PASADENA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2024
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2024
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CITY OF PASADENA, CALIFORNIA
ANNUAL COMPREHENSIVE
FINANCIAL REPORT
Year Ended June 30, 2024
MIGUEL MÁRQUEZ, CITY MANAGER
MATTHEW E. HAWKESWORTH, ACTING ASSISTANT CITY MANAGER/
DIRECTOR OF FINANCE
PREPARED BY THE DEPARTMENT OF FINANCE, CITY OF PASADENA Victor M. Gordo
Mayor
Tyron Hampton
Councilmember
District 1
Steve Madison
Vice Mayor
District 6
Felicia Williams
Councilmember
District 2
Justin Jones
Councilmember
District 3
Gene Masuda
Councilmember
District 4
Jessica C. Rivas
Councilmember
District 5
Jason Lyon
Councilmember
District 7
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TABLE OF CONTENTS CITY OF PASADENA
Annual Comprehensive Financial Report | June 30, 2024 i
INTRODUCTORY SECTION
Letter of Transmittal ................................................................................................................................................................... vii Principal City Officials ................................................................................................................................................................. xiv Organizational Chart ................................................................................................................................................................... xv GFOA Certificate of Achievement for Excellence in Financial Reporting...................................................................................... xvi
FINANCIAL SECTION
Independent Auditors’ Report .................................................................................................................................................. xix Management’s Discussion and Analysis (Required Supplementary Information) ........................................................................ 1 Basic Financial Statements
Government-wide Financial Statements
Statement of Net Position ................................................................................................................................................... 16 Statement of Activities ........................................................................................................................................................ 18 Fund Financial Statements
Governmental Fund Financial Statements
Balance Sheet .............................................................................................................................................................. 20 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position .......................................................................................................................... 21 Statement of Revenues, Expenditures and Changes in Fund Balances ........................................................................ 22 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the
Statement of Activities .......................................................................................................................................... 23 Proprietary Fund Financial Statements
Statement of Net Position ............................................................................................................................................ 24 Statement of Revenues, Expenses and Changes in Net Position .................................................................................. 26 Statement of Cash Flows.............................................................................................................................................. 28 Fiduciary Fund Financial Statements
Statement of Net Position ............................................................................................................................................ 32 Statement of Changes in Net Position ......................................................................................................................... 33 Notes to the Basic Financial Statements ................................................................................................................................. 37
CITY OF PASADENA
ii Annual Comprehensive Financial Report | June 30, 2024
TABLE OF CONTENTS
FINANCIAL SECTION (Continued)
Required Supplementary Information
Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual – General Fund ........................................................................................................................................................... 124 – Housing Successor Fund – Special Revenue Fund .................................................................................................... 127 Notes to Required Supplementary Information ................................................................................................................ 129 Schedule of Changes in Net Pension Liability and Related Ratios – Miscellaneous Plan ................................................... 130 Schedule of Plan Contributions – Miscellaneous Plan ....................................................................................................... 132 Schedule of Changes in Net Pension Liability and Related Ratios – Safety Plan ................................................................ 134 Schedule of Plan Contributions – Safety Plan ................................................................................................................... 136 Schedule of Changes in Net Pension Liability and Related Ratios – Fire and Police Retirement System ......................... 138 Schedule of Plan Contributions – Fire and Police Retirement System............................................................................... 140 Schedule of Fire and Police Retirement System Plan Investment Return ......................................................................... 141 Schedule of Changes in the Net OPEB Liability and Related Ratios ................................................................................... 142 Schedule of OPEB Plan Contributions ................................................................................................................................ 143 Supplementary Information
Nonmajor Governmental Funds
Combining Balance Sheet .......................................................................................................................................... 148 Combining Statement of Revenues, Expenditures and Changes in Net Position ....................................................... 149 Special Revenue Funds
Combining Balance Sheet .......................................................................................................................................... 154 Combining Statement of Revenues, Expenditures and Changes in Net Position ....................................................... 156 B u d g e t a r y C o m p a r i s o n S c h e d u l e s Special Revenue Funds
Public Safety Fund ............................................................................................................................................... 158 Health Fund ........................................................................................................................................................ 159 Building Services Fund ........................................................................................................................................ 160 Sewer Construction and Maintenance Fund… ..................................................................................................... 161 Underground Utilities Fund ................................................................................................................................. 162 Transportation Fund ........................................................................................................................................... 163 Library Services Fund .......................................................................................................................................... 164 Parking Fund ....................................................................................................................................................... 165 Air Quality Improvement Fund ........................................................................................................................... 166 Housing and Community Development Fund ..................................................................................................... 167 Rent Stabilization Fund....................................................................................................................................... 168 Donated Funds ..................................................................................................................................................... 169
TABLE OF CONTENTS CITY OF PASADENA
Annual Comprehensive Financial Report | June 30, 2024 iii FINANCIAL SECTION (Continued)
Capital Projects Funds
Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Project Management Fund – Capital Projects Fund ........................................................................................... 173 Combining Balance Sheet .......................................................................................................................................... 176 Combining Statement of Revenues, Expenditures and Changes in Fund Balances .................................................... 178 Permanent Funds
Combining Balance Sheet .......................................................................................................................................... 184 Combining Statement of Revenues, Expenditures and Changes in Fund Balances .................................................... 186 Nonmajor Enterprise Funds
Combining Statement of Net Position ........................................................................................................................ 192 Combining Statement of Revenues, Expenses and Changes in Net Position ............................................................. 193 Combining Statement of Cash Flows ......................................................................................................................... 194 Internal Service Funds
Combining Statement of Net Position ........................................................................................................................ 200 Combining Statement of Revenues, Expenses and Changes in Net Position ............................................................. 202 Combining Statement of Cash Flows ......................................................................................................................... 204 Fiduciary Funds
Combining Statement of Net Position – Pension (and Other Employee Benefit) Trust Funds ..................................... 214 Combining Statement of Changes in Net Position – Pension (and Other Employee Benefit) Trust Funds ................... 215 Combining Statement of Net Position – Custodial Funds .......................................................................................... 216 Combining Statement of Changes in Net Position– Custodial Funds ......................................................................... 217 Combined Successor Agency Funds
Combining Statement of Net Position – Private-Purpose Trust Funds ....................................................................... 222 Combining Statement of Changes in Net Position – Private-Purpose Trust Funds .................................................... 224 Discretely Presented Component Units
Combining Statement of Net Position ........................................................................................................................ 230 Combining Statement of Revenues, Expenses and Changes in Net Position .............................................................. 231 Rose Bowl Operating Company
Combining Statement of Net Position ........................................................................................................................ 232 Combining Statement of Revenues, Expenses and Changes in Net Position ............................................................. 233
STATISTICAL SECTION
Financial Trends
Net Position by Component ...................................................................................................................................... 238 Changes in Net Position ............................................................................................................................................. 240 Fund Balances of Governmental Funds ..................................................................................................................... 244 Changes in Fund Balances of Governmental Funds ................................................................................................... 246
CITY OF PASADENA
iv Annual Comprehensive Financial Report | June 30, 2024
TABLE OF CONTENTS
STATISTICAL SECTION (Continued)
Revenue Capacity
Assessed Value and Actual Value of Taxable Property ............................................................................................. 249 Direct and Overlapping Property Tax Rates .............................................................................................................. 250 Principal Property Taxpayers ..................................................................................................................................... 252 Property Tax Levies and Collections .......................................................................................................................... 253 Taxable Sales by Category… ....................................................................................................................................... 254 Electricity Sold by Type of Customer ......................................................................................................................... 256 Electricity Rates ......................................................................................................................................................... 258 Electricity Customers ................................................................................................................................................. 259 Debt Capacity
Ratios of Outstanding Debt by Type .......................................................................................................................... 260 Ratios of General Bonded Debt Outstanding ............................................................................................................ 264 Direct and Overlapping Debt… .................................................................................................................................. 267 Legal Debt Margin Information ................................................................................................................................. 268 Pledged Revenue Coverage – Governmental Activity Debt ...................................................................................... 270 Pledged Revenue Coverage – Business-type Activity Debt ....................................................................................... 271 Demographic and Economic Information
Demographic and Economic Statistics ....................................................................................................................... 272 Principal Employers ................................................................................................................................................... 273 Operating Information
Full-time and Part-time City Employees by Function ................................................................................................ 274 Operating Indicators by Function .............................................................................................................................. 276 Capital Asset Statistics by Function ........................................................................................................................... 278 Introductory
Section
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2024
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vii
December 2
3, 2024
To the Honorable Mayor, Members of the City Council
and the Citizens of the City of Pasadena, California:
The Annual Comprehensive Financial Report (ACFR) of the City of Pasadena, California (City) for the fiscal year ended June 30, 2024 (fiscal year 2024) is hereby submitted in compliance with Section 907.5 of the City Charter.
Management assumes full responsibility fo r the completeness and reliability of the information contained in this report, based upon a comprehensive internal control framework it established for this purpose. Because the cost of internal controls should not exceed anticipated benefits, the objective is to provide re asonable assurance, rather than absolute assurance, that the financial statements are free of any material misstatement.
This report was prepared in accordance with Generally A ccepted Accounting Principles (GAAP) as set forth in the pronouncements of the Governmental Accounting Standards Board (GASB). GASB has the primary responsibility for determining accounting and financial reporting standards for state and local government entities. It is believed that the data, as presented, is accurate in all material respects and presented in a manner designed to fairly set forth the financial position and results of operations of the City and its component units, as measured by the financial activity of the various funds. The financial statements include all disclosures necessary to enable the reader to gain the maximum understanding of the City's financial affairs and evaluate its financial condition.
The City Charter requires an audit of the financial statements of all accounts of the City by an independent certified public accountant. This year's audit was undertaken by Lance, Soll & Lunghard, LLP, a firm of licensed certified public accountants. The goal of the independent audit was to provide reasonable assurance that the financial statements of the City of Pasadena for the year ended fiscal year 2024 fairly state the City’s financial position. The independent audit involved examining evidence, on a test basis, that supports the amounts and disclosures in the financial statements; assessing the accounting pr inciples used and significant es timates made by management; and evaluating the overall financial statement presentation. The independent auditor concluded based upon the audit, that there was a reasonable basis for rendering an unmodified opinion on the City of Pasadena’s financial statements for fiscal year 2024 and that these financial statements are fairly presented in conformity with GAAP. The independent auditor’s report is presented as the first component of the financial section of this report. Under the current auditor contract, the City required the auditor to include sampling from every fund.
The independent audit of the financial statements of the City was part of a broader, federally mandated Single Audit designed to meet the special needs of federal grantor agencies. The standards governing Single Audit engagements require the independent auditor to report, not only on the fair presentation of the financial statements, but also on internal controls and compliance with legal requirements, with emphasis on those involving the administration of federal awards. The auditor’s report on internal controls and compliance will be available in the City’s separately issued Single Audit Report.
GASB requires that management provide a narrative intro duction, an overview, and an analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City of Pasadena’s MD&A can be found immediately following the report of the independent auditor.
LETTER OF TRANSMITTAL CITY OF PASADENA
viii Annual Comprehensive Financial Report | June 30, 2024
GOVERNMENTAL STRUCTURE
The City was incorporated in 1886 and became a Charter City in 1901. The City operates under the powers granted by the City Charter, which dictates the responsibilities of the City Council a nd the City Manager. There are seven City Council members who are nominated and elected by district for overlapping, four-year terms. In addition, there is a Citywide elected Mayor who also serves a four-year term.
The City Council is responsible for, among other things, se tting policies, passing ordinances, adopting the budget, appointing committees, and hiring the City's Manager, City Attorney/City Prosecutor, and the City Clerk. The City Manager is responsible for carrying out policies and ordinances of the City Council, appointing the heads of the City's departments, preparing and managing the budget, and overseeing the day-to-day operations of the City.
The City covers an area of 23 squa re miles in the northwestern portion of the San Gabriel Valley and has a 2023 population of 136,988, according to the California State Department of Finance. The City is bounded on the west by the cities of Los Angeles, Glendale, and La Cañada Flintridge; on the south by South Pasadena and San Marino; on the east by Arcadia and Sierra Madre; and on the north by the unincorporated community of Altadena.
REPORTING ENTITY AND ITS SERVICES
This report includes all funds of the City , as well as all its component units. Component units are legally separate entities for which the City is financia lly accountable. Blended component units, although legally separate entities, are, in substance, part of the City's operations and are included in this ACFR as part of the City. Accordingly, the Pasadena Public Financing Authority, Pasadena Parking Authority, the Pasadena Civic Improvement Corporation, and the Pasadena Fire and Police Retirement System are reported as part of the City. The Successor Agency to the Pasadena Community Development Commission is shown as a Private-Purpose Trust Fund reported in the Fiduciary Funds Section. Discretely presented component units are reported in a separate column in the combined financial statements to emphasize that they are legally separate from the City and to differentiate their financial position, results of operations, and cash flows from those of the City. The Rose Bowl Operating Company, the Pasadena Center Operating Company, and the Pasadena Community Access Corporation are discretely presented component units. Separate financial statements are also available for all three discretely presented component units. The City is a party to, and designated administrator for, two Joint Powers Authorities, the Foothill Air Support Team and the Foothill Workforce Development Board. These entities are accounted for in the City b ooks, ACFR, and audited as part of the City’s audit.
The City provides a full range of municipal services includin g public safety (police and fire), street construction and maintenance, refuse collection, water, power, sewer collection utilities, libraries, parks and recreation, planning and zoning, code enforcement, public health, affordable ho using, career services and job training, and general administrative and support services.
BUDGETARY CONTROLS
The City adopts a comprehensive budget detailed by department and fund prior to the beginning of each fiscal year, July 1. An appropriated annual budget is legally adopted for the General Fund and Special Revenue Funds. From the effective date of the budget, funds become appropriated to the departments and component units for the objects and purposes identified. At any public meeting after the adoption of the budget, the City Council may amend or supplement the budget by a motion adopted by the affirmative vote of at least five-members of the City Council.
The accounts of the City are maintained by line-item detail or object of expend iture. The legal level of budgetary control (the level at which management may not rea ssign resources or overspend appropriations) is at the departmental level within each fund. Revenues are estimated annually and monitored on an ongoing basis to ensure there are adequate resources to cover expenditures.
CITY OF PASADENA LETTER OF TRANSMITTAL
Annual Comprehensive Financial Report | June 30, 2024 ix
FACTORS AFFECTING FINANCIAL CONDITION
The information presented in the financial statements, is perhaps best understood when considered from the broader perspective of the current environment in which the City of Pasadena operates. It is important to consider various shifts in the global economy including rising interest rates and inflationary pressures.
THE CURRENT ECONOMIC CLIMATE
The national and global economies continue to face inflationary pressures not seen for several decades. While year- over-year inflation has dropped from the prior year, inflation remains over 3.0% and the Federal Funds Rate remain at 5.25% to 5.5% for fiscal year 2024 . The inflation, while rest raining, is expected to remain above the Fed’s 2% target. Upward price pressures on energy , raw materials, and finished goods tr anslate to inflation and increase to the Consumer Price Index across all sectors of the economy.
The Federal Reserve maintains a cautious approach to intere st rates, aiming to stabilize inflation while avoiding significant impact on economic activity.
General Fund revenues have shown stability in fiscal year 20 24, as property tax, sales tax, utility users’ tax, and transient occupancy tax continue to show resilience.
LOOKING FORWARD
City of Pasadena has a diverse economy that is not over-reliant on one industry or tax base. With a diverse revenue base and strong economic sectors, th e City is well-positioned to meet its ch allenges. A solid mix of automotive dealers, general and consumer goods businesses, restaurants, and hotels provide a relatively stable tax base. When combined with growing technology and health/life sciences sect ors, the overall economic blend provides more stability. Additionally, interest in the City by businesses in many of these key sectors continues to grow.
Though Pasadena’s economic foundation is strong, achieving faster revenue growth will be a challenge. Persistent inflation and high costs of living cont inues to pressure consumer spending, which will impact sales tax revenues.
While property values in Pasadena remain high, due to high er interest rates, the real estate market’s growth has slowed. Pasadena’s tourism-driven economy has recovered post-pandemic, but growth in this sector may now stabilize rather than expand significantly. All these factors signal a slower revenue growth.
LETTER OF TRANSMITTAL CITY OF PASADENA
x Annual Comprehensive Financial Report | June 30, 2024 General Fund Five-Year Forecast
FY 2023 FY 2024 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 FY 2029 Final Budget Forecast Budget Forecast Forecast Forecast Forecast Beginning Amount Available for Appropriations -$ 18,086,075$ 18,086,075 $ 12,753,458 $ 10,515,691 $ 7,951,863 $ 4,054,863$ 1,242,432$ Revenues
Tax Revenues 256,099,426 250,860,100 255,554,863 265,657,100 275,442,388 284,542,670 293,888,284 303,568,090 Other Revenues 46,153,066 61,823,605 61,162,192 54,985,734 56,308,747 57,665,316 59,056,309 60,482,618 Contributions/Svs. From Other Funds 54, 527,524 15,190,438 20,190,438 20,140,438 20,140,438 20,140,438 20,140,438 20,140,438 Total Revenues 356,780,016 327,874,143 336,907,493 340,783,272 351,891,573 362,348,424 373,085,031 384,191,146 Expenses
Personnel 186,024,588 204,966,273 206,049,267 215,348,587 226,088,731 234,929,446 242,567,769 253,716,392 Debt Service 11,426,366 11,692,948 11,692,948 12,318,397 12,323,966 12,317,139 11,290,184 11,288,643 Contributions To Other Funds 18,195,625 25,609,821 25,609,821 14,350,877 14,637,895 14,930,652 15,229,265 15,533,851 Other Expenses 87,921,858 114,997,675 114,997,675 99,932,178 101,404,809 104,068,187 106,810,243 109,633,568 Total Expenses 303,568,437 357,266,717 358,349,711 341,950,039 354,455,401 366,245,424 375,897,462 390,172,453 Operating Income/(Loss) 53,211,579 (29,392,574) (21,442,218) (1,166,767) (2,563,827) (3,897,000) (2,812,431) (5,981,307) Ending Amount Available for Appropriations 53,211,579 (11,306,499) (3,356,142) 11,586,691 7,951,864 4,054,863 1,242,432 (4,738,876) Contributions to Capital Projects (7,137,700) (7,137,700) (6,071,000) Reserve for Capital & Other Funds (33,860,146) 23,247,300 23,247,300 5,000,000 - - - - Reduction/(Contribution) to Policy Reserve (1,265,358) 5,000,000 - Net Income/(Loss) with Reserve Contribution 18,086,075$ 9,803,101 $ 12,753,458$ 10,515,691 $ 7,951,864 $ 4,054,863$ 1,242,432$ (4,738,876)$ FI
SCAL YEAR 2024 ACCOMPLISHMENTS
While it is critically important that th e City maintain strong fiscal health and address its multiple infrastructure- related issues, it must also take time to acknowledge positive improvements . Examples of fiscal year 2024 accomplishments include:
• Adoption of a balanced budget for the twelfth consecutive year; maintained an IRS Section 115 trust for future pension obligations and other post-employmen t benefits; and maintained the City’s AAA issuer credit rating w ith Standard & Poor ’s and AA+ with Fitch rating agency , consistent with the City Council’s goal to maintain fiscal responsibility and stability;
• Received $75.7 million in sales tax revenue and provided $ 10.9 million to the Pasa dena Unified School District to protect and strengthen our public schools;
• In partnership with Los Angeles County, acquired the Kaiser Permanente property at Lake and Villa, moving us one step closer to providing needed health and mental health services and affordable housing to our community;
• Opened the Union Street Protected Bikeway, providing a 1.5 mile long two-way protected bike lane along Union Street and an opportunity for residents and visitors to reach Pasadena destinations such as Old Pasadena, Playhouse Village, Pasadena City College, and Caltech on bike; • Opened the Honorable John J. Kennedy Pool at Robinson Park, a state-of-the-art aquatic facility that offers equity and access to water-based fun and fitness, and ensures all parts of our City have high quality recreation facilities and resources;
• Made substantial progress on affordable housing projects to address the widespread housing crisis; • Continued pursuit of Central Library’s assessment, mitigation plan and seismic retrofit with infrastructure and programming improvements to ensure public safety, without disruption of library services to the community;
CITY OF PASADENA LETTER OF TRANSMITTAL
Annual Comprehensive Financial Report | June 30, 2024 xi • Continued legacy land use planning effort on the approximately 50 acres of recaptured land at the heart of the City with the relinquishment of State Route 710 northern stub and appointed the Reconnecting Communities 710 Advisory Group charged with visioning and overseeing this process; • Awarded the contract to a highly experienced consultant to develop the 710 Stub Master Plan. The Historic Project work will document and acknowledge the history, stories, and impacts the construction of the 710 Stub had on the communities that existed in the Stub area. The process will include an exhaustive community engagement process and will take approximately two-years to complete; • The Rent Stabilization Depar tment was created in De cember of 2023 to support the Pasadena Rental Housing Board and implement the Pasadena Fair and Equitable Housing City Charter; • Provided leadership for the City of Pasadena Elderly and Dependent Adult Liaisons (“PEDAL”) team to help improve the quality of life for the more than 3,000 residents in over 100 skilled nursing and long-term care facilities within the City;
• Assisted with the foundational work to prepare the City to host events in the 2028 Olympic Games; • Developed and executed the “Authentically Yours, Pasadena” holiday shopping campaign as part of Small Business Saturday. In partnership with the Pasadena Convention and Visitor’s Bureau, the campaign generated over 30,000 social media impressions and nearly 1,800 shopping totes were given to local shoppers. Small businesses reported strong sales during the holiday season and the addition of new customers;
• Innovation and technology cluster in Pasadena continued to thrive and demonstrate strength as a tech hub in Southern California. New leases and existing expansions include Miso Robotics, Motive Space Systems, Xencor, and Innova Medical Group;
• Secured $1.5 million in Federal funding earmarked by Congressmember Chu to support the Dine Out Pasadena Program, through which local restaurants can received up to $45 thousand to install new or upgrade existing outdoor dining structures;
• Designed and produced the City’s 2023 Annual Report;
• The Pasadena Outreach Response Team comprised of a case manager (social worker), a public health nurse, a firefighter, and an outreach worker from the Unio n Station Homeless Services utilizes a street-based approach that engages, assesses, and provides links to housing opportunities for those experiencing chronic homelessness, severe mental illness, substance use disorders, physical disabilit ies, and complex chro nic health conditions;
• Continued pursuit of both major and minor public works improvements to preserve and expand the City’s infrastructure and resources;
• Continued implementation of multi-year Enterprise Resource Planning system project that delivers real- time information to City management, integrates financial transactions, provides enhanced inte rnal controls, and improves audit functions;
• Earned American Public Power Association’s prestigious Reliable Public Power Provider (“RP3”) “Diamond” designation for providing highest degree of reliable and safe electric services the RP3 designation recognizes public power utilities that demonstrate proficiency in four key disciplines: relia bility, safety, workforce development, and system improvement and;
LETTER OF TRANSMITTAL CITY OF PASADENA
xii Annual Comprehensive Financial Report | June 30, 2024 • Demonstrated ongoing support to Pasadena Water and Power’s commitment to invest in renewable energy and sustainable water resources in an operationally and fiscally responsible manner, approved Power Purchase Agreements for the purchase of renewable energy and capacity, and supported rate actions to recover the water and electric systems' increased operating and capital costs.
The noted accomplishments listed above are just a sample of the hundreds of fiscal year 2024 accomplishments, which are listed by department in the fiscal year 2025 Adopted Operating Budget.
CONCLUSION
Under the leadership of the Mayor and City Council and with prudent financial management, the City of Pasadena has successfully addressed the unique challenges it has faced in the past, with no reduction in the quality and level of services provided to the community. The City has thrived in many areas coming out of the pandemic. The fiscal year 2024 ACFR illustrates the City's mission to deliver exemplary municipal service and responsiveness to our entire community, consistent with our history, culture, and unique character.
Respectfully submitted,
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CITY OF PASADENA
City Officials
CITY COUNCIL
Mayor Victor M. Gordo
Vice Mayor (Dist
rict 6) Steve Madison
Councilmember (District 1) Tyron Hampton
Councilmember (District 2) Felicia Williams
Councilmember (District 3) Justin Jones
Councilmember (District 4) Gene Masuda
Councilmember (District 5) Jessica C. Rivas
Councilmember (District 7) Jason Lyon
APPOINTED OFFICIALS
City Manager Miguel Márquez
City Attorney/City Prosecutor Michele Beal Bagneris
City Clerk Mark Jomsky
EXECUTIVE LEADERSHIP TEAM
Assistant City Manager Nicholas G. Rodriguez
Assistant City Manager Brenda E. Harvey-Williams
Acting Assistant City Manager/
Director of Finance Matthew E. Hawkesworth
Director of Housing William K. Huang
Director of Human Resources Tiffany Jacobs-Quinn
Director of Parks, Recreation &
Community Services Koko Panossian
Director of Libraries & Information Services Tim McDonald Acting Chief Information Officer Jonathan Lang
Director of Planning and Community Development Jennifer Paige Chief of Police Eugene Harris
Director of Public Health Ying-Ying Goh
Director of Public Works Tony Olmos
Director of Transportation Joaquin Siques
Interim General Manager of Water and Power David Reyes
Public Information Officer Lisa Derderian
Fire Chief Chad Augustin
Interim Director of Rent Stabilization Phillip Leclair
OPERATING COMPANY EXECUTIVES
Chief Executive Officer,
Pasadena Center Operating Company Michael Ross
Gener
al Manager,
Rose Bowl Operating Company Jens Weiden
Executive Director/Chief Executive Officer,
Pasadena Community Access Corporation George Falardeau
xiv Annual Comprehensive Financial Report | June 30, 2024 City Manager
MIGUEL MÁRQUEZ
MATTHEW E.
HAWKESWORTH
JENS WEIDEN
City Clerk
MARK JOMSKY
City Attorney /
City Prosecutor
MICHELE BEAL
BAGNERIS
MATTHEW E.
HAWKESWORTH TIFFANY JACOBS-QUINNWILLIAM K. HUANGCHAD AUGUSTIN Citizens
of Pasadena
Pasadena Community
Access Corporation
GEORGE FALARDEAU
Pasadena Center
Operating Company
MICHAEL ROSS
Mayor &
City Council
Finance Human ResourcesHousingFire
Police
EUGENE HARRIS
Planning & Community
Development
JENNIFER PAIGE
Libraries &
Information Services
TIM MCDONALD
Information Technology
JONATHAN LANG
Parks, Recreation and
Community Services
KOKO PANOSSIAN Acting
Transportation
JOAQUIN SIQUES
Public Works
TONY OLMOS
Public Health
YING-YING GOH
Water & Power
DAVID REYES
Interim
Rent Stabilization
PHILLIP LECLAIR
Interim
Assistant
City Manager
NICHOLAS G.
RODRIGUEZ
Assistant
City Manager
BRENDA E.
HARVEY-WILLIAMS
Rose Bowl
Operating Company
Assistant
City Manager
Acting
CITY OF PASADENA
ORGANIZATION CHART
June 30, 2024
Annual Comprehensive Financial Report | June 30, 2024 xv Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Pasadena
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2023
Executive Director/CEO
xvi Annual Comprehensive Financial Report | June 30, 2024
CITY OF PASADENA
Financial
Section
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2024
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LSLCPAS.COM
INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and Members of the City Council
City of Pasadena, 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, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the City of Pasadena, 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 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, the business -type activities, the aggregate discretely presented component units, 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 with accounting principles generally accepted in the United States of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibil ities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter.
Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions.
Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exis ts. 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.
To the Honorable Mayor and Members of the City Council
City of Pasadena, California
Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. • Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
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 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.
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 additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements.
The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such inform ation directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with 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.
xx Annual Comprehensive Financial Report | June 30, 2024 To the Honorable Mayor and Members of the City Council
City of Pasadena, 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 December 23, 2024, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance. That repo rt is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.
Irvine, California
December 23, 2024
Annual Comprehensive Financial Report | June 30, 2024 xxi (This page intentionally left blank)
CITY OF PASADENA MANAGEMENT’S DISCUSSION AND ANALYSIS Annual Comprehensive Financial Report | June 30, 2024 1 MANAGEMENT’S DISCUSSION AND ANALYSIS
(Unaudited)
As management of
the City of Pasadena (City), we offer this na rrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2024 (fiscal year 202 4). We encourage readers to consider the information presented here in conjunction with additional information that has been furnished in the letter of transmittal, which can be found on pages vii-xii of this report.
OVERVIEW OF THE FINANCIAL STATEMENTS
This discussion and analysis are intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements are comprised of three components: (1) government-wide fi nancial statements, (2) fund financial statements, and (3) notes to the basic financial statements. This report also contains other required supplementary information.
Government-wide Financial Statements
The government-wide financial statements are designed to provide readers with a broad overview of the City’s finances, in a manner similar to a private-sector business.
The statement of net position presents information on all the City’s assets and deferred outflows of resources and liabilities and deferred inflows of resources, with the difference reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating.
The statement of activities presents the most recent fiscal year changes in the City’s net position. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows.
Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods, e.g., uncollected taxes and earned but unused vacation leave.
Both government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, transportation, utility, sanitation, health, culture and leisure, and community development. The business-type activities of the City include electric, water, refuse, parking, and telecommunication operations.
The basic government-wide financial statements can be found on pages 16-19 of this report.
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like ot her state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal re quirements. All the funds of the City can be divided into three categories:
governmental funds, proprietary funds, and fiduciary funds.
Governmental Funds
Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental funds financial statements focus on near-term inflows and outflows of spendable resources , as well as on balances of spendable
resources available at the end of the fiscal year. Such informatio n may be useful in evaluating a government’s near-term financing requirements.
MANAGEMENT’S DISCUSSION AND ANALYSIS CITY OF PASADENA
2 Annual Comprehensive Financial Report | June 30, 2024 Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statem ents. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. Both the gove rnmental funds balance sheet and the governmental funds statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities.
The City maintains 31 individual governmental funds. Information is presented separately in the governmental funds balance sheet and in the governmental funds stat ement of revenues, expenditures, and chan ges in fund balances for the General Fund, the Project Management Capital Projects Fund, the Gene ral Debt Service Fund, and the Housing Successor Fund, all four of which are considered to be major funds. Data from the other 27 governmental funds are combined into a single, aggregated presentation. Individual fund data for each of thes e nonmajor governmental funds is provided in the form of combining statements elsewhere in this report.
