement Date June 30, 2023
Actuarial Cost Method Entry-Age Normal, Lev el % of Salary Actuarial Assumptions:

Discount Rate 3.86%
Inflation 2.30%
Projected Salary Increase 2.80%, Additional merit based increases based on CalPERS Merit
Salary Increase Table
Health Care Cost Trend Rates 7.4% (Pre-Medicare)/4.2% (Medicare) in first year, trending down to 4.14% over
52 years
Pre-retirement Turnover Derived from CalPERS Pension
Assumption Model, effectiv e Nov ember
17, 2021
Mortality Rate Derived from CalPERS Pension
Assumption Model, effectiv e Nov ember
17, 2021
75 449

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NOT
E 10: OTHER POST EMPLOYMENT BENEFITS (OPEB) (CONTINUED) The discount rate used to measure the total OPEB liability is 3.86%. The City's OPEB Plan is an unfunded plan, therefore the discount rate was set to the rate of tax exempt, high-quality 20-year municipal bonds, as of the valuation date.

Changes in Total OPEB Liability
F.

Sensitivity of the Total OPEB Liability to Changes in the Discount Rate The followi
ng presents 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 one percentage point lower or 1 percentage rate higher than the current rate: G.

Sensitivity of the Total OPEB Liability to Changes in the Healthcare Cost Trend Rates The following presents the total OPEB li
ability 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 one percentage point lower or 1 percentage rate higher than the current healthcare cost trend rates:

Total OPEB Liability
Balance at June 30, 2022 (Measurement Date) 37,411,365$ Changes in the Year:

Service Cost 1,552,104
I
nterest on the Total OPEB Liability 1,410,255
D
ifference Between Expected and Actual Experience (2,398,558) Changes in Assumptions (3,697,487)
Contribution - Employer (581,215)
Implicit Subsidy Fulfilled (909,145)
Net Changes (4,624,046)
Balance at June 30, 2023 (Measurement Date) 32,787,319$ Discount Rate Current Discount Rate
-1 Percent Discount Rate +1 Percent
(2.86%) (3.86%) (4.86%)
Total OPEB Liability 36,963,621$ 32,787,319 $ 29,304,402 $ Current Healthcare
1% Decrease 6.40%
Cost Trend Rates

7.40% 1% Increase 8.40%
Decreasing to 3.14% Decreasing to 4.14% Decreasing to 5.14% Total OPEB Liability 31,268,700$ 32,787,319 $ 34,576,518 $ 76 450

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 10: OTHER POST EMPLOYMENT BENEFITS (OPEB) (CONTINUED)

H. OPEB Expense and Deferred Outflows of Resources Related to OPEB

The $1,525,374 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the total OPEB liability in the year ended June 30, 2025.

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

NOTE 11: LONG-TERM LIABILITIES

Following is a reconciliation of long-term liabilities for the year ended June 30, 2024:

Deferred Outflows Deferred Inflows
of Resources of Resources
Differences between expected and actual experience 860,758$ 5,265,099 $ Changes in assumptions 4,922,716 9,811,801
Contributions subsequent to measurement date 1,525,374 - Total Deferred Outflows 7,308,848$ 15,076,900$
Year Ending
June 30, Amount
2025 (820,128)$
2026 (815,424)
2027 (1,053,893)
2028 (1,664,780)
2029 (1,949,372)
Thereafter (2,989,829)
Total (9,293,426)$
Amount Amount
Beginning Ending Due Within Due Beyond
Balance Additions Deletions Balance One Year One Year
Gov ernmental activ ities
Direct borrowing:

Loans payable 147,240 $ - $ 70,095$ 77,145 $ 49,772 $ 27,373 $ Leases payable 121,036 83,690 93,994 110,732 55,426 55,306 Subscription payable 7,075,011 563,094 1,072,469 6,565,636 811,712 5,753,924 Lease revenue bonds 28,860,000 - 570,000 28,290,000 595,000 27,695,000 Premium on lease
revenue bonds 3,937,907 - 145,848 3,792,059 - 3,792,059 Pension obligation bonds 248,970,043 - 10,337,072 238,632,971 10,401,938 228,231,033 Other liabilities:

Compensated absences 9,595,557 5,983,155 4,188,725 11,389,987 4,972,044 6,417,943 Claims payable 15,780,005 2,864,489 4,250,232 14,394,262 5,269,580 9,124,682 Total governmental activities 314,486,799 9,494,428 20,728,435 303,252,792 22,155,472 281,097,320 Business-type activities:

Compensated absences 769,896 287,933 158,593 899,236 185,237 713,999 Pension obligation bonds 19,699,957 - 817,929 18,882,028 823,062 18,058,966 Subscription liability 579,585 207,695 185,591 601,689 130,552 471,137 Total business activities 21,049,438 495,628 1,162,113 20,382,953 1,138,851 19,244,102 Total 335,536,237 $ 9,990,056$ 21, 890,548$ 323,635,745$ 23,294,323$ 300,341,422$ 77 451

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NOT
E 11: LONG-TERM LIABILITIES (CONTINUED)
In April 2018 and May 2019, the City entered into a series of loan agreements with Southern California Edison for LED retrofit of city-owned streetlights. The loans total $1,682,026 and carry a zero percent interest rate. The outstanding balance at June 30, 2024 is $77,145.

The annual payments are as follows:

On July 16, 2020, the City of Orange Public Facilities Financing Authority issued Lease Revenue Bonds Series 2020A in the amount of $29,930,000. Proceeds of the bonds will be used to: (i) finance the construction of a new Fire Headquarters and Station No. 1, roof replacement and other improvements to the City's Police Headquarters and the City's other fire stations; and installation of security improvements at various City facilities; and costs of issuance of the Bonds. The interest rate on the bonds is 4%. The bonds are payable in annual installments of $520,000 to $1,680,000 and are scheduled to mature in 2051.

The annual debt service payments for these bonds are made from the General Fund and are shown on the following page.

Year Ending
June 30, Principal
2024-25 49,772$
2025-26 27,373
Total 77,145$
Year Ending
June 30, Principal Interest Premium
2025 595,000$ 1,119,700$ 145,848$
2026 620,000 1,095,400 145,848
2027 645,000 1,070,100 145,848
2028 670,000 1,043,800 145,848
2029 695,000 1,016,500 145,848
2030-2034 3,935,000 4,632,100 729,242
2035-2039 4,805,000 3,761,100 729,242
2040-2044 5,865,000 2,697,500 729,242
2045-2049 7,165,000 1,398,500 729,242
2050-2051 3,295,000 133,100 145,851
Total 28,290,000$ 17,967,800$ 3,792,059$
78 452

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024

NOTE 11: LONG-TERM LIABILITIES (CONTINUED)

On March 3, 2021, the City issued 2021 Taxable Pension Obligation Bonds in the amount of $286,485,000.

Proceeds of the bonds were used to (i) pay all of the City's currently unamortized, unfunded accrued actuarial liability to the California Public Employees Retirement System with respect to the City's defined benefit retirement plans for City employees; (ii) to pay the premium for a municipal bond insurance policy for the Insured Bonds; and (iii) pay costs of issuance of the Bonds. Interest on the bonds ranges from .291% to 2.82%. The bonds are payable in annual installments of $7,695,000 to $12,455,000 and are scheduled to mature in 2044. The annual debt service payments for these bonds are paid through the Debt Service fund, with funds transferred in from General Government funds and Enterprise funds.

Loans payable are paid for from the General Fund. Compensated absences are paid from the Employee Accrued Liability Fund and claims payable are paid from the Workers' Compensation Fund and the Liability Fund.

NOTE 12: COMMUNITY FACILITIES AND ASSESSMENT DISTRICTS AND OTHER REVENUE BOND ISSUES

In February 2004, Community Facilities District No. 91-2 issued refunding bonds in the amount of $37,530,000 to finance the acquisition and/or construction of public improvements. In April 2013, bonds in the amount of $28,810,000 were issued to refund the 2004 bonds. In December 2021, bonds in the amount of $18,492,000 were issued to refund the 2013 bonds. The interest rate on this debt is 1.9%. The bonds outstanding at June 30, 2024 are $16,293,000 and are scheduled to mature in October 2030.

Year Ending
June 30, Principal Interest
2025 10,401,938$ 6,051,495$
2026 10,499,239 5,950,180
2027 10,628,974 5,821,670
2028 10,795,776 5,652,988
2029 10,990,387 5,460,067
2030-2034 58,746,626 23,504,788
2035-2039 66,623,372 15,303,580
2040-2044 59,946,659 5,110,465
Total 238,632,971$ 72,855,233$
Gov ernmental Activ ity
Year Ending
June 30, Principal Interest
2025 823,062$ 478,829$
2026 830,761 470,813
2027 841,026 460,644
2028 854,224 447,297
2029 869,622 432,032
2030-2034 4,648,374 1,859,835
2035-2039 5,271,628 1,210,908
2040-2044 4,743,331 404,370
Total 18,882,028$ 5,764,728$
Business Type Activ ity
79 453

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NOT
E 12: COMMUNITY FACILITIES AND ASSESSMENT DISTRICTS AND OTHER REVENUE BOND

ISSUES (CONTINUED)
In March 2015, Community Facilities District 06-1 issued 2015 Special Tax Refunding Bonds in the amount of $23,920,000. Proceeds of the bonds were used to a) refund all of the outstanding Community Facilities District No. 06-1 2010 Special Tax Bonds, which were originally issued to finance the acquisition of a park site and construction of public improvements, b) make a deposit into the Reserve Fund established under the Fiscal Agent Agreement and c) pay costs of issuance. The interest rate on the debt is variable, ranging from 2% to 5%. The bonds outstanding at June 30, 2024 are $20,705,000 and are scheduled to mature in October 2040.

The City has no obligation or duty to pay any delinquency out of any available funds of the City. The City is only acting as an agent for the property owners in collecting the assessments and then seeing that the debt service payments are made, and neither the faith and credit, nor the taxing power of the City, is pledged to the payment of the bonds.

NOTE 13: JOINT VENTURES
The City is a participant in the Anaheim-Garden Grove-Orange Fire Training Facility Authority, a joint powers authority created to finance fire training. These cities have one representative each on the Authority's three-member Board of Directors. The City's share of the Authority's costs is included in the accompanying financial statements as expenditures of the General Fund and is immaterial to the operations of the City. Separate financial statements may be obtained for the Fire Training Facility Authority from the City of Garden Grove.

In addition to the Fire Training Facility Authority, the Cities of Orange, Anaheim, Fountain Valley, Fullerton, Garden Grove, Brea, Huntington Beach, and Newport Beach have formed a regional dispatch operation to provide dispatch services for those cities.

The City of Orange's share of costs for these dispatch services is immaterial to the operations of the City. The financial management and administration of this operation is the responsibility of the City of Anaheim. Separate financial statements may be obtained for the Metro Cities Fire Authority from the City of Anaheim.

NOTE 14: LOANS RECEIVABLE
With the dissolution of the Redevelopment Agency effective January 31, 2012, the City Council adopted a resolution authorizing the City to become the Successor Housing Agency and enabling the City to retain housing assets and functions of the Redevelopment Agency. The Successor Housing Agency provides housing loans for the rehabilitation and expansion of housing for low and moderate-income families in the City. Housing rehabilitation loans are for the purpose of rehabilitating and upgrading existing housing due to structural deficiencies. Housing loans also assist in the construction of new multi-family housing projects or the rehabilitation of existing multi-family units.

Additionally, the former Redevelopment Agency issued several promissory notes, pursuant to and in implementation of the "Affordable Housing Resale Restrictions Option to Designate Eligible Purchaser with Alternative Option to Purchase and Option to Purchase Upon Default". These notes do not actually represent cash paid to the borrowers, but represent the subsidy constructively received by the borrower as a result of borrowers' purchase of the property at a price below its fair value. No repayment of these notes is due by the borrower until the Affordable Term of the loan date (45 years commencing from the loan date), or upon sale of the property or default, as described in the note. At June 30, 2024, the outstanding amount for these loans was $378,668. Due to the length of the deferral and the uncertainty of repayment on these loans, the outstanding balance is offset by an allowance for the full amount of the note.

In May 2013, the City entered into a Refinancing Agreement that provides for the Developer of the Serrano Woods Affordable Housing Project to restructure the permanent financing for the Serrano Woods project while maintaining compliance with affordable housing requirements. This Refinancing Agreement provided for a City loan from the In-lieu Housing funds in the amount of $4,300,000. The loan balance at June 30, 2024 is $4,294,711.
80 454

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 14: LOANS RECEIVABLE (CONITNUED)
On December 21, 2022, the City entered into Financing Agreements that provided the Developer of the Villa St.

Joseph Affordable Housing Project for the acquisition and development of forty-nine (49) affordable rental housing units for Extremely Low Income, Very Low Income, Low Income Senior Citizen Households, and one (1) manager’s unit located at 480 South Batavia Street in the City of Orange, while maintaining compliance with the affordable housing requirements. The Financing Agreements provided for City loans from the House In-Lieu Fund in the amount of $372,756, from the HOME Fund in the amount of $651,244, and from the Housing Successor Fund in the amount of $576,000. The loan balances at June 30, 2024 are $297,309 for the House In- Lieu Fund, $586,119 for the HOME Fund, and $458,696 for the Housing Sessor Fund.

On January 23, 2024, the City entered into a Financing Agreement that provided the Developer of 1800 E. La Veta Avenue in the City of Orange for the development and operation of one hundred sixty-four (164) affordable rental housing units for Extremely Low Income and Low Income Senior Citizen Households, and two (2) manager’s units. The Financing Agreement provided for a City loan from the Housing Successor Fund in the amount of $2,200,000. The loan balance is $1,980,000 at June 30, 2024.

Under the HOME and CDBG programs, the City provides housing loans to eligible City of Orange residents and low-income housing projects.

Outstanding loan balances, net of allowances for estimated uncollectible amounts, for these housing loans at June 30, 2024 are comprised of the following:

NOTE 15: DUE TO/FROM OTHER FUNDS
Short-term loans of cash were made from the General fund to the SB2 Building Home & Jobs Act fund in the amount of $656,907 and to the Equipment Maintenance fund in the amount of $181,244 to cover deficit cash balances as of June 30, 2024. Short-term loans of cash were also made from the Capital Improvement fund to the Air Pollution Reduction fund to cover costs.

NOTE 16: TRANSFERS
Total
Housing successor loans 28,921,146$
In-lieu loans 4,592,019
HOME loans 10,648,492
CDBG loans 378,668
Total Loans 44,540,325 $
Internal
Transfers Out General Sanitation Water Serv ice Total
Capital Improvement1,3 2,500,000$ 1,160,503 $ 1,149,767 $ 1,000,000 $ 5,810,270 $ Federal, State & Local Grants2 129,049 - - - 129,049 Total 2,629,049$ 1,160,503$ 1,149,767$ 1,000,000$ 5,939,319$ Transfers In
1The above Capital Improvement transfers were for $2,500,000 to the general fund for general services and $1,000,000 to the internal service fund to fund the self insurance liability. 2The Transfer from the Federal, State & Local Grants fund to the general fund is for the HUB OC eligible expenses. 3The Transfer from the Capital Improvement fund for $2,310,270 to the Enterprise funds is for contributed CIP paid for by the Capital Improvement fund.
81 455

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NO
TE 17: DEFICIT FUND BALANCE OR NET POSITION
In the non-major Special Revenue funds, the Opioid Settlement fund ended the fiscal year in a deficit fund balance of $613. This deficit is due to the negative use of money and property and unearned revenues yet to be recognized into fund balance.

In the Internal Service funds, the Equipment Maintenance fund had a deficit net position of $4.6 million, due to the GASB 68 journal entry, which requires the recording of the fund's unfunded net pension liability and GASB 75, which requires the recording of the fund's total Other Post-Employment Benefits liability. The Workers' Compensation Fund and the Liability Fund had deficit net positions of $7.9 million and $691,138, respectively, due the year-end recording of actuarial determined future claims payable. It is the City's policy not to fund these deficits, as these items do not represent tangible expenses.

NOTE 18: GOVERNMENTAL FUND BALANCES
NOTE 19: CONTINGENCIES
The City is involved in pending lawsuits of a nature common to many similar jurisdictions. City Management estimates that these potential claims against the City, not covered by insurance, will not have a material adverse effect on the financial position of the City.

NOTE 20: SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY A. Cash and Investments
Ca
sh and investments reported in the accompanying financial statements consisted of the following:

B. Loans
Receivable
Comm
ercial loans were issued to private businesses to fund development projects within the former Orange Merged and Amended Redevelopment Project Area through a variety of commercial rehabilitation loan programs. The loans bear interest rates ranging from 2% to 3% per annum and are to be repaid in installments over an established time period, if not fully or partially forgiven.

General Proposition 172 Measure M
Federal, State
& Local Grants
Housing
Successor
Capital
Improvement
Park
Acquisition,
Development
and
Other
Governmental Total
Nonspendable 271,684 $ -$ -$ -$ -$ -$ -$ -$ 271,684$ Restricted for:

Public safety - 841,793 - - - - - 2,378,398 3,220,191
Federal, state & local grants - - - 8,472,514 - - - - 8,472,514 Housing - - - - 28,615,840 - - - 28,615,840 Streets/roads/transportation improv. - - 5,217,331 - - - - 3,200,563 8,417,894 Development related transportation improv. - - - - - - - 4,208,776 4,208,776 Air quality - - - - - - - 253,932 253,932 Asset forfeiture operations - - - - - - - 4,114,990 4,114,990 Assessment district landscape maint. - - - - - - - 2,161,880 2,161, 880 Gov t access/local access programming - - - - - - - 411,389 411,389 Affordable housing units - - - - - - - 6,465,618 6,465,618 Training/certifying building inspectors - - - - - - - 567,013 567,013 Total restricted - 841,793 5,217,331 8,472,514 28,615,840 - - 23,762,559 66,910,037 Committed 23,891,358 - - - - - - - 23,891,358 Assigned 3,568,489 - - - - 22,436,013 9,740,836 2,578,172 38,323,510 Unassigned 726,027 - - - - - - (613) 725,414 Total fund balances 28,457,558$ 841,793$ 5,217,331$ 8,472,514$ 28,615,840$ 22,436,013$ 9,740,836$ 26,340,118$ 130,122,003$ Cash and investments pooled with the City 7,135,999$
Cash and inv estments with fiscal agent 1,749
T
otal Cash 7,137,748$
82 456

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NOT
E 20: SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY (CONTINUED)
The majority of loans are repaid in monthly or yearly installments. In addition, loans were issued under the Small Business Assistance (SBA) Programs. The programs are intended to promote and encourage property owners and tenants to rehabilitate commercial, retail and/or industrial properties located within the former Orange Merged and Amended Redevelopment Project Area. The SBA Programs are comprised of seven loan programs designed to provide incentives to property owners and tenants to upgrade signage, enhance landscaping, improve exterior facades, and other property improvements.

The seven SBA programs are as follows:
x Landscape Incentive - interest-free, 50/50 matching loan up to $60,000, 50% of which can be forgiven upon meeting certain performance conditions.
x Signage Incentive - interest-free, 50/50 matching loan up to $30,000, 50% of which can be forgiven upon meeting certain performance conditions.
x Restaurant Equipment Incentive - loans up to $30,000 to install grease interceptors in restaurants, 50% of which can be forgiven upon meeting certain performance conditions. x Property Improvement - interest-free loan up to $250,000 to upgrade building facades, parking, lighting, and related improvements. Upon timely repayment of the first 75% of the loan balance, the remaining 25% is forgiven.
x Old Towne Retail - a 3% interest loan up to $100,000 to bring older buildings into conformance with the current Uniform Building Code, 50% of which can be forgiven upon meeting certain performance conditions. x Hotel Rehabilitation Loan - loan to assist in the retention, attraction and expansion of hospitality uses seeking to upgrade existing and/or construct new facilities in the Project Area.