The City adopts an annual appropriated budget for its General Fund and Special Revenue Funds. Budgetary comparison statements have been provided for the General Fund and Special Revenue Funds to demonstrate compliance with this budget.
The basic governmental fund financial statements can be found on pages 20-23 of this report.
Proprietary Funds
The City maintains two different types of proprietary funds: enterprise funds and internal service funds. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its electric, water, refuse, parking, and telecommunication operations. Internal service funds are an accounting device used to accumulate and allo cate costs internally among th e City’s various functions.
The City uses internal service funds to account for it s computing and communication, building maintenance, fleet maintenance, fleet replacement, benefits , workers’ compensation, ge neral liability, and 311 call center services. Because each of these services predominantly benefits governmental ra ther than business-type function s, they have been included within governmental activities in the government-wide financial statements.
Proprietary funds provide the same type of information as th e government-wide financial stat ements, only in more detail.
The proprietary fund financial statements provide separate information for the Light and Po wer, Water, and Off-Street Parking Funds, each of which are considered to be major funds of the City. Conversely, each of the internal service funds are combined into a single, aggregated presen tation in the proprietary fund financial statements. Individual fund data for the internal service funds is provided in the form of combining statements elsewhere in this report. Data from the other two proprietary funds are combined into a sin gle, aggregated presentation. Individual fund data for each of these nonmajor proprietary funds is provided in the form of combining statements elsewhere in this report.
The basic proprietary fund financial statements can be found on pages 24-31 of this report.
Fiduciary Funds
Fiduciary funds are used to account for resources held for the benefits of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statements, because the resources of those funds are not available to support the City’s own programs. The activities of the Successor Ag ency to the Pasadena Community Development Commission are also reported with the City’s fiduciary funds as a private pu rpose trust fund. Individual fund data for each of these fiduciary funds is
provided in the form of combining statements elsewhere in this report. The accounting used for fiduciary funds is much like that used for proprietary funds.
The basic fiduciary fund financial statements can be found on pages 32-33 of this report.
CITY OF PASADENA MANAGEMENT’S DISCUSSION AND ANALYSIS Annual Comprehensive Financial Report | June 30, 2024 3 Notes to the Basic Financial Statements
The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the basic financial statements can be found on pages 37-121 of this report.
Other Information
In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information (RSI) concerning budgetary practices and budget-to-actual comparisons for the general fund and the major special revenue funds. Additional RSI includes pension and Other Postemployment Benefits (OPEB) information on net pension and OPEB liabilities and plan contributions. RSI can be found on pages 125-145 of this report.
The combining statements referred to earlier in connection wi th nonmajor governmental funds and internal service funds presented immediately following the required supplementary information. Combining and individual fund statements and schedules can be found on pages 150-209 of this report. Combining statements of the discretely presented component units can be found on pages 230-233 of this report.
FINANCIAL HIGHLIGHTS
New Significant Accounting Standards Implemented
In fiscal year 2024, the City adopted one new statement of financial accounting standards issued by the Government Accounting Standards Board (GASB), Statement No. 100, Accounting Changes and Error Corrections-an amendment of GASB Statement No. 62 (GASB 100).
The primary objective of GASB 100 is to enhance accounting and financial reporting requirements for accounting changes and error corrections to provide more understandable, reliable, relevant, consistent, and comparable information for making decisions or assessing accountability.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
As noted earlier, net position may serve over time as a useful indicator of a government’s finan cial position. In the case of the City, assets and deferred outflows exceeded liabilities and deferred inflows by $1,247.4 million at the close of the most recent fiscal year.
$1,335.7 million of the City’s net position reflect its investment in capital assets (e.g., land, buildings, machinery, and equipment), less any related outstanding debts used to acquire those assets. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided
from other sources, since the capital assets themselves cannot be used to liquidate these liabilities.
MANAGEMENT’S DISCUSSION AND ANALYSIS CITY OF PASADENA
4 Annual Comprehensive Financial Report | June 30, 2024 GOVERNMENT-WIDE FINANCIAL ANALYSIS (Continued)
City of Pasadena’s Net Position
(in millions)
2024 2023 2024 2023 2024 2023 $ Change % Change
C apital asset s:
Not being depreciated/amortized, net 183.3 $ 141.6 $ 98.0 $ 89.3 $ 281.3 $ 230.9$ 50.4$ 21.8% Being depreciated/amortized, net 391.9 401.8 739.8 736.0 1,131.6 1,137.8 (6.1) -0.5% Other a s s ets 402.0 390.4 572.4 499.0 974.4 889.4 85.0 9.6% Total assets 977.2 933.8 1,410.1 1,324.3 2,387.4 2,258.1 129.3 5.7% Deferred outflows of resources 191.0 192.8 33.9 34.3 224.8 227.1 (2.2) -1.0% C ur r ent liabilit ies 1 1 2 . 8 107.6 63.4 60.2 176.2 167.8 8.4 5.0% Long-term debt* 181.0 187.2 276.5 290.1 457.5 477.3 (19.7) -4.1% Net pension liability 4 96 .8 480.1 97.8 95.2 594.6 575.3 19.3 3.4% Other noncur r ent liabilities 91 .6 89.7 11.4 8.8 103.0 98.5 4.5 4.6% Total liabilities 882.1 864.6 449.2 454.2 1,331.4 1,318.9 4.1 0.3% Deferred inflows of resources 24.5 28.6 9.0 10.5 33.5 39.1 (5.6) -14.3% Net Position:
Net inv estment in capital assets 5 17 .2 500.7 545.2 522.0 1,062.4 1,022.7 39.7 3.9% Restricted 87.6 86.1 98.9 93.3 186.5 179.5 7.0 3.9% Unres tri cted (343.2) (353.5) 341.7 278.5 (1.5) (75.0) 73.5 -98.0% Total net position 261.6$ 233.4 $ 985.8 $ 893.8 $ 1,247.4 $ 1,127.1 $ 120.2$ 10.7% * For both current and noncurrent portions
Governmental
Activities
Business-type
Activities Total Primary Government
The restricted portion of
the City’s net position, $187.8 million or 15.1% of the total net position represents resources subject to externally imposed limitations for specific purposes. The remaining balance is a deficit in unrestricted net position of, $276.1 million, or 22.1% of the total net position is for unrestricted uses in acco rdance with finance-related legal requirements. A significant portion of the deficit, in unrestricted net positio n, is attributable to the net pe nsion liability, implementation of GASB 68, Accounting and Financial Reporting for Pensions , i.e., $191.1 million, and GASB 75, Other Postretirement Employment Benefits (OPEB), i.e., $16 million, upon the recognition of actu arial estimated future costs related to pension retirement and post-employment medical benefits.
During fiscal year 2024, the primary government’s net position increased by $120.2 million, where approximately $28.2 million relates to the increase in governmental activities, and $92 million to the increase in the City’s business-type activities.
The increase in the governmental activities reflects an increase in revenues against increased expenditures. The increase in business-type activities reflects is the continuance of strong trend in increased revenues in addition to a decrease in expenses and a restatement of $2.8 million related to the Raymond Basin Area water rights. Additional information is included in Note 23 of this report.
CITY OF PASADENA MANAGEMENT’S DISCUSSION AND ANALYSIS
Annual Comprehensive Financial Report | June 30, 2024 5 GOVERNMENT-WIDE FINANCIAL ANALYSIS (Continued)
City of Pasadena’s Changes in Net Position
(in millions)
Governmental Activities Business-type Activities Total Primary Government 2024 2023 $ Change % Change 2024 2023 $ Change % Change 2024 2023 $ Change % Change Revenues:
Progra m Revenues :
C har ges for ser v ic es 8 8 .8$ 75.0 $ 13.8$ 18.4% 377.9$ 347.1 $ 30.9$ 8.9% 466.7$ 422.1 $ 44.6$ 10.6% Operating grants and contributions 77.5 108.9 (31.4) -28.8% 2.1 2.2 (0.0) -1.7% 79.6 111.0 (31.4) -28.3% Capital grants and contributions 20.9 22.2 (1.3) -5.9% 5.2 5.9 (0.7) -11.7% 26.1 28.1 (2.0) -7.1% General revenues:
Taxes:
Property ta xes 87.3 84.3 2.9 3.5% - - - - 87.3 84.3 2.9 3.5% Sa l es ta xes 81.3 76.9 4.4 5.7% - - - - 81.3 76.9 4.4 5.7% Utility users' tax 32.0 32.8 (0.8) -2.3% - - - - 32.0 32.8 (0.8) -2.3% Trans ient occupancy tax 18.5 18.7 (0.2) -0.9% - - - - 18.5 18.7 (0.2) -0.9% Street light a nd tra ffic signa l tax 9.3 7.8 1.4 18.5% - - - - 9.3 7.8 1.4 18.5% Business lic ense t ax 8 . 0 7.8 0.1 1.6% - - - - 8.0 7.8 0.1 1.6% Other ta xes 15.6 16.9 (1.4) -8.1% 7.5 6.7 0.7 11.1% 23.0 23.7 (0.6) -2.7% Other revenues 42.2 30.2 12.0 39.7% 24.0 2.6 21.4 837.0% 66.2 32.8 33.4 102.0% M isc ellaneous r ev enues 6 .6 3.4 3.2 96.6% 2.9 2.9 (0.1) -2.1% 9.5 6.3 3.2 50.5% Tota l revenues 487.9 485.0 2.9 0.6% 419.6 367.3 52.2 14.2% 907.5 852.3 55.2 6.5% Expenses:
Genera l government 82.0 68.5 13.5 19.7% - - - - - 68.5 (68.5) -100.0% Publ i c s a fety 179.8 157.9 21.9 13.8% - - - - - 157.9 (157.9) -100.0% Tra nsportation 58.8 49.5 9.3 18.7% - - - - - 49.5 (49.5) -100.0% Culture and leisure 55.2 50.4 4.8 9.6% - - - - - 50.4 (50.4) -100.0% Communi ty de ve l opme nt 64.9 59.4 5.5 9.3% - - - - - 59.4 (59.4) -100.0% Int er est and ot her fisc al c har ges 6 . 2 6.3 (0.1) -1.3% - - - - 6.2 6.3 (0.1) -1.3% Electric - - - - 215.1 239.4 (24.3) -10.2% 215. 1 239.4 (24.3) -10.2% Water - - - - 62.8 61.7 1.1 1.7% 62.8 61.7 1.1 1.7% Other expenses 27.5 24.9 2.5 10.1% 37.9 34.9 3.0 8.5% 65.3 59.9 5.5 9.2% Total expenses 474.5 417.1 57.4 13.8% 315.7 336.0 (20.3) -6.0% 790.2 753.1 37.1 4.9% Increase (decrease) in net
position, before transfers 13.5 67.9 (54.5) -80.2% 103.8 31.3 72. 6 231.9% 117.3 99.2 18.1 18.2% Transfers 14.7 15.9 (1.1) -7.2% (14.7) (15.9) 1.2 -7.6% - (0.1) 0.1 -100.0% Increase (decrease) in net position 28.2 83.8 (55.6) -66.4% 89.1 15.4 73.8 480.3% 117.3 99.2 18.1 18.3% Net position, beginning 233.4 149.6 83.8 56.0% 893.8 878.4 15.4 1.7% 1,127.1 1,028.0 99.2 9.6% Restatement of beginning net position 0.0 - 0.0 - 2.9 - 2.9 - 2.9 - 2.9 - Net position, ending 261.6$ 233.4 $ 28.2$ 12.1% 985.8$ 893.8 $ 92.0$ 10.3% 1,247.4$ 1,127.1 $ 120.2$ 10.7%
Governmental Activities
Governmental activities net position increased by $28.2 million or 12.1% . Key elements of this decrease are a combination of
factors as follows:
The revenue components of governmental activities increased by $2.9 million or 0.6% from prior year revenues. The following categories illustrates the changes: charge s for services increased by $13.8 millio n, operating grants and contributions decreased by $31.4 million, capital grant and contributions decreased by $1.3 million, property taxes increased by $2.9 million, sales taxes increased by $4.4 million, utility users’ tax decreased by $0.8 million, transient occupancy tax decreased by $0.2 million, and other taxes decrease d by $1.4 million. Other revenues increased by $12 million, and miscellaneous revenues increased by $3.3 million.
• Charges for services increase of $13.8 million include changes in the following categories:
o $7.8 million increase in public safety charges due to police outside event revenues related to increased business activities and increased emergency medical services:
o $9.1 million increase in transportation charges:
o $4.4 million increase in general government charges:
o $1.6 million increase in culture and leisure, and health charges; and o Decrease of $7.7 million in sanitation charges an d $1.5 million decrease in community development charges.
MANAGEMENT’S DISCUSSION AND ANALYSIS CITY OF PASADENA
6 Annual Comprehensive Financial Report | June 30, 2024 GOVERNMENT-WIDE FINANCIAL ANALYSIS (Continued)
• Operating grants and contributions de creased by $31.4 million, primarily due to ARPA revenue not available during the current fiscal year.
• Capital grants and contributions decreased by $1.3 million, primarily due to reimbursement type grant funds for Public Works and Transportation during the current fiscal year. The decrease of capital grant monies is related to the decrease in capital grant-type expenditures.
• Property taxes increased by $2.9 million due to appreciation of property value in Pasadena. • Sales taxes increased by $4.4 million. Regular sales tax increased by $5.1 million due to increased spending activity within City jurisdiction during the current fiscal year. Measure I sales tax decreased by $0.7 million. • Transient occupancy taxes decreased by $0.2 million, as there was less hospitality industry activity. • Other taxes decreased by $1.4 million mainly due to the following categories:
o $0.4 million decrease in construction taxes and
o $1 million decrease in franchise taxes.
• Other revenues increased by $12 millio n, primarily due to more favorabl e investment performance during the current fiscal year. The breakdown is as follows:
o $10.6 million increase in net change in fair value of investments; o $2.6 million increase in investment earnings; and
o $1.2 million decrease in other revenues.
• Miscellaneous revenue increased by $3.3 million mainly du e to a $3.3 million claim settlement. There was a $0.1 reduction of revenue in farmers market, filming permits and rental fees, collections interest, burglar alarm penalty, and other miscellaneous revenue.
The expense components of governmental activities increased by $57.4 million or 13.8%. The changes in expenses were general government increased by $13.5 million, public safety in creased by $21.9 million, transportation increased by $9.3 million, culture and leisure increased by $4.8 million and co mmunity development increased by $5.5 million. The other categories have a net increase of $2.4 million.
• General government expenses increase is primarily due to the increase of $3.2 million in personnel, $7.6 million in services and supplies and $1.3 million in GASB 68 pension expenses. • Public safety expenses increase is ma inly due to increases of $13.7 million in personnel costs, $6.1 million in GASB 68 pension expense and $1.0 million in services and supplies. • Transportation expenses incr ease is mainly due to increases of $11.6 million in capi tal project activity and decreases of $3.4 million in personnel costs.
• Culture and leisure expenses increase is mainly due to increases of $3.4 million in personnel costs. • Community development expenses increase is primarily due to the $1.7 million increase in personnel costs and $2.7 million increase in services and supplies.
• Other expenses increase is mainly due to increase of $1.2 million in personnel costs and $0.5 million in services and supplies. These increases were offset by other expense decreases.
CITY OF PASADENA MANAGEMENT’S DISCUSSION AND ANALYSIS
Annual Comprehensive Financial Report | June 30, 2024 7 GOVERNMENT-WIDE FINANCIAL ANALYSIS (Continued)
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
$180,000
Program Revenues and Expenses - Governmental Activities Program Revenue
Expenses
Charges for services
18.20%
Operating grants and
contributions
15.88%
Capital grants and
contributions
4.28%
Property taxes
17.88%
Sales taxes
16.67%
Utility users' taxes
6.56%
Transient occupancy
taxes
3.79%
Street light and traffic
signal taxes
1.90%
Business license taxes
1.63%
Other taxes
3.19%
Motor vehicle in-lieu
5.13%
Other intergovernmental,
unrestricted
0.16%
Use of money - investment
earnings
1.52%
Use of property -
interest income from
leases
0.00%
Net change in fair value
of investments
1.83%
Miscellaneous
revenues
1.35%
Revenues by Source - Governmental Activities
MANAGEMENT’S DISCUSSION AND ANALYSIS CITY OF PASADENA
8 Annual Comprehensive Financial Report | June 30, 2024 GOVERNMENT-WIDE FINANCIAL ANALYSIS (Continued)
Business-type Activities
Business-type activities increased the City’s net position by $92 million. Key elements of this year’s increase are as follows:
• Net income of the Light and Power, Water, Off-Street Pa rking, and nonmajor enterprise funds were $78.9 million, $15.9 million, $392 thousand, and $3.3 million net loss, respectively.
• Electric charges for services increased $26.2 million or 10.2% from the prior fiscal year. Majority of the increase was due to an increase in recovered transmission and energy cost.
• Electric expenses decreased by $24.3 million or 10.2% fr om the prior year. The decr ease in fuel expense and transmission and distribution costs.
• Water charges for services increased by $4.5 million or 6.9% over the prior year mainly due to the increase in water sales.
• Water expenses increased by $1.1 million or 1.7% from the prior year mostly due to decrease in administrative and distributions costs.
• Off-Street Parking charges for services decreased by $0.5 million or 3.7% primarily due to a decrease in monthly parking permit revenues. Operating expenses decreased $0.57 million or 4.3% primarily due to a one time fiscal year 2023 expense of $1.2 million lease termination and settlement which is not applicable to fiscal year 2024. This was offset by small increases in other expense accounts includ ing $243 thousand in other contract services and $155 thousand in personnel costs.
CITY OF PASADENA MANAGEMENT’S DISCUSSION AND ANALYSIS
Annual Comprehensive Financial Report | June 30, 2024 9 GOVERNMENT-WIDE FINANCIAL ANALYSIS (Continued)
$0
$50
$100
$150
$200
$250
$300
Program Revenues and Expenses - Business-type Activities Program Revenues
Expenses
Charges for services
90.1%
Operating grants and
contributions
0.5%
Capital grants and
contributions
1.2%
Franchise taxes
1.8%
Use of money - investment earnings
2.6%
Use of property - interest
income from leases
0.0%
Net change in fair value of
investments
3.1%
Miscellaneous revenues
0.7%
Revenue by Sources - Business-type Activities
MANAGEMENT’S DISCUSSION AND ANALYSIS CITY OF PASADENA
10 Annual Comprehensive Financial Report | June 30, 2024 FINANCIAL ANALYSIS OF THE GOVERNMENT’S FUNDS
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.
City of Pasadena’s Governmental Funds
Summary Statement of Revenues, Expenditures and
Changes in Fund Balances (in millions)
2024 2023 $ Change % Change
Revenues:
Taxes 251.9 $ 245.3$ 6.6$ 2.7% Licenses and permits 16.1 17.1 (1.0) -5.6% Intergovernmental 121.0 158.7 (37.7) -23.8% Charges for services 59.9 47.8 12.1 25.4% Fines and forfeitures 6.3 5.4 1.0 17.9% Investment earnings 7.2 4.7 2.5 53.8% Net change in fair value of investments 8.6 (1.6) 10.2 -622.6% Lease revenues 4.9 5.2 (0.3) -5.5% Interest income from leases 0.0 0.0 (0.0) -33.3% Miscellaneous revenues 7.7 6.6 1.1 16.5% Contributions 1.6 1.5 0.0 1.9% Total revenues 485.2 490.6 (5.4) -1.1% Expenditures:
Current:
General government 72.7 58.6 14.1 24.0% Public safety 174.8 159.3 15.4 9.7% Transportation 45.4 47.5 (2.0) -4.3% Utility 0.0 0.1 (0.1) -78.5% Sanitation 6.4 5.9 0.5 8.8% Health 20.7 18.9 1.7 9.1% Culture and leisure 53.1 48.3 4.8 10.0% Community development 58.5 53.1 5.4 10.1% Capital outlay 66.7 40.3 26.4 65.6% Debt service:
Principal retirement 6.0 5.8 0.2 3.2% Interest 6.0 6.2 (0.2) -3.2% Lease payments 1.4 1.2 0.1 9.6% Subscription payments 1.6 0.7 0.9 119.4% Interest on leases and subscriptions 0.1 0.1 0.1 144.4% Total expenditures 513.4 446.1 67.2 15.1% Excess (deficiency) of revenues over
(under) expenditures (28.2) 44.5 (72.6) -163.4% Other Financing Sources (Uses):
Transfers in 80.8 77.5 3.4 4.3% Transfers out (65.7) (60.9) (4.8) 7.8% Leases issued 0.1 0.8 (0.7) -89.3% Subscriptions issued 2.2 0.9 1.3 147.0% Total other financing sources (uses) 17.5 18.2 (0.7) -4.0% Net change in fund balances (10.7) 62.7 (73.4) -117.1% Fund balances, beginning, as previously
reported 330.8 268.2 62.7 23.4% Fund balances, ending 320.1$ 330.8$ (10.7)$ -3.2%
CITY OF PASADENA MANAGEMENT’S DISCUSSION AND ANALYSIS
Annual Comprehensive Financial Report | June 30, 2024 11 FINANCIAL ANALYSIS OF THE GOVERNMENT’S FUNDS (Continued)
Governmental Funds
The focus of the City’s governmental funds is to provide information on near-ter m inflows, outflows, and balances of spendable resources. Such information is useful in assessin g the City financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year.
Governmental Funds report the differenc e between their assets and liabilities as fund balance, which is divided into nonspendable, restricted, committed, assigned, and unassigned portions. City Council may commit a portion of the fund balance by formal action, per the current policy of increasing the commitment up to 20% of the General Fund annual appropriations. The 20% is comprised of 15% General Fund Emergency Contingency and 5% General Fund Operating Reserve.
On October 28, 2024, the City Council committed the full 15% or $48.5 million for Emergency Contingency Reserve and up to 5% or $16.1 million for Operating Reserve.
At the end of fiscal year 2024, the City’s governmental funds reported combined ending fund balances of $320.1 million, a decrease of $10.7 million from the prior year. The nonspendable fund balance of $1 5.8 million represents assets generated by prepayments, permanent trust fund balances and receivables in funds, net of allowances. The restricted fund balance of $79.8 million represents resources that are subject to externally enforceable legal restrictions, such as the restrictions on the use of special revenue funding and capital improvement contracts. The committed fund balance of $167.8 million represents the use of resources constrained by limitations the City imposes upon itself through decisions made by the City Council. The assigned fund balance of $59.1 million designates the portion of fund balance that reflects the City’s intended use of resources. The unassigned fund balance of ($2.3) million represents the residual amount after the nonspendable, restricted, committed, and assigned balances have been identified of total fund balance.
Total expenditures increased by $67.2 million or 15.1%. These expenditure categories increased: public safety $15.4 million, general government $14.1 million, cultur e and leisure $4.8 million, health $1.7 m illion, capital outlay $26.4 million, and community development $5.4 million. Transportation expenditures decreased by $2.0 million. The other categories have a net increase of $0.4 million. Due to the im plementation of GASB 87 and 96, lease and subscription payments, as well as the corresponding interest expenditures are presented under debt service. Prior to fiscal year 2022, these expenditures were presented within the governmental funds’ function.
• General government expenditure increase is mainly due to the $3 million increase in City operating expenses related to the contribution to the Rose Bowl’s debt service, $2.9 in Self -Insured Retention, $1.8 million in general liability, $1.5 million in outside legal services, $1.8 million in personnel costs and $3.6 million increase in other contract services.
• Public safety expenditure increase is due to an overall increase in personnel and benefit costs, and services and supplies costs.
• Culture and leisure expenditure increase is due to the increase of $3.3 million in personnel costs. Additionally, there was an increase of $0.8 million in other contract services and $0.7 million increase of internal services cost allocation.
• Transportation expenditure decrease is mai
nly due to the decrease in other contract services and personnel and benefit costs.
In fiscal year 2024, the net governmental fund transfers increased by $1.4 million mainly due to an increase of $4.3 million in transfers from the Transport Sales Tax, $2.3 million from Ga s Tax, $3.2 million from Road Maintenance Rehab Fund and $.6 million from Off Street Pkg Fund. A decrease of $2.1 million from ARPA fund, $2.0 million fr om CDBG, $4.7 million from Residential Development Fund, $1.6 million from Fleet Maintenance Fund and $1.4 million from Traffic Reduction Fund.
MANAGEMENT’S DISCUSSION AND ANALYSIS CITY OF PASADENA
12 Annual Comprehensive Financial Report | June 30, 2024 FINANCIAL ANALYSIS OF THE GOVERNMENT’S FUNDS (Continued)
The General Fund is the chief opera Ɵng fund of the City. At the end of fiscal year 2024, total fund balance equaled $158.9 million, versus $164.6 million in the prior year. The f und balance decreased by $5.7 million or 3.5%, during fiscal year 2024.
Key factors for this change are as follows:
General Fund total revenues decreased by $15.5 million or 4.4% ma inly due to a decrease in one category and increases in three categories of revenue, as explained below:
• Taxes increased by $6.0 million primarily due to an increase of $2.8 million in property taxes and $4.5 million in sales tax. In addition, street traffic signal tax increased by $1.4 million and business license tax by $0.1 million. Utility users’ tax, transient occupancy tax, and real property transfer tax revenue had a net decrease of $1.4 million. Other taxes had a net decrease of $1.5 million.
• Intergovernmental revenues decreased by $39.4 million, prim arily due to no funding received this fiscal year for ARPA, Caltrans highway construction, and California Arts Council grant, which resulted in a net decrease of $46.1 million. There was an increase of $1.7 million from FEMA and $1.5 million from a federal grant from Small Business Administration to support on-street dining that were not available last fiscal year. Other intergovernmental revenue increased by $3.5 million.
• Charges for services increased by $12 m illion, primarily due to an increase of $7 million in EMS cost recovery, $2.5 million increase in city-wide internal services charges in cost allocation, an increase of $1.3 million in utility late fee billing, an increase of $1 million in Parks, Recreation, and Community Services program fees, and an increase of $0.2 for Rose Bowl services. The other charges for services had an increase of $1.4 million. Transportation charges for services decreased by $.7 million, Pub lic Works charges for services decrease d by $0.2 million, and a net decrease of $1 million in other charges for services.
• Net change in fair value of investments increased by $4.1 million due to a more favorable investment activity during the fiscal year.
General Fund total expenditures increased by $50.6 million or 17.8% primarily due to:
• Public safety increased by $15.5 million in personnel costs and internal service charges in fleet and equipment, and fire and rescue services.
• General Government increased by $14.3 million in personnel costs for new positions, and salary increase.
• Capital outlay increased by $12.2 million due to purchases of real property, and for new lease and subscription assets.
• Culture and Leisure increased by $3.7 million, due to increased expenditures in various sections including Aquatics, After School Programs and Summer Day Camp.
• Community Development increased by $2.5 million due to increased expenditures in housing production, lease payments, and consulting services.
• Transportation increased by
$1.2 million due to increased internal costs for general liability, workers’ compensation, and benefits.
The Housing Successor Fund has a fund ba lance of $0.7 million, which is a decrease of $0.3 million from the prior year. The key factors contributing to this decrease are as follows:
• Total revenue decreased by $0.1 million mainly from loan repayments.
• Total expenditures decreased by $0.7 million, primarily due to the Bridge Housing affordable housing project.
CITY OF PASADENA MANAGEMENT’S DISCUSSION AND ANALYSIS
Annual Comprehensive Financial Report | June 30, 2024 13 FINANCIAL ANALYSIS OF THE GOVERNMENT’S FUNDS (Continued)
Proprietary Funds
The City’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail.
Unrestricted net position of the Light and Power Fund at the en d of the year amounted to $ 284.0 million and those for the Water, Off-Street Parking Fund, and nonm ajor enterprise funds amou nted to $48.4 million, $3.8 million, and $5.5 million respectively. The total operating net income/(loss) before transfers and contributions for each fund was $87.1 million, $13.1 million, $1.3 million, and $(2.8) million, respectively.
Light and Power operating revenues increased by $25.8 million fr om prior year primarily due to the increase in recovered transmission and energy cost. Total retail electric energy so ld decreased by 59,968 megawatt-hours, a 5.6% decrease compared to the prior fiscal year. Total operating expenses decreased by $22.7 million to $208.1 million.
Water Fund operating revenues increased $4.5 million from prior year primarily due to the increase water sales. Total retail water sales increased by 52,376 billing units ; a 0.5% increase compared to last fisc al year. Operating expenses increased by $1.6 million or 2.7% primarily due to $1.3 million increase in commercial and general expenses and $0.5 million decrease in production expenses and $0.7 million decrease in transmission and distribution expenses.
Off-Street Parking operating revenues decreased by $0.5 million or 3.7% primarily due to a decrease in monthly parking permit revenues. Operating expenses decreased $0.8 million or 6.9% mostly due to a one-time fiscal year 2023 expense of $1.2 million lease termination and settlement which is not applicable to fiscal year 2024. This was offset by small increases in other expense accounts including $243 thousand in other contract services.
Implementation of GASB 68 resulted in a Net Pension Liability in the proprietary funds. At June 30, 2024, the net pension liability is $65.3 million, $2 2.4 million, $1.3 million, and $8.8 million for Ligh t and Power, Water, O ff-Street Parking, and nonmajor enterprise funds, respectively.
Implementation of GASB 75 resulted in a Net OPEB Liability in the proprietary funds. At June 30, 2024, the net OPEB liability is $9.1 million, $4.4 million, $0.07 million, and $2.4 million fo r Light and Power, Water, Off-Street Parking, and nonmajor enterprise funds, respectively.
MANAGEMENT’S DISCUSSION AND ANALYSIS CITY OF PASADENA
14 Annual Comprehensive Financial Report | June 30, 2024
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets
The City of Pasadena’s investment in capital assets for its go vernmental and business-type activities as of June 30, 2024 amounts to $1,412.9 million, net of accumulated depreciation/amortization. This investment in capital assets includes land, buildings, improvements, equipment, infrastructure, construction-in-progress, and intangible assets. Infrastructure assets are items that are normally immovable such as roads, bridges, drainage systems, and other similar assets. The net increase in the City of Pasadena’s investment in capital assets for the current fiscal year was $44.3 million, a $31.9 million increase for governmental activities and $12.4 million increase for business-type activities. There is a restatement to the beginning balance of the capital assets related to the Raymond Basin Area Water Right reflected as a restatement in fiscal year 2024.