The outstanding balance of these loans, net of allowances for forgiveness and doubtful accounts, at June 30, 2024 is $422,063.

C. Long-Ter
m Debt
A descri
ption of long-term debt outstanding (excluding defeased debt) of the Successor Agency as of June 30, 2024, follows:

Tax Allocation Bonds
To provi
de funds to refund the Tustin Street Redevelopment Project 1997 Taxable Tax Allocation Parity Bonds, Series B, the Agency sold Orange Merged and Amended Redevelopment Project Area 2008 Taxable Tax Allocation Refunding Bonds, Series B, on May 1, 2008, in the amount of $6,180,000 maturing September 1, 2027.

The initial bonds were issued for redevelopment purposes. The current issue is comprised of serial bonds and term bonds. The serial bonds are payable in annual installments of $85,000 to $395,000 and mature in the years prior to 2020. The term bonds are payable in annual installments of $410,000 to $635,000 and mature in the years 2021 to 2027. Interest rates on the refunding bonds range from 5.00% to 6.20%. In lieu of cash funding the Reserve Account, the Successor Agency purchased the Reserve Fund Insurance Policy to satisfy the "Reserve Requirement” as defined in the Indenture. The bonds outstanding at June 30, 2024 were $2,300,000.

Beginning
Balance Deletions Ending Balance
Due Within
One Year
Due Beyond
One Year
Other debt:

Tax allocation bonds 27,010,000$ (4,335,000) $ 22,675,000 $ 1,265,000 $ 21,410,000 $ Unamortized bond premium 2,364,512 (353,740) 2,010,772 167,564 1,843,208 Total 29,374,512$ (4,688,740)$ 24,685,772$ 1,432,564$ 23,253,208$ 83 457

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NOT
E 20: SUCCESSOR AGENCY TRUST FOR ASSETS OF FORMER REDEVELOPMENT AGENCY (CONTINUED)
In December 2014, to provide funds to a) advance refund the outstanding Tustin Street Redevelopment Project 1997 Tax Allocation Parity Bonds, Series A, issued by the Former Agency in the original principal amount of $3,280,000 and the outstanding Orange Merged and Amended Redevelopment Project Area 2003 Tax Allocation Refunding Bonds, Series A issued by the former Agency in the original principal amount of $45,915,000, b) a
cquire a debt service reserve fund surety bond for the debt service reserve account under the Indenture, and c) p
rovide for the cost of issuing the 2014 bonds, the Successor Agency issued Orange Merged and Amende d Red
evelopment Project Area 2014 Tax Allocation Refunding Bonds, Series A in the amount of $28,850.0 00. The 2014 bo
nds are payable in annual installments of $2,745,000 to $3,845,000 and mature 20 24. Interest rates on the bond
s range from 3.00% to 5.0%. In lieu of cash funding the Reserve Account, the Successor Agency purchased the Reserve Fund Insurance Policy to satisfy the "Reserve Requirement" as defined in the Ind enture.

The final pri
ncipal payment of $3,845,000 was completed during fiscal year 2024.

In July 20
18, to provide funds to a) advance refund the outstanding Orange Merged and Amended Redevelopment Project Area 2008 Tax Allocation Bonds, Series A, issued by the Former Agency in the original principal amount of $33,450,000, b) acquire a debt service reserve fund surety bond for the debt service reserve account under the Indenture, and c) provide for the cost of issuing the 2018 bonds, the Successor Agency issued Orange Merged and Amended Redevelopment Project Area 2018 Tax Allocation Refunding Bonds, Series A in the amount of $20,375.000. The 2018 bonds are payable in annual installments of $750,000 to $2,265,000 and mature 2036. Interest rates on the bonds range from 4.00% to 5.00%. The Successor Agency completed the refunding to reduce its total debt service payments over the next 20 years by more than $3.7 million, resulting in an economic gain (difference between the present value of the old and new debt service payments) of approximately $2.6 million. The bonds outstanding at June 30, 2024 were $20,375,000.

Annual requirements to amortize all tax allocation bonds, notes payable, leases payable, and certificates of participation outstanding as of June 30, 2024 are shown below:

The Successor Agency of the former RDA is covered by insurance policies of the City of Orange as of June 30, 2024.

Year Ending
June 30, Principal Interest
2025 1,265,000$ 1,021,635$
2026 1,330,000 958,020
2027 1,410,000 890,570
2028 1,475,000 815,085
2029 1,565,000 735,275
2030-2034 9,100,000 2,398,775
2035-2037 6,530,000 398,800
Total 22,675,000$ 7,218,160$
Tax Allocation Bonds
84 458

CITY OF ORANGE, CALIFORNIA
Notes to the Basic Financial Statements
For the Year Ended June 30, 2024
NOTE 21: CONSTRUCTION COMMITMENTS AND CONTINGENCIES
The City has active construction projects as of June 30, 2024. The significant projects include the following:

NOTE 22: SUBSEQUENT EVENT S
In preparing these financial statements, the City has evaluated events and transactions for potential rec ognition or disclosure through March 03, 2025, the date the financial statements were available to be issued. No other events or transactions were identified that required recognition or disclosure.

Project Remaining Commitment
Pipeline Renewal 5,841,667$
Corp Yard Renov ations 4,476,809
Pavement Management Program 4,277,256
Hart Park Pickleball & Fitness Circuit 2,509,177
Sewer Line Maintenance/Replacement 2,488,568
Walnut Avenue Storm Drain 2,078,469
Well 29 Construction 1,600,462
Citywide Storm Drain Improvements 1,327,258
Katella Signal Network Extension 1,315,286
85 459
7+,63$*(,17(17,21$//</()7%/$1.
86 460
87 461
7+,63$*(,17(17,21$//</()7%/$1.
88 462

General Fund

General Fund - This fund has been classified as a major fund and is used to account for revenues and expenditures that are not required to be accounted for in another fund.

Special Revenue Fund

Proposition 172 – This fund is used to account for sales tax restricted by voter mandate for public safety services enhancements.

Measure M – This fund is used to account for receipts and expenditures relating to transportation improvement projects and programs, funded by local ½ cent sales tax.

Federal, State and Local Grants – This fund is used to account for grant programs such as Community Development Block Grant, Housing and Urban Development Grant, California Parklands Grant, Citizens Option for Public Safety (COPS) Grant, Traffic Safety Grant, Justice Assistance Grant, and other.

Housing Successor - This fund is used to account for low and moderate housing activities as of February 1, 2012, when the City became the successor housing agency to the former Redevelopment Agency, upon its dissolution.

Prior to that, these activities were accounted for in the Redevelopment Agency Housing fund.

89 463
7+,63$*(,17(17,21$//</()7%/$1.
90 464

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual General Fund
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Taxes 110,813,201$ 110,813,201 $ 111,273,077 $ 459,876$ Franchise fees 2,852,060 2,852,060 2,981,298 129,238 Licenses and permits 6,380,474 6,404,011 6,760,790 356,779 Intergovernmental 1,718,000 3,020,176 4,011,532 991,356 Charges for services and fees 9,894,086 10,086,377 11,135,922 1,049,545 Use of money and property 1,466,491 1,470,316 4,816,261 3,345,945 Fines and forfeitures 1,899,000 1,899,000 1,747,537 (151,463) Miscellaneous 1,298,590 1,840,154 1,631,796 (208,358) Total revenues 136,321,902 138,385,295 144,358,213 5,972,918

EXPENDITURES
Current:

General government 8,885,989 9,346,639 12,489,030 (3,142,391) Public safety 94,119,358 95,898,077 96,249,747 (351,670) Community development 6,161,677 7,014,613 6,251,653 762,960 Parks and library 17,866,864 18,687,723 17,054,804 1,632,919 Public works 10,419,911 11,313,657 10,168,341 1,145,316 Economic development 161,452 161,452 147,731 13,721 Capital outlay 134,992 521,570 115,047 406,523 Debt service:

Principal 570,000 570,000 640,095 (70,095) Interest and fiscal charges 1,143,000 1,143,000 1,141,460 1,540 Total expenditures 139,463,243 144,656,731 144,257,908 398,823 Excess (deficiency) of revenues
over (under) expenditures (3,141,341) (6,271,436) 100,305 6,371,741

OTHER FINANCING SOURCES (USES)
Transfers in 3,863,281 3,992,330 2,629,049 (1,363,281) Transfers out (1,363,281) (1,363,281) - 1,363,281 Total other financing sources (uses) 2,500,000 2,629,049 2,629,049 - Net change in fund balances (641,341)$ (3,642,387)$ 2,729,354 6,371,741$ Fund balances-beginning 25,728,204
Fund balances-ending 28,457,558$
Budget Amounts
91 465

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Proposition 172
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Taxes 1,312,156$ 1,312,156$ 1,281,262$ (30,894)$ Use of money and property - - 30,443 30,443 Total revenues 1,312,156 1,312,156 1,311,705 (451)

EXPENDITURES
Current:

General government 28,006 28,006 28,006 - Public safety 1,137,024 1,137,024 657,126 479,898 Capital outlay 41,600 41,600 35,556 6,044 Total expenditures 1,206,630 1,206,630 720,688 485,942 Net change in fund balances 105,526$ 105,526$ 591,017 485,491$ Fund balances-beginning 250,776
Fund balances-ending 841,793$
Budget Amounts
92 466

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Measure M
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Taxes 4,186,844$ 4,186,844$ 3,389,302$ (797,542)$ Intergovernmental 193,516 193,516 123,777 (69,739) Use of money and property 37,189 37,189 321,198 284,009 Total revenues 4,417,549 4,417,549 3,834,277 (583,272)

EXPENDITURES
Current:

Parks and library 412,627 857,386 404,288 453,098 Public works 701,221 761,461 936,415 (174,954) Capital outlay 2,825,000 7,723,309 3,473,596 4,249,713 Total expenditures 3,938,848 9,342,156 4,814,299 4,527,857 Net change in fund balances 478,701$ (4,924,607)$ (980,022) 3,944,585$ Fund balances-beginning 6,197,353
Fund balances-ending 5,217,331$
Budget Amounts
93 467

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Federal, State & Local Grants
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental 1,828,638$ 1,841,522$ 2,766,999$ 925,477$ Charges for services and fees 140,000 140,000 154,800 14,800 Use of money and property 225 225 183,509 183,284 Miscellaneous 12,094 12,094 2,908,212 2,896,118 Total revenues 1,980,957 1,993,841 6,013,520 4,019,679

EXPENDITURES
Current:

Public safety 437,612 437,612 406,214 31,398 Economic development 410,692 1,311,607 1,361,111 (49,504) Capital outlay 1,099,398 3,133,147 264,455 2,868,692 Total expenditures 1,947,702 4,882,366 2,031,780 2,850,586 Excess (deficiency) of revenues
over (under) expenditures 33,255 (2,888,525) 3,981,740 6,870,265

OTHER FINANCING SOURCES (USES)
Transfers out - (129,049) (129,049) - Total other financing sources (uses) - (129,049) (129,049) - Net change in fund balances 33,255$ (3,017,574)$ 3,852,691 6,870,265$ Fund balances-beginning 4,619,823
Fund balances-ending 8,472,514$
Budget Amounts
94 468

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Housing Successor
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Use of money and property 85,341$ 85,341 $ 242,751 $ 157,410$ Miscellaneous - - 12,531,973 12,531,973 Total revenues 85,341 85,341 12,774,724 12,689,383

EXPENDITURES
Current:

General government 27,458 27,458 27,178 280 Community development 52,955 181,660 151,415 30,245 Economic development 32,242 2,808,242 30,051 2,778,191 Total expenditures 112,655 3,017,360 208,644 2,808,716 Net change in fund balances (27,314)$ (2,932,019)$ 12,566,080 15,498,099$ Fund balances-beginning 16,049,760
Fund balances-ending 28,615,840$
Budget Amounts
95 469

CITY OF ORANGE, CALIFORNIA
Schedule of Changes in Total OPEB Liability and Related Ratios As of June 30, for the Last Ten Fiscal Years 1
2024 2023 2022
Measurement Date 6/30/2023 6/30/2022 6/30/2021

TOTAL OPEB LIABILITY
Service cost 1,552,104$ 2,229,321 $ 2,020,586$ Interest on total pension liability 1,410,255 880,729 1,112,493 Changes of assumptions (3,697,487) (8,604,291) 3,582,060 Difference between expected and actual experience (2,398,558) (24,560) (4,973,808) Benefit payments, including refunds of employee
contributions (581,215) (537,370) (503,530) Implicit subsidy fulfilled (909,145) (886,427) (1,045,784) Net change in total OPEB liability (4,624,046) (6,942,598) 192,017 Total OPEB liability-beginning 37,411,365 44,353,963 44,161,946 Total OPEB liability-ending 32,787,319$ 37,411,365$ 44,353,963$ Covered-employee payroll 61,844,646$ 61,715,879 $ 58,599,662$ Plan net OPEB liability/(asset) as a percentage of
covered-employee payroll 53.0% 60.6% 75.7%
Notes to Schedule of Changes in the Total OPEB Liability and Related Ratios:

Benefit Changes : None
Changes of Assumptions : For the fiscal year ended June 30, 2024, the City's actuary updated assumptions in determining the total OPEB liability for: healthcare trends; mo rtality tables; merit salary increase tables; retirement, termination and disability rates; decrement timing; spousal rate; and the discount rate. See Note 10 to the financial statements for details on the actuarial methods and assump tions. For changes in the preceding years, refer to those years' respective annual comprehensive financial reports. 1 Fiscal year 2018 was the first year of GASB Statement No. 75 implementation; therefore only seven years are shown.
96 470
2021 2020 2019 2018
6/30/2020 6/30/2019 6/30/2018 6/30/2017
1,679,816$ 1,358,445 $ 1,360,032 $ 1,322,024 $ 1,252,988 1,201,679 1,119,120 1,087,864 3,630,272 2,818,825 (371,560) - (25,507) 2,516,073 - - (486,947) (1,305,875) (1,207,876) (1,148,907) (967,848) - - - 5,082,774 6,589,147 899,716 1,260,981 39,079,172 32,490,025 31,590,309 30,329,328 44,161,946$ 39,079,172 $ 32,490,025 $ 31,590,309 $ 52,413,430$ 49,778,287 $ 59,649,993 $ 58,053,521 $

84.3% 78.5% 54.5% 54.4%
97 471

CITY OF ORANGE, CALIFORNIA
Schedule of Changes in Net Pension Liability and Related Ratios Miscellaneous Plan
As of June 30, for the Last Ten Fiscal Years 1
2024 2023 2022 2021 2020
Measurement Date 6/30/2023 6/30/2022 6/ 30/2021 6/30/2020 6/30/2019

TOTAL PENSION LIABILITY
Service cost 6,124,048$ 5,836,901 $ 5,435,892 $ 5,189,996 $ 5,067,666$ Interest on total pension liability 27,585,423 26,520,235 26,300,226 25,659,248 24,866,459 Changes of benefit terms 459,186 - - - - Changes of assumptions - 10,787,597 - - - Difference between expected and actual experience 4,733,966 (5,094,851) (1,615,823) 753,998 315,824 Benefit payments, including refunds of employee
contributions (22,793,273) (21,719,479) (20,507,418) (20,275,870) (19,046,828) Net change in total pension liability 16,109,350 16,330,403 9,612,877 11,327,372 11,203,121 Total pension liability-beginning 402,930,185 386,599,782 376,986,905 365,659,533 354,456,412 Total pension liability-ending (a) 419,039,535 402,930,185 386,599,782 376,986,905 365,659,533

PLAN FIDUCIARY NET POSITION
Contributions-employer 4,123,707 3,462,240 115,571,257 10,335,791 8,895,425 Contributions-employee 2,357,110 2,358,367 2,208,136 2,175,496 2,344,603 Net investment income 23,356,128 (32,211,334) 67,731,016 13,126,364 16,762,810 Benefit payments, including refunds of employee
contributions (22,793,273) (21,719,479) (20,507,418) (20,275,870) (19,046,828) Net plan to plan resource movement - - - - - Administrative expense (284,672) (271,293) (270,485) (374,692) (183,409) Other miscellaneous income/(expense) - - - - 599 Net change in fiduciary net position 6,759,000 (48,381,499) 164,732,506 4,987,089 8,773,200 Plan fiduciary net position-beginning 387,123,170 435,504,669 270,772,163 265,785,074 257,011,874 Plan fiduciary net position-ending (b) 393,882,170 387,123,170 435,504,669 270,772,163 265,785,074 Net pension liability/(asset) (a) - (b) 25,157,365$ 15,807,015$ (48,904,887)$ 106,214,742$ 99,874,459$ Plan fiduciary net position as a percentage of the
total pension liability 94.0% 96.1% 112.7% 71.8% 72.7%
Covered payroll 30,789,582$ 29,053,762 $ 29,494,804 $ 27,858,270 $ 26,357,030$ Plan net pension liability/(asset) as a percentage of
covered payroll 81.7% 54.4% -165.8% 381.3% 378.9%
Notes to Schedule of Changes in the Net Pension Liability and Related Ratios:

Benefit Changes: 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. In 2022, SB 1168 increased the standard retiree lump sum death benefit from $500 to $2,000 for any death occurring on or after July 1, 2023. The impact, if any, is included in the changes of benefit terms.

Changes of Assumptions: There were no assumption changes in 2024. Effective with the June 30, 2021 valuation date (June 30, 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, and 7.50% for measurement date June 30, 2014. 98 472
2019 2018 2017 2016 2015
6/30/2018 6/30/2017 6/ 30/2016 6/30/2015 6/30/2014
5,267,383$ 5,177,802 $ 4,672,901 $ 4,546,279 $ 4,911,456$ 24,067,324 23,418,521 23,117,281 22,231,987 21,813,800 - - - - - (1,376,690) 18,989,623 - (5,284,506) - (1,306,394) (5,876,562) (131,466) (7,188,831) - (17,701,058) (16,066,665) (15,554,542) (14,720,766) (13,890,809) 8,950,565 25,642,719 12,104,174 (415,837) 12,834,447 345,505,847 319,863,128 307,758,954 308,174,791 295,340,344 354,456,412 345,505,847 319,863,128 307,758,954 308,174,791 7,864,464 7,498,423 6,420,197 5,766,795 4,836,725 2,088,111 2,142,096 2,036,528 2,104,640 2,042,395 20,755,507 25,473,940 1,162,922 5,258,066 35,349,001 (17,701,058) (16,066,665) (15,554,542) (14,720,766) (13,890,809) (599) 32,777 26 (4,435) - (381,953) (334,215) (141,662) (275,403) - (725,336) - - - - 11,899,136 18,746,356 (6,076,531) (1,871,103) 28,337,312 245,112,738 226,366,382 232,442,913 234,314,016 205,976,704 257,011,874 245,112,738 226,366,382 232,442,913 234,314,016 97,444,538$ 100,393,109 $ 93,496,746 $ 75,316,041 $ 73,860,775 $

72.5% 70.9% 70.8% 75.5% 76.0%
27,290,727$ 26,413,315 $ 26,369,288 $ 25,364,199 $ 26,155,370$ 357.1% 380.1% 354.6% 296.9% 282.4%
99 473

CITY OF ORANGE, CALIFORNIA
Schedule of Changes in Net Pension Liability and Related Ratios Safety Plan
As of June 30, for the Last Ten Fiscal Years
2024 2023 2022 2021 2020
Measurement Date 6/30/2023 6/30/2022 6/30/2021 6/30/2020 6/30/2019

TOTAL PENSION LIABILITY
Service cost 10,646,420$ 10,563,736 $ 9,602,667 $ 9,008,558 $ 8,940,979$ Interest on total pension liability 44,229,279 42,323,381 41,044,660 39,162,098 37,812,758 Changes of benefit terms 260,657 - - - - Changes of assumptions - 21,493,940 6,910,237 (876,533) 628,915 Difference between expected and actual experience 7,299,176 (2,164,924) - - - Benefit payments, including refunds of employee
contributions (33,802,706) (31,930,430) (30,321,036) (27,775,755) (26,302,494) Net change in total pension liability 28,632,826 40,285,703 27,236,528 19,518,368 21,080,158 Total pension liability-beginning 645,022,369 604,736,666 577,500,138 557,981,770 536,901,612 Total pension liability-ending (a) 673,655,195 645,022,369 604,736,666 577,500,138 557,981,770

PLAN FIDUCIARY NET POSITION
Contributions-employer 7,904,822 6,930,384 198,675,791 16,809,199 14,629,767 Contributions-employee 3,670,921 3,579,796 3,429,542 3,158,214 2,962,476 Net investment income 36,179,168 (49,811,030) 101,688,630 19,165,432 24,251,336 Benefit payments, including refunds of employee
contributions (33,802,706) (31,930,430) (30,321,036) (27,775,755) (26,302,494) Net plan to plan resource movement - - - - - Administrative expense (439,783) (417,186) (396,207) (543,905) (264,424) Other miscellaneous income/(expense) - - - - 864 Net change in fiduciary net position 13,512,422 (71,648,466) 273,076,720 10,813,185 15,277,525 Plan fiduciary net position-beginning 598,056,526 669,704,992 396,628,272 385,815,087 370,537,562 Plan fiduciary net position-ending (b) 611,568,948 598,056,526 669,704,992 396,628,272 385,815,087 Net pension liability/(asset) (a) - (b) 62,086,247$ 46,965,843$ (64,968,326)$ 180,871,866$ 172,166,683$ Plan fiduciary net position as a percentage of the
total pension liability 90.8% 92.7% 110.7% 68.7% 69.1%
Covered payroll 34,690,193$ 34,142,651 $ 33,812,207 $ 31,421,550 $ 31,077,439$ Plan net pension liability/(asset) as a percentage of
covered payroll 179.0% 137.6% -192.1% 575.6% 554.0%
Notes to Schedule of Changes in the Net Pension Liability and Related Ratios:
1 Fiscal year 2015 was the first year of GASB Statement No. 68 implementation; therefore only nine years are shown.

Benefit Changes: 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 liab ility impact is deemed to be material by the plan actuary. In 2022, SB 1168 increased the standard retiree lump sum death benefit from $500 to $2,000 for any death occurring on or after July 1, 2023. The impact, if any, is included in the changes of benefit terms.

Changes of Assumptions: There were no assumption changes in 2024. Effective with the June 30, 2021 valuation date (June 30, 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, and 7.50% for measurement date June 30, 2014. 100
474
2019 2018 2017 2016 2015
6/30/2018 6/30/2017 6/ 30/2016 6/30/2015 6/30/2014
8,684,357$ 8,663,044 $ 7,677,162 $ 7,510,097 $ 8,277,333$ 36,374,391 34,973,049 34,040,818 32,660,257 31,691,919 - - - - - (2,407,807) 29,689,823 - (8,155,227) - 2,812,674 (4,567,911) (325,378) (6,412,547) - (25,095,404) (23,809,456) (22,545,119) (21,218,801) (20,071,826) 20,368,211 44,948,549 18,847,483 4,383,779 19,897,426 516,533,401 471,584,852 452,737,369 448,353,590 428,456,164 536,901,612 516,533,401 471,584,852 452,737,369 448,353,590 12,902,982 12,304,411 10,451,474 9,399,041 8,394,155 2,863,563 2,785,504 2,715,401 2,736,436 2,571,235 29,531,053 36,448,582 1,469,981 6,943,219 50,548,509 (25,095,404) (23,809,456) (22,545,119) (21,218,801) (20,071,826) (864) 1,111 - - - (548,398) (479,361) - - - (1,041,417) - - - - 18,611,515 27,250,791 (7,908,263) (2,140,105) 41,442,073 351,926,047 324,675,256 332,583,519 334,723,624 293,281,551 370,537,562 351,926,047 324,675,256 332,583,519 334,723,624 166,364,050$ 164,607,354 $ 146,909,596 $ 120,153,850 $ 113,629,966 $

69.0% 68.1% 68.8% 73.5% 74.7%
30,016,442$ 29,388,167 $ 29,062,548 $ 28,144,568 $ 29,790,653$ 554.2% 560.1% 505.5% 426.9% 381.4%
101
475

CITY OF ORANGE, CALIFORNIA
Schedules of Plan Contributions
As of June 30, for the Last Ten Fiscal Years
Fiscal Year Actuarially Actual Contribution Contribution as a Ending Determined Employer Deficiency Covered % of Covered June 30, Contribution Contrib utions (Excess) Payroll Payroll 2024 4,276,337$ 4,517,941$ (241,604)$ 35,679,085$ 12.7% 2023 3,640,116 3,640,116 30,789,582 11.8% 2022 3,460,554 3,460,554 - 29,053,762 11.9% 2021 11,230,178 115,573,579 (104,343,401) 29,494,804 391.8% 2020 10,331,501 10,331,501 - 27,858,270 37.1% 2019 8,889,983 8,889,983 - 26,357,030 33.7% 2018 7,865,000 7,865,000 - 27,290,727 28.8% 2017 7,496,129 7,496,129 - 26,413,315 28.4% 2016 6,420,229 6,420,229 - 26,369,288 24.3% 2015 5,766,795 5,766,795 - 25,364,199 22.7% 2024 7,952,294$ 8,644,337$ (692,043)$ 40,469,735$ 21.4% 2023 6,993,732 6,993,732 - 34,690,193 20.2% 2022 6,931,080 6,931,080 - 34,142,651 20.3% 2021 18,409,102 198,674,869 (180,265,767) 33,812,207 587.6% 2020 16,811,365 16,811,365 - 31,421,550 53.5% 2019 14,630,050 14,630,050 - 31,077,439 47.1% 2018 12,903,531 12,903,531 - 30,016,442 43.0% 2017 12,302,440 12,302,440 - 29,388,167 41.9% 2016 10,451,464 10,451,464 - 29,062,548 36.0% 2015 9,399,041 9,399,041 - 28,144,568 33.4% Actuarial Cost Method: Entry Age Normal
Amortizaton Method/Period: For details, see June 30, 2021 Funding Valuation Report Asset Valuation Method: Fair value of assets; for details, see June 30, 2021 Funding Valuation Report Inflation: 2.50%
Salary Increases: Varies by entry age and service
Payroll Growth: 2.75%
Investment Rate of Return: 7.00% (net of administrative expenses) Retirement Age: For details, see June 30, 2021 Funding Valuation Report Mortality: For details, see June 30, 2021 Funding Valuation Report Miscellaneous Agent, Multiple-Employer Pension Plan
Safety Agent, Multiple-Employer Pension Plan
Notes to Schedules of Plan Contributions
The actuarial methods and assumption sused to set the actuarially determined contributions for fiscal year ended June 30, 2024 were derived from the June 30, 2021 funding valuaton report publicly available on CalPERS' website. 102
476

CITY OF ORANGE, CALIFORNIA
Notes to Required Supplementary Information
For the Year Ended June 30, 2024

NOTE 1: BUDGETARY ACCOUNTING

Annual budgets are adopted by July 1 of each year on a basis consistent with generally accepted accounting principles for all governmental funds. The budget is monitored to ensure compliance with legal provisions embodied in the appropriated budget as approved or amended by the City Council throughout the year.

Department heads are responsible for monitoring their department's appropriated budget.

Legal level of Control - The legal level of budgetary control is at the department level within each fund. Transfers of appropriations between funds, between departments within a fund, and between capital outlay or debt service and another object group classification within a department, require City Council approval. All other transfers of appropriations can be made with the City management’s approval.

The City Council approved increases in appropriations during the year in the amount of $790,327 in the General Fund, $20,000,532 in the Special Revenue Funds, and $38,453,992 in the Capital Projects Funds.

Unencumbered appropriations of the governmental funds automatically lapse at the end of the fiscal year.

Ongoing, unfulfilled encumbrances and their appropriations automatically carry over and will be honored during the subsequent year.

The City did not adopt a budget in the current fiscal year for the Opioid Settlement Fund or the City Debt Service Fund.
103
477
7+,63$*(,17(17,21$//</()7%/$1.
104
478
105
479
7+,63$*(,17(17,21$//</()7%/$1.
106
480

Non-Major Special Revenue Funds

The following Special Revenue Funds have been classified as non-major funds in the accompanying financial statements and budgetary comparison schedules:

EMT Transport - This fund is used to account for the receipts and expenditures related to ambulance transportation.

1% PEG Program - This fund is used to account for Public Education and Government (PEG) access fees paid to the City by cable providers. These revenues are restricted by State regulations for the exclusive use of the City's Government Access and Local Access programming.

Certified Access Specialist Program (CASP) Certification & Tr aining - This fund is used to account for collection and expenditures of fees restricted, by Senate Bill 262 (Chapter 872, 2003), for costs of training and certifying inspectors and educating the public pursuant to Government Code Section 4467.

Headstart Building Maintenance - This fund is used to account for lease payments and maintenance on the Headstart/Preschool building.

Air Pollution Reduction - This fund is used to account for revenues and expenditures related to air pollution reduction programs pursuant to the California Clean Air Act of 1988.

Gas Tax - This fund is used to account for receipts and expenditures of money apportioned under Streets and Highway Code Sections 2105, 2106 and 2107 of the State of California.

Road Maintenance Rehabilitation Account (RMRA) - This fund is used to account for collection and expenditure of gas tax funds allocated and restricted under Street and Highway Code Section 2031, through the RMRA, for maintenance and construction of city streets and roads.

Transportation System Improvement Program (TSIP) - This fund is used to account for the collection of fees assessed to developers and expenditures made to improve the City's transportation system.

Landscape Maintenance Assessment Districts - This fund is used to account for the collection of assessments from property owners and the associated city expenditures for the maintenance of landscaped areas within the districts.

Asset Seizure - This fund is used to account for assets seized as a result of drug enforcement efforts.

SB2 Building Home & Jobs Act - This fund is used to account for the collection and expenditure of state grant funds received for the purpose of preparation, adoption, or implementation of planning documents that streamline housing project approvals and accelerate housing productions.

Housing in Lieu - This fund is used to account for the collection of developer affordable housing in-lieu fees and other transactions related to the creation of new affordable housing units.

Opioid Settlement Fund - National settlements were reached to resolve all opioids litigation brought by states and local political subdivisions against the three largest pharmaceutical distributors and the manufacturer. These National Settlements have been finalized, and payments have already begun. This fund is established to account for the proceeds that are restricted for specific use.

107
481

CITY OF ORANGE, CALIFORNIA
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2024
ASSETS
Cash and investments 2,427,097$ 401,723 $ 367,055$ Receivables (net of allowance for uncollectible):

Accounts 1,701 51,582 -
Taxes - - - Accrued interest 18,632 3,084 2,818 Notes and loans - - - Leases - - - Total assets 2,447,430$ 456,389$ 369,873$

LIABILITIES
Accounts payable 69,031$ 45,000 $ -$ Contracts payable - - - Accrued liabilities - - - Deposits payable - - - Due to other funds - - - Unearned revenues - - - Total liabilities 69,031 45,000 -

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues - - - Lease-related - - - Total deferred inflows of resources - - -

FUND BALANCES
Restricted 2,378,399 411,389 369,873 Assigned - - - Unassigned - - - Total fund balances 2,378,399 411,389 369,873 Total liabilities, deferred inflows
of resources, and fund balances 2,447,430$ 456,389$ 369,873$ EMT Transport
1% PEG
Program
CASP
Certification &
Training
Special Revenue Funds
108
482

CITY OF ORANGE, CALIFORNIA
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2024
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Taxes
Accrued interest
Notes and loans
Leases
Total assets

LIABILITIES
Accounts payable
Contracts payable
Accrued liabilities
Deposits payable
Due to other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Restricted
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows
of resources, and fund balances
(Continued)
195,418$ 279,015 $ 228,173$
1,600 485 1,786
- - 330,530 1,500 2,142 3,733
- - -
121,765 - -
320,283$ 281,642 $ 564,222 $
-$ 27,710$ 19,343$
- - -
- - -
- - 1,690
- 47,536 -
- - -
- 75,246 21,033
- - -
123,143 - -
123,143 - -
197,140 206,396 543,189
- - -
- - -
197,140 206,396 543,189
320,283$ 281,642 $ 564,222 $
Headstart
Building
Maintenance
Air Pollution
Reduction Gas Tax
Special Revenue Funds
109
483

CITY OF ORANGE, CALIFORNIA
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2024
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Taxes
Accrued interest
Notes and loans
Leases
Total assets

LIABILITIES
Accounts payable
Contracts payable
Accrued liabilities
Deposits payable
Due to other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Restricted
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows
of resources, and fund balances
2,823,828$ 4,275,751 $ 2,220,032$
- 981 -
627,819 - 3,213
21,678 32,824 17,049
- 24,300 -
- - -
3,473,325$ 4,333,856 $ 2,240,294 $
711,101$ 80,827 $ 78,414$
104,851 19,953 -
- - -
- - -
- - -
- - -
815,952 100,780 78,414
- 24,301 -
- - -
- 24,301 -
2,657,373 4,208,775 2,161,880
- - -
- - -
2,657,373 4,208,775 2,161,880
3,473,325$ 4,333,856 $ 2,240,294 $
Landscape
Maintenance
Assessment
Districts
RMRA Road
Maintenance
Transportation
System
Improvement
Program
Special Revenue Funds
110
484

CITY OF ORANGE, CALIFORNIA
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2024
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Taxes
Accrued interest
Notes and loans
Leases
Total assets

LIABILITIES
Accounts payable
Contracts payable
Accrued liabilities
Deposits payable
Due to other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Restricted
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows
of resources, and fund balances
(Continued)
4,123,637$ 2,265,118 $ 306,818 $ 456,990$ - - - - - - - - 30,389 17,389 2,355 3,508 - - 4,592,019 - - - - - 4,154,026$ 2,282,507 $ 4,901,192 $ 460,498 $ 11,551$ 61,170 $ - $ -$ - - - - 27,488 - - - - - - - - 656,907 - - - - - 461,111 39,039 718,077 - 461,111 - - - - - - - - - - - - 4,114,987 1,564,430 4,901,192 -
- - - - - - - (613) 4,114,987 1,564,430 4,901,192 (613) 4,154,026$ 2,282,507 $ 4,901,192 $ 460,498 $ Asset Seizure
Special Revenue Funds
SB2 Building
Home & Jobs
Act
Housing In-
Lieu
Opioid
Settlement
Fund
111
485

CITY OF ORANGE, CALIFORNIA
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2024
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Taxes
Accrued interest
Notes and loans
Leases
Total assets

LIABILITIES
Accounts payable
Contracts payable
Accrued liabilities
Deposits payable
Due to other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Restricted
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows
of resources, and fund balances
4,239$ 940,847 $ 866,293 $
- - -
- - -
33 7,223 6,650
- 38,936 18,791
- - -
4,272$ 987,006 $ 891,734 $
-$ 4,628$ - $
- - -
- - -
- - -
- - -
- - -
- 4,628 -
- 38,935 18,791
- - -
- 38,935 18,791
- - -
4,272 943,443 872,943
- - -
4,272 943,443 872,943
4,272$ 987,006 $ 891,734 $
Drainage
District
Fire Facilities
Fees
Police
Facilities Fees
Capital Projects Funds
112
486

CITY OF ORANGE, CALIFORNIA
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2024
ASSETS
Cash and investments
Receivables (net of allowance for uncollectible):

Accounts
Taxes
Accrued interest
Notes and loans
Leases
Total assets

LIABILITIES
Accounts payable
Contracts payable
Accrued liabilities
Deposits payable
Due to other funds
Unearned revenues
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Unavailable revenues
Lease-related
Total deferred inflows of resources

FUND BALANCES
Restricted
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows
of resources, and fund balances
Capital
Projects Fund
Debt Service
Fund
Total
Nonmajor
Funds
751,064$ - $ 22,933,098$
684 - 58,819
- - 961,562 5,766 - 176,773
34,427 - 4,708,473
- - 121,765 791,941$ - $ 28,960,490$
-$ - $ 1,108,775$ - - 124,804 - - 27,488 - - 1,690
- - 704,443 - - 461,111 - - 2,428,311 34,427 - 116,454
- - 123,143 34,427 - 239,597
- - 23,715,023 757,514 - 2,578,172
- - (613)
757,514 - 26,292,582
791,941$ - $ 28,960,490$
Library
Facilities Fees
City Debt
Service
113
487

CITY OF ORANGE, CALIFORNIA
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2024

REVENUES
Taxes -$ 219,936$ -$
Intergovernmental - - - Charges for services and fees 4,591,187 - - Use of money and property 39,700 16,955 14,457 Miscellaneous - - 64,628 Total revenues 4,630,887 236,891 79,085

EXPENDITURES
Current:

General government - 241,189 - Public safety 3,293,226 - - Community development - - 124 Parks and library - - - Public works - - - Economic development - - - Capital outlay - 44,364 - Debt service:

Principal - - - Interest and fiscal charges - - - Total expenditures 3,293,226 285,553 124 Net change in fund balances 1,337,661 (48,662) 78,961 Fund balances-beginning 1,040,738 460,051 290,912 Fund balances-ending 2,378,399$ 411,389$ 369,873$ EMT Transport
1% PEG
Program
CASP
Certification &
Training
Special Revenue Funds
114
488

CITY OF ORANGE, CALIFORNIA
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2024

REVENUES
Taxes
Intergovernmental
Charges for services and fees
Use of money and property
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community development
Parks and library
Public works
Economic development
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures
Net change in fund balances
Fund balances-beginning
Fund balances-ending
(Continued)
-$ - $ -$
- 186,188 3,817,166
- - 6,728
26,651 8,675 45,944
- - 141
26,651 194,863 3,869,979
- 60,918 5,550
- 9,288 -
- - -
- - -
1,763 - 3,819,619
- - -
- 84,217 99,287
- - -
- - -
1,763 154,423 3,924,456
24,888 40,440 (54,477)
172,252 165,956 597,666
197,140$ 206,396 $ 543,189 $
Headstart
Building
Maintenance
Air Pollution
Reduction Gas Tax
Special Revenue Funds
115
489

CITY OF ORANGE, CALIFORNIA
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2024

REVENUES
Taxes
Intergovernmental
Charges for services and fees
Use of money and property
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community development
Parks and library
Public works
Economic development
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures
Net change in fund balances
Fund balances-beginning
Fund balances-ending
-$ - $ 1,069,376$ 3,602,396 - -
- 1,900,992 -
179,933 174,732 93,694
- - -
3,782,329 2,075,724 1,163,070
- - -
- - -
- - -
- - 883,712 46,043 165,105 -
- - -
5,211,929 739,276 -
- - -
- - -
5,257,972 904,381 883,712
(1,475,643) 1,171,343 279,358
4,133,016 3,037,432 1,882,522
2,657,373$ 4,208,775 $ 2,161,880 $
RMRA Road
Maintenance
Transportation
System
Improvement
Program
Landscape
Maintenance
Assessment
Districts
Special Revenue Funds
116
490