City of Pasadena’s Capital Assets
(Net of Depreciation/Amortization, in millions)
2024 2023 2024 2023 2024 2023
Land and rights 104.0$ 87.5$ 17.3$ 14.7 $ 121.3 $ 102.2$ Construction in progress 79.3 54.1 80.6 74.6 159.9 128.7 Buildings and improvements 143.7 148.0 68.5 68.7 212.2 216.7 Lease asset-buildings 2.0 2.9 6.4 2.2 8.4 5.1 Machinery and equipment 36.7 36.2 661.5 659.9 698.2 696.1 Lease asset-equipment 0.6 0.6 0.1 - 0.7 0.6 Subsciption assets 6.8 7.6 3.3 5.2 10.1 12.8 Infrastructure 202.1 206.4 - - 202.1 206.4 Totals 575.2$ 543.3 $ 837.7 $ 825.3 $ 1,412.9 $ 1,368.6 $ Governmental Activities Business-type Activities Total Primary Government
Major capital asset-related events during fiscal year 2024 included the following:
• The City acquired a 2.28-acre site from Kaiser Permanente in November 2023 for $12 million, with the goal of developing a housing and mental health services complex. The project envisions up to 100 housing units and aims to expand services for homelessness, mental health, and communi ty needs in what officials have identified as a "high priority" area.
• Transportation purchased a property at 2211 E. Walnut Street for $4.3 m illion to support expanded programming needs. The site will house a new Transit Operations and Maintenance Facility designed to transition to a zero-emission transit vehicle fleet. The facility will accommodate 40-foot hydrogen fuel cell buses and battery electric vehicles, with on-site charging equipment to support sustainable transit services and future operations.
• Through a collaborative multi-year partnership with Caltrans, the California Transportation Commission approved the relinquishment of the SR 710 Northern Stub transportation network, spanning from Union Street to Columbia Street, to the City of Pasadena. This segment will be
transformed from a freeway-to-fre eway connection into a local-to- freeway connection. A multidisciplinary, community-driven visioning process will soon commence to reimagine the area’s future land use, transportation network, and utility infrastructure, with the goal of reconnecting and revitalizing Pasadena.
• The City continues to advance a variety of city-wide pr ojects, including street ma intenance and construction, technology upgrades, traffic control enhancements, and park and landscape improvements. In fiscal year 2024, $32 million was invested in governmental capital projects. Proj ects still in progress are categorized as Construction-in- Progress (CIP), with governmental activities CIP totaling $79.3 million and business-type activities CIP amounting to $80.6 million as of June 30, 2024.
CITY OF PASADENA MANAGEMENT’S DISCUSSION AND ANALYSIS
Annual Comprehensive Financial Report | June 30, 2024 15 CAPITAL ASSETS AND DEBT ADMINISTRATION (Continued)
• Improvements to City-owned facilities and traffic controls are ongoing. Nearly $2.5 million was invested in community park renovations and sports facility enhancements. while an additional $0.5 million was allocated to traffic signal upgrades.
• Pasadena Water and Power (PWP) utility plant net assets amounted to $793 million, an increase of $15 million. During the fiscal year 2024, the City spent $56 million on vari ous water and power projects and moved $69 million into completed projects.
• Some of the major water projects that are completed are: $2.2 million on installation of new and replacement water distribution mains at various locations throughout the City for improved water flows for fire protection; $1.0 million on the replacement of non-functioning or worn-out water meters to ensure the accurate billing of water.
• Some of the major power projects that are completed are: $3.3 million on Sub transmission Cable Upgrade (34-4) to significantly increase reliability and risk mitigation for the sub transmission system and upgrade the sub transmission system for long-term load growth; $1.8 million to install a new 34.5KV sub transmission system circuit from PWP’s Oak Knoll Substation to PWP’s Santa Anita Receiving Station and $1.3 million to reconstruct the aging and overloaded 4kV distribution systems to new and higher capacity 17kV systems.
Additional information on the City’s capital assets can be found in Note 6 on pages 62-65 of this report.
Long-Term Debt
At year-end, the City has a number of debt issues outstanding. These include $128.1 million of taxable pension bonds, $275.6 million of revenue bonds, $45.8 m illion of certificates of partic ipation, $4 million of loan pa yable and $4 million of notes payable. Long-term debt decreased by a ne t amount of $19.8 million as a result of normal scheduled prin cipal maturities.
The City was assigned an AAA issuer rating by Standard and Poor’s and AA+ rating by Fitch Rating Agency.
City of Pasadena’s Outstanding Long-Term Debt
(in millions)
Governmental Activities Business-type Activities
2024 2023 2024 2023 2024 2023
Long-term debt:
Notes payable 4.0$ 4.3 $ - $ - $ 4.0 $ 4.3$ Bonds payable 128.1 130.5 275.6 288.6 403.7 419.1 Certificates of participation 45.8 48.4 - - 45.8 48.4 Loan payable 3.0 4.0 1.0 1.5 4.0 5.4 Total long-term debt 181.0 187.2 276.5 290.1 457.5 477.3 Other long-term obligations:
Lease liability 2.7 3.6 6.7 2.4 9.4 6.1 Subscription liability 5.3 5.8 3.0 4.8 8.3 10.6 Total other long-term obligations 8.0 9.4 9.7 7.2 17.7 16.7 Total long-term obligations 189.0 $ 196.7$ 286.3$ 297.2$ 475.2$ 493.9$ Total Primary Government
Additional information on the City’s long-term debt can be found in Note 10 on pages 74-85 of this report.
REQUEST FOR INFORMATION
This financial report is designed to provide a general overview of the City’s finances for all those with an interest in the government’s finances. Questions concerning any of the info rmation provided in this report or requests for additional financial information should be addressed to the office of th e Director of Finance, 100 North Garfield Avenue, Room S348, Pasadena, California, 91101.
FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
16 Annual Comprehensive Financial Report | June 30, 2024 Statement of Net Position
June 30, 2024
Discretely
Total Presented
Governmental Business-t ypeP r i m a r y Component
Activities Activities Government Units
Assets:
Current assets:
Cash and investments 295,588$ 419,615$ 715,203$ 65,596$ Accounts receivable, net 64,043 49,225 113,268 5,667 Lease receivable 782 382 1,164 244 Notes receivable, net 13,505 - 13,505 - Prepaids and other assets 1,903 815 2,718 280 Due from com
ponent units 1,852 9 1,861 - Due from City - - - 874 Inventories 404 31,533 31,937 274 Deposits - - - 17 Restricted - cash and cash investments - - - 8,361 Total current assets 378,077 501,579 879,656 81,313 Noncurrent assets:
Restricted - cash and investments 23,767 63,573 87,340 10,491 Due from Cit y - - - 405 Deposits - 281 281 - Lease receivable 178 713 891 - Long-term prepaid and other assets - 6,248 6,248 - Capital assets:
Not bein g depreciated/amortized 183,336 97,970 281,306 3,407 Being depreciated/amortized, net 391,870 739,764 1,131,634 253,686 Total capital assets 575,206 837,734 1,412,940 257,093 Total noncurrent assets 599,151 908,549 1,507,700 267,989 Total assets 977,228 1,410,128 2,387,356 349,302 Deferred Outflows of Resources:
Accumulated decrease in fair value of
hedging derivatives - - - 2,533 Debt refunding related 18,945 695 19,640 1,771 Pension related 165,372 31,438 196,810 1,770 OPEB related 6,664 1,723 8,387 - Total deferred outflows of resources 190,981 33,856 224,837 6,074 (Continued)
Primary Government
The accompanying notes are an integral part of these financial statements.
CITY OF PASADENA FINANCIAL SECTION
(AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 17 Statement of Net Position (Continued)
June 30, 2024
Discretely
Total Presented
Governmental Business-type Primary Component
Activities Activities Government Units
Liabilities:
Current liabilities
Accounts payable and other accrued liabilities 53,023 30,657 83,680 13,768 Due to primary government - - - 1,069 Due to other governments 6 - 6 - Deposits 4,904 7,450 12,354 2,117 Advances - - - 100 Unearned revenues 6,242 11,004 17,246 7,422 Compensated absences 12,381 - 12,381 255 Insurance claims payable 26,426 - 26,426 - Long-term debt due within one year 6,935 12,194 19,129 13,995 Lease liability 944 1,339 2,283 185 Subscription liability 1,920 798 2,718 175 Total current liabilities 112,781 63,442 176,223 39,086 Noncurrent liabilities:
Compensated absences 1,400 - 1,400 92 Insurance claims payable 29,944 - 29,944 - Long-term debt 174,064 264,350 438,414 314,300 Lease liability 1,772 5,386 7,158 234 Subscription liability 3,389 2,204 5,593 263 Derivative instrument liability - - - 2,533 Long-term advances from primary government - - - 300 Net pension liability 496,794 97,830 594,624 3,932 Net OPEB liability 61,986 16,026 78,012 - Total noncurrent liabilities 769,349 385,796 1,155,145 321,654 Total liabilities 882,130 449,238 1,331,368 360,740 Deferred Inflows of Resources:
Debt refunding related - 1,348 1,348 3,221 Service concession agreement - - - 48 Lease related 899 1,111 2,010 232 Pension related 4,230 1,498 5,728 63 OPEB related 19,378 5,009 24,387 - Total deferred inflows of resources 24,507 8,966 33,473 3,564 Net Position (Deficit):
Net investment in capital assets 517,159 545,235 1,062,394 (13,820) Restricted:
Nonexpendable 1,434 - 1,434 - Expendable:
Community development 13,611 - 13,611 -
Public safety 4,809 - 4,809 - Capital projects 1,948 - 1,948 - Debt service 6,976 21,535 28,511 9,727 Stranded investments - 42,037 42,037 - Transportation 40,363 - 40,363 - Contribution to General Fund - 19,544 19,544 - Culture and literacy 3,757 - 3,757 - Other purposes 1,135 15,741 16,876 870 Air quality improvement 379 - 379 - Trust and loans 13,206 - 13,206 - Unrestricted (343,205) 341,688 (1,517) (5,705) Total net position (deficit) 261,572$ 985,780$ 1,247,352$ (8,928)$ Primary Government
FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
18 Annual Comprehensive Financial Report | June 30, 2024 Statement of Activities
For the Fiscal Year Ended June 30, 2024
Operating Capital
Charges for Grants and Grants and
Functions/Programs Expenses Services Contributions Contributions Primary government:
Governmental activities:
General government 82,026$ 17,983$ 3,437$ -$ Public safety 179,795 23,129 6,192 - Transportation 58,815 27,888 17,206 13,544 Utility 29 - - - Sanitation 6,413 - 55 2,806 Health 21,010 2,959 12,866 - Culture and leisure 55,227 2,084 739 4,542 Community development 64,936 14,782 36,993 13 Interest and other fiscal charges 6,230 - - - Total governmental activities 474,481 88,825 77,488 20,905 Business-type activities:
Electric 215,075 282,073 - 3,339 Water 62,769 69,471 1,242 1,868 Refuse 25,036 12,757 429 - Parking 12,651 13,048 412 - Telecommunications 191 565 41 - Total business-type activities 315,722 377,914 2,124 5,207 Total primary government 790,203 466,739 79,612 26,112 Discretely Presented Component Units 97,561$ 76,534$ 1,595$ 69$ General revenues:
Taxes:
Property
Sales
Utility users'
Transient occupancy
Street light and traffic signal
Construction
Business license
Franchise
Other
Grants and contributions, unrestricted
Motor vehicle in-lieu, unrestricted
Use of money - investment earnings
Use of property - interest income from leases
Net change in fair value of investments
Miscellaneous revenues
Total general revenues
Transfers
Total general revenues and transfers
Change in net position
Net position (deficit), beginning, as previously reported Restatement for correction of an error
Net position (deficit), beginning, as restated
Net position (deficit), ending
Program Revenues
The accompanying notes are an integral part of these financial statements.
CITY OF PASADENA FINANCIAL SECTION
(AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 19
Discretely
Total Presented
Governmental Business-type Primary Component
Activities Activities Government Units
(60,606)$ -$ (60,606)$ -$ (150,474) - (150,474) - (177) - (177) - (29) - (29) - (3,552) - (3,552) - (5,185) - (5,185) - (47,862) - (47,862) - (13,148) - (13,148) - (6,230) - (6,230) - (287,263) - (287,263) - - 70,337 70,337 - - 9,812 9,812 - - (11,850) (11,850) - - 809 809 - - 415 415 - - 69,523 69,523 - (287,263) 69,523 (217,740) -
(19,363)
87,265 - 87,265 - 81,319 - 81,319 - 32,027 - 32,027 - 18,505 - 18,505 11,608 9,270 - 9,270 - 3,524 - 3,524 - 7,969 - 7,969 - 2,709 7,456 10,165 -
9,328 - 9,328 4,148 784 - 784 118 25,052 - 25,052 - 7,440 11,084 18,524 3,960 5 7 12 - 8,919 12,895 21,814 -
6,609 2,877 9,486 5,243 300,725 34,319 335,044 25,077
14,730 (14,730) - - 315,455 19,589 335,044 25,077
28,192 89,112 117,304 5,714
233,358 893,786 1,127,144 (14,642)
22 2,882 2,904 - 233,380 896,668 1,130,048 (14,642)
261,572$ 985,780 $ 1,247,352$ (8,928)$
Changes in Net Position
Net (Expenses) Revenues and
Primary Government
FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
20 Annual Comprehensive Financial Report | June 30, 2024 Balance Sheet
Governmental Funds
June 30, 2024
Special Revenue Capital Projects Debt Service
Nonmajor Total
Housing Project General Governmental Governmental
General Successor Management Debt Service Funds Funds
Assets:
Cash and investments 76,984$ 708$ 5,059$ -$ 160,343$ 243,094$ Accounts receivable, net 37,919 10 4,588 - 17,708 60,225 Lease receivable 205 - - - 447 652 Notes receivable 18,350 27,138 - - 65,169 110,657 Allowance for uncollectible notes
receivable (4,845) (27,138) - - (65,169) (97,152) Due from other funds 38,321 - - - - 38,321 Due from component units 1,641 - - - - 1,641 Prepaids and other assets 719 - - - 134 853 Restricted assets:
Cash and investments 13,204 - - - 3,447 16,651 Cash with fiscal agent - - - 5 7,110 7,115 Total assets 182,498 718 9,647 5 189,189 382,057 Liabilities:
Accounts payable and accrued
liabilities 17,651 1 7,102 - 6,745 31,499 Deposits 3,567 - - - 1,337 4,904 Due to other funds - - - - 11,431 11,431 Due to other governments 6 - - - - 6 Unearned revenue 2,073 - 907 - 3,261 6,241 Total liabilities 23,297 1 8,009 - 22,774 54,081 Deferred Inflows of Resources:
Unavailable revenues 133 - 3,030 - 4,058 7,221 Lease related 189 - - - 425 614 Total deferred inflows of resources 322 - 3,030 - 4,483 7,835 Fund Balances:
Nonspendable 14,224 - - - 1,567 15,791 Restricted 13,206 717 - 5 64,538 78,466 Committed 67,892 - - - 102,595 170,487 Assigned 59,102 - - - - 59,102 Unassigned 4,455 - (1,392) - (6,768) (3,705) Total fund balances 158,879 717 (1,392) 5 161,932 320,141 Total liabilities, deferred inflows of
resources and fund balances 182,498$ 718$ 9,647$ 5$ 189,189$ 382,057$
The accompanying notes are an integral part of these financial statements.
CITY OF PASADENA FINANCIAL SECTION
(AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 21 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 320,141$
Capital assets 889,616
Accumulated depreciation (344,192)
Lease assets 5,919
Subscription assets 7,915
Accumulated amortization (6,044) 553,214 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.
Deferred outflows - pension related 124,399
Deferred outflows - OPEB related 6,017
Deferred inflows - pension related (2,913)
Deferred inflows - OPEB related (17,495) 110,008 Unavailable revenues are not available to pay for current period ex penditures and, therefore, are deferred in the funds. 7,221
The substance of an advanced refunding is reported as deferring the difference and amortizing it over future periods. 18,945
Long-term liabilities and deferred inflows of resources are not due, payable, or available in the current period, and therefore, are not reported in the funds.
Notes payable (4,005)
Pension bonds payable (128,115)
Certificates of participation (42,260)
Unamortized premium (discount) (3,561)
Accrued interest payable on long-term debt, leases, and SBITA (1,576) Financed purchase arrangements (47)
Loan payable (3,011)
Lease liability (2,705)
Subscription liability (4,087)
Net OPEB liability (55,963)
Net pension liabilit y (378,366) (623,696) Internal service funds are used by management to charge the costs of certain activities, such as equipment management and self-insurance, to individual funds. The assets, deferred outflows of of resources, liabilities, and deferred inflows of resources of the internal service funds are included in governmental activities in the statement of net position. (124,261) Net position of governmental activities 261,572$
Capital assets used in governmental activities are not current financial resources and are therefore not reported in the governmental funds.
FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
22 Annual Comprehensive Financial Report | June 30, 2024 Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds
For the Fiscal Year Ended June 30, 2024
Special Revenue Capital Projects Debt Service
Nonmajor Total
Housing Pro ject General Governmental Governmental
General Successor Management Debt Service Funds Funds
Revenues:
Taxes 240,222 $ - $ - $ - $ 11,694$ 251,916$ Licenses and permits 3,787 - - - 12,327 16,114 Intergovernmental 31,788 - 13,495 - 75,738 121,021 Charges for services 47,865 4 25 - 12,005 59,899 Fines and forfeitures 6,334 - - - - 6,334 Investment earnings 2,993 135 - 6 4,025 7,159 Net change in fair value of investments 3,468 - - - 5,093 8,561 Lease revenues 1,022 - 283 - 3,600 4,905 Interest income from leases 1 - - - 3 4 Miscellaneous revenues 3,386 134 33 - 4,155 7,708 Contributions 28 - 677 - 851 1,556 Total revenues 340,894 273 14,513 6 129,491 485,177 Expenditures:
Current:
General government 72,653 - - 6 4 72,663 Public safety 171,656 - - - 3,096 174,752 Transportation 25,461 - 1,644 - 18,326 45,431 Utility - - - - 29 29 Sanitation - - - - 6,403 6,403 Health - - - - 20,670 20,670 Culture and leisure 37,110 - - - 15,996 53,106 Community development 11,161 577 - - 46,725 58,463 Capital outlay 14,758 - 49,958 - 2,016 66,732 Debt service:
Principal retirement - - - 3,398 2,610 6,008 Interest - - - 3,916 2,107 6,023 Lease payments 976 - 1 - 376 1,353 Subscription payments 1,324 - 60 - 207 1,591 Interest on leases and subscriptions 106 - 5 - 21 132 Total expenditures 335,205 577 51,668 7,320 118,586 513,356 Excess (deficiency) of revenues over
(under) expenditures 5,689 (304) (37,155) (7,314) 10,905 (28,179) Other Financing Sources (Uses):
Proceeds from financed purchase arrangements 46 - - - 1 47 Transfers in 20,140 - 34,931 7,31 4 18,442 80,827 Transfers out (33,887) - (1,621) - (30,162) (65,670) Leases issued 67 - - - 23 90 Subscriptions issued 2,191 - - - - 2,191 Total other financing sources (uses) (11,443) - 33,310 7,31 4 (11,696) 17,485 Net change in fund balances (5,754) (304) (3,845) - (791) (10,694) Fund balances, beginning, as previously reported 164,611 1,021 2,453 5 162,728 330,818 Restatement for correction of an error 22 - - - - 22 Restatement for changes within reporting entity - - - - (5) (5) Fund balances, beginning, as restated 164,633 1,021 2,453 5 162,723 330,835 Fund balances, ending 158,879$ 717$ (1,392)$ 5$ 161,932$ 320,141$
The accompanying notes are an integral part of these financial statements.
CITY OF PASADENA FINANCIAL SECTION
(AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 23 Reconciliation of the Statement of Revenues,
Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities
For the Fiscal 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 (10,694)$ Governmental funds report capital outlays as 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 in the current period.
Capital outlay 53,533$
Depreciation/amortization expense (24,396) 29,137 The net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, and donations) is to decrease net position.
Loss on sale of assets (2,543)
Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. 964
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 statement 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.
Principal paid on notes 317
Principal paid on pension bonds 2,410
Principal paid on certificates of participation 2,310
Principal paid on leases 1,353
Principal paid on subscriptions 1,591
Principal paid on loan 971 8,952
Bond deferred charges and similar items are recorded as expenditures in governmental funds when debt is first issued, whereas these payments are deferred and amortized in the statement of activities.
This amount is the net offset of the difference. (1,113) Internal service funds are used by management to charge the costs of certain activities, such as computing and communication, building maintenance, fleet maintenance, fleet replacement, benefits, workers' compensation, general liability, and 311 call center, to individual funds. The net revenue (expense) of certain activities of internal service funds is reported with governmental activities. 15,518 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.
Accrued interest on long-term debt, leases, and SBITA 17 Amortization of bond premiums and discounts and deferred amounts of refunding 246 Net change in deferred (inflows) and outflows of resources - pension related (11,112) Net change in deferred (inflows) and outflows of resources - OPEB related (1,180) (12,029) Change in net position of governmental activities 28,192$
The accompanying notes are an integral part of these financial statements.
FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
24 Annual Comprehensive Financial Report | June 30, 2024 Statement of Net Position
Proprietary Funds
June 30, 2024
Light Off-Street
and Power Water Parking
Assets:
Current assets:
Cash and investments 337,167$ 56,544$ 5,647$ Accounts receivable, net 35,149 10,759 626 Due from component units - - - Inventories 20,436 11,097 - Lease receivable - 17 365 Prepaids and other assets 117 498 200 Total current assets 392,869 78,915 6,838 Noncurrent restricted assets:
Cash and investments 15,194 21 - Cash and investments - stranded investments reserve 42,037 - - Cash with fiscal agent 40 4,422 1,859 Total noncurrent restricted assets 57,271 4,443 1,859 Other noncurrent assets:
Deposit with Independent System Operator (ISO) 281 - - Prepaid long-term assets 6,248 - - Lease receivable - 81 632 Capital assets, net of accumulated
depreciation/amortization 539,406 254,124 37,914 Total other noncurrent assets 545,935 254,205 38,546 Total noncurrent assets 603,206 258,648 40,405 Total assets 996,075 337,563 47,243 Deferred Outflows of Resources:
Bond refunding related 695 - - Pension related 20,294 7,452 518 OPEB related 972 481 8 Total deferred outflows of resources 21,961 7,933 526 Liabilities:
Current liabilities:
Accounts payable and accrued liabilities 18,780 9,022 1,643 Deposits 933 150 209 Insurance claims payable - - - Due to other funds - - - Unearned revenues 7,587 2,116 2 Compensated absences - - - Revenue bonds 7,845 2,86 0 1,000 Loan payable - - 489 Lease liability 913 421 3 Subscription liability 571 209 - Total current liabilities 36,629 14,778 3,346 Noncurrent liabilities:
Insurance claims payable - - - Compensated absences - - - Net pension liability 65,297 22,382 1,305 Net OPEB liability 9,088 4,428 72 Revenue bonds 176,895 69,353 17,600 Loan payable - - 502 Lease liability 3,340 2,039 - Subscription liability 1,649 517 - Total noncurrent liabilities 256,269 98,719 19,479 Total liabilities 292,898 113,497 22,825 Deferred Inflows of Resources:
Bond refunding related 17 1,331 - Lease related - 113 962 Pension related 967 355 25 OPEB related 2,834 1,391 22 Total deferred inflows of resources 3,818 3,19 0 1,009 Net Position:
Net investment in capital assets 346,311 174,381 18,320 Restricted:
Debt service 15,234 4,443 1,859 Contribution/reimbursement to General Fund 18,000 1,544 - Stranded investments 42,037 - - Other purposes 15,741 - - Unrestricted 283,997 48,441 3,756 Total net position (deficit) 721,320$ 228,809 $ 23,935 $
The accompanying notes are an integral part of these financial statements.
CITY OF PASADENA FINANCIAL SECTION
(AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 25
Governmental
Nonmajor Total Activities -
Enterprise Enterprise Internal
Funds Funds Service Funds
Assets:
Current assets:
20,257$ 419,615$ 52,494$ Cash and investments 2,691 49,225 3,817 Accounts receivable, net 9 9 211 Due from component units 31,533 404 Inventories - 382 308 Lease receivable - 815 1,049 Prepaids and other assets 22,957 501,579 58,283 Total current assets Noncurrent restricted assets:
- 15,215 - Cash and investments - 42,037 - Cash and investments - stranded investments reserve - 6,321 - Cash with fiscal a gent - 63,573 - Total noncurrent restricted assets Other noncurrent assets:
- 281 - Deposit with Independent System Operator (ISO) - 6,248 - Prepaid long-term assets - 713 - Lease receivable 6,290 837,734 21,992 Capital assets, net of accumulated
depreciation/amortization
6,290 844,976 21,992 Total other noncurrent assets 6,290 908,549 21,992 Total noncurrent assets 29,247 1,410,128 80,275 Total assets Deferred Outflows of Resources:
- 695 - Bond refunding related 3,174 31,438 40,974 Pension related 262 1,723 647 OPEB related 3,436 33,856 41,621 Total deferred outflows of resources Liabilities:
Current liabilities:
1,212 30,657 19,953 Accounts payable and accrued liabilities 6,158 7,450 - Deposits - - 26,426 Insurance claims payable - - 26,890 Due to other funds 1,299 11,004 - Unearned revenues - - 12,381 Compensated absences - 11,705 - Revenue bonds - 489 - Loan payable 2 1,339 2 Lease liabilit y 18 798 408 Subscription liability 8,689 63,442 86,060 Total current liabilities Noncurrent liabilities:
- - 29,944 Insurance claims payable - - 1,400 Compensated absences 8,846 97,83 0 118,428 Net pension liability 2,438 16,026 6,022 Net OPEB liability - 263,848 - Revenue bonds - 502 - Loan payable 7 5,386 8 Lease liability 38 2,204 813 Subscription liabilit y 11,329 385,796 156,615 Total noncurrent liabilities 20,018 449,238 242,675 Total liabilities Deferred Inflows of Resources:
- 1,348 - Bond refunding related 36 1,111 285 Lease related 151 1,498 1,316 Pension related 762 5,009 1,881 OPEB related 949 8,966 3,482 Total deferred inflows of resources Net Position:
6,225 545,237 23,606 Net investment in capital assets Restricted:
- 21,536 - Debt service - 19,544 - Contribution/reimbursement to General Fund - 42,037 - Stranded investments - 15,741 - Other purposes 5,491 341,685 (147,867) Unrestricted 11,716$ 985,780$ (124,261)$ Total net position (deficit)
FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
26 Annual Comprehensive Financial Report | June 30, 2024 Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds
For the Fiscal Year Ended June 30, 2024
Light Off-Street
and Power Water Parking
Operating Revenues:
Utilities 281,577$ 69,471$ -$ Off-street parking - - 13,048 Refuse collection - - - Telecommunication - - - Computing and communication services - - - Building maintenance - - - Fleet maintenance - - - Employee benefits - - - Insurance - - - 311 Call Center - - - Total operating revenues 281,577 69,471 13,048 Operating Expenses:
Utility production 99,177 28,653 - Utility transmission and distribution 46,111 8,474 - Utility commercial and general 23,944 12,753 - Off-street parking - - 9,541 Refuse collection - - - Telecommunications - - - Computing and communication services - - - Building maintenance - - - Fleet maintenance - - - Benefits - - - Insurance - - - 311 Call Center - - - Depreciation/amortization 38,841 10,318 1,886 Total operating expenses 208,073 60,198 11,427 Operating income (loss) 73,504 9,273 1,621 Nonoperating Revenues (Expenses):
Taxes - - - Intergovernmental - 899 - Investment earnings 8,742 1,533 298 Net change in fair value of investments 10,192 1,916 159 Miscellaneous revenues - - - Lease revenues - 3 412 Interest income from leases - - 7 Noncompliance forfeitures - - - Other 1,632 2,072 13 Interest expense (6,812) (2,258) (1,165) Interest on leases and subscriptions (136) (48) - Gain (loss) on sale of assets (53) (265) (59) Total nonoperating revenues (expenses) 13,565 3,852 (335) Income (loss) before transfers and contributions 87,069 13,125 1,286 Capital contributions 3,339 1,868 - Transfers in 6,559 - - Transfers out (18,000) (1,894) (894) Change in net position 78,967 13,099 392 Net position (deficit), beginning, as previously reported 642,353 212,828 23,543 Restatement for correction of an error - 2,882 - Net position (deficit), beginning, as restated 642,353 215,710 23,543 Net position (deficit), ending 721,320$ 228,809$ 23,935$
The accompanying notes are an integral part of these financial statements.
CITY OF PASADENA FINANCIAL SECTION
(AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 27
Governmental
Activities -
Nonmajor Total Internal
Enterprise Enterprise Service
Funds Funds Funds
Operating Revenues:
-$ 351,048$ -$ Utilities - 13,048 - Off-street parking 12,747 12,747 - Refuse collection 565 565 - Telecommunication - - 21,555 Computing and communication services - - 16,613 Building maintenance - - 14,963 Fleet maintenance - - 44,585 Employee benefits - - 45,006 Insurance - - 1,009 311 Call Center 13,312 377,408 143,731 Total operating revenues Operating Expenses:
- 127,830 - Utility production - 54,585 - Utility transmission and distribution - 36,697 - Utility commercial and general - 9,541 - Off-street parking 24,038 24,038 - Refuse collection 12 12 - Telecommunications - - 20,185 Computing and communication services - - 15,672 Building maintenance - - 11,363 Fleet maintenance - - 51,746 Benefits - - 28,688 Insurance - - 862 311 Call Center 1,159 52,204 3,489 Depreciation/amortization 25,209 304,907 132,005 Total operating expenses (11,897) 72,501 11,726 Operating income (loss) Nonoperating Revenues (Expenses):
7,456 7,456 - Taxes 96 995 - Intergovernmental 508 11,081 282 Investment earnings 625 12,892 354 Net change in fair value of investments - - 3,350 Miscellaneous revenues 41 456 285 Lease revenues - 7 2 Interest income from leases 318 318 - Noncompliance forfeitures - 3,717 - Other - (10,235) (86) Interest expense (2) (186) - Interest on leases and subscriptions 10 (367) 32 Gain (loss) on sale of assets 9,052 26,134 4,219 Total nonoperating revenues (expenses) (2,845) 98,635 15,945 Income (loss) before transfers and contributions - 5,207 - Capital contributions 196 6,755 2,252 Transfers in (697) (21,485) (2,679) Transfers out (3,346) 89,112 15,518 Change in net position 15,062 893,786 (139,779) Net position (deficit), beginning, as previously reported - 2,882 - Restatement for correction of an error 15,062 896,668 (139,779) Net position (deficit), beginning, as restated 11,716$ 985,780$ (124,261)$ Net position (deficit), ending
FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
28 Annual Comprehensive Financial Report | June 30, 2024 Statement of Cash Flows
Proprietary Funds
For the Fiscal Year Ended June 30, 2024
Light Off-Street
and Power Water Parking
Cash Flows from Operating Activities:
Cash received from customers 277,603$ 69,454$ 13,401$ Cash payments to suppliers for goods and services (119,589) (32,336) (8,091) Cash payments to employees for services (38,775) (14,636) (1,193) Cash payments to other funds for services (7,968) (4,700) - Miscellaneous revenue 1,632 2,072 20 Other payments - - - Net cash provided by (used for) operating activities 112,903 19,854 4,137 Cash Flows from Noncapital Financing Activities:
Cash transfers in 6,559 - - Cash transfers out (18,000) (1,894) (894) Advances from other funds - - - Taxes received - - - Intergovernmental revenues - 899 - Net cash provided by (used for) noncapital financing activities (11,441) (995) (894) Cash Flows from Capital and Related Financing Activities:
Acquisition and construction of capital assets (35,606) (20,039) (46) Proceeds from sale of capital assets 12 - - Proceeds from lease activities - 20 36 Payments on leases and subscriptions (2,068) (769) (474) Capital contributions 3,348 1,861 - Principal paid on debt (7,485) (2,795) (900) Interest paid on debt (8,123) (2,997) (1,165) Net cash used for capital and related financing activities (49,922) (24,719) (2,549) Cash Flows from Investing Activities:
Proceeds from sale of investments - 5 - Purchase of investments (1,173) - - Investment earnings 8,192 1,473 299 Net change in fair value of investments 10,192 1,916 159 Payments received from loans made to suppliers 74 - - Net cash provided by (used for) investing activities 17,285 3,394 458 Net increase (decrease) in cash and cash equivalents 68,825 (2,466) 1,152 Cash and cash equivalents, beginning 279,540 60,006 6,354 Cash and cash equivalents, ending 348,365 57,540 7,506 Reconciliation of cash and cash equivalents to amounts
reported on the Statement of Net Position:
Cash and investments 337,167 56,544 5,647 Restricted:
Cash and stranded investments reserve 42,037 - - Cash and investments 15,194 21 - Cash with fiscal agent 40 4,422 1,859 Less non-cash equivalents (46,073) (3,447) - Cash and cash equivalents, ending 348,365$ 57,540$ 7,506$
The accompanying notes are an integral part of these financial statements.
CITY OF PASADENA FINANCIAL SECTION
(AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 29
Governmental
Activities -
Nonmajor Total Internal
Enterprise Enterprise Service
Funds Funds Funds
13,892$ 374,350$ 139,898$
(15,546) (175,562) (25,878) (8,568) (63,172) (103,586) - (12,668) - 318 4,042 3,738 - - - (9,904) 126,990 14,172
196 6,755 2,252 (697) (21,485) (2,679) - - - 7,456 7,456 -
96 995 - 7,051 (6,279) (427) (152) (55,843) (5,974) 10 22 32 - 56 - (12) (3,323) (1,185) - 5,209 - - (11,180) - (2) (12,287) (74) (156) (77,346) (7,201) - 5 - - (1,173) - 509 10,473 282
627 12,894 356
- 74 - 1,136 22,273 638
(1,873) 65,638 7,182
22,130 368,030 45,312
20,257 433,668 52,494
20,257 419,615 52,494
- 42,037 - - 15,215 - - 6,321 - - (49,520) - 20,257$ 433,668$ 52,494$
FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
30 Annual Comprehensive Financial Report | June 30, 2024 Statement of Cash Flows
Proprietary Funds
For the Fiscal Year Ended June 30, 2024
Light Off-Street
and Power Water Parking
Reconciliation of operating income (loss) to net cash
provided by (used for) operating activities:
Operating income (loss) 73,504$ 9,273$ 1,621$ Adjustments to reconcile operating income (loss) to net cash provided by (used for) operating activities:
Depreciation and amortization 38,841 10,318 1,886 Miscellaneous and other revenue (loss) 1,632 2,072 432 (Increase) decrease in accounts receivable (398) 1,295 (53) Increase (decrease) in allowance for uncollectible accounts (4,098) (1,314) - (Increase) decrease in lease receivable - - 119 Increase (decrease) in due to other funds - - - (Increase) decrease in due from component units - - - (Increase) decrease in inventories (811) (1,365) - (Increase) decrease in prepaids and other assets 521 (72) 46 Increase (decrease) in accounts payable and accrued liabilities 3,026 (466) 170 Increase (decrease) in unearned revenue 304 - - Increase (decrease) in insurance claims payable - - - Increase (decrease) in compensated absences - - - Increase (decrease) in deposits payable (675) (283) - Increase (decrease) in deferred inflows (590) (216) (145) (Increase) decrease in deferred outflows (34) 14 31 Increase (decrease) in net OPEB liability 162 74 8 Increase (decrease) in net pension liability 1,519 524 22 Total adjustments 39,399 10,581 2,516 Net cash provided by (used for) operating activities 112,903$ 19,854$ 4,137$ Non-cash Capital and Financing Activities
Loss on disposition of capital assets -$ (230)$ (59)$ Amortization of deferred charges (38) 83 - Amortization of premiums (discounts) 1,206 644 -
Capital contributions (9) 7 - Leases issued 2,934 2,760 13 Subscriptions issued 324$ 275$ -$
The accompanying notes are an integral part of these financial statements.
CITY OF PASADENA FINANCIAL SECTION
(AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 31
Governmental
Activities -
Nonmajor Total Internal
Enterprise Enterprise Service
Funds Funds Funds
(11,897)$ 72,501 $ 11,726 $
1,159 52,204 3,489 356 4,492 3,630 165 1,009 (3,540) - (5,412) - 55 174 321 - - (10,118) 2 2 (209) - (2,176) 6 - 495 (13) (521) 2,209 12,871 233 537 - - - (8,494) - - 929 110 (848) - (93) (1,044) (1,409) (65) (54) 2,284 255 499 645 337 2,402 2,054 1,993 54,489 2,446
(9,904)$ 126,990$ 14,172$
10$ (279)$ -$ - 45 - - 1,850 - - (2) - 7 5,714 7 -$ 599$ 12$
FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
32 Annual Comprehensive Financial Report | June 30, 2024 Statement of Net Position
Fiduciary Funds
June 30, 2024
Pension
(and Other
Employee Benefit) Private-Purpose
Trust Funds Custodial Funds Trust Funds
Assets:
Cash and cash equivalents 2,481$ 476$ 241$ Cash with fiscal agent - - 127 Short-term investments 4,313 - - Receivables:
Accounts - 951 - Pending trade sales 1,779 - - Interest 238 - - Notes receivable - - 515 Allowance for uncollectible notes receivable - - (515) Total receivables 2,017 951 - Investments, at fair value:
Government and agencies 18,628 - - Corporate obligations 7,583 - - Mutual funds 404,770 - - Real estate 10,755 - - Corporate stocks 44,227 - - Total investments 485,963 - - Capital assets, net - - 104 Total assets 494,774 1,427 472 Liabilities:
Accounts payable and accrued liabilities 50 360 - Due to other governments - 551 35 Due to bondholders - 888 - Pending purchases 8,399 - - Total liabilities 8,449 1,799 35 Net Position (Deficit):
Restricted for pensions 98,630 - - Restricted for other employee benefits 387,695 - - Restricted for special assessments - (5) - Restricted for library equipment - 316 - Restricted for WIOA - 56 - Restricted for bondholders - (739) - Restricted for other purposes - - 437 Total net position (deficit) 486,325$ (372)$ 437$ The accompanying notes are an integral part of these financial statements.
CITY OF PASADENA FINANCIAL SECTION
(AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 33 Statement of Changes in Net Position
Fiduciary Funds
For the Fiscal Year Ended June 30, 2024
Pension
(and Other
Employee Benefit) Private Purpose
Trust Funds Custodial Funds Trust Funds
Additions:
Contributions:
Plan members 15,715$ -$ -$ Property taxes - - 6,566 Intergovernmental - 4,090 - Program revenue - 26 - Assessment revenue - 112 - Amounts collected for distribution 601 - - Gain/(loss) on disposition of property - - (110) Miscellaneous revenues - - 28 Total contributions 16,316 4,228 6,484 Net investment income:
Investment earnin gs 2,762 10 - Net change in fair value of investments 50,341 8 - Gross investment income 53,103 18 - Less investment ex penses (414) - - Total net investment income 52,689 18 - Total additions 69,005 4,246 6,484 Deductions:
Benefits paid to participants 37,260 - - Contributions to City - 33 - Program expense - 3,918 - Interest ex pense - 53 - Statutory passthrough expenses - - 5,570 Administrative expenses 461 4 - County administrative ex penses - - 962 Total deductions 37,721 4,008 6,532 Change in net position 31,284 238 (48) Net position (deficit), beginning, as previously reported 455,064 (615) 507 Restatement for correction of an error (23) 5 (22) Net position (deficit), beginning, as restated 455,041 (610) 485 Net position (deficit), ending 486,325$ (372)$ 437$ (This page intentionally left blank)
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2024
Notes to the Basic
Financial Statements
FINC_Annual_Comprehensive_Report_2024_Dividers_Layout 1 11/21/2024 5:01 PM Page 4
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
36 Annual Comprehensive Financial Report | June 30, 2024
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 37 Note Index
(1) Summary of Significant Accounting Policies .......................................................................................................... 38 (A) Reporting Entity ............................................................................................................................................................ 38 (B) Basis of Accounting and Measurement Focus .............................................................................................................. 43 (C) Major Funds, Internal Service Funds and Fiduciary Fund Types ................................................................................... 46 (D) Cash Equivalents ........................................................................................................................................................... 47 (E) Cash and Investments ................................................................................................................................................... 47 (F) Inventories .................................................................................................................................................................... 48 (G) Advances to Other Funds ............................................................................................................................................. 48 (H) Prepaids ........................................................................................................................................................................ 48 (I) Restricted Cash and Investments ................................................................................................................................. 48 (J) Property Held for Resale ............................................................................................................................................... 49 (K) Capital Assets ................................................................................................................................................................ 49 (L) Leases ........................................................................................................................................................................... 50 (M) Subscription-Based Information Technology Agreements (SBITA)............................................................................... 50 (N) Insurance Claims Payable ............................................................................................................................................. 50 (O) Compensated Absences................................................................................................................................................ 50 (P) Net Pension Liability ..................................................................................................................................................... 51 (Q) Other Postemployment Benefits (OPEB) ...................................................................................................................... 51 (R) Bond Premiums / Discounts / Issuance Costs ............................................................................................................... 51 (S) Deferred Outflows and Inflows of Resources ............................................................................................................... 52 (T) Fund Balance ................................................................................................................................................................ 52 (U) Property Taxes .............................................................................................................................................................. 53 (V) Use of Estimates ........................................................................................................................................................... 53 (W) Interfund Activities ....................................................................................................................................................... 54 (X) Endowments ................................................................................................................................................................. 54 (Y) New and Future Accounting Pronouncements ............................................................................................................. 54 (2) Cash and Investments ........................................................................................................................................... 55 (3) Accounts Receivable ............................................................................................................................................. 60 (4) Notes Receivable – Primary Government .............................................................................................................. 61 (5) Due to and from Other Funds ............................................................................................................................... 61 (6) Capital Assets ........................................................................................................................................................ 62 (7) Leases ................................................................................................................................................................... 66 (8) Subscription-Based Information Technology Arrangements ................................................................................. 70 (9) Deferred Inflows and Outflows ............................................................................................................................. 72 (10) Long-Term Debt .................................................................................................................................................... 74 (11) Derivative Instruments ......................................................................................................................................... 85 (12) Fund Balance ......................................................................................................................................................... 88 (13) Restricted Net Position – Stranded Investments ................................................................................................... 90 (14) Accumulated Fund Deficits .................................................................................................................................... 91 (15) Excess of Expenditures over Appropriations ......................................................................................................... 94 (16) Pledged Revenue .................................................................................................................................................. 95 (17) Transfers ............................................................................................................................................................... 96 (18) Self-insurance ....................................................................................................................................................... 98 (19) Deferred Compensation Plan .............................................................................................................................. 100 (20) Pension Plans ...................................................................................................................................................... 101 (21) Other Postemployment Benefits (OPEB) ............................................................................................................. 113 (22) Commitments and Contingencies ........................................................................................................................ 118 (23) Restatement of Beginning Net Position or Fund Balances ................................................................................... 119 (24) Subsequent Events .............................................................................................................................................. 121
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
38 Annual Comprehensive Financial Report | June 30, 2024 (1) Summary of Significant Accounting Policies
The basic financial statements of the City of Pasadena, California (City) have been prepared in conformity with generally accepted accounting principles (GAAP) as applied to governmental entities. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The more significant accounting policies of the City are described below. All amounts, unless otherwise indicated, are expressed in thousands of dollars; and some of the totals may not foot or cross foot due to rounding.
(A) Reporting Entity
The City was incorporated on June 19, 1886 as a Charter City, which operates under a Council-City Manager form of government. The City is a municipal corporation governed by an elected mayor and seven (7) council members.
As required by GAAP, these financial statements present the City and its component units, entities for which the City is financially accountable. The City is financially accountable for an organization if the City appoints a voting majority of that organization's governing body, and the City is able to impose its will on that organization or there is a potential for that organization to provide specific financial benefits to or impose specific financial burdens on the City. The City is also considered to be financially accountable if that organization is fiscally dependent (i.e., it is unable to adopt its budget, levy taxes, set rates or charges, or issue bonded debt without approval from the City). In certain cases, other organizations are included as component units if the nature and significance of their relationship with the City is such that their exclusion would cause the City's financial statements to be misleading or incomplete.
The two methods of reporting component unit data in the basic financial statements are blended and discrete presentation. Blending is limited exclusively to when the board of the component unit is substantively the same as that of the City or if the component unit serves the City exclusively, or almost exclusively.
Blended component units, although legally separate entities, are in substance part of the City’s operations; data from these units are combined with data of the City. Component units that do not meet the criteria for blending are included within financial statements as discrete presentations. Discretely presented component units are reported in a separate column in the government-wide financial statements to emphasize they are legally separate from the government. Similar to the City, each blended and discretely presented component unit has a June 30th year-end.
Jointly governed organizations provide goods or services to the citizenry of two or more governments, but do not have an ongoing financial interest or responsibility by the participating governments.
Blended Component Units
Pasadena Parking Authority (The Authority)
The Authority was created by Resolution No. 1399, dated June 6, 1972, pursuant to the provisions of the Parking Law of 1949 (California Streets and Highways Code, Sections §32651 and §32661.1). The City Council constitutes the governing board of the Authority pursuant to the aforementioned resolution. The primary purpose of the Authority is to establish parking facilities for motor vehicles within the City, to furnish motor vehicle parking spaces, and to care for such vehicles within any parking facility or space owned, controlled or operated by the Authority. The City has operational responsibility for the Authority. The Authority is reported as an enterprise fund and does not release a separate financial report.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 39 (1) Summary of Significant Accounting Policies (Continued)
(A) Reporting Entity (Continued)
Blended Component Units (Continued)
Pasadena Civic Improvement Corporation (PCIC)
PCIC was created on August 9, 1985, pursuant to the Non-profit Public Benefit Corporation Law of the State of California (Title 1, Division 2, Part 2 of the California Corporations Code). At the request of the City, PCIC was organized for the specific and primary purpose of providing financial assistance to the City by acquiring or constructing property and appurtenances for and on behalf of the City. This is accomplished through the issuance of such financing instruments as certificates of participation. The PCIC is a non-profit organization with three directors: Chief Executive Officer, Secretary/Financial Officer, and Assistant Executive Officer/Assistant Secretary. PCIC's financial data and transactions are blended with the debt service and capital projects funds.
The PCIC does not release a separate financial report.
Pasadena Housing Authority (Housing Authority)
Formerly known as the Local Housing Authority, the Pasadena Housing Authority administers the City's federally funded housing programs under contract with the United States Department of Housing and Urban Development (HUD). The Housing Authority’s purpose is to help provide safe and sanitary housing accommodations for citizens with low income. It is governed by the City Council and the City has operational responsibility for the Authority.
The Housing Authority’s financial data and transactions are blended as a special revenue fund. The Housing Authority does not release a separate financial report.
Pasadena Public Financing Authority (PPFA)
The Pasadena Public Financing Authority was created through the joint exercise of powers agreement between the City and the Pasadena Community Development Commission (PCDC) dated April 24, 2000. The purpose of creating the PPFA is to accomplish the purposes of the law and the Bond Pooling Act, including the financing of public capital improvements and the purchase of certain local obligations issued or incurred by the City, PCDC, or other public agencies or the sale of such local obligations or the issuance of bonds of the PPFA secured in whole or in part by such local obligations, or by any other designated source of revenues, all permitted by the law or the Bond Pooling Act. The Bond Pooling Act authorizes and empowers the PPFA to, among other things, (1) issue bonds and to expend or loan the proceeds thereof to the City or PCDC, (2) finance the acquisition and/or construction of public capital improvements and to sell or lease such improvements to the City or PCDC, and (3) purchase bonds issued by the City or PCDC, all for the purpose of financing public capital improvements, working capital, liability and other insurance needs, or certain other projects whenever there are significant public benefits, as determined by the City or PCDC. PCDC ceased operations as an entity on January 31, 2012, and the City became the successor agency to the PCDC to perform all of PCDC’s continuing obligations. PPFA’s financial data and transactions are blended with the debt service and capital projects funds. The PPFA does not release a separate financial report.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
40 Annual Comprehensive Financial Report | June 30, 2024 (1) Summary of Significant Accounting Policies (Continued)
(A) Reporting Entity (Continued)
Blended Component Units (Continued)
Pasadena Fire and Police Retirement System (FPRS)
FPRS was originally established by the City Charter in 1919. The system was closed on June 30,1977 but continues to pay out benefits to retirees and their beneficiaries. FPRS covers all sworn fire and police personnel who were employed by the City prior to July 1, 1977, except those who elected to transfer to the California Public Employees’ Retirement System (CalPERS) when the system closed. FPRS is managed by a five-member Retirement Board. Three of the members are appointed by the City Council. The other two members represent firefighter and police officials and are each appointed by their respective members. The accompanying financial statements include FPRS under the pension (and other employee benefit) trust fund. Additional information related to FPRS is included in the detailed notes on Pension Plans.
Successor Agency to PCDC (Successor Agency)
The Successor Agency to PCDC was created to serve, in a fiduciary capacity, as custodian for the assets and to wind down the affairs of the former Pasadena Community Development Commission (PCDC). The Successor Agency operates under the auspices of a legislatively formed oversight board who has authority over its financial affairs and supervises its operations and timely dissolution. Its assets are held in trust for the benefit of the taxing entities within the former PCDC boundaries and as such are not available for City use. The accompanying financial statements include the Successor Agency under the statutorily required private-purpose trust fund in the fiduciary funds section.
Pasadena Rental Housing Board (PRHB)
The Pasadena Rental Housing Board (PRHB) was established as part of the adoption of a voter-initiated City Charter Amendment (Measure H), which was approved by Pasadena voters at the November 2022 General Municipal Election. Codified as City Charter Article XVIII, Section 1811 of the Charter establishes the PRHB, its composition, duties, authority, and oversight of the Pasadena Fair and Equitable Housing Charter Amendment.
In November 2023, City Council voted to turn PRHB into the Rent Stabilization Department. The PRHB’s financial data and transactions are blended as a special revenue fund. Additional information is available at https://www.cityofpasadena.net/commissions/pasadena-rental-housing-board.
Discretely Presented Component Units
The following organizations are considered to be discretely presented component units of the City:
Rose Bowl Operating Company (RBOC)
RBOC was incorporated on January 18, 1994, as a legally separate entity with the primary purpose of returning economic and civic value to the City by managing a world class stadium and a professional quality golf course complex in a residential open-space environment. RBOC is governed by a thirteen-member board. Eleven members are appointed by the City Council, while the University of California, Los Angeles (UCLA) and the Tournament of Roses appoint one each.
RBOC operations are discretely presented in the accompanying financial statements since neither of the two criteria for blended component units, as described above, have been met. RBOC’s budget is reviewed and approved by the City Council. Separate component unit financial statements of RBOC are issued and available upon request from the RBOC Administration Office at 1001 Rose Bowl Drive, Pasadena, California 91103. RBOC’s financials were audited in accordance with Government Auditing Standards . Additional information is available at https://www.rosebowlstadium.com.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 41 (1) Summary of Significant Accounting Policies (Continued)
(A) Reporting Entity (Continued)
Discretely Presented Component Units (Continued)
Pasadena Center Operating Company (PCOC)
PCOC was established on September 19, 1973, as a legally separate entity with the primary purpose of managing and operating the Pasadena Center, a civic facility designed for conferences, exhibitions, trade shows, assemblies, cultural, educational, and recreational programs, and for the use, benefit, and enjoyment of the public. PCOC was also established to supervise the activities of the Pasadena Convention and Visitors Bureau.
PCOC is governed by a fourteen-member board who are appointed by the City Council. The City provides a significant portion of the operating support of PCOC through allocation of the Transient Occupancy Tax collected by the City. Separate component unit financial statements of PCOC are issued and available upon request from Pasadena Center Operating Company, 300 E. Green Street, Pasadena, CA 91101. PCOC’s financials were audited in accordance with Government Auditing Standards . Additional information is available at https://www.visitpasadena.com/.
Pasadena Community Access Corporation Board (PCAC)
PCAC was created by the City Council in July 1983 and established on December 9, 1983, by Articles of Incorporation. The PCAC's primary purpose is to provide a means for individuals or groups to use cable telecommunications to communicate and share information. The PCAC board consists of eleven members. Seven are appointed from each Council district, one each by the Mayor and City Manager, two members, including one representing Pasadena City College (PCC) and another one representing Pasadena Unified School District (PUSD) with residency required except for the PCC and PUSD representative. The City can impose its will on PCAC through its ability to appoint a majority of its board members. PCAC’s budget is reviewed and approved by the City Council. The City provides support through the 1% Public, Education, and Government (PEG) allocation. Separate component unit financial statements of PCAC are issued and available upon request from Pasadena Community Access Corporation, 150 South Los Robles Avenue, Pasadena, CA 91101. PCAC’s financials were audited in accordance with Government Auditing Standards . Additional information is available at https://www.pasadenamedia.org.
Jointly Governed Organizations
The following organizations are considered to be jointly governed organizations of the City:
Hollywood Burbank Airport
The Hollywood Burbank Airport (formerly marketed as Bob Hope Airport) is under the governance of the Burbank-Glendale-Pasadena Airport Authority (Airport Authority). The Airport Authority is a separate agency created in 1977 under a joint powers agreement (JPA) between the three cities for the sole purpose of owning and operating the Bob Hope Airport. Three commissioners from each city, appointed by each city's respective city council, make up the nine members of the Airport Authority. There is no ongoing financial interest or responsibility by the participating governments. Additional information is available at www.hollywoodburbankairport.com.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
42 Annual Comprehensive Financial Report | June 30, 2024 (1) Summary of Significant Accounting Policies (Continued)
(A) Reporting Entity (Continued)
Jointly Governed Organizations (Continued)
County of Los Angeles (County)
Under a Joint Powers Agreement dated November 22, 1966, both the City and the County participated in the construction of a parking structure at 199 North Garfield Avenue, Pasadena, California. In 1985, the County exercised an option to purchase the structure from the Retirement Board of the Los Angeles County Employees' Retirement Association, at which time the City became tenant in common, holding a 30% share of the facility.
Foothill Air Support Team (FAST)
On July 31, 2000, the cities of Monrovia, Arcadia, Azusa, Covina, West Covina, and Pasadena formed a Joint Powers Agreement (JPA) for police helicopter services known as the FAST. Currently, the cities of Alhambra, Arcadia, Covina, Glendora, Monrovia, Pasadena, Pomona, San Marino, Sierra Madre, and South Pasadena are parties to the JPA. This arrangement provides police helicopter support to a number of neighboring cities on an hourly cost reimbursement basis. The City of Pasadena operates a fleet of police helicopters which it has made available for a limited set number of weekend hours and then on an on-call basis. Cities are billed for their actual utilization. FAST does not own or operate helicopters, has not issued debt, and cannot levy taxes. The City bears the burden of purchasing, operating, maintaining, and providing helicopter support. It does so under the City’s General Fund.
Rose Bowl Aquatics Center (RBAC)
On December 11, 1987, the City and the RBAC entered into an Operating and License Agreement for RBAC to build and operate swimming facilities owned by the City in the designated area of Brookside Park. The most recent Operating and License Agreement has a 15-year term with 3 five-year extensions and was executed on June 3, 2008. The City leases the property to the RBAC for $1 per year and provides various financial and operational supports to the community aquatics facility. In return RBAC operates as a year- round community aquatics facility, is responsible for capital improvements and repairs, and provides scholarship assistance and community services. The City Council and Mayor appoint 5 of the 21 members of the RBAC Board of Directors.
Additional information is available at https://rosebowlaquatics.org.
Foothill Workforce Development Board (FWDB)
Developed 1998, the City Council approved a JPA among the cities of Arcadia, Duarte, Monrovia, Sierra Madre, South Pasadena, and Pasadena. The JPA created the Foothill Employment and Training Consortium (FETC) which the City of Pasadena is the fiscal agent and has the authority to receive and administer workforce development funds. FETC formed the Foothill Workforce Development Board (FWDB) to take the lead in developing the implementation plan for workforce development services for job seekers and businesses. The mission is to support economic growth in the San Gabriel Valley by investing in skill development and job training to ensure that businesses have qualified workforce talent and job seekers have career opportunities. The FWDB’s Americas Job Center of California is located at 1207 East Green Street in Pasadena and is funded through the Workforce Innovation and Opportunity Act (WIOA). Additional information is available at https://fwdbworks.org.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 43 (1) Summary of Significant Accounting Policies (Continued)
(A) Reporting Entity (Continued)
Jointly Governed Organizations (Continued)
Arroyo Verdugo Communities Joint Powers Authority (AVCJPA) The City is a party to, and administrator for, the AVCJPA. This separate entity is a vehicle for the six-member agencies: cities of Burbank, Glendale, La Cañada Flintridge, Pasadena, South Pasadena, and County of Los Angeles 5th District (La Crescenta-Montrose) to coordinate regional and cooperative planning, primarily in transportation and determine how to prioritize regional transportation projects and the allocation of Measure M funds. The JPA is financially accountable to the member agencies and is governed by a Board of Directors. The JPA issues its own audited financial statements. Additional information is available at https://avcjpa.org.
(B) Basis of Accounting and Measurement Focus
The basic financial statements of the City are composed of the following:
Government-wide financial statements
Fund financial statements
Notes to the basic financial statements
Government-wide Financial Statements
Government-wide financial statements display information about the reporting government as a whole, except for its fiduciary activities. These statements include separate columns for the governmental and business-type activities of the primary government (including its blended component units), as well as its discretely presented component units. Eliminations have been made in the statement of activities so that certain allocated expenses are recorded only once (by function to which they were allocated). However, general governmental expenses have not been allocated as indirect expenses to the various functions of the City.
Government-wide financial statements are presented using the economic resources measurement focus and the accrual basis of accounting . Under the economic resources measurement focus, all economic resources, and obligations of the reporting government (both current and long-term) are reported in the government-wide financial statements. Basis of accounting refers to when revenues and expenditures are recognized in the accounts and reported in the financial statements. Under the accrual basis of accounting, revenues, expenses, gains, losses, assets, and liabilities are recognized in accordance with various GASB Statements.
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; and (2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function. Program revenues are netted with program expenses in the statement of activities to present the net cost of each program. Taxes and other items not included among program revenues are reported instead as general revenues.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
44 Annual Comprehensive Financial Report | June 30, 2024 (1) Summary of Significant Accounting Policies (Continued)
(B) Basis of Accounting and Measurement Focus (Continued)
Government-wide Financial Statements (Continued)
Amounts paid to acquire capital assets are capitalized as assets in the government-wide financial statements, rather than reported as expenditures. Proceeds of long-term debt are recorded as a liability in the government- wide financial statements, rather than as another financing source. Amounts paid to reduce long-term indebtedness of the City are reported as a reduction of the related liability, rather than as expenditures.
Fund Financial Statements
The underlying accounting system of the City is organized and operated based on separate funds, each of which is 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, 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 how spending activities are controlled.
Fund financial statements for the City are governmental, proprietary, and fiduciary funds and they are presented after the government-wide financial statements. These statements display information about major funds individually and nonmajor funds in the aggregate for governmental and enterprise funds. Fiduciary statements include financial information for fiduciary funds and similar component units. Fiduciary funds of the City primarily represent assets held by the City in a custodial capacity for other individuals or organizations.
Governmental Funds
In the fund financial statements, governmental funds are presented using the modified-accrual basis of accounting. Their revenues are recognized when they become measurable and available as net current assets.
Measurable means that the amounts can be estimated, or otherwise determined. Available means that the amounts were collected during the reporting period or soon enough thereafter to be available to finance the expenditures accrued for the reporting period. The City uses the following revenue availability periods:
Reimbursement-type grants 90 days
All other governmental fund revenues 60 days
The City accrues the following revenue types: taxes, licenses, fines and forfeits, and miscellaneous revenues.
Revenue recognition is subject to the measurable and availability criteria for the governmental funds in the fund financial statements. Exchange transactions are recognized as revenues in the period in which they are earned (i.e., the related goods or services are provided). Locally imposed derived tax revenues are recognized as revenues in the period in which the underlying exchange transaction on 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.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 45 (1) Summary of Significant Accounting Policies (Continued)
(B) Basis of Accounting and Measurement Focus (Continued)
Governmental Funds (Continued)
In the fund financial statements, governmental funds are presented using the current financial resources measurement focus. This means that only current assets and current liabilities are generally included on their balance sheets. The reported fund balance (net current assets) is 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 net current assets. Accordingly, they are said to present a summary of sources and uses of “available spendable resources” during a period.
Noncurrent portions of long-term receivables due to governmental funds are reported on their balance sheets despite their spending measurement focus. Special reporting treatments are used to indicate that they should not be considered “available spendable resources,” since they do not represent net current assets. Recognition of governmental fund type revenues represented by noncurrent receivables are deferred until they become current receivables. Noncurrent portions of other long-term receivables are reflected in nonspendable fund balance.