CITY OF ORANGE, CALIFORNIA
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2024

REVENUES
Taxes
Intergovernmental
Charges for services and fees
Use of money and property
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community development
Parks and library
Public works
Economic development
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures
Net change in fund balances
Fund balances-beginning
Fund balances-ending
(Continued)
-$ - $ - $ -$ - 3,081,547 - - - - - - 99,894 18,699 97,621 (613) 296,756 - 1,127,324 - 396,650 3,100,246 1,224,945 (613) - 503 - - 243,795 - - - - 64,397 - - - - - - - - - - - - - - 75,165 - - - - - - - - - - - 318,960 64,900 - - 77,690 3,035,346 1,224,945 (613) 4,037,297 (1,470,916) 3,676,247 - 4,114,987$ 1,564,430 $ 4,901,192 $ (613) $ Opioid
Settlement
Fund
Housing In-
Lieu Asset Seizure
SB2 Building
Home & Jobs
Act
Special Revenue Funds
117
491

CITY OF ORANGE, CALIFORNIA
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2024

REVENUES
Taxes
Intergovernmental
Charges for services and fees
Use of money and property
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community development
Parks and library
Public works
Economic development
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures
Net change in fund balances
Fund balances-beginning
Fund balances-ending
-$ - $ -$
- - -
- 624,180 237,135
198 28,998 31,583
- - -
198 653,178 268,718
- - -
- 280 -
- - -
- - -
- - -
- - -
- 221,920 35,433
- - -
- - -
- 222,200 35,433
198 430,978 233,285
4,074 512,465 639,658
4,272$ 943,443 $ 872,943 $
Drainage
District
Fire Facilities
Fees
Police
Facilities Fees
Capital Projects Funds
118
492

CITY OF ORANGE, CALIFORNIA
Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2024

REVENUES
Taxes
Intergovernmental
Charges for services and fees
Use of money and property
Miscellaneous
Total revenues

EXPENDITURES
Current:

General government
Public safety
Community development
Parks and library
Public works
Economic development
Capital outlay
Debt service:

Principal
Interest and fiscal charges
Total expenditures
Net change in fund balances
Fund balances-beginning
Fund balances-ending
Capital
Projects Fund
Total
Nonmajor
Funds
-$ - $ 1,289,312$ - - 10,687,297 363,696 - 7,723,918
19,207 - 896,328
- 17,358,737 18,847,586
382,903 17,358,737 39,444,441
- - 308,160
- - 3,546,589 - - 64,521
5,544 - 889,256
- - 4,032,530 - - -
2,632 - 6,514,223
- 10,762,933 10,762,933
- 6,595,804 6,595,804
8,176 17,358,737 32,714,016
374,727 - 6,730,425
382,787 - 1,310,992
757,514$ - $ 26,292,582$
City Debt
Service
Library
Facilities Fees
Debt Service
Fund
119
493

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual EMT Transport
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Charges for services and fees 2,890,000$ 2,890,000$ 4,591,187$ 1,701,187$ Use of money and property - - 39,700 39,700 Total revenues 2,890,000 2,890,000 4,630,887 1,740,887

EXPENDITURES
Current:

Public safety 3,406,035 3,536,775 3,293,226 243,549 Total expenditures 3,406,035 3,536,775 3,293,226 243,549 Net change in fund balances (516,035)$ (646,775)$ 1,337,661 1,984,436$ Fund balances-beginning 1,040,738
Fund balances-ending 2,378,399$
Budget Amounts
120
494

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual 1% PEG Program
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Taxes 251,900$ 251,900 $ 219,936 $ (31,964)$ Use of money and property - - 16,955 16,955 Total revenues 251,900 251,900 236,891 (15,009)

EXPENDITURES
Current:

General government 244,736 244,736 241,189 3,547 Capital outlay 67,500 67,500 44,364 23,136 Total expenditures 312,236 312,236 285,553 26,683 Net change in fund balances (60,336)$ (60,336)$ (48,662) 11,674$ Fund balances-beginning 460,051
Fund balances-ending 411,389$
Budget Amounts
121
495

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual CASP Certification & Training
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Licenses and permits 40,000$ 40,000 $ - $ (40,000)$ Use of money and property 1,157 1,157 14,457 13,300 Miscellaneous - - 64,628 64,628 Total revenues 41,157 41,157 79,085 37,928

EXPENDITURES
Current:

Community development 145,124 145,124 124 145,000 Total expenditures 145,124 145,124 124 145,000 Net change in fund balances (103,967)$ (103,967)$ 78,961 182,928$ Fund balances-beginning 290,912
Fund balances-ending 369,873$
Budget Amounts
122
496

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Headstart Building Maintenance
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Use of money and property 15,581$ 15,581$ 26,651$ 11,070$ Total revenues 15,581 15,581 26,651 11,070

EXPENDITURES
Current:

Public works 10,627 10,627 1,763 8,864 Total expenditures 10,627 54,333 1,763 52,570 Net change in fund balances 4,954$ (38,752)$ 24,888 63,640$ Fund balances-beginning 172,252
Fund balances-ending 197,140$
Budget Amounts
123
497

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Air Pollution Reduction
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental 182,000$ 182,000 $ 186,188 $ 4,188$ Use of money and property 478 478 8,675 8,197 Total revenues 182,478 182,478 194,863 12,385

EXPENDITURES
Current:

General government 64,380 64,380 60,918 3,462 Public safety 10,000 10,000 9,288 712 Capital outlay 86,000 178,860 84,217 94,643 Total expenditures 160,380 253,240 154,423 98,817 Net change in fund balances 22,098$ (70,762)$ 40,440 111,202$ Fund balances-beginning 165,956
Fund balances-ending 206,396$
Budget Amounts
124
498

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Gas Tax
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental 3,980,878$ 3,980,878$ 3,817,166$ (163,712)$ Charges for services and fees - - 6,728 6,728 Use of money and property 4,687 4,687 45,944 41,257 Miscellaneous - - 141 141 Total revenues 3,985,565 3,985,565 3,869,979 (115,586)

EXPENDITURES
Current:

General government 12,900 12,900 5,550 7,350 Public works 4,018,791 4,068,021 3,819,619 248,402 Capital outlay 100,000 516,611 99,287 417,324 Total expenditures 4,131,691 4,597,532 3,924,456 673,076 Net change in fund balances (146,126)$ (611,967)$ (54,477) 557,490$ Fund balances-beginning 597,666
Fund balances-ending 543,189$
Budget Amounts
125
499

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual RMRA Road Maintenance
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental 3,450,822$ 3,450,822$ 3,602,396$ 151,574$ Use of money and property 9,112 9,112 179,933 170,821 Total revenues 3,459,934 3,459,934 3,782,329 322,395

EXPENDITURES
Current:

Public works - - 46,043 (46,043) Capital outlay 3,000,000 6,963,862 5,211,929 1,751,933 Total expenditures 3,000,000 6,963,862 5,257,972 1,705,890 Net change in fund balances 459,934$ (3,503,928)$ (1,475,643) 2,028,285$ Fund balances-beginning 4,133,016
Fund balances-ending 2,657,373$
Budget Amounts
126
500

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Transportation System Improvement Program
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Charges for services and fees -$ - $ 1,900,992$ 1,900,992$ Use of money and property 73,083 73,083 174,732 101,649 Total revenues 73,083 73,083 2,075,724 2,002,641

EXPENDITURES
Current:

Public works 104,640 104,640 165,105 (60,465) Capital outlay - 3,354,693 739,276 2,615,417 Total expenditures 104,640 3,459,333 904,381 2,554,952 Net change in fund balances (31,557)$ (3,386,250)$ 1,171,343 4,557,593$ Fund balances-beginning 3,037,432
Fund balances-ending 4,208,775$
Budget Amounts
127
501

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Landscape Maintenance Assessment Districts
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Taxes 1,038,175$ 1,038,175$ 1,069,376$ 31,201$ Use of money and property 5,537 5,537 93,694 88,157 Total revenues 1,043,712 1,043,712 1,163,070 119,358

EXPENDITURES
Current:

Parks and library 1,106,730 1,146,730 883,712 263,018 Capital outlay - 430,285 - 430,285 Total expenditures 1,106,730 1,577,015 883,712 693,303 Net change in fund balances (63,018)$ (533,303)$ 279,358 812,661$ Fund balances-beginning 1,882,522
Fund balances-ending 2,161,880$
Budget Amounts
128
502

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Asset Seizure
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Use of money and property 12,192$ 12,192 $ 99,894 $ 87,702$ Miscellaneous 64,000 64,000 296,756 232,756 Total revenues 76,192 76,192 396,650 320,458

EXPENDITURES
Current:

Public safety 339,780 385,929 243,795 142,134 Capital outlay 222,800 268,113 75,165 192,948 Total expenditures 562,580 654,042 318,960 335,082 Net change in fund balances (486,388)$ (577,850)$ 77,690 655,540$ Fund balances-beginning 4,037,297
Fund balances-ending 4,114,987$
Budget Amounts
129
503

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual SB2 Building Home & Jobs Act
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental 78,500$ 3,078,500$ 3,081,547 $ 3,047$ Use of money and property - - 18,699 18,699 Total revenues 78,500 3,078,500 3,100,246 21,746

EXPENDITURES
Current:

General government - 22,844 503 22,341 Community development - 3,005,124 64,397 2,940,727 Total expenditures - 3,027,968 64,900 2,963,068 Net change in fund balances 78,500$ 50,532$ 3,035,346 2,984,814$ Fund balances-beginning (1,470,916)
Fund balances-ending 1,564,430$
Budget Amounts
130
504

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Housing In-Lieu
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Use of money and property 12,289$ 12,289 $ 97,621 $ 85,332$ Miscellaneous - - 1,127,324 1,127,324 Total revenues 12,289 12,289 1,224,945 1,212,656

EXPENDITURES
Capital outlay - 372,756 - 372,756 Total expenditures - 372,756 - 372,756 Net change in fund balances 12,289$ (360,467)$ 1,224,945 1,585,412$ Fund balances-beginning 3,676,247
Fund balances-ending 4,901,192$
Budget Amounts
131
505
7+,63$*(,17(17,21$//</()7%/$1.
132
506

Major and Non-Major Capital Projects Funds

The following Capital Projects Funds have been classified as major funds in the accompanying Budgetary Comparison Schedules:

Capital Improvement - This fund is used to account for general purpose capital improvement and cooperatively funded projects.

Park Acquisition, Development and Maintenance - This fund is used to account for the acquisition, development and maintenance of parks that are financed by developer fees.

The following Capital Projects Funds have been classified as non-major funds in the accompanying financial statements and Budgetary Comparison Schedules:

Drainage District - This fund is used to account for the construction of major storm drains identified in the master plan for storm drains.

Fire Facilities Fees - This fund is used to account for fees collected from the developers to improve the fire protection within specified areas.

Police Facilities Fees - This fund is used to account for fees collected from developers to construct or improve police facilities.

Library Facilities Fees - This fund is used to account for fees collected from developers to construct or improve library facilities.

133
507

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Capital Improvement
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Intergovernmental 4,441,570$ 4,877,570$ 4,748,576$ (128,994)$ Charges for services and fees 3,700 3,700 3,253,450 3,249,750 Use of money and property 26,467 26,467 339,475 313,008 Total revenues 4,471,737 4,907,737 8,341,501 3,433,764

EXPENDITURES
Current:

General government 300,000 300,000 276,981 23,019 Capital outlay 10,978,775 34,074,455 9,407,536 24,666,919 Total expenditures 11,278,775 34,374,455 9,684,517 24,689,938 Excess (deficiency) of revenues
over (under) expenditures (6,807,038) (29,466,718) (1,343,016) 28,123,702

OTHER FINANCING SOURCES (USES)
Transfers out (3,500,000) (3,500,000) (5,810,270) (2,310,270) Total other financing sources (uses) (3,500,000) (3,500,000) (5,810,270) (2,310,270) Net change in fund balances (10,307,038)$ (32,966,718)$ (7,153,286) 25,813,432$ Fund balances-beginning 29,636,835
Fund balances-ending 22,483,549$
Budget Amounts
134
508

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Park Acquisition, Development and Maintenance
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Charges for services and fees -$ - $ 4,141,103$ 4,141,103$ Use of money and property 126,829 126,829 462,411 335,582 Miscellaneous - - 13 13 Total revenues 126,829 126,829 4,603,527 4,476,698

EXPENDITURES
Current:

Public works - - 8,002 (8,002) Capital outlay 445,000 4,559,965 2,037,902 2,522,063 Total expenditures 445,000 4,559,965 2,045,904 2,514,061 Net change in fund balances (318,171)$ (4,433,136)$ 2,557,623 6,990,759$ Fund balances-beginning 7,183,213
Fund balances-ending 9,740,836$
Budget Amounts
135
509

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Drainage District
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Use of money and property 16$ 16$ 198$ 182$ Total revenues 16 16 198 182 Net change in fund balances 16$ 16$ 198 182$ Fund balances-beginning 4,074
Fund balances-ending 4,272$
Budget Amounts
136
510

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Fire Facilities Fees
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Charges for services and fees -$ - $ 624,180$ 624,180$ Use of money and property 5,973 5,973 28,998 23,025 Total revenues 5,973 5,973 653,178 647,205

EXPENDITURES
Current:

Public safety - - 280 (280) Capital outlay - 398,842 221,920 176,922 Total expenditures - 398,842 222,200 176,642 Net change in fund balances 5,973$ (392,869)$ 430,978 823,847$ Fund balances-beginning 512,465
Fund balances-ending 943,443$
Budget Amounts
137
511

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Police Facilities Fees
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Charges for services and fees -$ - $ 237,135$ 237,135$ Use of money and property 2,206 2,206 31,583 29,377 Total revenues 2,206 2,206 268,718 266,512

EXPENDITURES
Current:

Public safety 20,000 50,000 - 50,000 Capital outlay - 291,453 35,433 256,020 Total expenditures 20,000 341,453 35,433 306,020 Net change in fund balances (17,794)$ (339,247)$ 233,285 572,532$ Fund balances-beginning 639,658
Fund balances-ending 872,943$
Budget Amounts
138
512

CITY OF ORANGE, CALIFORNIA
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget to Actual Library Facilities Fees
For the Year Ended June 30, 2024
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)

REVENUES
Charges for services and fees -$ - $ 363,696$ 363,696$ Use of money and property 3,450 3,450 19,207 15,757 Total revenues 3,450 3,450 382,903 379,453

EXPENDITURES
Current:

Parks and library - - 5,544 (5,544) Capital outlay - 325,488 2,632 322,856 Total expenditures - 325,488 8,176 317,312 Net change in fund balances 3,450$ (322,038)$ 374,727 696,765$ Fund balances-beginning 382,787
Fund balances-ending 757,514$
Budget Amounts
139
513
7+,63$*(,17(17,21$//</()7%/$1.
140
514

Internal Service Funds

Internal Service Funds are used to account for the financing of special activities and services provided by one department of a government to another. The following Internal Service Funds are included in the accompanying financial statements:

Equipment Maintenance - This fund is used to account for the operating costs of the City's rolling stock.

Equipment Replacement - This fund is used to account for the replacement costs of the City's rolling stock.

Major Building Improvements - This fund is used to account for replacement costs of the City's building improvements.

Workers' Compensation - This fund is used to account for workers' compensation claims, premiums, and administrative costs, and to maintain a sinking fund for future claims.

Liability - This fund is used to account for liability claims, premiums, and administrative costs.

Dental - This fund is used to maintain a sinking fund for future claims.

Employee Accrued Liability - This fund is used to account for the City's vacation, sick and compensation time payouts for all City departments.

Information Systems - This fund is used to account for the development, administration, and maintenance of the City's information management services.

Computer Replacement - This fund is used to account for the replacement costs of the City's computers.

141
515

CITY OF ORANGE, CALIFORNIA
Combining Statement of Net Position
Internal Service Funds
June 30, 2024
ASSETS
Current assets:

Cash and investments -$ 4,979,757$ 192,728$ 4,481,279$ 1,375,543$ Receivables (net of uncollectibles):

Accounts 393 2,052 - 87,343 8,338 Prepaid costs - - - - - Inventories 797,366 - - - - Total current assets 797,759 4,981,809 192,728 4,568,622 1,383,881 Noncurrent:

Capital assets, net 108,200 18,757,197 - - - Total noncurrent assets 108,200 18,757,197 - - - Total assets 905,959 23,739,006 192,728 4,568,622 1,383,881

DEFERRED OUTFLOWS OF RESOURCES
Pension-related 1,274,663 - - - - OPEB-related 292,354 - - - - Total deferred outflows of resources 1,567,017 - - - -

LIABILITIES
Current liabilities:

Accounts payable 172,315 60,484 16,400 105,210 47,726 Due to other funds 181,244 - - - - Claims and judgments, due in one year - - - 4,392,977 876,603 Subscriptions, due in one year - - - - - Bonds, due in one year 164,612 - - - - Total OPEB liability, due in one year 23,600 - - - - Total current liabilities 541,771 60,484 16,400 4,498,187 924,329 Noncurrent liabilities:

Claims and judgments - - - 7,973,992 1,150,690 Subscriptions - - - - - Bonds, notes, and loans 3,611,794 - - - - Net pension liability 1,006,295 - - - - Net OPEB liability 1,287,893 - - - - Total noncurrent liabilities 5,905,982 - - 7,973,992 1,150,690 Total liabilities 6,447,753 60,484 16,400 12,472,179 2,075,019

DEFERRED INFLOWS OF RESOURCES
Pension-related 40,759 - - - - OPEB-related 603,076 - - - - Total deferred inflows of resources 643,835 - - - -

NET POSITION
Net investment in capital assets 108,200 18,757,197 - - - Unrestricted (4,726,812) 4,921,325 176,328 (7,903,557) (691,138) Total net position (4,618,612)$ 23,678,522$ 176,328$ (7,903,557)$ (691,138)$ Equipment
Maintenance
Equipment
Replacement
Major Building
Improvements
Self Insurance
Worker's
Compensation
Self Insurance
Liability
142
516

CITY OF ORANGE, CALIFORNIA
Combining Statement of Net Position
Internal Service Funds
June 30, 2024
ASSETS
Current assets:

Cash and investments
Receivables (net of uncollectibles):

Accounts
Prepaid costs
Inventories
Total current assets
Noncurrent:

Capital assets, net
Total noncurrent assets
Total assets

DEFERRED OUTFLOWS OF RESOURCES
Pension-related
OPEB-related
Total deferred outflows of resources

LIABILITIES
Current liabilities:

Accounts payable
Due to other funds
Claims and judgments, due in one year
Subscriptions, due in one year
Bonds, due in one year
Total OPEB liability, due in one year
Total current liabilities
Noncurrent liabilities:

Claims and judgments
Subscriptions
Bonds, notes, and loans
Net pension liability
Net OPEB liability
Total noncurrent liabilities
Total liabilities

DEFERRED INFLOWS OF RESOURCES
Pension-related
OPEB-related
Total deferred inflows of resources