Because of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by noncurrent liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities.
Amounts expended to acquire capital assets are recorded as expenditures in the year that resources were expended, rather than as fund assets. The proceeds of long-term debt are recorded as other financing source rather than as a fund liability. Amounts paid to reduce long-term indebtedness are reported as fund expenditures.
Proprietary Funds
The City’s enterprise and internal service funds are proprietary funds. In the fund financial statements, proprietary funds are presented using the accrual basis of accounting . Revenues are recognized when they are earned, and expenses are recognized when the related goods or services are delivered. In the fund financial statements, proprietary funds are presented using the economic resources measurement focus. This means that all assets and all liabilities (whether current or noncurrent) associated with their activity are included on their balance sheets. Proprietary funds type operating statements present increases (revenues) and decreases (expenses) in total net position.
Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the Light and Power Fund, Water Fund, Off-Street Parking Facilities Fund, and the City’s internal service funds are charges to customers for sales and services. Operating expenses for the enterprise and internal service funds include the cost of sales and services, administrative expenses, and depreciation/amortization on capital assets.
All revenue and expenses not meeting this definition are reported as nonoperating revenues and expenses.
Amounts paid to acquire capital assets are capitalized as assets in the proprietary fund financial statements, rather than reported as expense. Proceeds of long-term debt are recorded as a liability in the proprietary fund financial statements. Amounts paid to reduce long-term liability of the proprietary funds are reported as a reduction of the related liability.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
46 Annual Comprehensive Financial Report | June 30, 2024 (1) Summary of Significant Accounting Policies (Continued)
(B) Basis of Accounting and Measurement Focus (Continued)
Proprietary Funds (Continued)
When both restricted and unrestricted resources are combined in a fund, expenses are paid first from restricted resources, and then from unrestricted resources.
Fiduciary Funds
The City’s fiduciary funds include employee benefit trust funds, custodial funds, and private-purpose trust funds.
Employee benefit trust funds account for resources required to be held in trust for the members and beneficiaries of benefit and contribution plans. Private-purpose trust funds account for receipt of incremental property tax and payment of enforceable obligations (debts) of the former redevelopment agency.
(C) Major Funds, Internal Service Funds and Fiduciary Fund Types
The City reports the following major governmental funds:
General Fund – The primary fund of the City; accounts for all general revenues of the City not specifically levied or collected for other City funds and for expenditures related to the rendering of general services by the City.
Housing Successor Fund – Accounts for the use of property tax increment legally restricted for increasing or improving housing for low- and moderate-income households effective February 1, 2012.
Project Management Capital Projects Fund – Accounts for all capital improvement projects, except for those involving the utilities, and special assessment districts, where revenues are received from grants by other governments, private parties, and through transfers from other City funds.
General Debt Service Fund – Accounts for the payment of interest and principal of the pension bonds and other city-wide obligations.
The City reports the following major proprietary funds:
Light and Power Fund – Accounts for the operations of the City’s electric utility; a self-supporting activity that renders services on a user-charge basis to residents and businesses as prescribed by the City Charter.
Water Fund – Accounts for the operations of the City’s water utility; a self-supporting activity that renders services on a user-charge basis to residents and businesses as prescribed by the City Charter.
Off-Street Parking Fund – In fiscal year ended 2014, the City combined all the parking funds into the Off- Street Parking Fund. This fund accounts for the operation of the parking facilities throughout the City.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 47 (1) Summary of Significant Accounting Policies (Continued)
(C) Major Funds, Internal Service Funds and Fiduciary Fund Types (Continued)
The City reports the following internal service funds:
Computing and communication services, building maintenance, fleet replacement, fleet repair and maintenance, employee benefits, workers’ compensation, general liability, and the 311 call center provide services to other departments or agencies of the City.
The City reports the following fiduciary fund types:
Pension (and Other Employee Benefit) Trust Funds – The funds account for transactions of the Pasadena Fire and Police Retirement System (FPRS) and the City’s Deferred Compensation Plan.
Custodial Funds – These funds account for resources held by the City in a purely custodial capacity. Custodial funds typically involve only the receipt, temporary investment, and remittance of fiduciary resources to individuals, private organizations, or other governments. The custodial funds account for monies received from agencies and financial activities for: (1) Lake/Washington Special Assessment District, (2) Library equipment, (3) Workforce Innovation and Opportunity Act (WIOA), (4) Open Space Assessment District.
In fiscal year 2023, in its first year, the Pasadena Rental Housing Board was presented as a custodial fund under fiduciary fund types. In fiscal year 2024, the Pasadena Rental Housing Board, the Rent Stabilization Department, is presented as the Rent Stabilization Fund, a special revenue fund. More information is available under Blended Component Units, Pasadena Rental Housing Board.
Private-Purpose Trust Funds – These funds account for monies held on behalf of others in a fiduciary capacity, typically pursuant to a formal trust agreement. The City uses a private purpose trust fund to account for the receipt of incremental property tax and payment of enforceable obligations (debts) of the former redevelopment agency that were approved on the Recognized Obligation Payment Schedule (ROPS) by the California Department of Finance until all enforceable obligations of the prior redevelopment agency have been paid in full and all assets have been liquidated.
(D) Cash Equivalents
For purposes of the statement of cash flows, cash equivalents are defined as short-term, highly liquid investments that are both readily convertible to known amounts of cash or so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Cash equivalents also represent the proprietary funds’ share in the City’s cash and investment pool. Cash equivalents have an original maturity date of three months or less from the date of purchase.
(E) Cash and Investments
Investments are reported in the accompanying financial statements at fair value based on quoted market prices, except for certain certificates of deposits, money market investments that mature within one year of acquisition and investment contracts that are reported at cost because they are not transferable, they have terms that are not affected by changes in market interest rates, and provided that the fair value of those investments is not significantly affected by the impairment of the credit standing of the issuer or by other factors.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
48 Annual Comprehensive Financial Report | June 30, 2024 (1) Summary of Significant Accounting Policies (Continued)
(E) Cash and Investments (Continued)
Both realized and unrealized changes in fair value that occur during a fiscal year are recognized and recorded as net changes in fair value of investments . Investment earnings include net changes in fair value of investments, interest earnings, and all other investment income.
The City pools cash and investments of all funds, except for certain fund specific City held portfolios, deferred compensation assets, and assets held by fiscal agents. Each fund’s share in this pool is displayed in the accompanying financial statements as cash and investments.
Investment income earned by the pooled investments is allocated to the various funds based on each fund’s average cash and investment balance, except for investment earnings associated with the following funds not legally required to receive pooled investment earnings that have been assigned to and recorded as revenue in the General Fund, as provided by the legal provisions of the California Government Code Section §53647: Health, Housing and Community Development, Project Management, Workers’ Compensation, General Liability, Employment and Training, South Lake Business Improvement District and Old Pasadena Business Improvement District.
The City enters into interest rate swap agreements to modify rates on outstanding debts. Other than the net interest expenditures resulting from these agreements, no amounts are recorded in the financial statements.
(F) Inventories
There are three types of inventories: held for consumption in operations, those that are capitalized, and those held for resale. For the Water and Light and Power Fund (enterprise funds), inventories held for consumption are valued at the lower of weighted average cost, while inventories held for resale are reported at the lower of cost or market value.
Inventories held by the Fleet Maintenance internal service fund are carried at average cost. Inventory items are accounted for as an expenditure or expense when consumed or sold.
(G) Advances to Other Funds
Long-term interfund advances are recorded as a receivable and as nonspendable fund balance by the General Fund since they do not reflect current appropriable reserves.
(H) Prepaids
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid assets. The City utilizes the allocation method to record its prepaids. The prepaid assets recorded in the governmental funds do not reflect current appropriable resources and, thus, an equivalent portion of fund balance is nonspendable.
(I) Restricted Cash and Investments
The City considers all cash and investments from bond proceeds in proprietary funds as restricted. The City is legally mandated under bond indentures to use these resources only for the purposes specified. Also included as restricted cash and investments are amounts accumulated in the Light and Power Fund for the purpose of meeting future contractual commitments, including the Stranded Investment Reserve (SIR) Utilization Plan (discussed further in the detailed notes), deferred compensation, and all cash and investments belonging to employee benefit trust and custodial funds held by trustees.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 49 (1) Summary of Significant Accounting Policies (Continued)
(J) Property Held for Resale
Property held for resale represents land, structures, and their related improvements that were acquired for resale. This includes the properties acquired in accordance with the objective of the former Pasadena Community Development Commission (PCDC) project area.
On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 that provides for the dissolution of all redevelopment agencies in California. The bill provides that upon dissolution of a redevelopment agency, either the City or another unit of local government will agree to serve as the “successor agency” to hold the assets until they are distributed to other units of state and local government. The City Council elected to become the Successor Agency on January 30, 2012.
(K) Capital Assets
Capital assets, including infrastructure, greater than $10 are capitalized and recorded at cost or at the estimated fair value of the assets at the time of acquisition where complete historical records have not been maintained.
Contributed capital assets, works of art, and capital assets received in service concession agreements are reported at acquisition value. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized.
Capital assets include public domain (infrastructure) general assets consisting of certain improvements including roads, streets, sidewalks, medians, sewer systems and storm drains.
Capital assets are depreciated or amortized using the straight-line method over the following estimated useful lives:
Production plant 20 to 40 years Source of supply 20 to 50 years Transmission plant 25 to 40 years Pumping plant 10 to 50 years Distribution plant 20 to 40 years Treatment plant 10 to 20 years General plant 10 to 40 years Transmission and distribution plant 10 to 80 years Equipment 4 to 10 years General plant 6 to 50 years Lease assets Equipment 4 to 10 years
Lease assets
Subscription assets
Subscription assets
Buildings and improvements 20 to 50 years
Machinery and equipment 2 to 20 years
Infrastructure 8 to 200 years
Lease assets
Subscription assets
Light and Power Fund Water Fund
Shorter of the useful l i fe of the
underl yi ng a ss et or the l ease term
Shorter of the useful l i fe of the
underl yi ng a ss et or the s ubscri pti on
term
Shorter of the useful l i fe of the
underl yi ng a ss et or the l eas e term
Shorter of the useful l i fe of the
underl yi ng a ss et or the s ubs cri pti on
term
All Other Funds
Shorter of the useful l i fe of the
underl yi ng a ss et or the l ease term
Shorter of the useful l i fe of the
underl yi ng a ss et or the s ubscri pti on
term
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
50 Annual Comprehensive Financial Report | June 30, 2024 (1) Summary of Significant Accounting Policies (Continued)
(L) Leases
Leases are financings of the right to use an underlying asset. In accordance with GASB Statement No. 87, Leases, parties to a lease agreement, the lessee and lessor, are required to recognize a lease liability and an intangible right-to-use lease asset (a capital asset hereinafter referred to as the lease asset), and a lease receivable and deferred inflow of resources, respectively. A general description of the leasing arrangements, the aggregated amounts of resource inflows and outflows recognized from lease contracts, including those not included in the measurement of the lease liability and receivable, and the disclosure of the long-term effect of lease arrangements on a government’s resources are further discussed in the detailed notes.
(M) Subscription-Based Information Technology Agreements (SBITA)
In accordance with GASB Statement No. 96, Subscription-Based Information Technology Agreements (SBITA) , a government should recognize a right-to-use subscription asset—an intangible asset—and a corresponding subscription liability. A government should recognize the subscription liability at the commencement of the subscription term, which is when the subscription asset is placed into service. The subscription liability should be initially measured at the present value of subscription payments expected to be made during the subscription term. Future subscription payments should be discounted using the interest rate the SBITA vendor charges the government, which may be implicit, or the government’s incremental borrowing rate if the interest rate is not readily determinable. A government should recognize amortization of the discount on the subscription liability as an outflow of resources (for example, interest expense) in subsequent financial reporting periods.
(N) Insurance Claims Payable
Insurance claims payable are claims and judgments recognized when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated, net of insurance coverage. Such claims, including an estimate for claims incurred but not reported at year end, are recorded as liabilities in the workers’ compensation and general liability internal service funds. The City records a liability for material litigation, judgments, and claims on a case-by-case basis when it is probable a material liability has been incurred on or before June 30, and the probable amount of loss can be reasonably estimated. Detailed notes discuss excess liability insurance covers claims greater than the self-insurance thresholds .
(O) Compensated Absences
The City accounts for compensated absences including accumulated vacation, floating holidays, and compensatory time-off, and certain sick leave in the Benefits internal service fund. Management time off is recorded under departmental expense as incurred. Upon separation, employees are paid for all their unused vacation leave, floating holidays, management time off, and compensatory time-off subject to maximums described below.
Eligible employees accumulate 3 to 22 days of vacation each year, depending on the employee’s bargaining unit and length of service, but may not carry over from one year to the next more than the equivalent of two to three (depends on Memorandum of Understanding or Salary Resolution) year’s vacation without prior approval of the respective department head and/or City Manager.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 51 (1) Summary of Significant Accounting Policies (Continued)
(O) Compensated Absences (Continued)
A liability is recorded for unused vacation and similar compensatory leave balances since the employees' entitlement to these balances is attributable to services already rendered and it is probable that virtually all these balances will be liquidated by either paid time-off or payments upon termination or retirement. The City does not accrue for unused holiday and management time off.
Compensated absences are primarily liquidated by the General Fund, Light and Power Fund, and Water Fund.
Sick pay benefits only accumulate; they can be converted at retirement from the City for PERS Service Credit.
Consistent with this policy, the City does not accrue sick pay benefits. The total outstanding vacation, compensatory time-off obligations are accrued at fiscal year-end and included under Compensated Absences in the Benefits internal service fund as a current liability.
(P) Net Pension Liability
Pension is a retirement plan the City provides to retired employees. Pension liabilities are primarily liquidated by the General Fund, Light and Power Fund, and Water Fund. For purposes of measuring the net pension liability, deferred outflows and inflows of resources related to pensions, and pension expense, information about the fiduciary net position and additions to/deductions from the fiduciary net position have been determined on the same basis as they are reported by the CalPERS Financial Office and are in accordance with the implementation of GASB Statement No. 68, Accounting and Financial Reporting for Pensions . Investments are reported at fair value. CalPERS audited financial statements are publicly available reports that can be obtained at CalPERS’ website, www.calpers.ca.gov, under Forms and Publications.
(Q) Other Postemployment Benefits (OPEB)
OPEB are benefits (other than pensions) the City provides to retired employees. OPEB liabilities are primarily liquidated by the General Fund, Light and Power Fund, and Water Fund. For purpose of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the City’s OPEB plan, and additions to/deductions from the OPEB Plan’s fiduciary net position have been determined by an independent actuary and are in accordance with the implementation of GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions . For this purpose, benefit payments are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value.
(R) Bond Premiums / Discounts / Issuance Costs
For governmental-wide and proprietary funds financial statements, issuance costs are recognized during the current period. Any bond premiums and discounts are capitalized and amortized over the life of the bonds. Bond proceeds, premiums and discounts are reported as other financing sources in the governmental fund financial statements.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
52 Annual Comprehensive Financial Report | June 30, 2024 (1) Summary of Significant Accounting Policies (Continued)
(S) Deferred Outflows and Inflows of Resources
Pursuant to GASB Statements No. 63 and 65, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position and Items Previously Reported as Assets and Liabilities , respectively, the City recognizes deferred outflows and inflows of resources. A deferred outflow of resources is defined as a consumption of net assets by the government that is applicable to a future reporting period. A deferred inflow of resources is defined as an acquisition of net assets by the government that is applicable to a future reporting period. The City has four items that qualify for reporting in this category: deferred amounts for bond refunding, pensions, OPEB, and leases.
(T) Fund Balance
In the fund financial statements, governmental fund balance is made up of the following components:
Nonspendable fund balance is the portion of fund balance that cannot be spent due to form. Examples include inventories, prepaid amounts, long-term loans, notes receivable, and property held for resale, unless the proceeds are restricted, committed or assigned. Also, amounts that must be maintained intact legally or contractually, such as the principal of a permanent fund are reported within the nonspendable category.
Restricted fund balance is the portion of fund balance that is subject to externally enforceable limitations by law, enabling legislation or limitations imposed by creditors or grantors.
Committed fund balance is the portion of fund balance that is subject to self-imposed constraints due to City Council resolutions, as they have the highest level of decision-making authority.
Assigned fund balance is the portion of fund balance that is constrained by the City’s intent to utilize fund balance for a specific purpose. The authority to assign fund balance has been delegated by the City Council to the Finance Director through the Fund Balance Policy.
Unassigned fund balance is the residual classification for the General Fund. This classification represents fund balance that has not been assigned to other funds and that has not been restricted, committed, or assigned to specific purposes within the General Fund. The General Fund should be the only fund that reports a positive unassigned fund balance amount. In a governmental fund other than the General Fund, expenditures incurred for a specific purpose might exceed the amounts in the fund that are restricted, committed, and assigned to that purpose and a negative residual balance for that purpose may result.
The accounting policies of the City consider restricted fund balance to have been spent first when expenditures are incurred for purposes for which both the restricted and unrestricted fund balance is available. Similarly, when expenditures are incurred for purposes for which amounts in any of the unrestricted classifications of fund balance could be used, the City considers committed amounts to be reduced first, followed by assigned and then unassigned amounts.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 53 (1) Summary of Significant Accounting Policies (Continued)
(T) Fund Balance (Continued)
In June 2017, the City Council directed staff to revise the Fund Balance Policy to split the General Fund Emergency Contingency into two components of committed fund balance: the General Fund Emergency Contingency Reserve and a General Fund Operating Reserve. The goal of a 20 percent General Fund reserve as committed fund balance continues but is split 15 percent to the Emergency Contingency Reserve and 5 percent to the Operating Reserve. These percentages continue to be calculated using that year’s General Fund budgeted appropriations. It is intended that these committed fund balances would not be reduced below a 20 percent level without the direction of Council or upon a declared local emergency.
(U) Property Taxes
The assessment, levy and collection of property taxes are the responsibility of the County of Los Angeles. The City records property taxes as revenue when received from the County, except at year-end, when property taxes received within 60 days are accrued as revenue.
Property taxes are assessed and collected each fiscal year according to the following property tax calendar:
Lien January 1
Levy July 1 to June 30
Due November 1 - 1s t ins ta llment
February 1 - 2nd ins ta llment
Col lection December 10 - 1s t ins ta llment
April 10 - 2nd ins ta llment
Property taxes on the secured roll are due in two installments: on November 1 and February 1 of the fiscal year.
If unpaid, such taxes become delinquent on December 10 and April 10, respectively, and a 10% penalty attaches to any delinquent payment. Such delinquent property may thereafter be redeemed by payment of the delinquent taxes and the delinquent penalty, plus a redemption penalty of 1% per month to the time of redemption. If taxes are unpaid for a period of five years or more, the property is then subject to sale by the County Tax Collector.
Property taxes on the unsecured roll are due as of the January 1 lien date and become delinquent, if unpaid, on August 31. A 10% penalty attaches to delinquent taxes on property of the unsecured roll, and an additional penalty of 1% per month begins to accrue. Collection of delinquent unsecured taxes is the responsibility of the County of Los Angeles using the several means legally available.
(V) Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenditures. The City has made certain estimates and assumptions relating to the revenues due and expenditures incurred through fiscal year-end, collectability of its receivables, the valuation of property held for resale, the useful lives of the capital assets, the ultimate outcome of claims and judgments, and the valuation of pension and other postemployment benefit plan liabilities and related deferred outflows and inflows of resources. Actual results may differ from those estimates and assumptions.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
54 Annual Comprehensive Financial Report | June 30, 2024 (1) Summary of Significant Accounting Policies (Continued)
(W) Interfund Activities
Certain eliminations have been made as prescribed by GASB Statement No. 34, Basic Financial Statements – and Management’s Discussion and Analysis – for State and Local Governments , regarding interfund activities, payables, and receivables. All internal balances in the Statement of Net Position have been eliminated except those representing balances between the governmental activities and the business-type activities, which are presented as internal balances and eliminated in the total government column. In the statement of activities, internal services funds transactions have been eliminated. However, transactions between governmental and business-type activities have not been eliminated.
(X) Endowments
The City has been the recipient of endowments that are recorded in permanent funds. The endowments are legally restricted to the extent that only earnings, and not principal, may be used for purposes that support the City’s programs or specific restrictions that were placed on the endowment when the donation to the City was made.
(Y) New and Future Accounting Pronouncements
The following Government Accounting Standards Board (GASB) pronouncement was effective for the fiscal year ended June 30, 2024:
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.
GASB has issued the following pronouncements that may affect future financial position, results of operations, cash flows, or financial presentation of the City upon implementation. Management has not yet evaluated the effect of implementation of these standards:
GASB Statement
No. GASB Accounting Standard Effective Fiscal Year
101 Compensated Absences 2025
102 Certain Risk Disclosures 2025
103 Financial Reporting Model Improvements 2026
104 Disclosure of Certain Capital Assets 2026
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 55 (2) Cash and Investments
Primary Government (excluding the FPRS Employee Benefit Trust Fund’s Short-term investments and Investments, at fair value):
Cash and investments as of June 30, 2024 are classified in the accompanying financial statements as follows:
Statement of net position:
Cash and investments 715,203$
Restricted cash and investments 87,340
Fiduciary funds:
Cash and cash equivalents 391,020
Total cash and investments 1,193,563$
Cash on hand 61$ Deposits with financial institutions (2,429) Investments 1,195,931 Total cash and investments 1,193,563$ Cash and investments as of June 30, 2024 consist of the following:
Investments Authorized by the California Government Code and the City’s Investment Policy
The table below identifies the investment types that are authorized for the City by the California Government Code and the City’s investment policy. The table also identifies certain provisions of the California Government Code (or the City’s investment policy, if more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City’s investment policy.
Authorized by * Maximum * Maximum
Investment Types Investment * Maximum Percentage Investment Authorized by State Law Policy Maturity of Portfolio in One Issuer Local Agency Bonds Yes 5 years None None
US Treasury Obligations Yes 5 years None None
US Agency Securities Yes 5 years None None
Banker's Acceptance Yes 180 days 40% 30%
Commercial Paper Yes 270 days 15% 10%
Negotiable Certificates of Deposit Yes 5 years 30% None Repurchase Agreement Yes 1 year None None
Reverse Repurchase Agreements Yes 92 days 20% of base value None Time Deposits Yes N/A 25% None
Medium Term Notes Yes 5 years 30% 5%
Mutual Funds Yes N/A 20% 10%
Money Market Mutual Funds Yes N/A 20% 10%
Mortgage Pass-Through Securities Yes 5 years 20% None
Corporate Bonds Yes 5 years 20% 10%
County Pooled Investment Fund Yes N/A None None
Local Agency Investment Fund (LAIF) Yes N/A None None
JPA Pools (other investment pools) Yes N/A None None
Registered State Warrants Yes N/A None None
* Based on state law requirements or investment policy requirements, whichever is more restrictive.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
56 Annual Comprehensive Financial Report | June 30, 2024 (2) Cash and Investments (Continued)
Investments Authorized by Debt Agreements
Investment of debt proceeds held by bond trustee are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City’s investment policy. The table below identifies the investment types that are authorized for investments held by bond trustee. The table also identifies certain provisions of these debt agreements that address interest rate risk, credit risk, and concentration of credit risk.
Maximum
Authorized Inves tment Type Maturity
US Treas ury Obli gati ons None
US Agency Securities None
Banker's Acceptance 360 days
Commercial Paper 270 days
Money Market Mutual Funds N/A
Inves tment Contracts 20-30 yea rs
Pre-refunded Muni ci pa l Bonds None
Repurcha se Agreements 1 year
Local Agency Inves tment Fund (LAIF) N/A
General Obli gati on Bonds None
Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment.
Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations.
Information about the sensitivity of the fair values of the City’s investments (including investments held by bond trustee) to market interest rate fluctuations is provided by the following table that shows the distribution of the City’s investments by maturity:
12 Months 13 to 24 25 to 60 More than
Investment Type Total or Less Months Months 60 Months
Corporate Bonds 83,916$ 14,198$ 29,778$ 39,940$ -$ Supernationals 33,722 14,471 4,414 14,837 - Federal Agency Securities 426,193 116,945 160,779 131,459 17,010 Municipal Bonds 41,170 14,471 7,875 15,665 3,159 Certificate of Deposit 1,223 - 1,223 - California Asset Management Program 102,464 102,464 - - - Money Market Funds 1 1 - - - Commercial Paper Disc 29,107 29,107 - - - State Investment Pool 1,347 1,347 - - - US Treasury 62,528 48,885 9,508 4,135 - Held by Bond Trustee:
Federal Agency Securities 11,990 - - 5,291 6,699 Money Market Funds 1,369 1,369 - - - Held by Pension Section 115 Trustee:
Mutual Fund 13,206 13,206 - - - Deferred Compensation Plan:
Mutual Funds 387,695 387,695 - - - Total 1,195,931$ 744,159$ 213,577$ 211,327$ 26,868$ Remaining Maturity (in Months)
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 57 (2) Cash and Investments (Continued)
Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization.
Presented below is the minimum rating required by (where applicable) the California Government Code, the City’s investment policy, or debt agreements, and the actual rating as of year-end for each investment type.
Minimum
Legal Not
Investment Type Total Rating AAA Aa A Rated Exempt
Corporate Bonds 83,916$ A 17,597$ 5,341$ 60,978$ -$ -$ Supernationals 33,722 A 33,722 - - - - Federal Agency Securities 426,193 N/A - - - - 426,193 Municipal Bond 41,170 N/A 6,268 34,902 - - - Certificate of Deposit 1,223 A - - - 1,223 - California Asset Management Program 102,464 N/A - - - 102,464 - Money Market Funds 1 N/A - - - 1 - Commercial Paper Disc 29,107 AA 24,483 - 4,624 - - State Investment Pool 1,347 N/A - - - 1,347 - US Treasury 62,528 N/A - - - - 62,528 Held by Bond Trustee:
Federal Agency Securities 11,990 A - - - - 11,990 Money Market Funds 1,369 A 1,369 - - - - Held by Pension Section 115 Trustee:
Mutual Fund 13,206 N/A - 13,206 - - - Deferred Compensation Plan:
Mutual Fund 387,695 N/A - 387,695 - - - Total 1,195,931$ 83,439$ 441,144$ 65,602$ 105,035$ 500,711$ Rating as of Year-End
Concentration of Credit Risk
The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code. Investments in any one issuer (other than U.S. Treasury securities, mutual funds, and external investment pools) that represent 5% or more of total City investments are as follows:
Inves tment Reported
Iss uer Type Amount
Federal Home Loan Ba nk Federa l Agency Securiti es 177,232$ Federal Home Loan Mortgage Ba nk Federa l Agency Securiti es 150,860 Federal Farm Credit Bank Federa l Agency Securiti es 56,770 U.S. Treasury U.S. Treas ury 58,946
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 custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the City’s investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits: The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The market value of the pledged securities in the collateral pool must equal at least 110% of the
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
58 Annual Comprehensive Financial Report | June 30, 2024 (2) Cash and Investments (Continued)
Disclosures Relating to Credit Risk (Continued)
total amount deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.
The City has no uncollateralized cash at June 30, 2024. As of June 30, 2024, the City’s deposits with financial institutions in excess of federal depository insurance limits were $59,900 held in accounts collateralized in accordance with California law described above.
For investments identified herein as held by bond trustee, the bond trustee selects the investment under the terms of the applicable trust agreement, acquires the investment, and holds the investment on behalf of the reporting government.
California Asset Management Program CAMP
CAMP is a program created through a joint powers agency as a pooled short-term portfolio and cash management vehicle for California public agencies under California Government Code Section 53601(p). CAMP is governed by a seven-member Board of Trustees comprised of finance directors and treasurers of California public agencies. The total amount invested by all public agencies in CAMP was $20,400,000 as of June 30, 2024, respectively. Of the amount invested in CAMP, 35.8 percent were invested in medium-term and short-term notes and asset-backed securities at June 30, 2024. The average maturity of CAMP investments was 28 days to 52 days as of such dates.
Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by the California Government Code 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 (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis.
Fair Value Hierarchy
The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset or liability. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are quoted prices in active markets for similar assets. Level 3 inputs are significant unobservable inputs.
The City is a participant in the California Asset Management Program (CAMP). CAMP is an investment pool offered by the California Asset Management Trust (the Trust). The Trust is a joint powers authority and public agency created by the Declaration of Trust and establish under the provisions of the California Joint Exercise of Powers Act (California Government Code Sections 6500 et seq., or the “ACT”) for the purpose of exercising the common power of its Participants to invest certain proceeds of debt issues and surplus funds. CAMP’s investments are limited to investments permitted by subdivisions (a) to (n), inclusive, of Section 53601 of the California Government Code. The City reports its investments in CAMP at the fair value amounts provided by CAMP, which is the same as the value of the pool share in accordance with GASP 79 requirements. On June 30, 2024, the CAMP pool had an average maturity of 26 days and it exempt from the fair value hierarchy.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 59 (2) Cash and Investments (Continued)
The City has the following recurring fair value measurements as of June 30, 2024:
Meas ure by Fai r Val ue
Not Subject to Fai r
Value Hiera rchy 1 2 3 Total
Corporate Bonds -$ -$ 83,916$ -$ 83,916$ Supernational s - - 33,722 - 33,722 Federal Agency Securi ties - - 426,193 - 426,193 Munici pa l Bond - - 41,170 - 41,170 Certi ficate of Deposit 1,223 1,223 California As set Ma nagement Program 102,464 - - - 102,464 Money Market Funds 1 - - - 1 Commercial Paper Di s c - - 29,107 - 29,107 State Investment Pool 1,347 - - - 1,347 US Treas ury - - 62,528 - 62,528 Hel d by Bond Trus tee:
Federal Agency Securi ties - - 11,990 - 11,990 Money Market Funds 1,369 - - - 1,369 Hel d by OPEB Trustee:
Mutua l Fund - - - - - Hel d by Pens ion Section 115 Trustee:
Mutua l Fund - - 13,206 - 13,206 Deferred Compensati on Pl an:
Mutua l Fund - - 387,695 - 387,695 Total 106,404$ -$ 1,089,527$ -$ 1,195,931$ Level
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
60 Annual Comprehensive Financial Report | June 30, 2024 (3) Accounts Receivable
As of June 30, 2024, accounts receivable is categorized as follows:
Capital Nonmajor Internal
Project Housing Governmental Service
General Management Successor Funds Funds Total
Governmental Activities:
Accounts receivable 4,468$ 4,582$ -$ 9,658$ 167$ 18,875$ Accrued revenue
receivable 28,218 6 - 6,563 3,539 38,326 Interest receivable 680 - 10 884 111 1,685 Paramedics receivable 5,769 - - - - 5,769 Utility receivable 1,929 - - 696 - 2,625 41,064 4,588 10 17,801 3,817 67,281 Less: allowance for
uncollectible amounts (3,145) - - (93) - (3,238) Total 37,919$ 4,588$ 10$ 17,708$ 3,817$ 64,043$ Nonmajor
Light and Off-Street Enterprise
Power Water Parking Funds Total
Business-type Activities:
Accounts receivable 188$ 197$ 118$ 53$ 556$ Accrued revenue
receivable 20,661 6,609 457 1,629 29,355 Interest receivable 1,418 342 51 103 1,915 Paramedics receivable - - - - - Utility receivable 15,026 4,256 - 1,173 20,455 37,294 11,405 626 2,957 52,282 Less: allowance for
uncollectible amounts (2,145) (646) - (266) (3,057) Total 35,149$ 10,759$ 626$ 2,691$ 49,225$
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 61 (4) Notes Receivable – Primary Government
The notes receivable in the governmental activities amounted to $110,657 at June 30, 2024. Due to the uncertainty of their collectability at June 30, 2024, the City has recorded an allowance for uncollectible long-term receivables of $97,152, resulting in a net balance of $13,505.
Housing and Community Development loans were $65,169 which arose from the sale of land to project developers and other agencies, and the provision of loan assistance under the City’s affordable housing programs, subject to approved redevelopment plans. $27,138 consisted of loans that the former redevelopment agency made to assist the development of affordable rental housing projects and the purchase of homes by homebuyers. These loans are secured by trust deeds and were funded with redevelopment low-moderate income housing set-aside funds. These notes have various terms, including maturities ranging from 5 to 45 years and interest rates ranging from 1.5% to 11%.
The remaining balance notes receivable balance, $18,350, is related to the sale of the Concord property located at 275 Cordova St for which collection efforts are underway in the next 50 years. See additional note disclosure in Subsequent Events.
In January 2009, Light and Power utilized $80,000 of Reserves for Stranded Investment and in return received Subordinated Notes totaled $70,000 from Intermountain Power Agency (IPA) to defease some of IPA’s outstanding debt service requirement for Intermountain Power Project (IPP) bonds. These notes have various maturity dates, and the proceeds, when mature, will be used to stabilize future energy costs. As of June 30, 2024, the full amount of a previously outstanding notes has been collected, resulting in no further remaining balance in the notes receivable.
(5) Due to and from Other Funds
Current interfund receivable and payable balances at June 30, 2024 are as follows:
Due from Other Funds
Due to Other Funds General Fund
Nonmajor Governmental Funds 11,431$
Internal Service Funds 26,890
Total 38,321$
The above balances are due to short-term payables between funds and negative cash balances at the end of the fiscal year.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
62 Annual Comprehensive Financial Report | June 30, 2024 (6) Capital Assets
Primary Government
Capital asset activity for the year ended June 30, 2024 is as follows:
Balance at Balance at
Governmental Activities: June 30, 2023 Additions Deletions Transfers June 30, 2024 Capital assets, not being
depreciated/amortized:
Land 87,525$ 15,497$ -$ 1,000$ 104,022$ Construction in progress 54,109 32,211 (1,622) (5,384) 79,314 Total capital assets, not being
depreciated/amortized 141,634 47,708 (1,622) (4,384) 183,336 Capital assets being
depreciated/amortized:
Buildings and improvements 307,723 953 (642) 297 308,331 Lease asset - buildings 4,384 339 (269) - 4,454 Machinery and equipment 94,822 6,684 (2,645) 1,206 100,067 Lease asset - equipment 1,146 382 (50) - 1,478 Subscription assets 9,290 2,433 (194) - 11,529 Infrastructure 340,043 - - 2,881 342,924 Total capital assets, being
depreciated/amortized 757,408 10,791 (3,800) 4,384 768,783 Less accumulated depreciation/amortization:
Buildings and improvements (159,724) (5,554) 613 - (164,665) Lease asset - buildings (1,480) (1,024) - - (2,504) Machinery and equipment (58,607) (7,121) 2,396 - (63,332) Lease asset - buildings (543) (360) 25 - (878) Subscription assets (1,693) (3,122) 107 - (4,708) Infrastructure (133,611) (7,214) - - (140,825) Total accumulated
depreciation/amortization (355,658) (24,395) 3,141 - (376,913) Total capital assets, being
depreciated/amortized, net 401,750 (13,604) (659) 4,384 391,870 Govermental activites
capital assets, net 543,384$ 34,104$ (2,281)$ -$ 575,206$
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 63 (6) Capital Assets (Continued)
During the year, governmental activities received proceeds of $4 from the disposal of capital assets and incurred a net loss on disposal of $279.
Depreciation/amortization expense was charged in the following functions and activities in the statement of activities:
Community development 518$
Culture and leisure 1,955
General government 8,558
Health 208
Public safety 3,089
Transportation 10,067
Total 24,395$
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
64 Annual Comprehensive Financial Report | June 30, 2024 (6) Capital Assets (Continued)
Balance at Balance at
Business type Activities: June 30, 2023 Adjustments (1) Additions Deletions Transfers June 30, 2024 Capital assets not being
depreciated/amortized:
Land and rights 14,686$ 2,881$ -$ (226)$ -$ 17,341$ Construction in progress 74,565 - 55,475 - (49,411) 80,629 Total capital assets, not being
depreciated/amortized 89,251 2,881 55,475 (226) (49,411) 97,970 Capital assets being
depreciated/amortized:
Buildings and improvements 139,819 - - (2,441) 3,806 141,184 Lease asset - buildings 4,952 - 5,643 - - 10,595 Utility lines, machinery and
equipment 1,293,380 - 1,454 (798) 45,605 1,339,641 Lease asset - equipment 35 - 7 - - 42 Subscription assets 6,824 - 599 (2,397) - 5,026 Total capital assets, being
depreciated/amortized 1,445,010 - 7,703 (5,636) 49,411 1,496,488 Less accumulated
depreciation/amortization:
Buildings and improvements (71,157) - (3,882) 2,385 - (72,654) Lease asset - buildings (2,767) - (1,382) - - (4,149) Utility lines, machinery and
equipment (633,475) - (45,479) 791 - (678,163) Lease asset - equipment (17) - (13) - - (30) Subscription assets (1,586) - (1,448) 1,306 - (1,728) Total accumulated
depreciation/amortization (709,002) - (52,204) 4,482 - (756,724) Total capital assets, being
depreciated/amortized, net 736,008 - (44,501) (1,154) 49,411 739,764 Business-type Activites
capital assets, net 825,259$ 2,881$ 10,974$ (1,380)$ -$ 837,734$
(1) Adjustment is related to Raymond Basin Area water right. Additional information is available in Note 23 of this report.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 65 (6) Capital Assets (Continued)
Primary Government (Continued)
During the year, business-type activities received proceeds of $20 from the disposal of capital assets and incurred a loss on disposal of $289.
Depreciation/amortization expense was charged in the following functions in the statement of activities:
Electric 38,842$
Water 10,318
Refuse 980
Parking 1,886
Telecommunication 178
Total 52,204$
Fiduciary Funds – Private-Purpose Trust Fund
Balance at Balance at
Fiduciary Funds June 30, 2023 Additions Deletions June 30, 2024 Capital assets not depreciated:
Land 214$ -$ (110)$ 104$ Total cost of nondepreciable assets 214 - (110) 104 Capital assets, net 214$ -$ (110)$ 104$
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
66 Annual Comprehensive Financial Report | June 30, 2024 (7) Leases
A lease is defined as a contractual agreement that conveys control of the right to use another entity’s nonfinancial asset, for a minimum contractual period of greater than one year, in an exchange-like transaction.
City as Lessor
The City is a lessor of land and building nonfinancial assets. 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.
The following are key estimates and judgments how the City determines the discount rate on the expected lease receipts to present value, lease term, and lease receipts:
The City uses its estimated incremental borrowing rate as the discount rate for leases The lease term includes the noncancellable period of the lease. Lease receipts included in the measurement of the lease receivable is composed of fixed payments from the lessee.
As lessor, the City has 14 applicable leases that qualify for reporting as of June 30, 2024. During the fiscal year, the City entered into 2 lease agreements. The lease terms range from 36 to 120 months for the intangible right-to-use land, land improvements, buildings, and infrastructure, respectively. Most of these leases include periodic adjustments to the lease amounts at determined intervals. The fixed annualized lease payments range from $1 to $494, respectively, with the incremental borrowing rate ranging from 0.28% to 2.6%. For the year ended June 30, 2024, the City received an immaterial amount of variable and other payments from these lease arrangements.
The City monitors changes in circumstances that would require a remeasurement of its leases and will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable.
Changes in lease receivable for the year ended June 30, 2024 are as follows:
Balance at Balance at
June 30, 2023 Additions Deletions June 30, 2024
Governmental Activities:
Lease receivable 1,719$ -$ (759) $ 960$ Deferred inflow of resources 1,641 - (742) 899 Business-type Activities:
Lease receivable 1,183 392 (480) 1,095 Deferred inflow of resources 1,174 392 (455) 1,111
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 67 (7) Leases (Continued)
City as Lessor (Continued)
During the year ended June 30, 2024, the City recognized the lease revenues and interest revenues as follows:
Governmental Business-type
Activities Activities
Amortization of deferred inflow of resources 742$ 456$ Short-term rental revenues 5,094 -
Total lease revenues 5,836$ 456$
Lease interest revenues 5$ 7$
City as Lessee
The City is a lessee of nonfinancial assets such as land, buildings, and equipment. The City recognizes a lease liability and intangible right-to-use lease assets in the government-wide financial statements. The City recognizes lease liabilities with an initial, individual value of $10 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, which is the shorter of the lease asset’s useful life for the lease term.
The following are key estimates and judgements on how the City determines its discount rate on the expected lease payments to present value, lease term, and lease payments:
The City uses its estimated incremental borrowing rate as the discount rate for leases. The lease term includes the noncancellable period of the lease. Lease payments included in the measurement of the lease liability are composed of fixed payment and purchase option price that the City is reasonably certain to exercise.
As lessee, the City has 24 applicable leases that qualify for reporting as of June 30, 2024. During the fiscal year, the City entered into 3 lease agreements. The lease terms range from 24 to 100 months for the intangible right-to-use buildings and equipment. Most of these leases include periodic adjustments to the lease amounts at determined intervals. The fixed annualized lease payments range from $1 to $929 with the incremental borrowing rate ranging from 0.2% to 3.31%. For the year ended June 30, 2024 the City paid an immaterial amount of variable and other payments from these lease arrangements.
The City monitors changes in circumstances that would require a remeasurement of its leases and will remeasure the lease asset and liability if certain changes occur that are expected to significantly affect the amount of the lease liability.
Lease assets are reported with capital assets (see Note 6).
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
68 Annual Comprehensive Financial Report | June 30, 2024 (7) Leases (Continued)
City as Lessee (Continued)
Changes in lease assets and lease liability for the year ended June 30, 2024 are as follows:
Balance at Balance at
June 30, 2023 Additions Deletions June 30, 2024
Governmental Activities:
Lease assets
Buildings 4,384$ 339$ (269)$ 4,454$ Equipment 1,146 382 (50) 1,478 Total lease assets 5,530 721 (319) 5,932 Accumulated amortization (2,023) (1,384) 25 (3,382) Total lease assets, net 3,507$ (663)$ (294)$ 2,550$ Lease liability 3,641$ 721$ (1,646)$ 2,716$ Business-type Activities:
Lease assets
Buildings 4,952$ 5,643$ -$ 10,595$ Equipment 35 7 - 42 Total lease assets 4,987 5,650 - 10,637 Accumulated amortization (2,784) (1,395) - (4,179) Total lease assets, net 2,203$ 4,255$ -$ 6,458$ Lease liability 2,426$ 5,651$ (1,352)$ 6,725$
During the year ended June 30, 2024, the City recognized lease amortization expenses and interest expenses as follows:
Governmental Business-type
Activities Activities
Amortization of lease assets 1,384$ 1,395$ Other lease (non-GASB 87) expenses 971 476 Total lease expenses 2,355$ 1,871$
Lease interest expenses 36$ 52$
Other lease (non-GASB 87) interest expenses 62 36 Total lease interest expenses 98$ 88$
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 69 (7) Leases (Continued)
City as Lessee (Continued)
As of June 30, 2024, the City had minimum principal and interest payment requirements for its leasing activities with a remaining term in excess of one year, as follows:
Lease Payable Principal and Interest Requirements to Maturity Fiscal Year Principal Interest Total Payments
2025 944$ 25$ 969$
2026 590 17 607
2027 541 11 552
2028 424 5 429
2029 217 1 218
Total 2,716$ 59$ 2,775$
Fiscal Year Principal Interest Total Payments
2025 1,339$ 62$ 1,401$
2026 1,378 49 1,427
2027 1,425 35 1,460
2028 1,139 22 1,160
2029 1,012 11 1,023
2030 432 1 433
Total 6,725$ 180$ 6,904$
Governmental Activities
Business-type Activities
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
70 Annual Comprehensive Financial Report | June 30, 2024 (8) Subscription-Based Information Technology Arrangements
A Subscription-Based Information Technology Arrangement (SBITA) is defined as a contract that conveys control of the right to use another party’s (a SBITA vendor’s) information technology (IT) software, alone or in combination with tangible capital assets (the underlying IT assets), as specified in the contract for a period of greater than one year in an exchange or exchange-like transaction.
The City recognizes a SBITA liability and an intangible right-to-use asset in the government-wide financial statements.
The City recognizes SBITA liabilities with an initial, individual value of $10 or more.
Key estimate and judgements related to SBITA include how the City determines (1) the discount rate it uses to discount the expected SBITA payments to present value, (2) SBITA term, and (3) SBITA payments.
The City uses its estimated incremental borrowing rate as the discount rate for SBITA. The SBITA term includes the noncancellable period and periods covered by an option to extend if it is reasonably certain that the government or SBITA vendor will exercise that option.
The City monitors changes in circumstances that would require a remeasurement of its SBITA and will remeasure the SBITA asset and liability if certain changes occur that are expected to significantly affect the amount of the SBITA liability.
SBITA assets are reported with the other capital assets and SBITA liabilities are reported with long-term debt on the statement of net position.
On June 30, 2024, the City has sixty-six (66) qualifying SBITAs under GASB 96. The SBITAs include a range of options to extend the SBITA term for a period of one to eight years with the final extension period ending June 30, 2030.
The City is required to make annual principal and interest payments that range from $0 to $690. The City is utilizing a range of incremental borrowing rates between 0.00-4.0% The total combined value of the subscription liability is $8,311 and the total combined value of the short- term subscription liability is $2,718.
The combined value of the right to use asset, as of June 30, 2024 is $16,555 with accumulated amortization of $6,435.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 71 (8) Subscription-Based Information Technology Arrangements (Continued)
The right-to-use SBITA asset and SBITA liability for the year ended June 30, 2024, are as follows:
Balance at
June 30, 2023 Additions Deletions
Balance at
June 30, 2024
Governmental Activities
Subscription Assets 9,290$ 2,433$ (194)$ 11,529$ Accumulated amortization (1,692) (3,122) 107 (4,708) Total subscription assets, net 7,598$ (689)$ (87)$ 6,821$ Subscription liability 5,819$ 2,337$ (2,847)$ 5,309$ Business-type Activities
Subscription Assets 6,824$ 599$ (2,397)$ 5,026$ Accumulated amortization (1,586) (1,448) 1,306 (1,728) Total subscription assets, net 5,239$ (850)$ (1,090)$ 3,299$ Subscription liability 4,771$ 457$ (2,225)$ 3,002$
SBITA principal and interest payments to maturity are as follows:
Fiscal Year Principal Interest Total Payments
2025 1,920$ 143$ 2,063$ 2026 1,744 91 1,835 2027 1,001 40 1,041 2028 528 15 543 2029 73 2 75 2030 43 1 44 Total 5,309$ 292$ 5,601$ Fiscal Year Principal Interest Total Payments
2025 798$ 75$ 874$ 2026 764 55 819 2027 758 35 793 2028 468 17 485 2029 177 6 183 2030 37 1 38 Total 3,002$ 189$ 3,192$ Governmental Activities
Business-type Activities
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
72 Annual Comprehensive Financial Report | June 30, 2024 (9) Deferred Inflows and Outflows
Primary Government
Deferred Outflows on the Government-wide Statement of Net Position consists of the following at June 30, 2024:
Govermental Activities: Balance at Balance at
June 30, 2023 Increase Decrease June 30, 2024 0
2015A Refunding COP Deferred Charges 3,598$ -$ (246)$ 3,352$ 2020A Refunding POB Deferred Charges 11,244 - (515) 10,729 2020B Refunding POB Deferred Charges 5,217 - (353) 4,864 GASB 68 Contribution Subsequent to Measurement Date 58,726 63,143 (58,726) 63,143 GASB 68 Net Difference on Pension Plan Investments 64,621 61,249 (64,621) 61,249 GASB 68 Change of Assumptions 36,010 23,661 (36,010) 23,661 GASB 68 Difference in Experience 1,725 14,237 (1,725) 14,237 GASB 75 Net Difference on Pension Plan Investments 147 53 (147) 53 GASB 75 Change of Assumptions 5,329 6,125 (5,329) 6,125 GASB 75 Difference in Experience 556 486 (556) 486 FPRS Net Difference on Pension Plan Investments 5,594 3,082 (5,594) 3,082 192,767$ 172,036$ (173,822)$ 190,981$
Business-type Activities: Balance at Balance at
June 30, 2023 Increase Decrease June 30, 2024
2008 Electric Bonds Deferred Charges 749$ -$ (54)$ 695$ GASB 68 Contribution Subsequent to Measurement Date 11,843 12,917 (11,843) 12,917 GASB 68 Net Difference on Pension Plan Investments 13,342 13,010 (13,342) 13,010 GASB 68 Change of Assumptions 6,812 4,067 (6,812) 4,067 GASB 68 Difference in Experience - 1,444 - 1,444 GASB 75 Net Difference on Pension Plan Investments 38 13 (38) 13 GASB 75 Change of Assumptions 1,375 1,584 (1,375) 1,584 GASB 75 Difference in Experience 142 126 (142) 126 34,301$ 33,161$ (33,606)$ 33,856$
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 73 (9) Deferred Inflows and Outflows (Continued)
Primary Government (Continued)
Deferred Inflows on the Government-wide Statement of Net Assets consists of the following at June 30, 2024:
Governmental Activities:
Balance at Balance at
June 30, 2023 Increase Decrease June 30, 2024
GASB 68 Change of Assumptions 57$ -$ (57)$ -$ GASB 68 Difference in Experience 7,887 4,230 (7,887) 4,230 GASB 75 Change of Assumptions 17,201 15,048 (17,201) 15,048 GASB 75 Difference in Experience 1,782 4,330 (1,782) 4,330 GASB 87 Lease Related 1,641 - (742) 899 28,568$ 23,608$ (27,669)$ 24,507$
Business-type Activities Balance at Balance at
June 30, 2023 Increase Decrease June 30, 2024
2019 Electric Bonds Deferred Gain 217$ -$ (200)$ 17$ 2021 Water Bonds Deferred Gain 1,480 - (149) 1,331 GASB 68 Difference in Experience 2,776 1,498 (2,776) 1,498 GASB 75 Change of Assumptions 4,437 3,891 (4,437) 3,891 GASB 75 Difference in Experience 459 1,118 (459) 1,118 GASB 87 Lease Related 1,174 102 (165) 1,111 10,543$ 6,609$ (8,186)$ 8,966$
In accordance with revenue recognition requirements, the following revenues have been deferred on the governmental fund statements, because the related cash was not available at year-end. The breakdown by fund is as follows:
Fund Name Amount
General Fund 133$
Project Management 3,030
Nonmajor Governmental Funds 4,058
Total unavailable revenues 7,221$
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
74 Annual Comprehensive Financial Report | June 30, 2024 (10) Long-Term Debt
Primary Government
Changes in long-term debt and other liabilities for the year ended June 30, 2024 are as follows:
Due in
Balance at Balance at Due Within More Than
Governmental Activities: June 30, 2023 Additions Reductions June 30, 2024 One Year One Year Notes payable:
Notes from Direct Borrowings
(Rose Bowl) 422$ -$ (17)$ 405$ 18$ 387$ Section 108 3,900 - (300) 3,600 300 3,300 Total Notes Payable 4,322 - (317) 4,005 318 3,687 Pension bonds:
2015 Taxable Pension Obligation Bonds 3,540 - (1,380) 2,160 2,160 - Bond Premiums/(Discount) (31) - 17 (14) - (14) 2020 Taxable Pension Obligation Bonds 126,985 - (1,030) 125,955 1,050 124,905 Total Pension Bonds 130,494 - (2,393) 128,101 3,210 124,891 Certificates of participation:
2015 COP Series A Refunding 2008 COP 44,570 - (2,310) 42,260 2,420 39,840 Bond Premiums/(Discount) 3,838 - (263) 3,575 - 3,575 Total Certificates of Participation 48,408 - (2,573) 45,835 2,420 43,415 Loan Payable 3,982 - (971) 3,011 987 2,024 Subscription Liability 5,819 2,337 (2,847) 5,309 1,920 3,389 Lease liability 3,641 721 (1,646) 2,716 944 1,772 Financed Purchase Arrangements - 47 - 47 - 47 Total governmental activity long-term obligations 196,666$ 3,105$ (10,747)$ 189,024$ 9,799$ 179,225$
Due in
Balance at Balance at Due Within More Than
Business-type Activities: June 30, 2023 Additions Reductions June 30, 2024 One Year One Year Revenue bonds:
2013A Electric Revenue Refunding Bonds 65,445$ -$ (2,015)$ 63,430$ 2,115$ 61,315$ 2016A Electric Revenue Refunding Bonds 102,565 - (3,325) 99,240 3,485 95,755 2017A Water Revenue Refunding Bonds 11,350 - (645) 10,705 670 10,035 2019A Electric Revenue Refunding Bonds 4,390 - (2,145) 2,245 2,245 - 2020A Water Revenue Refunding Bonds 27,415 - (1,000) 26,415 1,045 25,370 2021A Water Revenue Refunding Bonds 21,175 - (1,150) 20,025 1,145 18,880 Total Water and Power 232,340 - (10,280) 222,060 10,705 211,355 2008 Paseo Colorado Taxable Revenue Bonds 19,500 - (900) 18,600 1,000 17,600 Bond Premiums/(Discounts) 36,742 - (1,850) 34,892 - 34,892 - Total revenue bonds 288,582 - (13,030) 275,552 11,705 263,847 Loan Payable 1,468 - (476) 992 489 503 Subscription Liability 4,771 457 (2,225) 3,002 798 2,204 Lease liability 2,426 5,651 (1,352) 6,725 1,339 5,386 Total business-type activity long-term liabilities 297,247$ 6,108$ (17,083)$ 286,271$ 14,331$ 271,940$
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 75 (10) Long-Term Debt (Continued)
Discretely Presented Component Units
Changes in discretely presented component units’ long-term debt and other liabilities for the year ended June 30, 2024 are as follows:
Additions Due In
Balance at Including Balance at Due Within More Than
Discretely Presented Component Units June 30, 2023 Accretion Reductions June 30, 2024 One Year One Year Certificates of participation:
2008 Refunding COP Series 2008A (Conference Center
Project) 134,720$ -$ (6,775)$ 127,945$ 7,480$ 120,465$ Total Certificates of Participation 134,720 - (6,775) 127,945 7,480 120,465 Revenue Bonds:
2010A Revenue Bonds-Tax Exempt 26,557 1,806 - 28,363 - 28,363 2010B Revenue Bonds-Taxable Build America Bonds 106,660 - - 106,660 - 106,660 2010D Revenue Bonds-Taxable Recovery 7,400 - - 7,400 - 7,400 2016A Revenue Bonds-Partial Refunding 2010A Bonds 17,630 - (4,310) 13,320 4,705 8,615 2016A Bond Premium (Discount) 2,063 - (550) 1,513 - 1,513 2018A Revenue Bonds-Refunding / Tax Exempt Fixed
Rate 30,585 - - 30,585 - 30,585 2018B Revenue Bonds-Taxable 5,385 - (665) 4,720 915 3,805 2018AB Bond Premium/(Discount) 3,665 - (178) 3,487 - 3,487 Total Revenue Bonds (Rose Bowl Renovation) 199,945$ 1,806$ (5,703)$ 196,048$ 5,620$ 190,428$ Subscription Liability 1,485 44 (211) 1,318 199 1,119 Lease Liability 46 - (28) 18 12 6 Total discretely presented component units long-
term liabilities 336,196$ 1,850$ (12,717)$ 325,329$ 13,311$ 312,018$
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
76 Annual Comprehensive Financial Report | June 30, 2024 (10) Long-Term Debt (Continued)
Governmental Activities:
Final
Principal
Issue Original Coupon Payment Outstanding at
Date Purpose Amount Interest Rate Date June 30, 2024
Detail of Long-Term Debt
Governmental Activities:
Notes payable
Notes Payable-RBOC 1/15/2013 a 576 2.10% 1/7/2043 405$ Notes Payable-Section 108 10/29/2015 c 6,000 variable 8/1/2035 3,600 Total Notes Payable 4,005$
Pension bonds:
2015 Unrefunded Taxable Pension Obligation Bonds 5/5/2015 b 119,460 2.82% to 3.47% 5/1/2025 2,160$ 2020 Taxable Pension Obligation Bonds 2/26/2020 b 131,805 1.60% to 3.10% 5/1/2045 125,955 Bond Premium (Discount) (14)
Total Pension Bonds 128,101$
Certificates of Participation:
2015 COP Series A Refunding 2008 COP 12/2/2015 d 55,350 3.00% to 5.00% 2/1/2038 42,260$ Bond Premium (Discount) 3,575
Total Certificates of Participation 45,835$
Loan Payable
2020 Equipment Lease-Radio Equipment 1/15/2020 e 6,800 1.66% 1/15/2027 3,011$ Total Loan Payable 3,011$
Financed Purchase Arrangements
2024 EV Purchases 5/2/2024 n 47 variable 9/30/2026 47$ Total Financed Purchase Arrangements 47$
Business-type Activities:
Final
Principal
Issue Original Coupon Payment Outstanding at
Date Purpose Amount Interest Rate Date June 30, 2024
Detail of Long-Term Debt
Business-type Activities:
Revenue bonds:
2008 Paseo Colorado Taxable Revenue Bonds 9/17/2008 f 28,800 variable 6/1/2038 18,600$ 2013A Electric Revenue Refunding Bonds 12/3/2013 i, j 80,485 4.25% to 5.00% 6/1/2043 63,430 2016A Electric Revenue Refunding Bonds 11/7/2016 k 119,440 4.00% to 5.00% 6/1/2046 99,240 2017A Water Revenue Refunding Bonds 3/13/2017 l 15,395 5.00% 6/1/2036 10,705 2019A Electric Revenue/ Refunding Bonds 8/1/2019 m 11,575 5.00% 8/1/2024 2,245 2020A Water Revenue Refunding Bonds 12/1/2020 g 30,130 5.00% 6/1/2050 26,415 2021A Water Revenue Refunding Bonds 12/1/2021 h 22,480 5.00% 6/1/2051 20,025 Bond Premium (Discount) 34,892
Total Revenue Bonds 275,552$
Loan Payable:
2019 Equipment Lease-Parking System 4/1/2019 e 3,252,694 2.67% 4/1/2026 992$ Total Loan Payable 992$
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 77 (10) Long-Term Debt (Continued)
Component Unit Activities:
Final
Principal
Issue Original Coupon Payment Outstanding at
Date Purpose Amount Interest Rate Date June 30, 2024
Detail of Long-Term Debt
Discretely Presented Component Units
Certificates of Participation
2008 Refunding COP, Series 2008A (Conference
Center Project)
4/15/2008 CC1 134,720 variable 2/1/2035 127,945
Total Certificates of Participation (PCOC) 127,945$
Revenue Bonds
2010A Revenue Bonds-Tax Exempt Capital
Appreciation
11/18/2010 RB1 11,588 6.43% to 6.52% 3/1/2033
28,363
2010B Revenue Bonds-Taxable Build America
Bonds
11/18/2010 RB1 106,660 7.00% to 7.15% 3/1/2043
106,660
2010D Revenue Bonds-Taxable Recovery Zone
Economic Development
11/18/2010 RB1 7,400 7.150% 3/1/2043
7,400
2016A Revenue Bonds-Partial Refunding 2010A
Bonds
10/5/2016 RB3 21,865 5.00% 4/1/2027
13,320
2016A Bond Premium (Discount) 1,513
2018A Revenue Bonds-(Refunding 2013A Tax
Exempt)
12/6/2018 RB2 30,585 5.00% 12/1/2042
30,585
2018B Revenue Bonds-(Refunding 2013B
Taxable)
12/6/2018 RB2 12,515 2.60% to 3.58% 12/1/2027
4,720
2018 AB Bond Premium (Discount) 3,487
Total Revenue Bonds (RBOC) 196,048$
a Refund 2006 Revenue Bonds
b Fire and Police Retirement
c Section 108 Note for Robinson Park Improvements
d Partially refund 2008 Certificates of Participation City Hall e Equipment Purchases, assets purchased collateralized debt f Refund 2000 Paseo Bonds
g Refund 2010A Water Revenue Bonds
h Refund 2011A Water Revenue Bonds and Capital Improvements to Water System Revenue Bonds i GT5 Improvements
j Refund 2002 Electric Bonds and Capital Improvements to the Electric System k Refund 2008 Electric Bonds, repay Line of Credits and Capital Improvement to the Electric System l Refund 2007 Water Bonds
m Refund 2009 Electric Bonds and Capital Improvement to the Electric System n Leased vehicles purchases
CC1 Refund 2006B Certificates of Participation
RB1 Rose Bowl Stadium Renovation
RB2 Refund 2013 Rose Bowl Revenue Bonds
RB3 Partial refund 2010A Rose Bowl Revenue Bonds
Purpose of Debt:
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
78 Annual Comprehensive Financial Report | June 30, 2024 (10) Long-Term Debt (Continued)
The annual requirements to amortize as of June 30, 2024, are as follows:
Governmental Activities:
Year Ending
June 30 Principal Interest Principal Interest Principal Interest 2025 318$ 117$ 3,210$ 3,780$ 2,420$ 1,875$ 2026 318 108 3,305 3,686 2,545 1,754 2027 318 100 3,370 3,620 2,670 1,627 2028 319 91 3,445 3,548 2,800 1,494 2029 319 81 3,525 3,471 2,940 1,354 2030-2034 1,602 257 22,665 16,034 13,285 4,521 2035-2039 713 38 26,755 12,709 15,600 1,590 2040-2044 99 5 50,695 6,817 - - 2045-2047 - - 11,145 361 - - Bond Premium (Discount) - - (14) - 3,575 - Total Payment 4,005$ 798$ 128,101$ 54,026$ 45,835$ 14,215$ Pension BondsNotes Payable Certificates of Participation
Year Ending
June 30 Principal Interest Principal Interest
2025 987$ 46 $ -$ -$ 2026 1,004 29 47 - 2027 1,020 13 - - Total Payment 3,011$ 88$ 47$ -$ Loan Payable Finance Purchase Arrangements
Business-type Activities:
Year Ending
June 30 Principal Interest Principal Interest
2025 11,705$ 10,650$ 489$ 23 $
2026 9,810 10,168 503 10
2027 10,175 9,725 - -
2028 10,655 9,264 - -
2029 11,145 8,783 - -
2030-2034 62,730 35,937 - -
2035-2039 61,625 21,716 - -
2040-2044 44,905 9,577 - -
2045-2049 15,730 2,076 - -
2050-2052 2,180 147 - - Bond Premium (Discount) 34,892 - - - Total Payment 275,552$ 118,043$ 992$ 33 $
Loan PayableRevenue Bonds
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 79 (10) Long-Term Debt (Continued)
Disclosure Related to Long-Term Debt under GASB 88
The City’s outstanding notes from direct borrowings related to government activities of $405 is payable to Rose Bowl Operating Company, resulting from the refunding of revenue bonds activities in 2013 and does not have any special provision.