NET POSITION
Net investment in capital assets
Unrestricted
Total net position
Total Internal
Service
Funds
575,908$ 7,385,370 $ 1,337,023 $ 8,678,311 $ 29,005,919$ - - - - 98,126 41,500 - 494,917 237,601 774,018 - - - - 797,366 617,408 7,385,370 1,831,940 8,915,912 30,675,429 - - 874,899 5,294,572 25,034,868 - - 874,899 5,294,572 25,034,868 617,408 7,385,370 2,706,839 14,210,484 55,710,297 - - - - 1,274,663 - - - - 292,354 - - - - 1,567,017 41,394 1,884 686,590 322,219 1,454,222 - - - - 181,244 - - - - 5,269,580 - - 245,329 466,189 711,518 - - - - 164,612 - - - - 23,600 41,394 1,884 931,919 788,408 7,804,776 - - - - 9,124,682 - - 453,957 5,057,969 5,511,926 - - - - 3,611,794 - - - - 1,006,295 - - - - 1,287,893 - - 453,957 5,057,969 20,542,590 41,394 1,884 1,385,876 5,846,377 28,347,366 - - - - 40,759 - - - - 603,076 - - - - 643,835 - - 175,613 (229,586) 18,811,424 576,014 7,383,486 1,145,350 8,593,693 9,474,689 576,014$ 7,383,486 $ 1,320,963 $ 8,364,107 $ 28,286,113 $ Employee
Accrued
Liability
Information
Systems
Operations
Computer
Replacement
Self Insurance
Dental
143
517

CITY OF ORANGE, CALIFORNIA
Combining Statement of Revenues, Expenses and
Changes in Net Position
Internal Service Funds
For the Year Ended June 30, 2024

OPERATING REVENUES
Charges for services and fees 3,653,031$ - $ - $ 4,313,713$ 3,648,315$ Other revenues 5,567 352,118 - 1,302,169 66,157 Total operating revenues 3,658,598 352,118 - 5,615,882 3,714,472

OPERATING EXPENSES
Salaries and wages 1,066,526 - - 271,867 403,651 Maintenance and operations 2,498,541 - 25,801 193,606 227,916 Contractual services 84,478 - - 14,444 264,979 Insurance claims and charges - - - 3,414,535 3,676,511 Depreciation/amortization 31,908 1,730,783 - - - Total operating expenses 3,681,453 1,730,783 25,801 3,894,452 4,573,057 Operating income (loss) (22,855) (1,378,665) (25,801) 1,721,430 (858,585)

NONOPERATING REVENUES (EXPENSES)
Interest expense (96,728) - - - - Gain (loss) on disposal of capital assets - 52,948 - - - Total nonoperating revenues (expenses) (96,728) 52,948 - - - Income (loss) before transfers (119,583) (1,325,717) (25,801) 1,721,430 (858,585) Transfers in - - - - 1,000,000 Change in net position (119,583) (1,325,717) (25,801) 1,721,430 141,415 Net position-beginning (4,499,029) 25,004,239 202,129 (9,624,987) (832,553) Net position-ending (4,618,612)$ 23,678,522$ 176,328$ (7,903,557)$ (691,138)$ Equipment
Maintenance
Equipment
Replacement
Major
Building
Improvements
Self Insurance
Worker's
Compensation
Self Insurance
Liability
144
518

CITY OF ORANGE, CALIFORNIA
Combining Statement of Revenues, Expense
Changes in Net Position
Internal Service Funds
For the Year Ended June 30, 2024

OPERATING REVENUES
Charges for services and fees
Other revenues
Total operating revenues

OPERATING EXPENSES
Salaries and wages
Maintenance and operations
Contractual services
Insurance claims and charges
Depreciation/amortization
Total operating expenses
Operating income (loss)

NONOPERATING REVENUES (EXPENSES)
Interest expense
Gain (loss) on disposal of capital assets
Total nonoperating revenues (expenses)
Income (loss) before transfers
Transfers in
Change in net position
Net position-beginning
Net position-ending
Total Internal
Service
Funds
546,132$ 1,951,853$ 3,833,950$ 397,040$ 18,344,034$ - - - - 1,726,011 546,132 1,951,853 3,833,950 397,040 20,070,045 - 1,222,078 1,288,272 - 4,252,394 10,926 79,545 391,498 1,821,243 5,249,076 - - 1,881,118 7,784 2,252,803 495,845 28,318 - - 7,615,209 - - - 661,821 2,424,512 506,771 1,329,941 3,560,888 2,490,848 21,793,994 39,361 621,912 273,062 (2,093,808) (1,723,949) - - - - (96,728) - - - - 52,948 - - - - (43,780) 39,361 621,912 273,062 (2,093,808) (1,767,729) - - - - 1,000,000 39,361 621,912 273,062 (2,093,808) (767,729) 536,653 6,761,574 1,047,901 10,457,915 29,053,842 576,014$ 7,383,486 $ 1,320,963 $ 8,364,107 $ 28,286,113 $ Employee
Accrued
Liability
Information
Systems
Operations
Computer
Replacement
Self Insurance
Dental
145
519

CITY OF ORANGE, CALIFORNIA
Combining Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2024

CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from interfund charges 3,658,765$ 360,506 $ - $ 5,607,001$ 3,706,134$ Payments to suppliers and service providers (2,987,362) - (16,565) (529,498) (973,894) Payments to employees for salaries and benefits (581,751) - - - - Other receipts (payments) - - - (5,054,151) (3,422,638) Net cash provided by (used for)
operating activities 89,652 360,506 (16,565) 23,352 (690,398)

CASH FLOWS FROM NONCAPITAL

FINANCING ACTIVITIES
Transfers from other funds - - - - 1,000,000 Principal paid on noncapital debt (163,586) - - - - Interest paid on noncapital debt (96,728) - - - - Payments from other funds on interfund borrowings 170,495 - - - - Net cash provided by (used for)
noncapital financing activities (89,819) - - - 1,000,000

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES
Acquisition and construction of capital assets - (3,321,298) - - - Principal paid on capital debt - - - - - Proceeds from sales of assets - 52,948 - - - Net cash provided by (used for)
capital and related financing activities - (3,268,350) - - - Net increase (decrease) in
cash and cash equivalents (167) (2,907,844) (16,565) 23,352 309,602 Cash and cash equivalents-beginning 167 7,887,601 209,293 4,457,927 1,065,941 Cash and cash equivalents-ending -$ 4,979,757$ 192,728$ 4,481,279$ 1,375,543$

RECONCILIATION OF OPERATING INCOME (LOSS)

TO NET CASH PROVIDED BY (USED FOR)

OPERATING ACTIVITIES
Operating income (loss)
(22,855)$ (1,378,665)$ (25,801) $ 1,721,430 $ (858,585)$ Adjustments to reconcile operating income (loss) to
net cash provided by (used for) operating activities:

Depreciation/amortization expense 31,908 1,730,783 - - - (Increase) decrease in accounts receivable 167 6,258 - (8,881) (8,338) (Increase) decrease in inventories (350,186) - - - - (Increase) decrease in prepaid items - - - - - Increase (decrease) in accounts payable (92) 2,130 9,236 (49,581) (77,348) Increase (decrease) in claims and judgments - - - (1,639,616) 253,873 Increase (decrease) in pension and related items 406,036 - - - - Increase (decrease) in OPEB and related items 24,674 - - - - Total adjustments 112,507 1,739,171 9,236 (1,698,078) 168,187 Net cash provided by (used for)
operating activities 89,652$ 360,506 $ (16,565) $ 23,352 $ (690,398) $ Equipment
Maintenance
Equipment
Replacement
Major Building
Improvements
Self Insurance
Worker's
Compensation
Self Insurance
Liability
146
520

CITY OF ORANGE, CALIFORNIA
Combining Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2024

CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from interfund charges
Payments to suppliers and service providers
Payments to employees for salaries and benefits
Other receipts (payments)
Net cash provided by (used for)
operating activities

CASH FLOWS FROM NONCAPITAL

FINANCING ACTIVITIES
Transfers from other funds
Principal paid on noncapital debt
Interest paid on noncapital debt
Payments from other funds on interfund borrowings
Net cash provided by (used for)
noncapital financing activities

CASH FLOWS FROM CAPITAL AND RELATED

FINANCING ACTIVITIES
Acquisition and construction of capital assets
Principal paid on capital debt
Proceeds from sales of assets
Net cash provided by (used for)
capital and related financing activities
Net increase (decrease) in
cash and cash equivalents
Cash and cash equivalents-beginning
Cash and cash equivalents-ending

RECONCILIATION OF OPERATING INCOME (LOSS)

TO NET CASH PROVIDED BY (USED FOR)

OPERATING ACTIVITIES
Operating income (loss)
Adjustments to reconcile operating income (loss) to
net cash provided by (used for) operating activities:

Depreciation/amortization expense
(Increase) decrease in accounts receivable
(Increase) decrease in inventories
(Increase) decrease in prepaid items
Increase (decrease) in accounts payable
Increase (decrease) in claims and judgments
Increase (decrease) in pension and related items
Increase (decrease) in OPEB and related items
Total adjustments
Net cash provided by (used for)
operating activities
Totals
546,132$ 1,951,853$ 3,833,950$ 397,040$ 20,061,381$ (10,380) (1,310,810) (3,727,331) (1,797,009) (11,352,849) - - - - (581,751) (495,845) (28,318) - - (9,000,952) 39,907 612,725 106,619 (1,399,969) (874,171) - - - - 1,000,000 - - - - (163,586) - - - - (96,728) - - - - 170,495 - - - - 910,181 - - - - (3,321,298) - - (384,267) 8,050 (376,217) - - 546,604 - 599,552 - - 162,337 8,050 (3,097,963) 39,907 612,725 268,956 (1,391,919) (3,061,953) 536,001 6,772,645 1,068,067 10,070,230 32,067,872 575,908$ 7,385,370$ 1,337,023$ 8,678,311$ 29,005,919$ 39,361$ 621,912 $ 273,062 $ (2,093,808)$ (1,723,949)$ - - - 661,821 2,424,512 - - - - (10,794) - - - - (350,186) - - (494,917) (237,601) (732,518) 546 (9,187) 328,474 269,619 473,797 - - - - (1,385,743) - - - - 406,036 - - - - 24,674 546 (9,187) (166,443) 693,839 849,778$ 39,907$ 612,725 $ 106,619 $ (1,399,969)$ (874,171) $ Self Insurance
Dental
Employee
Accrued
Liability
Information
Systems
Operations
Computer
Replacement
147
521
7+,63$*(,17(17,21$//</()7%/$1.
148
522
149
523
7+,63$*(,17(17,21$//</()7%/$1.
150
524

Statistical Section

This part of the City's annual comprehensive financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City's overall financial health.

Contents Page

Financial Trends ........................................................................................................................................... 152

These schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time.

Revenue Capacity ........................................................................................................................................ 162 These schedules contain information to help the reader assess the City's most significant revenue source, property tax.

Debt Capacity ............................................................................................................................................... 168 These schedules present information to help the reader assess the affordability of the City's current levels of outstanding debt and its ability to issue additional debt in the future.

Demographic and Economic Information ..................................................................................................... 175 These schedules offer demographic and economic indicators to help the reader understand the environment within which the City's financial activities take place.

Operating Information ................................................................................................................................... 178 These schedules contain service and infrastructure data to help the reader understand how the information in the City's financial report relates to the services it provides and the activities it performs.

Sources: Unless otherwise noted, the information in these schedules is derived from the annual comprehensive financial reports for the relevant year.
151
525
2024 2023 2022 2021
Governmental activities:

Net investment in capital assets 697,803,590$ 684,071,711 $ 683,891,043 685,927,045$ Restricted for:

Specific projects and programs 66,862,501 68,868,022 50,065,919 44,321,446 Unrestricted (194,108,200) (195,375,182) (174,372,427) (186,982,262) Total governmental act.net position 570,557,891$ 557,564,551 $ 559,584,535 543,266,229$ Business-type activities:

Net investment in capital assets 132,978,321 127,758,485 131,949,626 131,443,618 Unrestricted 15,360,402 12,039,915 5,392,793 1,639,357 Total business-type act. net position 148,338,723$ 139,798,400 $ 137,342,419 133,082,975$ Primary government:

Net investment in capital assets 830,781,911$ 811,830,196 $ 815,840,669$ 817,370,663$ Restricted for:

Specific projects and programs 66,862,501 68,868,022 50,065,919 44,321,446 Unrestricted (178,747,798) (183,335,267) (168,979,634) (185,342,905) Total primary gov't net position 718,896,614$ 697,362,951 $ 696,926,954 676,349,204 $ (1) In 2016 the Sanitation Fund was reclassed from a Governmental activity to a Business-type activity

CITY OF ORANGE
Net Position by Component
Last Ten Fiscal Years
(accrual basis of accounting)
Fiscal Year
152
526
2020 2019 2018 2017 2016 (1) 2015
674,673,211 668,898,000 658,706,056 643,259,170 632,246,033 691,177,418 42,194,380 40,509,831 40,833,934 43,175,076 50,288,584 56,695,286 (183,258,010) (160,066,933) (147,206,248) (103,909,743) (104,017,007) (115,036,341) 533,609,581 549,340,898 552,333,742 582,524,503 578,517,610 632,836,363 129,356,837 130,464,008 132,924,641 134,136,742.0 137,600,598 66,354,962 622,689 (833,151) (3,721,768) 2,174,136.0 2,606,432.0 3,876,072 129,979,526 129,630,857 129,202,873 136,310,878 140,207,030 70,231,034 804,030,048 799,362,008 791,630,697 777,395,912 769,846,631 757,532,380 42,194,380 40,509,831 40,833,934 43,175,076 50,288,584 56,695,286 (182,635,321) (160,900,084) (150,928,016) (101,735,607) (101,410,575) (111,160,269) 663,589,107 678,971,755 681,536,615 718,835,381 718,724,640 703,067,397 Fiscal Year
153
527
2024 2023 2022 2021 2020
Expenses:

General government 16,723,060$ 24,083,824 $ 13,171,835 18,961,388 $ 19,426,844 Public safety 124,980,249 110,206,495 91,321,077 102,189,315 106,839,054 Public works 22,436,985 19,715,973 22,820,124 25,264,533 14,683,383 Community development 7,696,354 4,112,664 3,304,024 5,280,546 5,174,978 Parks and library 22,279,842 20,276,823 17,810,698 17,161,257 17,048,393 Economic development 1,723,275 8,310,619 4,562,019 465,809 849,150 Health and sanitation - - - - - Interest on long-term debt 8,124,874 7,745,269 7,850,113 5,097,209 - Cost of issuance - - 677,074 - - Total governmental activities expenses 203,964,639 194,451,667 161,516,964 174,420,057 164,021,802 Program revenues:

Charges for services:

Public safety 11,657,313 9,973,692 8,229,685 7,233,973 8,444,493 Community development 1,976,021 4,141,083 3,655,955 2,973,252 3,105,770 Sanitation -- - -
Other activities 19,670,861 19,161,183 10,233,437 8,100,014 14,732,822 Operating grants and contributions 7,266,416 6,116,512 19,559,089 19,358,516 5,650,779 Capital grants and contributions 15,249,685 8,934,066 7,934,114 12,631,485 8,026,570 Total governmental activities program revenues 55, 820,296 48,326,536 49,612,280 50,297,240 39,960,434 Net program revenues (expenses) (148,144,343) (146,125,131) (111,904,684) (124,122,817) (124,061,368) General revenues and other changes in net position:

Taxes:

Property taxes 55,610,096 53,784,303 50,960,121 48,272,714 46,274,506 Sales tax 51,891,628 51,389,099 54,702,920 56,577,610 47,215,228 Transient occupancy taxes 6,092,659 6,080,399 5,253,351 1,834,447 3,990,266 Franchise taxes 3,201,234 3,148,573 2,871,612 2,791,170 2,819,979 Other taxes 3,418,634 3,897,046 26,039 30,466 23,361 Use of money and property 7,292,376 4,287,125 (2,755,656) 1,534,758 4,158,758 State motor vehicle in lieu (unrestricted) - - - - - Other general revenues 35,941,326 21,365,548 32,636,552 4,478,646 3,847,953 Transfers (2,310,270) 153,054
Extraordinary items - - 4,030,000 - - Total general revenues and other changes in net position 161,137,683 144,105,147 147,724,939 115,519,811 108,330,051 Changes in net position - governmental activities 12, 993,340$ (2,019,984) $ 35,820,255 (8,603,006) $ (15,731,317) Last Ten Fiscal Years
(accrual basis of accounting)
(1) In 2016 the Sanitation Fund was reclassed from a Governmental activity to a Business-type activity Fiscal Year

CITY OF ORANGE
Changes in Net Position - Governmental Activities
154
528
2019 2018 2017 2016 (1) 2015
16,046,573 12,469,911 12,901,270 11,523,233 11,043,299 91,261,509 91,221,804 74,753,184 68,091,154 68,074,704 18,465,238 18,449,207 21,174,647 15,343,879 18,432,374 5,280,071 5,419,811 4,753,861 3,651,913 3,760,037 17,791,196 18,243,140 15,632,111 12,867,558 14,226,553 1,195,781 2,667,779 2,371,172 2,615,785 2,026,364 - - - - 4,677,346
--- - -
--- - -
150,040,368 148,471,652 131,586,245 114,093,522 122,240,677 6,578,160 7,412,945 7,115,563 7,227,522 6,594,312 8,438,051 2,250,135 2,476,758 2,825,885 2,144,006 --- - 4,642,609
8,812,877 7,727,691 7,310,803 10,687,277 5,889,501 3,340,401 4,562,365 4,161,061 4,397,657 5,110,904 7,881,907 4,388,460 5,726,683 3,845,044 3,355,657 35,051,396 26,341,596 26,790,868 28,983,385 27,736,989 (114,988,972) (122,130,056) (104,795,377) (85,110,137) (94,503,688) 44,237,113 42,385,253 39,907,869 26,733,026 24,378,818 52,300,499 45,082,151 46,102,329 45,789,026 43,928,900 5,399,992 5,476,167 5,413,495 5,211,752 4,545,827 2,821,430 2,831,378 2,755,030 3,076,891 3,157,617 31,682 31,440 39,235 58,043 37,067 5,077,128 1,753,319 1,572,433 2,248,055 1,629,390 - - - 11,951,577 11,313,325
4,118,151 5,075,459 11,510,192 5,274,621 3,160,624 - - 1,501,687 7,900,901 15,605,368
113,985,995 102,635,167 108,802,270 108,243,892 107,756,936 (1,002,977) (19,494,889) 4,006,893 23,133,755 13,253,248 Fiscal Year
155
529
2024 2023 2022 2021 2020
Expenses:

Water 38,089,991$ 34,893,589 $ 36,818,407 35,983,197 $ 35,010,074 Sanitation 9,286,085 10,061,616 6,670,133 7,860,697 8,486,309 Total Expenses 47,376,076 44,955,205 43,488,540 43,843,894 43,496,383 Program revenues:

Charges for services:

Water 41,539,708 38,461,941 40,369,251 38,899,703 35,425,788 Sanitation 9,121,934 8,300,397 8,318,717 8,012,849 7,754,294 Operating grants and contributions 721,295 - - - - Capital grants and contributions - - - - - Total program revenues 51,382,937 46,762,338 48,687,968 46,912,552 43,180,082 Net Program revenues (expenses) 4,006,861 1,807,133 5,199,428 3,068,658 (316,301) General revenues and other
changes in net position:

Use of money and property 1,782,865 324,028 (939,984) 34,791 664,970 Others 440,327 477,874 - - - Transfers 2,310,270 (153,054) - - - Total general revenues and other 4,533,462 648,848 (939,984) 34,791 664,970 Changes in net position -
business-type activities 8,540,323 2,455,981 4,259,444 3,103,449 $ 348,669 (accrual basis of accounting)
(1) In 2016 the Sanitation Fund was reclassed from a Governmental activity to a Business-type activity Fiscal Year

CITY OF ORANGE
Changes in Net Position - Business-type Activities
Last Ten Fiscal Years
156
530
2019 2018 2017 2016 (1) 2015
33,532,078 33,413,891 29,293,848 25,302,258 28,440,276 8,153,404 7,926,974 7,761,578 7,591,850 - 41,685,482 41,340,865 37,055,426 32,894,108 28,440,276 33,358,746 32,419,133 28,192,880 25,733,212 28,795,052 7,866,374 7,838,429 4,408,670 4,353,379 - - - 72,327 - -
180,500 -- 462,951 385,000 41,405,620 40,257,562 32,673,877 30,549,542 29,180,052 (279,862) (1,083,303) (4,381,549) (2,344,566) 739,776 707,846 41,164 92,860 240,646 156,077 - - 392,537 - -
-- - - -
707,846 41,164 485,397 240,646 156,077 427,984 (1,042,139) (3,896,152) (2,103,920) 895,853 Fiscal Year
157
531
2024 2023 2022 2021
General fund:

Nonspendable 271,684 130,663 102,858 101,737 Restricted - 22,506,997 20,667,960 18,259,654 Committed 23,891,358 630,545 - - Assigned 3,568,489 1,546,660 3,115,614 2,928,780 Unassigned 726,027 913,339 21,234,508 25,568,686 Total general fund 28,457,558 25,728,204 45,120,940 46,858,857 All other governmental funds:

Nonspendable - - - - Restricted 66,862,501 46,361,025 49,810,179 44,321,446 Committed - 250,776 255,740 4,740,268 Assigned 34,802,557 38,359,032 40,371,444 52,871,901 Unassigned (613) (1,470,916) (1,608,382) (1,856,633) Total all other governmental funds 101,664,445 83,499,917 88,828,981 100,076,982 (modified accrual basis of accounting)
Fiscal Year

CITY OF ORANGE
Fund Balances of Governmental Funds
Last Ten Fiscal Years
158
532
2020 2019 2018 2017 2016 (1) 2015
87,818 160,760 95,178 88,269 88,354 109,731 - - - - - - - - - - - - - - - - - - 32,313,009 38,610,758 34,763,378 35,810,692 34,732,497 31,493,563 32,400,827 38,771,518 34,858,556 35,898,961 34,820,851 31,603,294 - - - - - - 42,194,380 40,509,831 40,833,934 43,175,076 50,288,584 56,695,286 5,269,093 6,154,780 7,398,168 7,737,725 7,886,387 13,486,748 31,184,214 29,603,940 29,224,001 39,584,296 34,414,429 31,626,222 (2,053,907) (1,593,498) (1,989,867) - - - 76,593,780 74,675,053 75,466,236 90,497,097 92,589,400 101,808,256 Fiscal Year
159
533
2024 2023 2022 2021
Revenues:

Taxes 117,232,953$ 115,150,847 $ 110,942,447 106,715,236$ Franchise fees 2,981,298 3,148,573 2,871,611 2,791,170 Licenses and permits 6,760,790 6,591,296 6,669,254 5,550,237 Intergovernmental 22,338,181 12,356,695 27,482,163 33,085,279 Charges for services and fees 26,409,193 16,557,655 13,515,236 11,243,519 Use of money and property 7,292,376 4,287,125 (2,775,150) 1,533,906 Fines and forfeitures 1,747,537 2,006,648 1,942,715 1,485,230 Gas tax exchange - - - - Other revenues 35,919,580 23,939,387 20,252,480 4,483,183 Total Revenues 220,681,908 184,038,226 180,900,756 166,887,760 Expenditures:

Current:

General government 13,129,355 16,509,249 11,134,810 15,518,693 Public safety 100,859,676 95,857,843 90,723,202 88,567,963 Community development 6,467,589 3,910,804 3,404,436 4,844,971 Parks and library 18,348,348 18,141,773 16,188,815 14,581,024 Public works 15,145,288 15,824,350 13,033,667 10,901,569 Economic development 1,538,893 8,265,884 4,457,229 420,264 Health and sanitation - - - - Gas tax exchange - - - - Capital outlay 21,848,315 16,745,964 32,146,704 24,762,286 Debt service:

Principal 11,403,028 10,826,439 8,452,778 237,778 Interest 7,737,264 7,800,774 9,250,095 947,783 Cost of issuance - - - - Pass-through payments - - - - Total expenditures 196,477,756 193,883,080 188,791,736 160,782,331 Excess (deficiency) of revenues over (under)
expenditures 24,204,152 (9,844,854) (7,890,980) 6,105,429 Other Financing sources (uses):

Loan proceeds - - - Lease proceeds - - 118,528 - Gain on sale of property - - 4,030,000 - Transfers in 2,629,049 9,400,000 7,300,000 5,847,783 Transfers out (5,939,319) (24,276,946) (16,587,500) (8,027,783) Bond proceeds - - - 295,582,983 Payment to pension liability - - - (259,566,751) Cost of issuance - - - (2,000,429) Total other financing sources (uses) (3,310,270) (14,876,946) (5,138,972) 31,835,803 Extraordinary gain/(loss) - - - - Net change in fund balances 20,893,882$ (24,721,800)$ (13,029,952) 37,941,232$ Debt service as a percentage of noncapital expenditures 12.31% 11.75% 12.74% 0.88% (1) In 2016 the Sanitation Fund was reclassed from a Governmental activity to a Business-type activity Fiscal Year

CITY OF ORANGE
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
160
534
2020 2019 2018 2017 2016 (1) 2015
97,503,362 101,969,285 92,975,011$ 91,462,928 77,791,847 72,890,611 2,819,979 2,821,431 2,831,378 2,755,030 3,076,891 3,157,618 5,780,011 5,846,046 4,846,681 4,966,017 5,443,388 4,080,299 13,638,969 11,584,134 9,016,736 9,727,861 20,125,635 20,574,583 18,699,180 15,924,806 10,703,009 10,978,973 14,311,067 13,740,393 4,121,085 5,077,127 1,753,319 1,572,433 2,248,055 1,629,390 1,772,867 2,194,948 1,852,674 1,706,291 1,725,785 2,190,664 - - - - - - 3,661,149 4,108,287 4,783,149 11,495,612 4,732,645 2,640,918 147,996,602 149,526,064 128,761,957 134,665,145 129,455,313 120,904,476 16,680,796 13,460,308 11,488,962 11,369,206 11,059,999 9,750,112 85,168,745 80,275,211 75,704,854 72,292,753 70,304,539 65,620,597 4,842,271 4,538,371 4,545,422 4,651,614 4,086,895 3,735,548 14,763,471 14,840,900 14,575,737 13,835,002 12,464,990 12,796,867 11,062,997 11,209,853 10,351,948 10,099,229 9,732,287 9,942,108 435,243 1,037,149 2,354,318 2,115,151 2,519,124 557,096 - - - - - 4,595,026 - - - - - - 17,107,265 18,370,773 23,596,982 18,601,383 12,103,521 11,654,340 237,778 92,339 - - - - - - - - - - - - - - - - - - - - - - 150,298,566 143,824,904 142,618,223 132,964,338 122,271,355 118,651,694 (2,301,964) 5,701,160 (13,856,266) 1,700,807 7,183,958 2,252,782 - 570,619 - - - - - - - - - - - - - - - - - 2,000,000 1,042,261 3,765,260 1,500,000 3,025,395 (2,150,000) (5,150,000) (3,257,261) (6,480,260) (2,952,143) (7,069,316) - - - - - - - - - - - - - - - (2,150,000) (2,579,381) (2,215,000) (2,715,000) (1,452,143) (4,043,921) - - - - 31,406 14,548,779 (4,451,964) 3,121,779 (16,071,266)$ (1,014,193) 5,763,221 12,757,640

0.18% 0.07% 0.00% 0.00% 0.00% 0.00%
Fiscal Year
161
535
Fiscal Year Taxable Total Direct
Ended June 30 Secured Unsecured Assessed Value Tax Rate 2015 17,047,541,092 900,737,944 17,948,279,036 0.132% 2016 18,044,868,280 923,910,674 18,968,778,954 0.125% 2017 18,745,544,867 820,730,838 19,566,275,705 0.132% 2018 19,781,317,411 816,774,617 20,598,092,028 0.129% 2019 20,805,169,196 864,502,376 21,669,671,572 0.131% 2020 21,855,913,285 988,437,454 22,844,350,739 0.129% 2021 22,722,807,195 923,182,436 23,645,989,631 0.137% 2022 23,683,281,478 1,099,996,267 24,783,277,745 0.138% 2023 25,668,360,217 963,478,200 26,631,838,417 0.135% 2024 26,220,108,841 1,044,183,594 27,264,292,435 0.137% Notes:

Source: Orange County Auditor-Controller
http://acweb1.ocgov.com/ac/txfdr_Civica/av/AssessedValuations1_egov.asp?title=0280

CITY OF ORANGE
Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years
Secured and Unsecured Assessed Value are net of exemptions. Total direct tax rate is calculated using total property tax collections within the fiscal year divided by the taxable assessed value.

In 1978 the voters of the State of California passed Proposition 13 which limited taxes to a total maximum rate of 1% based upon the assessed value of the property being taxed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only reassessed at the time that it is sold to a new owner.

At that point, the new assessed value is reassessed at the purchase price of the property sold. The assessed valuation data shown above represents th e only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above.

City
162
536
Total for Primary
Government
Taxable Total Direct Total Direct
Secured Unsecured Assessed Value Tax Rate Tax Rate
- - - - 0.132% - - - - 0.125% - - - - 0.132% - - - - 0.129% - - - - 0.131% - - - - 0.129% - - - - 0.137% - - - - 0.138% - - - - 0.135% - - - - 0.137% Former Redevelopment Agency
163
537
2024 2023 2022 2021
Basic levy 1.0000 1.0000 1.0000 1.0000 Overlapping Rates:

School Services:

Anaheim Elementary School District 0.04644 0.04667 0.06321 0.06595 Anaheim High School District 0.03164 0.03016 0.03804 0.03971 North Orange County Community College District 0.01715 0.02778 0.02877 0.03198 No. OC Comm. College Dist. 2002 Bond 0.02533 - - - Orange USD Elementary 2016 Series 2022 - 0.00946 - - Orange USD Series 2018 2016 - 0.01609 0.01656 0.01664 Rancho Santiago Community College District 0.04555 0.04691 0.02652 0.02768 Santa Ana Unified School District 0.05893 0.06976 - - Tustin Unified School District SFID No. 2002-1 0.05856 0.06647 0.06523 0.07102 Total School Services 0.28360 0.31330 0.23833 0.25298 Irvine Ranch Water District 0.05001 0.05001 0.05001 0.05001 Metropolitan Water District 0.00350 0.00350 0.00350 0.00350 Total Direct Rate 1.33711 1.36681 1.29184 1.30649 Notes:
fiscal years through 2012
Source: HdL Coren & Cone
In 1978, California voters passed Proposition 13 which sets the property tax rate at a 1.00% fixed amount. This 1.00% is shared by all taxing agencies for which the subject property resides within. In addition to the 1.00% fixed amount, property owners are charged taxes as a percentage of assessed property values for the payment of various bonds.

Fiscal Year
The above information is for the entire City, which includes the former Redevelopment Agency for

CITY OF ORANGE
Direct and Overlapping Property Tax Rates
(Rate per $100 assessed value)
Last Ten Fiscal Years
164
538
2020 2019 2018 2017 2016 2015

1.0000 1.0000 1.0000 1.0000 1.0000 1.0000

0.05943 0.05059 0.04502 0.04461 0.04227 0.02867

0.03968 0.04244 0.02211 0.04259 0.04948 0.02412

0.02409 0.02828 0.02927 0.02885 0.03043 0.01704 - 0.00001 - - - - - - - - - -

0.02288 0.02685 - - - -

0.02818 0.02875 0.03013 0.04945 0.03063 0.02878 - - - 0.06377 - -

0.06376 0.06687 0.06873 0.07001 0.07751 0.06955

0.23802 0.24379 0.19526 0.29928 0.23032 0.16816

0.06901 0.06901 0.06901 0.02803 0.02803 0.02803

0.00350 0.00350 0.00350 0.00350 0.00350 0.00350

1.31053 1.31630 1.26777 1.33081 1.26185 1.19969 Fiscal Year
165
539
Percentage of (1) Percentage of
Taxable Total Taxable Taxable Total Taxable
Taxpayer Assessed Value Assessed Value Assessed Value Assessed Value Orange City Mills LP 246,705,040$ * 0.90% 149,589,704$ 0.83% St Joseph Hospital of Orange 169,984,481 0.62% 97,396,142 0.54% Gateway Apartments I 167,024,357 0.61% - 0.00% Bex Portfolio Inc 145,161,308 0.53% - 0.00% City Tower Properties LLC 139,594,422 0.51% - 0.00% WaterFord Property 136,839,200 0.50% - 0.00% OC OET Owner LLC 127,834,407 * 0.47% - 0.00% AWH Anaheim Hotel LLC 118,698,111 0.44% - 0.00% RexFord Industrial Realty LP 113,854,158 0.42% - 0.00% Mainstay Main Place LP 105,075,805 0.39% - 0.00% Children's Hospital of Orange County - 0.00% 131,046,853 0.73% Irvine Company LLC - 0.00% 149,146,386 0.83% Passco TVO-S LLC - 0.00% 118,183,377 0.66% Bre Properties Inc - 0.00% 100,227,954 0.56% 3091 Chapman Ave Apts Investors - 0.00% 68,894,374 0.38% Mullock Executive Land - 0.00% 75,022,721 0.42% Orange County Realty Investors LLC - 0.00% 73,000,000 0.41% 1,470,771,289$ 5.39% 1,032,265,688$ 5.75%
(1) Includes assessed value data for both the City and the former Redevelopment Agency * Pending appeals on parcels
2024 2015

CITY OF ORANGE
Principal Property Taxpayers
Current Year and Nine Years Ago
166
540
Refunds
Fiscal Taxes Levied Collections of Prior Year
Year Ended for the Percent for Prior Collections/ Percent June 30 Fiscal Year Amount of Levy Fiscal Years Appeals Amount of Levy 2015 44,363,564 25,762,104 58.07% 218,294 (232,532) 25,747,866 58.04% 2016 45,251,635 26,539,570 58.65% 204,687 (154,193) 26,590,064 58.76% 2017 38,241,617 28,362,047 74.17% 194,368 (156,033) 28,400,382 74.27% 2018 40,644,711 29,514,238 72.62% 174,216 (112,829) 29,575,625 72.77% 2019 42,770,704 29,572,421 69.14% 170,111 (166,907) 29,575,625 69.15% 2020 44,635,001 30,747,643 68.89% 180,209 (101,066) 30,826,786 69.06% 2021 41,994,760 32,699,503 77.87% 243,898 (611,668) 32,331,733 76.99% 2022 48,623,035 34,141,966 70.22% 245,581 (142,219) 34,245,328 70.43% 2023 47,783,174 35,948,954 75.23% 252,228 (284,750) 35,916,432 75.17% 2024 48,954,690 37,235,698 76.06% 243,129 (179,884) 37,298,943 76.19% Notes:
delinquent taxes by collection year.

Source: Orange County Auditor-Controller
http://acweb1.ocgov.com/acledger/report_eGov.asp
Information not available from the County of Orange for delinquent taxes by levy year. Therefore, the City has opted to report

CITY OF ORANGE
Property Tax Levies and Collections
Last Ten Fiscal Years
Collected within
Fiscal Year of Levy within the Fiscal Year
Total Collections
167
541
Fiscal Pension Lease Total Pension Total
Year Ended Obligation Revenue Governmental Obligation Business-type June 30 Bonds Bonds Activities Bonds Activities
2015 - - - - - 2016 - - - - - 2017 - - - - - 2018 - - - - - 2019 - - - - - 2020 - - - - - 2021 265,478,776 34,159,604 299,638,380 21,006,224 21,006,224 2022 258,348,004 29,410,000 287,758,004 20,441,996 20,441,996 2023 248,970,043 28,860,000 277,830,043 19,699,957 19,699,957 2024 238,632,971 28,290,000 266,922,971 18,882,028 18,882,028 Notes:

Details regarding the City's outstanding debt can be found in the notes to the financial statements. 1 See the Schedule of Demographic and Economic Statistics for personal income. These ratios are calculated using city population times county per capita personal income for two years prior 2 Based on latest per capita income information available. See the Schedule of Demographic and Economic Statistics for population data.
(e.g., 2012 amount is calculated using 2010 data).

Business-type ActivitiesGovernmental Activities

CITY OF ORANGE
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
168
542
Total Percentage
Total Primary of Personal Debt
Government Income 1 Per Capita 2
- - -
- - -
- - -
- - -
- - -
- - -
320,644,604 3.25% 2,303
308,200,000 2.90% 2,218
297,530,000 2.62% 2,143
285,804,999 2.52% 2,062
169
543
7+,63$*(,17(17,21$//</()7%/$1.
170
544
2023-2024Assessed Valuation: $27,264,292,435
Total Debt City’s Share of
OVERLAPPING TAX AND ASSESSMENT DEBT: 6/30/2024 % Applicable (1) Debt 6/30/24 Metropolitan Water District 18,210,000$ 0.704% 128,198$ Irvine Ranch Water District, Improvement District No. 125 157,134,762 0.879 1,381,215 Irvine Ranch Water District, Improvement District No. 225 230,261,626 0.008 18,421 Irvine Ranch Water District, Improvement District No. 153-253 18,210,043 0.047 8,559 North Orange County Joint Community College District 291,560,678 0.121 352,788 Rancho Santiago Community College District 154,276,441 27.535 42,480,018 Rancho Santiago Community College District School Facilities Improvement District No. 1 144,765,000 0.0001 145 Anaheim Union High School District 229,078,955 0.345 790,322 Anaheim School District 345,875,685 0.587 2,030,290
Tustin Unified School District School Facilities Improvement District No. 2002-1 36,420,000 0.047 17,117 Tustin Unified School District School Facilities Improvement District No. 2008-1 73,030,000 0.048 35,054 Tustin Unified School District School Facilities Improvement District No. 2012-1 47,005,000 0.035 16,452 Orange Unified School District 276,295,000 59.493 164,376,184 Orange Unified School District Community Facilities District No. 2005-1 5,090,000 100 5,090,000 Orange Unified School District Community Facilities District No. 2005-2 4,730,000 100 4,730,000 Santa Ana Unified School District 409,228,633 0.0001 409 City of Orange Community Facilities District No. 91-2 14,545,000 100 14,545,000 City of Orange Community Facilities District No. 06-1 20,115,000 100 20,115,000 TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT 256,115,172.00$ DIRECT AND OVERLAPPING GENERAL FUND DEBT:

Orange County General Fund Obligations 440,385,000$ 3.541% 15,594,033.00 $ Orange County Board of Education Certificates of Participation 10,030,000 3.541 355,162 North Orange County Regional Occupation Program Certificates of Participation 7,350,000 0.124 9,114 Orange Unified School District Certificates of Participation and Benefit Obligations 64,700,000 59.493 38,491,971 Santa Ana Unified School District General Fund Obligations 42,399,216 0.000 42 Anaheim Union High School District Certificates of Participation 28,320,000 0.345 97,704 City of Orange General Fund Obligations 28,290,000 100 28,290,000 City of Orange Pension Obligation Bonds 257,515,000 100 257,515,000 TOTAL DIRECT AND OVERLAPPING GENERAL FUND DEBT 340,353,026$ OVERLAPPING TAX INCREMENT DEBT (Successor Agencies): 22,675,000$ 100% 22,675,000 $ TOTAL DIRECT DEBT 285,805,000$
TOTAL OVERLAPPING DEBT 333,338,198$
COMBINED TOTAL DEBT (2) 619,143,198$ (2)
Ratios to 2023-2024 Assessed Valuation:

Total Overlapping Tax and Assessment Debt 0.94%
Total Direct Debt ($285,805,000) 1.05%
Combined Total Debt 2.27%
Ratios to Redevelopment Successor Agencies Incremental Valuation ($5,504,353,461):

Total Overlapping Tax increment Debt 0.41%
(1) The percentage of overlapping debt applicable to the city is estimated using taxable assessed property value. Applicable percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries of the city divided by the district's total taxable assessed value. (2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations. Qualified Zone Academy Bonds are included based on principal due at maturity.