The City’s outstanding Notes Payable – Section 108 relating to government activities are payable from the annual allocation of Community Development Block Grant Funds (CDBG).
In regard to the 2020AB and 2015B Pension Obligation Bonds (POBs), the debt service payments are secured by revenue received by the General Fund.
In case of a default, the following is the course of action:
The Trustee will, by written notice to the City and the Paying Agent, declare immediately due and payable the principal and Accreted Value of the accrued interest on all Outstanding Bonds of such Series, whereupon the same become immediately due and payable with any further action or notice.
In regard to the 2015A Certificates of Participation, the City’s outstanding bonds from public offerings related to government activities are payable from and secured by revenue received by the City. In case of the City’s default, the following is the course of action:
The Authority or its assignee, in addition to all other rights and remedies it may have at law, will have the option to do the following:
(1) To terminate the Sublease in the manner provided in the Sublease on account of default by the City, and to retake possession of the Lease Property. In the event of such termination, the City agrees to surrender immediately possession of the Lease Property, without let or hindrance, and to pay the Authority or its assignee all damages recoverable at law that the Authority or its assignee may incur by reason of default by the City, including, without limitation, any costs, loss or damage whatsoever arising out of, in connection with, or incident to any such retaking possession of the Lease Property. Neither notice to pay rent nor to deliver up possession of the Lease Property given pursuant to law nor any proceeding in unlawful detainer, or otherwise, brought by the Authority or its assignee for the purpose of obtaining possession of the Leased Property nor the appointment of a receiver upon initiative of the Authority or its assignee to protect the Authority’s or its assignee’s interest under the Sublease shall of itself operate to terminate the Sublease, and no termination of the Sublease on account of default by the City shall be or become effective by operation of law or acts of the parties hereto, unless and until the Authority or its assignee shall have given written notice to the City of the election on the part of the Authority or its assignee to terminate the Sublease.
(2) Without terminating the Sublease, (i) to collect each installment of rent as it becomes due and enforce any other term or provision of the Sublease to be kept or performed by the City and/or (ii) to exercise any and all rights to retake possession of the Lease Property. In the event the corporation or its assignee does not elect to terminate the Sublease in the manner described in subparagraph (1) above, the City will remain liable and agrees to keep or perform all covenants and conditions contained in the Sublease to be kept or performed by the City and, to pay the rent to the end of the term of the Sublease or, in the event that the Lease Property is re-let, to pay any deficiency in the rent that results therefrom; and further agrees to pay said rent and/or the payment of rent under the Sublease (without acceleration), notwithstanding the fact that the Authority or its assignee may have received in previous years or may receive thereafter in subsequent years rental in excess of the rental specified in the Sublease and notwithstanding any retaking of possession of the Leased Property by the Authority of its assignee or suit in unlawful detainer, or otherwise, brought by the Authority or its assignee for the purpose of obtaining possession of the Leased Property. Should the Authority or its assignee elect to retake possession of the Lease Property as provided in the Sublease, the City irrevocably appoints the Authority or it assignee as the
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
80 Annual Comprehensive Financial Report | June 30, 2024 (10) Long-Term Debt (Continued)
Disclosure Related to Long-Term Debt under GASB 88 (Continued)
agent and attorney-in-fact of the City to re-let the Lease Property, or any items thereof, from time to time, either in the Authority’s or its assignee’s name or otherwise, upon such terms and conditions and for such use and period as the Authority or its assignee may deem advisable and the City indemnifies and agrees to save harmless the Authority or its assignee from any costs, loss or damage whatsoever arising out of, in connection with, or incident to any retaking of possession of and re-letting of the Lease Property by the Authority or its assignee or its duly authorized agents in accordance with the provisions contained in the Sublease. The City agrees that the terms of the Sublease constitute full and sufficient notice of the right of the Authority or its assignee to re-let the Lease Property in the event of such reentry without effecting a surrender of the Sublease, and further agrees that no acts of the Authority or its assignee in effecting such re-letting with constitute a surrender of termination of the Sublease irrespective of the use or the terms for which such re-letting is made or the terms and conditions of such re-letting, or otherwise, but that on the contrary, in the event of such default by the City the right to terminate the Sublease will vest in the Authority or its assignee to be effected in the sole and exclusive manner described in subparagraph (1) above. The City further waives the right to rental obtained by the Authority or its assignee in excess of the rental specified in the Sublease and conveys and release such excess to the Authority or its assignee as compensation to the Authority or its assignee for its services in re-letting the Lease Property or any items thereof. The City further agrees to pay the Authority or its assignee the cost of any alterations or repairs to the Lease Property or any items thereof necessary to place the Leased Property or any items thereof in conditions for re-letting immediately upon notice of the City of the completion and installation of such alterations or repairs.
The City waives any and all claims for damages caused or which may be caused by the Authority or its assignee in taking possession of the Leased Property as provided in the Sublease and all claims for the damages that may result from the destruction of or injury to the Leased Property and all claims for damages to or loss of any property belonging to the City, or any other person, that may be on about the Leased Property.
The Authority expressly waives the right to receive any amount from the City pursuant to Section 1951.2(a)(3) of the California Civil Code.
In addition to any default resulting from breach by the City of any agreement, condition, covenant or term of the Sublease, if( 1) the City’s interest in the Sublease or any part thereof be assigned, sublet or transferred without the written consent of the Authority (except as otherwise permitted by the Sublease), either voluntarily or by operation of law; or (2) the City or any assignee will file any petition or institute any proceeding under any act or acts, state of federal, dealing with or relating to the subject of bankruptcy or insolvency or under any amendment of such act or acts, either as a bankrupt or as an insolvent or as a debtor or in any similar capacity, wherein or whereby the City asks or seeks or prays to be adjudicated a bankrupt, or is to be discharged from any or all of its debts or obligations, or offers to its creditors to effect a composition or extension of time to pay its debts, or asks, seeks or prays for reorganization or to effect a plan of reorganization or for a readjustment of its debts or for any other similar relief, or if the City will make a general or any assignment for the benefit of its creditors; or (3) the City will abandon or vacate the Leased Property or any portion thereof (except as permitted by the Sublease); then in each and every such case the City will be deemed to be default under the Sublease.
Neither the City nor the Authority will be default in the performance of any of its obligations under the Sublease (except for the obligation to make Base Rental Payments pursuant to the Sublease) unless and until it will have failed to perform such obligation within 30 days after notice by the City or the Authority, as the case may be, to the other party properly specifying wherein it has failed to perform such obligation.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 81 (10) Long-Term Debt (Continued)
Disclosure Related to Long-Term Debt under GASB 88 (Continued)
In regard to the Paseo Colorado Revenue Bonds 2008 Series, the City’s outstanding Lease Revenue bonds from public offering related to business-type parking activities are payable from and secured by revenue received by the City. In relation to the 2008 Paseo Colorado Revenue Bonds, the following is the remedy upon default:
The Authority, in addition to all other rights and remedies it may have at law, shall have the option to do any of the following:
(a) Terminate the Lease in the manner provided in the Lease on account of default by the City, notwithstanding ay re-entry or re-letting of the Lease Premises and remove all persons in possession thereof and all personal property whosesoever situation upon the Leased Premises and place such personal property in storage in any warehouse or other suitable place in the County of Los Angeles, State of California, provided that the Leased Premises continue to be operated and maintained as a public off-street vehicular parking facility, subject to the provisions of the Development Agreements. In the event of such termination, the City agrees to surrender immediately possession of the Lease Premises, without let or hindrance, and to pay the Authority all damages recoverable at law that the Authority may incur by reason of default by the City, including, without limitation, any costs, loss or damage whatsoever arising out of, in connection with, or its duly authorized agents in accordance with the provisions contained in the Lease. Neither notice to pay rent or to deliver up possession of the Lease Premises given pursuant to law nor any entry or re-entry by the Authority nor any proceeding in unlawful detainer, or otherwise, brought by the Authority for the purpose of effecting such re-entry or obtaining possession of the Leased Premises nor the appointment of a receiver upon initiative of the Authority to protect the Authority interest under the Lease, will of itself operate to terminate the Lease , and no termination of the Lease on account of default by the City will be or become effective by operation of law or acts of the parties to the Lease, or otherwise, unless and until the Authority gives written notice to the City and the Commission of the election on the part of the Authority to terminate the Lease. The City agrees that no surrender of the Lease Premises or of the remainder of the term of the Lease or any termination of the Lease will be valid in any manner or for any purpose whatsoever unless stated or accepted by the Authority by such written notice.
(b) Without termination the Lease, (i) to collect each installment of rent as it becomes due and enforce any other term or provision of the Lease to be kept or performed by the City or (ii) to exercise any and all rights of entry and re-entry upon the Leased Premises as provided. In the event the Authority does not elect to terminate the Lease in the manner provided for in the Lease, the City remains liable and agrees to keep or perform all covenants and conditions in the Lease contained to be kept or performed by the City and , if the Leased Premises are not re-let, to pay the full amount of the rent annually to the end of the term of the Lease or, in the event that the Leased Premises are re-let, to pay any deficiency in rent that results therefrom; and further agrees to pay said rent and/or rent deficiency punctually at the same time and in the same manner as provided in the Lease for the payment of rent under the Lease (without acceleration), notwithstanding the fact that the Authority may have received in previous years or may receive thereafter in subsequent years rental in excess of the rental specified in the Lease and notwithstanding any entry or re-entry by the Authority or suit in unlawful detainer, or otherwise, brought by the Authority for the purpose of effecting such re=entry or obtaining possession of the Lease Premises.
Should the Authority elect to re-enter as provided in the Lease, the City irrevocably appoints the Authority as the agent and attorney-in-fact of the City to re-let the Leased Premises, or any part thereof, from time to time, either in the Authority’s name or otherwise, for use as public off-street vehicular parking facility upon such terms and conditions and for such period as the authority may deem advisable and, subject to the provisions of the Development Agreement, to remove all persons in possession thereof and all personal property whosesoever situated in and upon the Leased Premises and to place such personal property in storage in any warehouse or other suitable place in the County of Los Angeles, State of California, for the account of and at the expense of the City, and the City exempts and agrees to save harmless the Authority from any costs, loss or damage whatsoever arising out of, in connection with, or incident to any such re-entry upon and re-letting of the Lease Premises and removal storage of such property by the Authority or its duly authorized agents in accordance with the provisions contained in the Lease; provided, however, that any such re-entry upon and re-letting of the Leased Premises its subject to the provisions of the Development Agreements.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
82 Annual Comprehensive Financial Report | June 30, 2024 (10) Long-Term Debt (Continued)
Disclosure Related to Long-Term Debt under GASB 88 (Continued)
The City agrees that the terms of the Lease constitute full and sufficient notice of the right of the Authority to re- let the Leased Premises as provided in the Lease in the event of such re-entry without effecting a surrender of the Lease, and further agrees that no acts of the Authority in effecting such re-letting will constitute a surrender or termination of the Lease irrespective of the use or the term for which such re-letting or otherwise, but that, on the contrary, in the event of such default by the City the right to terminate the Lease will vest in the Authority to be effected in the sole and exclusive manner provided for in the Lease. The City further waivers the right to any rental obtained by the
Authority in excess of the rental specified in the Lease and conveys and releases such excess to the Authority as compensation to the Authority for its services in re-letting the Leased Premises or any part thereof. The City further agrees to pay the Authority the cost of any alterations or additions to the Lease Premises or any part thereof necessary to place the Leased Premises or any part thereof in conditions for re-letting immediately upon notice to the City of the completion and installation of such additions or alterations.
The City waives any and all claims for damages caused or which may be caused by the Authority in re-entering and taking possession of the Lease Premises as provided in the Lease and all claims for damages that may result from the destruction of or injury to the Leased Premises and all claims for damages to or loss of any property belonging to the City, or any other person, that may be in or upon the Lease Premises.
Each and all of the remedies given to the Authority under the Lease or by any law enacted are cumulative and the exercise of one right or remedy will not impair the right of the Authority to any or all other remedies, provided, however, that the Lease Premises continue to be operated and maintained as public off-street vehicular parking facility, subject to the provisions of the Development Agreement. The term “re-let” or “re-letting” as used in the Lease include, but not be limited to re-letting by means of the operation of the Leased Premises by the Authority.
If any statute or rule of law validly limits the remedies given to the Authority under the Lease, the Authority nevertheless will be entitled to whatever remedies are allowable under any statute or rule of law.
In the event the Authority prevails in any action brought to enforce any of the terms and provisions of the Lease, the City agrees to pay a reasonable amount as and for attorney’s fees incurred by the Authority to enforce any of the remedies available to the Authority under the Lease, whether or not a lawsuit has been filed and whether or not any lawsuit culminates in a judgment.
(c) If (1) the City’s interest in the Lease or any part thereof be assigned or transferred without the written consent of the Authority, wither voluntarily or by operation of law or otherwise, or if (2) any proceeding under the United States Bankruptcy Code or any federal or state bankruptcy, insolvency or similar law or any law providing for the appointment of a receiver, liquidator, trustee or similar official of the City or all or substantially all of its assets is instituted by or with the consent of the City, or it instituted with its consent and is not permanently stayed or dismissed within sixty days, or it the City offers to the City’s’ creditors to effect a composition or extension of time to pay the City’s debts, or asks, seeks or prays for reorganization or to effect a plan of reorganization or for readjustment of the City’s debts, or if the City makes a general assignment or any assignment for the benefit of the City’s creditors, or if (3) the City will abandon or vacate any part of the Leased Premises, then the City will be deemed to be default under the Lease.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 83 (10) Long-Term Debt (Continued)
Disclosure Related to Long-Term Debt under GASB 88 (Continued)
In regard to the City’s outstanding bonds from public offerings related to business-type, activities (2017A, 2020A and 2021A Water Revenue Bonds and 2013A, 2016A and 2019A Electric Revenue Bonds) are payable from and secured by revenue received by the Utilities (Water and Power Funds).
In relation to the Electric Revenue Bonds course of action in case of the City’s default, the following is the course of action:
Upon the concurrence and continuation of and Event of Default the Bond Owners’ Committee or, if there is none, the Owners of 25% in aggregate Bond Obligation of Bonds then Outstanding may, by written notice to the City, declare the entire unpaid principal of the Bonds due and payable and thereupon the entire unpaid principal of the Bonds will forthwith become due and payable. Upon any such declaration the City will forthwith pay to the Owners of the Bonds the entire unpaid principal of, premium, pledged for such purpose. If at any time after such a declaration and before the entry of a final judgement or decree in any suit, action or proceeding instituted on account of such default or before the completion of the enforcement of any other remedy under the Fiscal Agent Agreement, the principal of all Bonds that have matured or been called for redemption pursuant to any sinking fund provision and all arrears of interest have been paid and any other Events of Default which may have occurred have been remedied, then the Bonds Owners’ Committee or, if there is none, the Owners of 25% in aggregate Bonds Obligation of Bond then Outstanding may, by written notice of the City, rescind of annual such declaration and its consequences. No such rescission or annulment will extend to or affect any subsequent default or impair any right consequent thereon.
In relation to the Water Revenue Bonds course of action in case of the City’s default, the following is the course of action:
Application of Pledged Revenues and Other Funds after Default; Acceleration. If an Event of Default shall occur and be continuing, the City shall immediately transfer to the Trustee all Pledged Revenues held by it and received thereafter and the Trustee shall apply all Pledged Revenues and any other funds then held or thereafter received by the Trustee under any of the provisions of the Indenture (except as otherwise provided in the Indenture) as follows and in the following order:
(1) To the payment of any expenses necessary in the opinion of the Trustee to protect the interests of the Owners of the Bonds and Parity Debt, including the costs and expenses of the Trustee and the Bondholders in declaring such Event of Default, and payment of reasonable fees and expenses of the Trustee (including reasonable fees and disbursements of its counsel and other agents) incurred in and about the performance of its powers and duties under the Indenture;
(2) To the payment of the whole amount of Bond Obligation then due on the Bonds and Parity Debt (upon presentation of the Bonds and Parity Debt to be paid, and stamping thereon of the payment if only partially paid, or surrender thereof if fully paid) subject to the provisions of the Indenture, with interest on such Bond Obligation at the rate or rates of interest borne by the respective Bonds and Parity Debt, to the payment to the persons entitled thereto of all installments of interest then due and the unpaid principal or Redemption Price of any Bonds and Parity Debt which shall have become due, whether at maturity or by call for redemption, in the order of their due dates, with interest on the overdue Bond Obligation and Parity Debt at the rate borne by the respective Bonds and Parity Debt, and, if the amount available shall not be sufficient to pay in full all the Bonds and Parity Debt due on any date, together with such interest, then to the payment thereof ratably, according to the amounts of principal or interest or Accreted Value (plus accrued interest) due on such date to the persons entitled thereto, without any discrimination or preference; and
(3) To the extent not paid pursuant to clause (1) or (2) above, to any Credit Provider any amounts then due and owing.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
84 Annual Comprehensive Financial Report | June 30, 2024 (10) Long-Term Debt (Continued)
Disclosure Related to Long-Term Debt under GASB 88 (Continued)
In each and every such case during the continuance of such Event of Default, the Owners of not less than a majority in aggregate amount of Bond Obligation of the Bonds at the time Outstanding shall be entitled, upon notice in writing to the City, to declare the principal of all of the Bonds then Outstanding, and the interest accrued thereon, to be due and payable immediately, and upon any such declaration the same shall become and shall be immediately due and payable, anything in the Indenture or in the Bonds contained to the contrary notwithstanding.
This provision, however, is subject to the condition that if, at any time after the principal of the Bonds shall have been so declared due and payable, the City shall pay to or shall deposit with the Trustee a sum sufficient to pay all principal on such Bonds matured prior to such declaration and all matured installments of interest (if any) upon all the Bonds, and the reasonable fees and expenses of the Trustee, and any and all other defaults known to the Trustee (other than in the payment of principal of and interest on the Bonds due and payable solely by reason of such declaration) shall have been made good or cured to the satisfaction of the Trustee, or provision deemed by the Trustee to be adequate shall have been made therefor, then, and in every such case, the Owners of not less than a majority in aggregate amount of Bond Obligation of the Bonds at the time Outstanding, by written notice to the City and to the Trustee, may, on behalf of the Owners of all the Bonds, rescind and annul such declaration and its consequences; but no such rescission and annulment shall extend to or shall affect any subsequent default, or shall impair or exhaust any right or power consequent thereon.
In regard to the Discretely Presented Component Units as it relates to the Rose Bowl Lease Revenue Bonds series, 2010ABD, 2016A, and 2018AB in case of default, the following is the course of action:
Upon the happening of any of the events & default, then it shall be lawful for the Authority or its assignee, subject to the terms of the Lease, with the consent of the Majority Holder, to (i) exercise any and all remedies available or granted to it under the Sublease or pursuant to law, to the extent not inconsistent with the remedies granted under the Sublease or (ii) by mandamus or other suit, action or proceeding at law or in equity to enforce the Authority’s or its assignee’s rights against the City and to compel the City to perform and carry out its duties and obligations under the law and its covenants and agreements with the City as provided in the Sublease. Upon the breach of any agreement, condition, covenant, or term contained in the Sublease required to be observed or performed by the City, the Authority or its assignee may not exercise any rights of entry upon or repossession of the Leased Property. In the event of such default, the Authority or its assignee must thereafter maintain the Sublease in full force and effect and may only recover rent and other monetary charges as they become due, all without terminating the City’s right to possession of the Leased Property, regardless of whether or not the City has abandoned the Leased Property; this shall be the sole and exclusive remedy available against the city under the sublease or otherwise. The Authority shall have no right upon an event of default under the sublease by the city to accelerate the rental payments, terminate the sublease or re-enter the leased property.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 85 (11) Derivative Instruments
Discretely Presented Component Units
Pasadena Center Operating Company (PCOC)
Conference Center Variable Rate Demand Refunding Certificates of Participation – SWAP No. 2
On September 18, 2006, the City entered into an interest rate swap agreement with DEPFA Bank related to the $135,500,000 Conference Center Auction Rate Certificates Series 2006B. The objective was to effectively change the City’s Variable interest rate to a synthetic fixed rate of 3.536%. Under the terms of the swap, the City pays the counterparty the fixed rate of 3.536% and receives a floating rate equal to 64% of the one month LIBOR rate. The swap has a notional amount of $133,000,000 representing a hedge ratio of 98.7% and declines according to the schedule set forth in the contract until the final principal payment on the certificates in 2034.
Objective and Terms of Hedging Derivative Instruments
The following table displays the objective and terms of PCOC’s hedging derivative instruments outstanding at June 30, 2024, along with the credit rating of the associated counterparty:
Cash Flow Notional Effective Maturity Counterparty
Hedge Objective Amount Date Date Term Credit Rating
Pay-fixed interest
rate swaps
Hedge of changes
in cash flows on
the 2008A COP's
$ 126,225,000 4/1/2011 2/1/2034
Pays 3.536%;
receive 64% of
LIBOR index
Aa1/AA-
Note in 2011, due to its declining credit ratings, DEPFA was replaced by RBC as the counterparty for the swap.
Pursuant to GASB 64, the replacement did not require any change in accounting treatment.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
86 Annual Comprehensive Financial Report | June 30, 2024 (11) Derivative Instruments (Continued)
Pasadena Center Operating Company (PCOC) (Continued)
Objective and Terms of Hedging Derivative Instruments (Continued)
On April 15, 2008, the City issued the 2008 Refunding Certificates of Participation, Series 2008A in the amount of $134,720. These certificates were issued to refund the City’s Certificates of Participation (Conference Center Project), Series 2006B and finance the cost of execution of the 2008A Certificates of Participation backed by a letter of credit from Bank of America. The final maturity on the 2008A COPs was extended by one year to 2035 in order to reduce the reserve requirement and consequently, reduce the size of the issue by approximately $800,000. The refunded certificates are considered to be defeased and the liability has been removed from the component unit’s column of the statement of net position and recorded as a deferred amount upon a refunding.
During the fiscal year ending June 30, 2011, PCOC entered into a new agreement to take advantage of a more advantageous interest rate adjustment mode than the 2008 Series Bonds previously had. As a result, the former derivative instrument terminated, and the new instrument has off-market terms. As a result, an up-front payment was received. The up-front payment is reported as a borrowing. The borrowing is amortized over the life of the swap and amortizes using the effective interest method for the life of the swap with adjustments to interest expense during each fiscal year. The original balance of the borrowing was $8,936. As of the year ended June 30, 2024, the balance was $3,221.
The C categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset or liability. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs. Level 3 inputs are significant unobservable inputs.
The Company has the following recurring fair value measurements as of June 30, 2024:
Beginning Accrued Ending
June 30 Balance Interest Payment Balance
2025 3,221$ 136$ (601)$ 2,756$ 2026 2,756 115 (564) 2,308 2027 2,308 95 (522) 1,881 2028 1,881 77 (477) 1,480 2029 1,480 59 (428) 1,111 2030 1,111 43 (374) 781 2031 781 29 (315) 495 2032 495 17 (251) 261 2033 261 8 (182) 87 2034 87 1 (89) -
The Company categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset or liability. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs. Level 3 inputs are significant unobservable inputs.
The Company has the following recurring fair value measurements as of June 30, 2024:
Level
Measurements by fair value level 1 2 3
Derivative instrument liability 2,533$ -$ 2,533$ -$
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 87 (11) Derivative Instruments (Continued)
Pasadena Center Operating Company (PCOC) (Continued)
Derivative Instrument Liability
The fair value balance and notional amount of the derivative instrument outstanding at June 30, 2024, classified by type, and the changes in fair value of such derivative instruments for the year then ended are as follows:
The fair values of the interest rate swaps were estimated using the zero-coupon method. This method calculates the future net settlement payments required by the swap, assuming that the current forward rates implied by the yield curve correctly anticipate future spot interest rates. These payments are then discounted using the spot rates implied by the current yield curve for hypothetical zero-coupon bonds due on the date of each future net settlement on the swaps.
Credit risk: PCOC is exposed to credit risk on hedging derivative instruments to the extent that value of the swap is position from PCOC’s perspective. The aggregate fair value of hedging derivative instruments was negative as of June 30, 2024, and therefore PCOC had no credit risk exposure.
Interest rate risk: The purpose of the swap is to eliminate interest rate risk on the associated hedged bonds and therefore the swap, in combination with related bonds does not create interest rate risk for PCOC.
Basis risk: PCOC is exposed to basis risk on its pay-fixed interest rate swap because the variable-rate payments received by PCOC on these hedging derivative instruments are based on a rate or index other than interest rates PCOC pays on its hedged variable-rate debt, which is typically remarketed every 7 days. As of June 30, 2024, the weighted-average interest rate on the PCOC’s hedged variable-rate debt is 2.89100%, while 64 percent of LIBOR- BBA Fallback is 3.4876%.
Termination risk: PCOC or its counterparty may terminate a derivative instrument if the other party fails to perform under the terms of the contract. The derivative contract uses the International Swap Dealers Association Master Agreement which includes standard termination events such as failure to pay and bankruptcy. In addition, PCOC may optionally terminate the agreement on any date. If at the time of a termination, PCOC may be required to make a termination payment to its counterparty. If PCOC had to terminate the Swap for any reason on June 30, 2024, the maximum exposure/loss would have been $5,935.
Rollover risk: PCOC is exposed to rollover risk on hedging derivative instruments that are hedges of debt that mature or may be terminated prior to the maturity of the hedged debt. When these hedging derivative instruments terminate prior to the maturity of the related debt, PCOC will be re-exposed to the risks being hedged by the hedging derivative instrument.
Cash Flow
Hedge
Classification
Amount
Classification
Amount
Notional
Pay-fixed interest
rate swaps
Deferred Outflow
$ (1,899)
Liability
$ 2,533
$ 126,225
Changes in Fair Value
Fair Value at June 30, 2024
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
88 Annual Comprehensive Financial Report | June 30, 2024 (12) Fund Balance
Fund Balances, Governmental Funds
On the Governmental Balance Sheet, the fund balances are reported in the aggregate in the classifications defined by GASB Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions. Fund balances by classification for the year ended June 30, 2024 are as follows:
Nonmajor
Housing Project General Governmental
General Fund Successor Management Debt Service Funds Total Fund Balances
Nonspendable:
Prepaid and other assets 719$ -$ -$ -$ 134$ 853$ Permanent fund principal - - - - 1,433 1,433 Notes receivable 13,505 - - - - 13,505 Total Nonspendable 14,224 - - - 1,567 15,791 Restricted for:
Air Quality Improvement - - - - 379 379 Notes receivable - - - - 65,169 65,169 Allowance for uncollectible long-
term receivables - - - - (65,169) (65,169) City Charter/Capital projects - - - - 1,948 1,948 Debt service - - - 5 6,970 6,975 Culture and literacy - - - - 3,757 3,757 Housing and Community Development
Housing funds - 717 - - 5,640 6,357 CDBG - - - - 9 9 Inclusionary Housing Trust - - - - 3,345 3,345 Rental Assistance programs - - - - 2,757 2,757 Rent Stabilization - - - - (1,934) (1,934) Other purposes - - - - 637 637 Property held for resale - - - - - - Public Safety -
Asset Forfeiture - - - - 2,872 2,872 Public Safety Augmentation - - - - 1,512 1,512 Other Public Safety Programs - - - - 425 425 Section 108 HUD Loan Security for - - Robinson Park Recreation Center
Rehabilitation - - - - - - Section 115 Trust - Pension 13,206 - - - - 13,206 Transportation - - - - 36,221 36,221 Total Restricted 13,206$ 717$ -$ 5$ 64,538$ 78,466$ (Continued)
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 89 (12) Fund Balance (Continued)
Fund Balances, Governmental Funds (Continued)
Nonmajor
Housing Project General Governmental
General Fund Successor Management Debt Service Funds Total Fund Balances, continued
Total from previous page 27,430$ 717$ -$ 5$ 66,105$ 94,257$ Committed to:
Public Safety 3,078 - - - - 3,078 Building Services - - - - 22,649 22,649 Parks, Recreation & Neighborhood
Services 61 - - - - ** 61 Public Works 17 - - - - 17 Capital Projects - - - - 6,493 6,493 Emergency Contingency 48,552 - - - - 48,552 Operating Reserve 16,184 - - - - 16,184 Libraries - - - - 13,884 13,884 Pasadena Center Capital
Improvement Trust - - - - 83 83 Transportation - - - - 4,437 4,437 Sewer Construction and
Maintenance - - - - 14,519 14,519 Underground Utilities - - - - 40,530 40,530 Total Committed 67,892 - - - 102,595 170,487 Assigned to:
General Government 46,621 - - - - 46,621 Capital Projects 12,481 - - - - 12,481 Total Assigned 59,102 - - - - 59,102 Unassigned 4,455 - (1,392) - (6,768) (3,705) Total Fund Balances 158,879$ 717$ (1,392)$ 5$ 161,932$ 320,141$
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
90 Annual Comprehensive Financial Report | June 30, 2024 (13) Restricted Net Position – Stranded Investments
In 1998, the City Council established a Reserve for Stranded Investment (Reserve) and imposed a Stranded Investment Surcharge (SIS) on all electric utility bills. The purpose of the Reserve for Stranded Investment was to create a fund to mitigate the potential impacts of open access to the energy market for Water and Power Department (PWP) customers and offset short- and long-term stranded energy costs associated with the Intermountain Power Project (IPP) and Palo Verde Nuclear Generating Station (PVNGS). Several sources of funding for the Reserve were identified in addition to the SIS and funding continued until June 30, 2002. At that time, it was determined that the Reserve was fully funded with no additional contributions required. Collection of the SIS was discontinued, and excess funds returned to PWP customers. All funds deposited into the Reserve, including investment earnings, were recorded as income during the year collected or realized.