CITY OF ORANGE
Direct and Overlapping Property Tax Rate
Last Ten Fiscal Years
(Rate per $100 assessed value)
171
545
2024 2023 2022 2021
Assessed valuation 27,264,292,435$ 26,631,838,417$ 24,783,277,745 23,645,989,631 Conversion percentage 25% 25% 25% 25%
Adjusted assessed valuation 6,816,073,109 6,657,959,604 6,195,819,436 5,911,497,408 Debt limit percentage 15% 15% 15% 15%
Debt limit 1,022,410,966 998,693,941 929,372,915 886,724,611 Total net debt applicable to limit - - - - Legal debt margin 1,022,410,966 998,693,941 929,372,915 886,724,611 Total debt applicable to the limit
as a percentage of debt limit 0.0% 0.0% 0.0% 0.0%
Fiscal Year
Last Ten Fiscal Years
Legal Debt Margin Information

CITY OF ORANGE
172
546
2020 2019 2018 2017 2016 2015
22,844,350,739$ 21,669,671,572 20,598,092,028$ 19,566,275,705 18,968,778,954 17,948,279,036 25% 25% 25% 25% 25% 25%
5,711,087,685 5,417,417,893 5,149,523,007 4,891,568,926 4,742,194,739 4,487,069,759 15% 15% 15% 15% 15% 15%
856,663,153 812,612,684 772,428,451 733,735,339 711,329,211 673,060,464 - - - - - - 856,663,153 812,612,684 772,428,451 733,735,339 711,329,211 673,060,464

0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Fiscal Year
173
547
Fiscal Year Property Tax
Ended June 30 Increment Principal Interest Coverage
2015 - - - - 2016 - - - - 2017 - - - - 2018 - - - - 2019 - - - - 2020 - - - - 2021 - - - - 2022 - - - - 2023 - - - - 2024 - - - - Debt Service
Tax Allocation Bonds

CITY OF ORANGE
Pledged-Revenue Coverage
Last Ten Fiscal Years
174
548
Personal Income
Fiscal Year (expressed Per Capita Public School Unemployment Ended June 30 Population 1, 5 in thousands) 2,5 Personal Income 2,5 Enrollment 3,6 Rate 4,5 2015 140,094 183,052,341 59,242 14,982 4.4%
2016 140,761 196,920,661 61,188 14,581 4.3%
2017 140,882 208,653,019 63,513 14,256 3.6%
2018 141,952 220,684,684 66,058 14,072 3.3%
2019 141,691 221,803,099 69,590 13,958 2.9%
2020 140,693 236,303,451 75,572 13,852 12.0%
2021 139,229 256,700,438 81,567 13,105 6.5%
2022 138,944 263,290,135 81,505 13,187 3.2%
2023 138,842 264,973,116 84,109 12,850 3.7%
2024 138,621 278,760,587 88,897 12,981 4.1%
Sources:
1 State of California, Department of Finance
2 U.S. Department of Commerce, Bureau of Economic Analysis (data shown is for the County) 3 Orange Unified School District region
4 State of California, Employment Development Department 5 In fiscal year 2023-2024, information was revised to improve accuracy 6 In fiscal year 2019-20, enrollment data is from February 2020 due to school closure from March through June 2020 due to COVID-19.
* Not available at time of printing

CITY OF ORANGE
Demographic and Economic Statistics
Last Ten Fiscal Years
175
549
Percent of Percent of
Number of Total Number of Total
Employer Employees Employment Employees Employment
UCI Irvine Healthcare 4,995 7.09% 4,000 15.75% CHOC Children's Hospital 3,938 5.59% 2,900 11.42% St. Joseph Hospital of Orange 3,500 4.96% 4,850 (1) 19.09% Chapman University 1,300 1.84% 1,235 4.86% Santiago Canyon College 950 1.35% 913 3.59% CalOptima Health Plans 930 1.32% 900 3.54% City of Orange 800 1.13% 753 2.96% Chapman Medical Center 700 0.99% 460 1.81% MS International 548 0.78% 266 1.05% OCTA 500 0.71% 500 1.97%
Hilton Hotel Fera 477 0.68% - 0.00% AECOM Technology Corp 454 0.64% - 0.00% Orange County Sheriff's Dept Theo Lacy J 450 0.64% - 0.00% Alignment Healthcare LLC 430 0.61% - 0.00% SA Recycling, LLC 410 0.58% - 0.00% Letner Roofing Company 380 0.54% - 0.00% GGG Demolition Inc 300 0.43% - 0.00% Coca-Cola Distribution Center 300 0.43% - 0.00% NOV Rig Systems (fomerly National Oilwell Varco) - 0.00% 900 3.54% Western Dental Services, Inc. (formerly Sybron Dental Specialists) - 0.00% 700 2.76% California Choice 250 0.35% 490 1.93% American Advisors Group (AAG) - 0.00% 800 3.15% AECOM Technology Corp 454 0.64% 450 1.77% Notes:
1 Incudes Outpatient Pavilion
Source: Inside Prospects, Inc. and State of California EDD "Total Employment" as used above represents the total employment of all employers located within City limits. 2024 2015

CITY OF ORANGE
Principal Employers
Current Year and Nine Years Ago
176
550
2024 2023 2022 2021 2020 2019 2018* 2017* 2016* 2015*
Governmental Activities:

General Government (2) 93 71 55 60 59 61 71 72 72 75 Public Safety 401 414 407 386 388 386 410 412 412 412 96 78 87 73 71 66 68 67 67 67 Community Development 40 25 24 33 33 32 36 36 36 36 Parks and Library 107 106 113 105 105 106 109 109 111 109 Economic Development 1 1 111 3--- -
Sanitation (1) - - ------- 21
Subtotal governmental activities 738 695 687 658 657 654 694 696 698 720 Business-Type Activities:

Water 48 46 46 51 51 53 45 45 45 45 Sanitation (1) 41 22 18 18 18 22 21 21 21 Subtotal business-type activities 89 68 64 69 69 75 66 66 66 45 Total activities 827 763 751 727 726 729 760 762 764 765 * Includes budgeted but frozen positions
(1) In fiscal year 2015-16, the Sanitation fund was reclassified as a Business-Type Activity (2) In fiscal year 2018-19, Information Technology transferred from contract to in-house Source: City of Orange
Last Ten Fiscal Years
Function
Public Works

CITY OF ORANGE
Full-Time Equivalents
by Function
Full-Time Equivalents as of June 30
177
551
2024 2023 2022 2021
City Attorney:

Number of claims/cases handled 537 467 453 234 Number of resolutions/ordinances/agreements 410 315 342 396 City Clerk:

Number of passports processed (1, 3)
1,375 1,000 1,634 1,106 Number of documents scanned (4)
- - - 2,423 Number of public records requested (4)
934 810 1,203 669 Finance:

Number of business licenses issued 19,526 20,385 20,678 20,849 Number of water accounts billed 35,547 35,513 35,492 36,508 Human Resources:

Number of recruitments held 114 128 123 83 Number of applications processed 6,836 7,851 7,622 7,051 Library:

Number of items checked out (2, 5)
654,713 602,683 462,847 266,537 Total library cards (5)
6,981 6,664 5,354 61,107 Number of patrons/visitors 311,012 258,478 217,211 76,152 Fire:

Number of calls:

Medical 14,993 14,467 13,014 11,789 Fire 731 806 845 729 Other 2,443 2,457 2,496 2,291 Number of inspections performed 5,466 5,949 4,864 3,421 Police:

Number of calls for service 97,836 94,091 91,179 88,853 Number of arrests 5,969 5,335 5,339 5,715 Public Works:

Lane miles of streets resurfaced 42 30 27 22 Miles of streets swept 40,872 40,872 39,664 39,664 Water Division:

Number of active water connections 36,593 36,536 36,508 36,508 Million gallons of daily average distribution 21 20 24 24 Sanitation Division:

Number of active sewer connections 33,460 33,667 33,667 33,662 1,983 1,983 1,985 1,985 Community Development:

Number of permits issued 3,572 4,151 3,676 3,576 Combined construction valuation 151,134,837$ 408,001,641$ 192,982,847$ 158,963,749$ Community Services:

Number of contract classes held (3)
500 521 611 278 Total participants at all activities/events (3)
856,677 804,521 878,457 32,039 Notes:
3 In 2019-20 and 2020-21, passports issued and classes/activities held were reduced due to COVID-19 4 Effective in 2020-21 we have revised are operating indicators to include public records requested, rather than documents scanned. The public records information was not available for years prior to 2017-18. 5 Source: City of Orange
Operating Indicators by Department
Last Ten Fiscal Years
Fiscal Year
In Fiscal Year 2021-22, information was revised to improve accuracy. Effective in 21-22 we changed the reporting to the number of library cards issued , rather than the total number of library cards
2 In Fiscal Year 2016-17, information was revised to improve accuracy.

Number of catch basins inspected
1 In Fiscal Year 2015-16, information was revised to improve accuracy.

CITY OF ORANGE
178
552
2020 2019 2018 2017 2016 2015
413 534 414 428 441 486 312 292 288 240 288 269 1,726 2,686 2,611 3,183 2,669 1,837 5,890 7,168 4,658 2,544 2,184 2,220 439 374 230 N/A N/A N/A 20,771 20,659 20,659 20,487 20,721 20,190 36,456 36,490 35,216 35,388 35,380 35,174 68 100 81 87 60 60 5,725 10,744 7,193 7,590 8,968 6,717 402,449 418,033 536,202 541,270 616,388 643,791 60,209 56,992 55,644 57,078 59,162 59,316 339,659 422,142 413,582 426,861 469,700 502,276 13,426 12,592 12,463 12,048 12,327 9,416 709 692 688 664 622 355 2,348 2,218 2,457 2,336 3,022 1,843 4,004 5,612 4,999 6,868 6,866 5,970 92,730 108,371 109,192 100,876 99,728 103,793 4,589 5,353 5,667 4,568 4,771 4,683 22 23 24 37 35 28 39,664 39,664 37,617 40,766 39,850 40,180 36,485 36,435 36,431 36,391 36,372 36,347 24 24 25 23 21 26 33,647 33,950 33,956 33,951 33,950 33,943 1,985 1,985 1,910 1,983 1,983 1,952 3,406 3,396 3,552 4,229 4,153 3,803 174,844,204$ 156,630,767$ 132,814,044 $ 114,940,690 $ 235,315,312 $ 106,328,212$ 863 1,201 1,188 1,044 1,148 1,212 622,373 1,000,000 1,060,872 1,060,893 918,805 934,188 Fiscal Year
179
553
2024 2023 2022 2021 2020
Library:

Number of libraries 3.00 3.00 3 3 3 Number of books & other items held 1
161,221.00 170,539.00 168,012 202,641 192,927 Fire:

Number of fire stations 8.00 8.00 8 8 8 Number of vehicles in fleet 63.00 62.00 62 62 59 Police:

Number of stations/sub-stations 2.00 2.00 2 2 2 Number of vehicles in fleet 132.00 136.00 133 131 132 Public Works:

Streets (in miles) 322.00 322.00 324 324 324 Number of streetlights 7,896.00 7,842.00 7,842 7,842 7,836 Number of traffic signals 158.00 158.00 158 158 157 Number of street trees 2,500.00 23,000.00 20,000 20,000 19,716 Water Division:

Number of wells 10.00 12.00 12 12 12 Water mains (in miles) 463.00 462.00 445 445 446 Number of hydrants 4,502.00 4,475.00 4,434 4,431 4,450 Sanitation Division:

Miles of sewer lines/storm drains 422.00 422.00 422 422 422 Facilities Maintenance Division:

Number of city buildings owned 82.00 82.00 82 82 82 Square feet of city buildings 2
533,384.00 533,384.00 533,384 533,384 533,384 Number of other city vehicles 269.00 270.00 277 275 275 Community Services:

Number of parks 22.00 22.00 22 22 22 Acres of parkland 1
278.00 267.00 267 267 260 Number of community pools 2.00 2.00 2 2 2 Notes:
2 In Fiscal Year 2017, information was revised to improve accuracy. 1 In Fiscal Years 2022, 2021, 2019 and 2014, information was revised to improve accuracy.

CITY OF ORANGE
Capital Asset Statistics by Department
Last Ten Fiscal Years
Fiscal Year
180
554
2019 2018 2017 2016 2015
3 3 3 3 3 196,198 218,688 231,715 223,161 212,373 8 8 8 8 8 58 58 58 58 58 2 2 2 2 2 133 132 132 132 132 324 324 324 331 328 7,836 7,836 3,182 3,182 3,125 157 157 157 157 157 22,000 22,000 22,000 22,000 20,430 12 12 14 17 16 446 462 462 452 452 4,439 4,434 4,389 4,417 4,410 436 436 436 436 436 82 82 82 82 82 533,384 512,000 512,000 529,995 529,995 274 272 271 271 236 22 22 22 22 22 260 258 258 258 258 2 2 2 2 2

Fiscal Year
181
555
556

LSLCPAS.COM
March 3, 2025
To the Honorable Mayor and City Council
City of Orange
300 E. Chapman Ave
Orange, CA 92866
We have audited the financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of Orange , (the “City”) for the year ended June 30, 2024. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards and Government Auditing Standards and the Uniform Guidance as well as certain information related to the planned scope and timing of our audit. We have communicated such information in our letter to you dated June 20, 2024. Professional standards also require that we communicate to you the following information related to our audit.

Significant Audit Matters
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in Note 1 to the financial statements . No new accounting policies were adopted and the application of existing policies was not changed during 2023-24. We noted no transactions entered into by the City during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period.

Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events.

Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the City’s financial statements were:

Management’s estimates of the pension, other postemployment benefits, and self -insured claims liabilities are based on actuarial valuations. We evaluated the methods, assumptions, and data used to develop the pension, other postemployment benefits, and self -insured claims liabilities in determining that it is reasonable in relation to the financial statements taken as a whole.

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

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

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

Management has corrected all such misstatements. In addition, none of the misstatements detected as a result of audit procedures and corrected by management were material, either individually or in the aggregate, to each opinion unit’s financial statements taken as a whole.
557

To the Honorable Mayor and Members of the City Council
City of Orange, California

Disagreements with Management

For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor’s report. We are pleased to report that no such disagreements arose during the course of our audit.

Management Representations

We have requested certain representations from management that are included in the management representation letter dated March 3, 2025.

Management Consultations with Other Independent Accountants

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

Other Audit Findings or Issues

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

Other Matters

We applied certain limited procedures to management’s discussion and analysis, the budgetary comparison schedules for the general fund and major special revenue funds, and the required pension and other postemployment benefits schedules, which are required supplementary information ( “RSI”) that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI.

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

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

558

To the Honorable Mayor and Members of the City Council
City of Orange, California

Future GASB Pronouncements

The following Government Accounting Standards Board (GASB) pronouncements will be effective for the following fiscal years’ audits and should be reviewed for proper implementation by management:

Fiscal Year 2024-2025

GASB Statement No. 101, Compensated Absences.

GASB Statement No. 102, Certain Risk Disclosures.

Fiscal Year 2025-2026

GASB Statement No. 103, Financial Reporting Model Improvements.

GASB Statement No. 104, Disclosure of Certain Capital Assets.

Future Projects

Comprehensive Project, Revenue and Expense Recognition.

Major Project, Going Concern Uncertainties and Severe Fina.ncial Stress

Major Project, Infrastructure Assets.

Practice Issue, Classification of Nonfinancial Assets.

Practice Issue, Risks and Uncertainties Disclosures.

Practice Issue, Subsequent Events.

Restriction on Use

This information is intended solely for the information and use of the City Council and management of the City and is not intended to be, and should not be, used by anyone other than these specified parties.

Very truly yours,

LSL, LLP

559
1611 E. Fourth Street, Suite 200
Santa Ana, CA 92701
(714) 569-1000
203 N. Brea Blvd, Suite 203
Brea, CA 92821
(714) 672-0022
21 Waterway Avenue, Suite 30089
The Woodlands, TX 77380
(936) 828-4587
2151 River Plaza Dr., Suite 150
Sacramento, CA 95833
(916) 503-9691
24422 Avenida de la Carlota, Suite 275
Laguna Hills, CA 92653
(949) 829-8299
www.lslcpas.com
INDEPENDENT ACCOUNTANTS’ REPORT ON AGREED-UPON

PROCEDURES APPLIED TO APPROPRIATIONS LIMIT WORKSHEETS

To the Honorable Mayor and Members of the City Council
City of Orange, California

We have performed the procedures enumerated below on the accomp anying Appropriations Limit Worksheet No. 6 (or other alternative computation) of the City of Orange, California, for the year ended June 30, 2024. These procedures are the responsibility of the City, whi ch were agree d to by the City of Orange and the League of California Cities (as presented in the publication entitled Agr eed-Upon Procedures Applied to the Appropriations Limitation Prescribed by Article XIII-B of the California Const itution), were performed solely to assist the City of Orange in meeting the r equirements of Section 1.5 of Ar ticle XIII-B of the California Constitution. The City of Orange's management is responsible for the Appropriatio ns Limit Worksheet No. 6 (or other alternative computation).

The City has agreed to and acknowledged that the procedures per formed are appropriate to meet the intended purpose of recomputing the Appropriations Limit Worksheet No. 6 (or other alternative comp utation). This report may not be suitable for any other purpose. The procedures performed may not address all the items of interest to a user of this report and may not meet the needs of all users o f this report and, as such, users are responsible for determining whether the procedures performed are appropriate for their purposes.

The procedures performed and our findings were as follows:

1. We obtained the completed Worksheets No. 1 through No. 7 (or other alternative computations) and compared the limit and annual adjustment factors included in th ose worksheets to the limit and annual adjustment factors that were adopted by resolution of the City Council. We also compared the population and inflation options included in the aforementioned worksheets to those that were selected by a recorded vote of the City Council.

Finding: No exceptions were noted as a result of our procedures.

2. For the accompanying Appropriations Limit Worksheet No. 6, w e multiplied line A, last year's limit, by line D, ratio of change and compared the resulting amount to line E, this year's limit.

Finding: No exceptions were noted as a result of our procedures.

3. We compared the current year information presented in the ac companying Appropriations Limit Worksheet No. 6 to the other worksheets described in No. 1 above.

Finding: No exceptions were noted as a result of our procedures.

4. We compared the prior year appropriations limit presented in the accompanying Appropriations Limit Worksheet No. 6 to the prior year appropriations limit adopted by the City Council for the prior year.

Finding: No exceptions were noted as a result of our procedures.

560

To the Honorable Mayor and Members of the City Council
City of Orange, California

We were engaged by the City to perform this agreed-upon procedu res engagement and conducted our engagement in accordance with attestation standards established by the AICPA. We were not engaged to and did not conduct an examination or review engagement, the object ive of which would be the expression of an opinion or conclusion, respectively, on the accompanying Approp riations Limit Worksheet No. 6 (or other alternative computati on). Accordingly, we do not expr ess such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you.

We are required to be independent of the City and to meet our o ther ethical responsibilities, in accordance with the relevant ethical requirements related to our agreed-upon procedures engagement.

This report is intended solely for the information of the City Council and management of the City of Orange and is not intended to be, and should not be, used by anyone other than these specified parties.

Brea, California
July 31, 2024

561

CITY OF ORANGE
2023-2024

APPROPRIATIONS LIMIT CALCULATION

A. 2022-2023 APPROPRIATIONS LIMIT: $ 216,332,740

B. 2023-2024 CHANGE IN PER CAPITA PERSONAL
INCOME: 4.44%

C. 2023-2024 CHANGE IN POPULATION: 0.66%

D. RATIO OF CHANGE (1.04 44 x 1.0066) x 1.0513

E. 2023-2024 APPROPRIATIONS LIMIT: $ 227,430,610
($216,332,740 x 1.0513)

562

LSLCPAS.COM
INDEPENDENT ACCOUNTANTS’ REPORT

ON AGREED-UPON PROCEDURES
To the Honorable Mayor and Members of the City Council
City of Orange, California
We have performed the procedures enumerated below to assist the City of Orange, California (the City) in evaluating the Treasurer’s Report for the month ended June 30, 2024, for compliance with the provisions of the California Government Code (the Code) and with the City’s investment policy dated April 26, 2023, (the Policy).

The City’s management is responsible for the Treasu rer’s Report for the month ended June 30, 2024, the compliance with the Policy and the Code and for selecting that such criteria are appropriate for your purpose.

The City has agreed to and acknowledged that the proced ures performed are appropriate to meet the intended purpose of evaluating the Treasurer’s Report for the month ended June 30, 2024, for compliance with the provision of the Code and with the Policy. This report ma y not be suitable for any other purpose. The procedures performed may not address all the items of interest to a us er of this report and may not meet the needs of all users of this report and, as such, users are responsi ble for determining whether the procedures performed are appropriate for their purposes.

The procedures and the associated findings are as follows:

1. We obtained a copy of the Investment Portfolio Report as of June 30, 2024 and agreed individual investments/deposits to supporting documentation obtained from the City and reconciled such to the Investment Portfolio Report. We traced total investments listed on the Investment Portfolio Report to the City’s general ledger.

Finding: No exceptions were noted as a result of this procedure.

2. We compared investments listed in the Investment Portfolio Report as of June 30, 2024, to the types of investments authorized for the City by the City’s in vestment policy and California Government Code Section 53601.

Finding: No exceptions were noted as a result of this procedure.

3. We compared the market value of the investments listed in the Investment Portfolio Report as of June 30, 2024 to the bank statements and other supporting documentation.

Finding: No exceptions were noted as a result of this procedure.

4. We
read the Investment Portfolio Report to ascertai n that it contained the in formation/data required by California Government Code Section 53646 and met the timing requirements of California Government Code Section 53646, as follows:
a. Included the type of investment, issuer, date of ma turity, par and dollar amount invested on all securities , inve
stments and monies held by the City.
b.

Included those funds under management of contracted parties. 563
To the Hon
orable Mayor and Members of the City Council
City of Orange, California
c.

Included market value (and source) as of the date of the report of all securities held by the City or un der manag
ement of contracted parties.
d.

Stated compliance of the portfolio to the investment policy of the City. e.

Included a statement addressing the ability of the City to meet the pool’s expenditure requirements for the next six months.

Finding: No e xceptions were noted as a result of this procedure.

5. We compared the investments listed in the Investment Portfolio Report as of June 30, 2024, to the prohib ited inve
stments listed in California Government Code Section 53601.6.

Finding: No e xceptions were noted as a result of this procedure.

6. We calculated the totals (cost basis) for the investm ent type s listed in the Investment Portfolio Report as of June 30, 2024 and compared those totals to the limitations imposed by the City’s invest ment policy and California Go
vernment Code Section 53601 for the specific investment types.

Finding: No exceptions were noted as a result of this procedur e.

7. We agreed individual investment maturity dates listed in the Investment Portfolio Report as of Jun
e 30, 2024, to the City’s copies of investment statements to determine if they conformed to the maturity requirements of the City’s investment policy and California Government Code section 53601.

Finding: No exceptions were noted as a result of this procedure.

8. We obtained and read the third-party custodial agreements a nd broker/dealer agreements in effect at the date of the Inve
stment Portfolio Report to determine if the agreements contained a cl ause addressing deliver y of se
curities and that the delivery method conformed to California Government Code section 53601.

Finding: The City does not have a formal agreement or cont ract with the broker/dealer since they are not required to use the broker/dealer for trades an d there are no fees or commissions charged. The City Treasurer authorizes the use of designated brokers and ensures that the City has written documentation with the broker’s signature stati ng that the broker will adhere to the City’s investment policy.

We were engaged by the City to perform this a greed-upon procedures engagement and conducted our engagement in accordance with attestation standards established by the AICPA. We were not engaged to and did not conduct an examination or review engagement, the obj ective of which would be t he expression of an opinion or conclusion, respectively, on evaluating the Treasurer’s Report for the month ended June 30, 2024, for compliance with the provisions of the Code) and with t he Policy. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you.

We are required to be independent of the City and to meet ou r other ethical responsibilities, in accordance with the relevant ethical requirements related to our agreed-upon procedures engagement This report is intended solely for the information of the City Council and management of the City of Orange and is not intended to be, and should not be, used by anyone other than these specified parties.

Irvine, California
March 04, 2025
564

LSLCPAS.COM
INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE

AND ON INTERNAL CONTROL OVER COMPLIANCE
To the Honorable Mayor and Members of the City Council
City of Orang
e, California
Report on Compliance
Opinion
We have audited the Air Pollution Reduction Fund (the “Fund ) of the City of Orange, California (the “City”)’s compliance with the types of compliance requirements identified as subject to audit in California Assembly Bill 2766, Chapter 1705 (44220 through 44247) (“AB 2766”) that could have a direct and material effect on the City’s AB 2766 Subvention Fund Program (the “Program”) for the year ended June 30, 2024.

In our opinion, the City complied, in all material respec ts, with the types of compliance requirements referred to above that could have a direct and material effect on the Program for the year ended June 30, 2024.

Basis for Op
inion
We conducted our audit of compliance in accordance wi th auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained inGovernment Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of AB 2766. Our responsibilities under those standards and AB 2766 are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our report.

We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on compliance for the Program. Our audit does not provide a legal determination of the City’s compliance with the compliance requirements referred to above.

Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation, and maintenance of effective internal c ontrol over compliance with the requirements of laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to the Program.

Auditor’s Responsibilities for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fr aud or error, and express an opinion on the City’s compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards, Government Auditing Standards, and AB2766 will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the overri de of internal control.

Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it woul d influence the judgment made by a reasonable user of the report on compliance about the City’s compliance with the requirements the Program as a whole. 565

To the Honorable Mayor and Members of the City Council
City of Orange, California

In performing an audit in accordance with generally accepted auditing standards, Government Auditing Standards, and AB 2766, we:

 Exercise professional judgment and maintain professional skepticism throughout the audit.

 Identify and assess the risks of material noncompliance , whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such pr ocedures include examining, on a test basis, evidence regarding the City’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances.

 Obtain an understanding of the City’s internal control ov er compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with AB 2766, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control over compliance. Accordingly, no such opinion is expressed.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any signi ficant deficiencies and material w eaknesses in internal control over compliance that we identified during the audit.

Report on Internal Control over Compliance

A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compli ance requirement of the Program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a reasonabl e possibility that material noncompliance with a type of compliance requirement of the Program will not be prevented, or detec ted and correc ted, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of the Program that is less severe than a material weakness in internal control over compliance, yet im portant enough to merit attention by those charged with governance.

Our consideration of internal control over compliance was for the limited purpose described in the Auditor’s Responsibilities for the Audi t of Compliance section above and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or signifi cant deficiencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies in internal control over compliance may exist that were not identified.

Our audit was not designed for the purpo se of expressing an opinion on the effe ctiveness of internal control over compliance. Accordingly, no such opinion is expressed.

The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of AB 2766. Accordingly, this report is not suitable for any other purpose.

Irvine, California
February 12, 2025
566
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567

CITY OF ORANGE, CALIFORNIA

AIR POLLUTION REDUCTION FUND

Financial Statements

With Report on Audit
By Independent
Certified Public Accountants

For the Year Ended June 30, 2024
568

CITY OF ORANGE, CALIFORNIA

AIR POLLUTION REDUCTION FUND

Financial Statements

With Report on Audit
By Independent
Certified Public Accountants

For the Year Ended June 30, 2024

Table of Contents
Page
Number

FINANCIAL SECTION

INDEPENDENT AUDITORS’ REPORT ................................................................................................................... 1

BASIC FINANCIAL STATEMENTS

GOVERNMENT - WIDE FINANCIAL STATEMENTS

Statement of Net Position ...................................................................................................................................... 4

Statement of Activities ........................................................................................................................................... 5

FUND FINANCIAL STATEMENTS

Balance Sheet – Governmental Fund ................................................................................................................... 6

Reconciliation of the Balance Sheet - Governmental Fund to the Statement of Net Position .................................................................................................................. 7

Statement Of Revenues, Expenditures and Changes In
Fund Balance – Governmental Fund: .......................................................................................................... 8

Reconciliation of the Statement of Revenues
Expenditures and Changes in Fund Balances of Governmental Fund to the Statement of Activities ....................................................................................................................... 9

Notes to Financial Statements ................................................................................................................................ 10

REQUIRED SUPPLEMENTARY INFORMATION

Budgetary Comparison Schedule ........................................................................................................................... 16

Note to Required Supplementary Information ................................................................................................... 17

OTHER REPORT

Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in
Accordance with Government Auditing Standards ........................................................................................................... 18

569

LSLCPAS.COM

INDEPENDE
NT AUDITORS’ REPORT
To the Hon
orable Mayor and Members of the City Council
City of Orang
e, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities and the governmental fund of the Air Pollution Reduction Fund (the “Fund”), a special revenue fund of the City of Orange, California (the “City”), as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the Fund’s basic financial statements as listed in the table of contents.

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and governmental fund of the Fund, as of June 30, 2024, and the respective changes in financial position, for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and the Fund and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Emphasis of Matter
Fund Financial Statements
As discussed in Note 1, the financial statements of the Fund are intended to present the financial position, the changes in financial position, and, where applicable, cash flows of only that portion of the governmental activities, each major fund, and the aggregate remaining fund information of the City that is attributable to the transactions of the Fund. They do not purport to, and do not, present fairly the financial position of the City, as of June 30, 2024, the changes in its financial position, or, where applicable, its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter.

Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. 570
To the Hon
orable Mayor and Members of the City Council
City of Orange, California
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.

Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions.

Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

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

Required Supplementary Information
Acco
unting principles generally accepted in the United States of America require that the budgetary comparison schedules, as listed on the table of contents, presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. 2 571
To the Honorable Mayor and Members of the City Council
City of Orange, California
Management has omitted the management’s discussion and analysis and required pension and other post-employment benefit schedules that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinions on the basic financial statements are not affected by this missing information.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards , we have also issued our report dated February 12, 2025, on our consideration of the City’s internal control over the Fund’s financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over the Fund’s financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering City’s inte rnal control over the Fund ’s financial reporting and compliance.

Irvine, California
February 12, 2025
3 572

CITY OF ORANGE, CALIFORNIA

AIR POLLUTION REDUCTION FUND
Statement of Net Position
Governmental
Activities
ASSETS
Cash and investments 279,015$
Receivables (net of uncollectibles):

Accounts 485
Accrued interest 2,142
Capital assets (net of accumulated depreciation/amortization) 165,157 Total assets 446,799

LIABILITIES
Accounts payable 27,710
Due to the City of Orange 47,536
Total liabilities 75,246

NET POSITION
Invested in capital assets 165,157
Restricted for air pollution reduction projects 206,396 Total net position 371,553$
June 30, 2024
See Notes to Financial Statements.
4 573

CITY OF ORANGE, CALIFORNIA

AIR POLLUTION REDUCTION FUND
Statement of Activities
For the Year Ended June 30, 2024
Operating Capital
Charges for Contributions Contributions Governmental
Expenses Services and Grants and Grants Activities
Functions/Programs:

Primary government:

Governmental activities:

General government 87,014$ -$ 186,188$ -$ 99,174$ Public safety 9,288 -
-
- (9,288)
Total governmental activities 96,302$ -$ 186,188$ -$ 89,886$ General revenues and transfers:

General revenues:

Use of money and property 8,675
Total general revenues and transfers 8,675
Change in net position 98,561
Net position-beginning 272,992
Net position-ending 371,553$
Program Revenues
Net (Expenses)
Revenues and
Changes in Net
Position
See Notes to Financial Statements.
5 574

CITY OF ORANGE, CALIFORNIA

AIR POLLUTION REDUCTION FUND
Balance Sheet - Governmental Fund
June 30, 2024
ASSETS
Cash and investments 279,015$
Receivables (net of allowance for uncollectible):

Accounts 485
Accrued interest 2,142
Total assets 281,642$

LIABILITIES
Accounts payable 27,710$
Due to the City of Orange 47,536
Total liabilities 75,246

FUND BALANCE
Restricted for air pollution remediation projects 206,396 Total fund balance 206,396
Total liabilities
and fund balances (deficits) 281,642$
See Notes to Financial Statements.
6 575

AIR POLLUTION REDUCTION FUND
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position
June 30, 2024
Amounts reported for governmental activities in the Statement of Net Position are different because:

Total fund balances of governmental fund 206,396$
165,157
Net position of governmental activities 371,553$

CITY OF ORANGE, CALIFORNIA
Capital assets, net of accumulated depreciat ion/amortization, used in governmental activities are not financial resources and, therefore, are not reported in the funds.

See Notes to Financial Statements.
7 576

CITY OF ORANGE, CALIFORNIA

AIR POLLUTION REDUCTION FUND
Statement of Revenues, Expenditures, and
Changes in Fund Balance - Governmental Fund
For the Year Ended June 30, 2024

REVENUES
Intergovernmental 186,188$
Use of money and property 8,675
Total revenues 194,863

EXPENDITURES
Current:

General government 60,918
Public safety 9,288
Capital outlay 84,217
Total expenditures 154,423
Net change in fund balances 40,440
Fund balances -beginning 165,956
Fund balances -ending 206,396$
See Notes to Financial Statements.
8 577

AIR POLLUTION REDUCTION FUND
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities For the Year Ended June 30, 2024
Amounts reported for governmental activities in the Statement of Activities are different because:

Net change in fund balances - Governmental Fund: 40,440$ Capital outlay 84,217$
Depreciation expense (36,626)
Total adjustment 47,591
Changes in pension liabilities and related deferred outflows and inflows of resources (1,398) Cha
nges in OPEB liabilities and related deferred outflows and inflows of resources 11,928 Total adjustment 10,530
Change in net position of governmental activities 98,561$ Some expenses reported in the Statement of Activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds.

CITY OF ORANGE, CALIFORNIA
Governmental funds report capital outlays are expenditures. However, in the Statement of Activities, the cost of these assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays exceeded depreciation/amortization expense in the current period.

See Notes to Financial Statements.
9 578

CITY OF ORANGE, CALIFORNIA

AIR POLLUTION REDUCTION FUND
Notes to the Financial Statements
For the Year Ended June 30, 2024

NOTE 1: GENERAL

The financial statements are intended to reflect the financial position and changes in the financial position attributable to the Air Pollution Reduction Special Revenue Fund (AQMD) of the City of Orange, California (the City). These financial statements are exclusively for AQMD and do not purport to, and do not, present fairly the financial position and changes in the financial position for the City.

Assembly Bill 2766 authorizes the South Coast Air Quality Management District (SCAQMD) to impose an annual vehicle registration fee and to distribute a portion of the collected revenues to all local jurisdictions within the South Coast Air Basin. These revenues are to be used solely to reduce air pollution from motor vehicles by implementing new programs and studies necessary for the implementation of the California Clean Air Act.

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. Description of the Reporting Entity

The accounts of the City are organized on the basis of funds, each of which is considered a separate accounting entity with a self-balancing set of accounts. Monies received under Assembly Bill 2766 are recorded in a Special Revenue Fund, the Air Pollution Reduction Fund, which is used to account for the proceeds of revenue to be used for the purpose of implementing the California Clean Air Act.

B. Basis of Presentation

The Air Pollution Reduction Fund’s financial statements are prepared in accordance with accounting principles generally accepted in the United States of America. The Governmental Accounting Standards Board (GASB) is the acknowledged standard setting body for establishing accounting and financial reporting standards followed by governmental entities in the United States of America.

The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the nonfiduciary activities of the fund. The AQMD has no fiduciary activities.

The statement of activities demonstrates the degree to which the direct expenses of a given function or segments are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment.

Program revenues include (1) charges to customers or applicants who purchase, use or directly benefit from goods, services or privileges provided by a given function or segment, and (2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues.

The underlying accounting 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 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.

While separate government-wide and fund financial statements are presented, they are interrelated.

10 579

CITY OF ORANGE, CALIFORNIA

AIR POLLUTION REDUCTION FUND
Notes to the Financial Statements
For the Year Ended June 30, 2024

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

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

The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting . Under the economic resources measurement focus, all (both current and long term) economic resources and obligations are included in the accompanying statement of net position. Under the accrual basis of accounting, revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.

Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting . Under the current financial resources measurement focus, only current assets and liabilities are generally included on the balance sheet. Under the modified accrual basis of accounting, revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. The city uses an availability period of 60 days for all revenues. Expenditures generally are recorded when a liability is incurred, as under accrual accounting.

Intergovernmental and interest revenues associated with the current fiscal period are all considered to be susceptible to accrual and have been recognized as revenues of the current fiscal period. All other revenue items are considered to be measurable and available only when cash is received by the AQMD.

D. Cash and Investments

Investments are reported in the accompanying financial statements 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. Changes in fair value that occur during a fiscal year are recognized as interest income for that fiscal year. Use of money and property includes interest earnings, changes in fair value (realized/unrealized), gains or losses realized upon the liquidation, maturity or sale of investments and rental income.

Cash and investments are pooled with other City funds for investment purposes, with interest being allocated monthly to various funds based on each fund’s prior month-end cash and investment balance.

E. Deferred Outflows/Inflows of Resources

In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period and will not be recognized as an outflow of resources (expense/expenditure) until that time. The AQMD has items related to the pension and OPEB plans that qualify for reporting in this category.

In addition to liabilities, the statement of net position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period and will not be recognized as an inflow of resources (revenue) until that time. The AQMD has items related to the pension and OPEB plans that qualify for reporting in this category.

11 580

CITY OF ORANGE, CALIFORNIA

AIR POLLUTION REDUCTION FUND
Notes to the Financial Statements
For the Year Ended June 30, 2024
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) F.

Net Position Flow Assumption
Sometimes th
e AQMD 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 financial statements, a flow assumption must be made about the order in which the resources are considered to be applied. It is the AQMD’s policy to consider restricted net position to have been depleted before unrestricted net position is applied.

Fund Balance Flow Assumptions
Sometimes t
he AQMD will fund outlays for a particular purpose from both restricted and unrestricted resources (the total of committed, assigned and unassigned fund balance). In order to calculate the amounts to report as restricted, committed, assigned and unassigned fund balance in the governmental fund financial statements, a flow assumption must be made about the order in which the resources are considered to be applied. It is the AQMD’s policy to consider restricted fund balance to have been depleted before using any of the components of unrestricted fund balance. Further, when the components of unrestricted fund balance can be used for the same purpose, committed fund balance is depleted first, followed by assigned fund balance. Unassigned fund balance is applied last.

Orange City CouncilMarch 11, 2025

Orange City Council
March 11, 2025