In November 2006, the City Council approved the Stranded Investment Reserve Utilization Plan (Plan). In January 2009, in accordance with the Plan and a previously approved Prepayment Agreement (Agreement), PWP utilized approximately $80.0 million of the reserve funds to complete an economic defeasance of selected bonds for IPP. As authorized in the Agreement, the Intermountain Power Agency (IPA) issued approximately $70.0 million of subordinated notes to PWP, the payments for which will offset a portion of the debt service associated with the economically-defeased bonds, thereby reducing the cost of energy purchased from IPP.
As of June 30, 2024, the Stranded Investment Reserve balance was $42.0 million. The details of the additions and subtractions, in the Reserve, that occurred during fiscal year 2024 are shown below:
Restricted Cash and Investment
Beginning balance 40,267$
Interest earnings 1,216
Market gain (loss) 554
Restricted cash and investment ending balance 42,037$
IPA Subordinated Notes
Balance at Balance at
June 30, 2023 Reduction June 30, 2024
Notes receivable 74$ (74)$ -$ Premium - - - .
Total IPA subordinated notes 74$ (74)$ -$ Restricted for Stranded Investments at June 30, 2024 42,037$
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 91 (14) Accumulated Fund Deficits
The following funds reported accumulated deficits in their respective fund balances/net position at June 30, 2024:
Due to
Operations
Due to GASB 68
Implementation
Due to GASB 75
Implementation
Due to GASB 96
Implementation
Total
Accumulated
Deficit
Governmental Activities:
Special Revenue Funds:
Health (6,766)$ -$ -$ -$ (6,766)$ Rent Stabilization (1,934) - - - (1,934) Internal Service Funds:
Computing and Communications Service 13,036 (16,292) (2,832) (651) (6,739) Benefits (28,891) (78,922) (215) - (108,028) Workers Compensation (26,117) (10,784) (251) - (37,152) General Liability (3,217) (684) (143) - (4,044) 311 Call Center 655 (606) (179) (25) (155)
Management’s plans for resolution of the accumulated fund deficits are as follows:
Health
The Health Fund was established to account for grants for the provision of public health services which are restricted by grant award agreement as well as state health realignment funding requirements. The Pasadena Public Health Department continues its steadfast commitment to offering programs and services that ensure public safety and improve public health outcomes while maintaining systems and controls for a financially sustainable operation. In fiscal year 2024, the Department ended the year with a shortfall largely attributable to COVID-19 pandemic response; however, the City requested FEMA reimbursement for pandemic-related expenses and continues to await FEMA response. To address continued fiscal challenges, the Department will continue to expedite the processing of grant reimbursement requests, maintain monitoring of program and financial performance.
Rent Stabilization
The Rent Stabilization Fund was established to implement the provisions of the Pasadena Fair & Equitable Housing City Charter Article XVIII (City Charter Article XVIII). City Charter Article XVIII was approved by voters as a ballot measure in November 2022. The charter article established the Pasadena Rental Housing Board (PRHB) which is responsible for enforcing rent stabilization laws and provides counseling to assist landlords and tenants with navigating the new rent stabilization ordinance (RSO). In addition, the Department supports an appointed Board to fulfill its policy development functions. In October 2023, the PRHB requested to be incorporated into the City as a city department to expedite the implementation of the voter-approved objectives by using existing city infrastructure and processes. In November 2023, City Council voted to turn PRHB into the Rent Stabilization Department. The Rent Stabilization fund generates revenue to offset its expenses by collecting a service fee for each rental unit that falls under the RSO. The service fee was not collected in fiscal year 2024 because the Department was implementing necessary software to facilitate collection of the service fee. The go-live date for the service fee collection began in fiscal year 2025 on September 21, 2024. Management plans to generate sufficient service fee revenue to resolve the negative fund balance through the annual rent registration program which began on September 21, 2024 and ends on December 22, 2024.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
92 Annual Comprehensive Financial Report | June 30, 2024 (14) Accumulated Fund Deficits (Continued)
Computing and Communications
The Computing and Communications Fund was established to historically track and fund the operations and lifecycle capital replacement of the City’s Department of Information Technology, which provides centralized IT support across all City departments. In fiscal year 2024, the deficit decreased compared to fiscal year 2023 primarily attributable to a positive increase from operations of over $869. On average, there were some personnel vacancies and some acting assignments outside the department that kept personnel costs lower than expected, but revenues increased as well due to an increase of over 7% to the fixed rates charged to departments. However, this was offset by increases to GASB 68 and GASB 75 costs of almost $967 combined. GASB 96 costs decreased though, by almost $238, which helped realize the overall deficit reduction. The deficit is being monitored by management, and an appropriate revenue recovery plan to gradually reduce the deficit is in place, as IT is solely funded by the fixed rates it charges to its customer departments. To that end, for fiscal year 2025, fixed rates were increased by 9% compared to fiscal year 2024 in an effort to keep pace with both personnel and inflationary cost increases to services and supplies. The continuing challenge in the coming years will be to maintain enough growth in revenues to keep pace with the costs needed to provide effective service, while also combatting any financial pressures that may impact the fund’s ability to absorb these increases.
Benefits Fund
The Benefits Fund was established to account for employee compensated absences, retirement, and health benefits.
A large deficit is likely to be shown in this fund at the end of each fiscal year, as the largest component represents a portion of the unfunded pension liability, and the second largest portion of the deficit reflects the total liability from accrued leave balances. Each year, the city reviews the rates charged to Departments to adjust to an appropriate recovery level and keep the deficit as low as possible or reduce it. The overall fiscal year 2024 fund balance deficit increased by $8,600. This is primarily attributable to increased expenses including pension contributions, benefits, and compensation. To better manage the short-term costs and long-term liabilities associated with pensions and OPEB, the City set aside $10,500 into a Section 115 pension trust and $2,000 into a Section 115 OPEB trust in fiscal year 2018.
Workers’ Compensation
The City has established a Workers’ Compensation Fund to provide benefits for potential claim and cost expenditures for workers’ compensation claims against the City. In addition to any monies held in this Fund, the City makes an annual appropriation based upon its estimate of claim and expense payments during the fiscal year. Management has reviewed the deficit and is working to mitigate the situation through a combination of injury prevention programs, training programs, reduction of claim severity and claim frequency, return-to-work procedures, medical management and minimizing delays in all aspects of claims handling. An increase in rates charged to the Departments remains a part of the annual budget process. The City initiated the Carve Out program with Pasadena Police Officers Association (PPOA) and that program remains in effect through all of the current fiscal year. That program is focused on ensuring timely delivery of treatment that will: 1) expedite claim resolutions and 2) reduce costs and litigation. All of this will continue to reduce the negative fund balance. The City has initiated discussions with three (3) additional bargaining units to expand the Carve Out program focused on the same goals of expediting claim resolutions that leads to reducing claim costs.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 93 (14) Accumulated Fund Deficits (Continued)
General Liability
The City has established a General Liability Fund to provide for the potential claim and cost expenditures for general liability claims against the City. In addition to any monies held in this fund, the City makes an annual appropriation based upon its estimate of claim and expense payments during the fiscal year. In fiscal year 2019, there was a deficit primarily attributable to lower rates charged to Departments. In fiscal years 2020 and 2021, the City increased rates to collect an additional $1,200 from Departments. Additionally, in fiscal year 2020 the General Fund transferred $5,000 into this fund to help address increased claims and improve the deficit. In fiscal year 2023 a new allocation methodology was put in place to increase collection to cover the self-insurance deductible and increased settlements and self-insured retention amounts, as a result it reduced the deficit. In 2024, the city also received refund of payment for excess liability coverage in excess of the City’s self-insurance retention.
311 Call Center
The 311 Call Center receives direct revenue transfers from other city departments to support the Center's operational costs. Beyond the normal, immediate costs associated with operations, the Fund incurs GASB 68 and GASB 75 expenses at the end of the year. These GASB charges push the fund balance into the negative. At this time, the Fund is not structured to collect additional revenue to cover the deficit caused by GASB 68 and GASB 75 expenses. The Public Works Department has been working with the City's Finance Department to identify a solution and anticipates addressing this negative balance issue by fiscal year 2026.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
94 Annual Comprehensive Financial Report | June 30, 2024 (15) Excess of Expenditures over Appropriations
The following funds reported an excess of expenditures over appropriations at June 30, 2024:
Final
Budget Actual
Variance with
Final Budget
Positive
(Negative)
General Fund:
General Government
Attorney 13,661$ 13,968$ (307)$ Nondepartmental 23,767 25,663 (1,896) Public Safety
Fire 65,649 66,881 (1,232) Police 102,635 104,775 (2,140) Transportation
Public Works 17,144 17,788 (644) Debt Service
Lease payments - 976 (976) Subscription payments - 1,055 (1,055) Interest on leases and subscriptions - 106 (106) Project Management Fund:
Debt Service
Lease payments - 1 (1) Subscription payments 60 (60)
Interest on leases and subscriptions - 5 (5) Health Fund:
Capital Outlay 21 23 (2) Debt Service
Lease payments - 29 (29) Subscription payments 49 (49)
Interest on leases and subscriptions - 3 (3) Building Services Fund:
Capital Outlay 67 68 (1) Debt Service
Lease payments 3 (3)
Subscription payments - 3 (3) Sewer Construction and Maintenance Fund:
Sanitation 6,284 6,403 (119) Debt Service
Subscription payments - 2 (2) Transportation Fund:
Debt Service
Lease payments - 63 (63) Subscription payments - 25 (25) Interest on leases and subscriptions - 4 (4) Library Services Fund:
Debt Service
Lease payments - 148 (148) Subscription payments - 58 (58) Interest on leases and subscriptions - 5 (5) Parking Fund:
Debt Service
Lease payments - 10 (10) Housing and Community Development Fund:
Debt Service
Lease payments - 123 (123) Subscription payments - 70 (70) Interest on leases and subscriptions - 9 (9)
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 95 (15) Excess of Expenditures over Appropriations (Continued)
General Fund:
General Government – Attorney
The City Attorney Department incurred more litigation and outside legal service expense than the budgeted amount due to complex employment, police litigation, and other matters.
General Government – Non-Departmental
The fluctuation from budget is primarily due to a Covid related expenditure for $1,596. This was a one-time payment that was delayed pending internal review to determine and ensure compliance with FEMA guidelines.
Public Safety – Fire
The Fire Department incurred more personnel costs than the budgeted amount due to two Recruitment Academies including an unbudgeted lateral recruitment academy.
Public Safety – Police
The Police Department incurred approximately $2,000 in personnel and supply costs related to unbudgeted cost-reimbursable events.
Transportation – Public Works
The fluctuation from budget is primarily due to an additional $600 in unbudgeted utility costs due to increases in usage and overall rate charges.
Debt Service
Debt service expenditures in excess of appropriations related to third year recording of unbudgeted GASB Statement No. 87, Leases, for $976 and second-year recording of unbudgeted GASB Statement No. 96, Subscription-Based Information Technology Arrangements, for $1,055. GASB Statement information is further discussed in the detailed notes.
(16) Pledged Revenue
Pasadena Water and Power has a number of outstanding debt issuances that are collateralized by pledged electric and water revenues. The amount and term of the remainder of these outstanding debts are presented in Note 9.
The purpose of the debt issuances was for the financing of certain Light and Power and Water projects. For the current year, debt service payments as a percentage of the pledged gross revenue (net of certain expenses) are indicated in the table below. These percentages also approximate the relationship of debt service of pledged revenues for the remainder of the term of these debts:
Annual Amount of Pledged Annual Debt Debt Service as
Revenue (net of expenses) Service Payments a Percentage of Description of Pledged Revenue (in thousands) (in thousands) Pledged Revenue Light and Power Revenues $121,087 $15,608 13%
Water Revenues 21,124 5,792 27%
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
96 Annual Comprehensive Financial Report | June 30, 2024 (17) Transfers
Primary Government
The following is a summary of transfers in and out for the year ended June 30, 2024:
General
Project Debt
General Management Service
Transfers Out Fund Fund Fund
General Fund -$ 7,906$ A 7,314$ B Project Management Fund - - - Nonmajor Governmental Funds 48 23,540 D - Light and Power Fund 18,000 F - - Water Fund 1,894 - - Off-Street Parking Fund - 743 - Nonmajor Enterprise Funds 198 64 - Internal Service Funds - 2,679 - Total 20,140$ 34,931$ 7,314$
Transfers In
Primary Government
(A) Transfers of $7,906 from General Fund to Project Management Fund mainly consist of:
$5,606 for various street improvements including $2,009 for sidewalk improvements; $1,642 for the improvement of Municipal buildings including $1,623 for fire station renovations; $284 for the technology upgrade projects, including $187 for the police computer-aided dispatch; and records management system replacement project.
(B) Transfer of $7,314 from General Fund to General Debt Service Fund mainly consist of:
$4,752 to pay pension obligation for Bonds Series 2020AB; $1,503 to pay taxable pension obligation for Bonds Series 2015; and $1,033 to pay for equipment purchase note payable.
(C) Transfers of $18,442 from General Fund to Nonmajor Governmental Funds mainly consist of:
$12,213 to support the Library Services Fund; and
$4,304 to pay for 2015A Refunding COPs;
$700 from Health Fund; and
$379 from Transportation’s Proposition C Fund.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 97 (17) Transfers (Continued)
Light
Nonmajor and Nonmajor Internal
Governmental Power Enterprise Service
Funds Fund Funds Funds Total
18,442$ C -$ -$ 226$ 33,887$ - - 143 1,478 1,621 - 6,559 E - 15 30,162 - - - - 18,000 - - - - 1,894 - - 53 98 894 - - - 435 697 - - - - 2,679 18,442$ 6,559$ 196$ 2,252$ 89,835$ Transfers In
d
(D) Transfers of $23,540 from Nonmajor Governmental Funds to Project Management Fund mainly consist of:
$6,089 from Road Maintenance and Rehabilitation Fund for various street improvement projects including $5,809 for street resurfacing and ADA improvements;
$4,302 from Transportation Sales Tax Fund for the construction of a transit maintenance facility including $4,133 for the purchase of real property;
$4,288 from Sewer Facility Charge Fund and Sewer Construction Management Fund for sewer system related projects;
$3,069 from Gas Tax Fund for various street improvement projects including $2,491 for street resurfacing and ADA improvements;
$2,474 from Residential Development Impact Fund for various park improvement projects; $737 from Community Development Block Grant Fund for various sidewalk improvement projects; $553 from Traffic Reduction Fund for various transit projects including the construction of a transit maintenance facility and pedestrian access improvement projects; $533 from South Lake Parking Meter Fund for a pedestrian access improvement project; and $398 from Underground Utility Fund for various underground utility projects including an electrical system project.
(E) Transfers of $6,559 from Nonmajor Governmental Funds to Light and Power Fund to pay for the underground utilities program expenses.
(F) Light and Power Fund contributed $18,000 to the General Fund; the amount transferred may be expended for any municipal purpose.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
98 Annual Comprehensive Financial Report | June 30, 2024 (18) Self-insurance
The City maintains self-insurance and excess insurance programs for various lines of liability coverage. Liability claims are self-administered within the Self-Insured Retention (SIR). For the period of July 1, 2023 to June 30, 2024, excess liability insurance was purchased with limits of $25,000 in excess of $5,000 per occurrence SIR. Excess workers’ compensation insurance is at $3,000. Workers’ compensation claims for all City workers, including public safety, i.e., fire and police, are administered by a third-party administrator, Acclamation Insurance Management Services (AIMS). The City maintains a few self-administered claims for dates of injury prior to July 1, 2012.
The City currently has twenty-four (24) workers’ compensation claims from prior years that exceeded the SIR. The breakdown of claims that exceeded the corresponding year’s SIR excess level is as follows:
Number of Existing
Workers’ Compensation
Claims
Retention
Amount
10 $500
8 250
1 100
5 50
Total 24
No workers’ compensation injury incurred since the SIR has been $3,000. City has received $3,257 in workers’ compensation excess recovery. The City is requesting $1,663 in workers’ compensation excess recovery currently.
The Civil Division of the Department of the City Attorney/City Prosecutor, primarily using in-house civil attorneys, controls litigated liability claims. A claim is a demand seeking damages allegedly arising out of a wrongful act for which the claimant asserts the City is responsible. During fiscal year 2024, the City paid $6,802 in claims and settlement payments. For new claims with alleged dates of loss within fiscal year 2024, the overall total incurred was $5,000. Liability against a public entity is mitigated by existing laws/statutes/codes, which provide certain immunities. The City currently has approximately five (5) active litigation cases, each with reserves estimated in excess of $2,000.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 99 (18) Self-insurance (Continued)
SIR losses and administrative costs are reported in the General Liability and Workers’ Compensation internal service funds. Losses incurred are reimbursed by departments over a period of time as part of an internal service assessment system. Legal expenses are reported in the City Attorney Department of the General Fund. A case reserve is established for each claim, monitored, and adjusted by the Liability Division and the Workers’ Compensation Claims Supervisors, including expected litigation expenses and losses that will be paid by the City Treasurer.
Heliport and Aircraft coverage provides protection to the City for liability arising out of its public safety/police helicopter operations and for the City’s leadership role on the LA Impact Team. The policy carries a per occurrence limit of $50,000 for Aircraft Hull and Liability, with an aggregate of $50,000. Coverages include hull physical damage for the scheduled aircraft, damage done by the City’s aircraft to someone else’s hangar, and emergency landing. The policy also covers liability resulting from an error by pilot. In addition, the policy provides coverage for airport liability with a $50,000 per occurrence limit. The annual premium is apportioned between the City and LA Impact, since the policy carries hull coverage for LA Impact aircraft.
The City renewed property insurance on all its buildings, with a combined total scheduled insured value of $1.26 billion. The policy includes coverage for fine arts, valuable papers, business personal property, business income, and extended business income or rental value. Policy limits are $250,000 with an “all risk” deductible of $25, and varying deductibles for specific perils. Exclusions include earth movement, including earthquake, nuclear hazard, and military action. The City did not receive new claims under this policy for fiscal year 2024.
The City’s property: power plant boiler and machinery policy, with total insured value of $462,428. The program provides property and equipment breakdown coverage for City’s power plant facilities and machinery. The policy affords coverage for risks of loss or damage, including boiler explosion and machinery breakdown. Policy limits are $250,000 with deductibles of $750 per occurrence for all other property damage, and $1,500 per occurrence for machinery breakdown of GT1, GT2, GT3, GT4, and GT5. In FY2024, a claim was filed, but not pursued.
In an effort to protect the City’s assets and transfer potential risk, the City also purchases the following insurance policies: medical malpractice; pollution liability; terrorism – Chemical, Biological or Biochemical, Radiological or Nuclear (CBRN); auto physical damage; cyber liability; fiduciary, including a policy purchased for and by the Fire and Police Retirement System; and crime policies.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
100 Annual Comprehensive Financial Report | June 30, 2024 (18) Self-insurance (Continued)
Pasadena Center Operating Company (PCOC) is entitled to indemnity from the City; however, PCOC purchases a commercial general liability policy for general liability and employment practice coverage. The City manages the PCOC claims and tenders to the insurance carrier third-party administrator. PCOC carries statutory workers’ compensation insurance with no retention. PCOC requires licensees to provide insurance or purchase special events liability insurance from PCOC. The City buys liability insurance on the parking structures at PCOC. PCOC buys separate liability insurance on the ice rink.
Rose Bowl Operating Company (RBOC) is entitled to indemnity from the City, and its losses are included in the City’s general liability self-insurance program and under the excess general liability policies. RBOC carries statutory workers’ compensation insurance with no retention. Brookside Golf Course is also managed through RBOC. Major Rose Bowl tenants include: the Pasadena Tournament of Roses, UCLA Football, Anschutz Entertainment Group, and the R.G. Canning Swap Meet. Tenants provide insurance, naming City of Pasadena and RBOC as additional insured parties on their policies.
The claims liability reported in the General Liability and Workers’ Compensation internal service funds is based on the requirements of GASB Statement No. 10 (Accounting and Financial Reporting for Risk Financing and Related Insurance Issues ), which requires a liability for claims to be reported if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of loss can be reasonably estimated, including incurred but not yet reported claims. As of June 30, 2024, general liability claims payable amounted to $11,986 of which $10,352 is estimated to be paid within one year. Workers’ compensation claims payable amounted to $44,384 of which $16,074 is estimated to be paid within one year.
Beginning Fiscal Year Claim Ending
Fiscal Year Liability In Estimates Payments Liability
2022-23 76,153$ 5,646$ (16,936)$ 64,863$
2023-24 64,863 7,664 (16,157) 56,370
(19) Deferred Compensation Plan
For the benefit of its employees, the City has adopted a deferred compensation plan in accordance with Section 457 of the Internal Revenue Code. Generally, eligible employees may defer receipt of a portion of their salary until termination, retirement, death, or an unforeseeable emergency. As a result of changes under the Small Business Job Protection Act of 1996, all amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts must be held in a trust, custodial account, or annuity contract for the exclusive benefit of the employee participants and their beneficiaries.
The plan has a Plan Administrator and an oversight committee. The five-member committee is comprised of three elected City employees and two members of the community appointed by the City Council. The oversight committee members basically monitor the plan activity, performance of investment options and ensure that the Plan Administrator carries out his duties and responsibilities. The Plan Administrator, the Director of Finance, or their designee, is responsible for the day-to-day administration. The Plan Administrator has authority to sign all legal agreements with approved plan providers, and ensures proper amounts are withheld, immediately transferred to the trust, and invested in accordance with participants’ directions.
As of June 30, 2024 the market value of the City’s deferred compensation plan assets amounted to $387,695.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 101 (20) Pension Plans
Each full-time employee and each part-time employee (with 1,000 hours or more of service) of the City is a member of either the FPRS or CalPERS. Both plans are defined benefit pension plans and are described individually in the following notes.
Summary of Pension Plans
Net Pension
Liability
Pension
Expense
Deferred Outflows
Related to Pension
Deferred Inflows
Related to Pension
Pasadena Fire and Police Retirement Plan (FPRS) 16,712$ 651$ 3,082$ -$ CalPERS - Safety Plan 230,348 39,164 81,379 375 CalPERS - Miscellaneous Plan 347,563 54,226 112,349 5,353 Total Plans 594,623$ 94,041$ 196,810$ 5,728$
Pasadena Fire and Police Retirement System (FPRS)
Plan Description
FPRS (the System) is a single-employer defined benefit plan governed by a Retirement Board (Board) under provisions of the City Charter. The plan covers all fire and police personnel who were employed by the City prior to July 1, 1977, except for those who elected to transfer to CalPERS when FPRS closed to new member in June 2004. In June 2004, active members were provided a one-time opportunity to transfer from FPRS to CalPERS as provided by an agreement with the City. Once transferred to CalPERS, retirement benefits for all fire and police personnel employed thereafter are provided under CalPERS. The plan provides retirement, death, and disability benefits.
Copies of FPRS’s annual financial report may be obtained from the Pasadena Fire & Police Retirement System, 100 N. Garfield Ave., Rm. S201 Pasadena, CA 91101-1726 or at https://www.cityofpasadena.net/commissions/fire-and- police-retirement-board/.
Cash and Investments
Unrestricted pooled cash 1,188$
Designated pooled cash 1,250
Cash with master custodian 43
Cash and cash equivalents 2,481
Short-term investments 4,313
Investments 98,268
Total investments 102,581
Total cash and investments 105,062$
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
102 Annual Comprehensive Financial Report | June 30, 2024 (20) Pension Plans (Continued)
Pasadena Fire and Police Retirement System (FPRS) (Continued) Funding Policy
Section 1509.9 of the City Charter provides that the normal member contribution rates will provide an average annuity, at age 50, equal to 1/100 of the final compensation of members for each year of service according to tables adopted by the Board. The basic benefits otherwise funded by these contributions have now been fully funded by Contribution Agreement 16,900. Pursuant to the agreement, the City contributed $100,000 net proceeds from the issuance of pension bonds to FPRS on August 5, 1999. The net proceeds plus the existing assets of FPRS became sufficient to fully fund the basic benefits, the unfunded basic benefits, the 1919 benefits, and the cost-of-living adjustment (COLA) benefits. Contributions are recognized when due. Therefore, member contributions are suspended as long as basic benefits remain fully funded.
On October 20, 2011, the Board approved Amended and Restated Agreement No. 20,823 (“Agreement No. 20,823”).
Under this new agreement, the City’s minimum funding percentage schedule and reimbursement cap in Agreement No. 16,900 carried forward, and the City agreed to provide a contribution of $46,600 to the System through the issuance of pension obligation bonds. Agreement No. 20,823 provided that the annual required supplemental contribution would be actuarially calculated using an interest assumption of 6% and an inflation rate of 3% beginning with the June 30, 2012 valuation. Pursuant to this agreement, future annual valuations after June 30, 2012, shall adopt an assumed interest rate and inflation assumption based on analysis performed by the System’s actuary and after seeking input from the City and System’s investment consultant. Agreements No. 16,900 and No. 20,823 state that if the minimum funding deficit is greater than $3,000 in a year, the City will pay $3,000 to the System. Any remaining amount necessary to reach the minimum funding percentage will be phased in over a five-year period; however, no annual supplemental payment may exceed a reimbursement cap measured by the prior year’s payments for benefits other than the funded basic benefits.
As of June 30, 2024, the funded percentage of the System, calculated in accordance with Agreement No. 20,823 and Agreement No. 16,900, was 83.5%. As provided by Contribution Agreement No. 16,900, if the funded percentage is below the minimum funding percentage of 80% for fiscal year 2023, the City will reimburse the System in the following fiscal year subject to certain reimbursement limits. Based on the June 30, 2024 actuarial valuation, the funding deficiency was $0, or 0%, below the funding requirement of 80% as of June 30, 2024. Thus, no required supplemental contribution is owed to the System by the City during fiscal year ended June 30, 2024.
The components of the net pension liability of the System as of June 30, 2024 are as follows:
Total Pension Liability 115,342$
Beginning Fiduciary Net Position (FNP) 104,377$
Concord Loan Payment 601
Net Investment Income 6,220
Benefit Payments (12,250)
Administrative Expenses (318)
Plan Fiduciary Net Position 98,630$
Net Pension Liability/(Asset) 16,712
Plan Fiduciary Net Position as a
Percentage of Total Pension Liability 85.5%
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 103 (20) Pension Plans (Continued)
Pasadena Fire and Police Retirement System (FPRS) (Continued) Actuarial Methods and Assumptions Used to Determine Total Pension Liability Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and cost trends. Actuarially determined amounts are subject to continual review or modification as actual results are compared with past expectations and new estimates are made about the future. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employers and plan members) and include the types of benefits provided at the time of each valuation. Following the recommendation provided by the System’s Actuary on May 26, 2023, the Board later accepted the recommended assumptions for use in the preparation of the actuarial valuation for the year ended June 30, 2024.
Discount Rate 6.90%*
Inflation 2.30%
Salary Increases Varies by entry age and service
Mortality
Expected Geometric Real Rate of Return
Large Cap US Equity 3.77%
Small Cap US Equity 4.45%
Foreign Equity 4.41%
Domestic Core Fixed Income 0.53%
Senior Bank Loans 1.64%
Short-Term Investment-Grade Bonds 0.05%
TIPS -0.24%
Risk Parity 3.38%
Real Estate 3.81%
Inactive employees or beneficiaries currently receiving benefits** 172 Inactive employees entitled to but not yet receiving benefits - Active employees -
Total participants 172
** Al terna tive payee da ta for 23 Domes tic Rela tions Order (DRO) a greements provided s eparatel y from employee-retiree for first time in 6/30/24 va lua tion. Benefits for thes e a lternative pa yee previously Actuarial Assumptions
*
Dis count Ra te refl ects a s sumed inves tment expens e of 15 bas i s poi nts . 10-year geometric expected real rates of return from
Board-approved actuarial valuations, as prepared by
Bartel Associates, LLC (June 30, 2013-2021) & Foster &
Foster, Inc. (June 30, 2024)
CalPERS 2000-2021 Experience Study,
Mortality Improvement Scale 80% Scale MP-2021
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
104 Annual Comprehensive Financial Report | June 30, 2024 (20) Pension Plans (Continued)
Pasadena Fire and Police Retirement System (FPRS) (Continued) Discount Rate
The discount rate of 5.25% was selected by the System actuary and approved by the Board to measure the June 30, 2024 TPL for accounting purposes. The discount rate is the expected real long-term rate of return, plus the inflation assumption of 2.50%, less assumed investment expenses of 15 basis points. The expected long-term real rate of return is compared at the 50% and 55% confidence levels of capital market assumptions. Based on the assumptions, the System's Fiduciary Net Position was projected to be available to make all projected future benefit payments. The discount rate used as of June 30, 2024 is the same as the discount rate of 5.25% used as of June 30, 2023.
Asset Class
Target Asset
Allocation
Large Cap US Equity 17.00%
Small Cap US Equity 4.00%
Foreign Equity 21.00%
Domestic Core Fixed Income 25.00%
TIPS 5.00%
Short-Term Investment-Grade Bonds 13.00%
Senior Bank Loans 5.00%
Alternative (Risk Parity) 0.00%
Real Estate 10.00%
Total Portfolio 100.00%
Changes in Pension Liability
A B C = B - A
Total Pension
Liability
Plan Fiduciary
Net Position
Net Pension
Asset/(Liability)
Balance at June 30, 2023 122,950$ 104,377$ (18,573)$ Changes Recognized for the
Measurement Period:
Service Cost - - -
Interest on the Total Pension Liability 6,133 - (6,133) Differences between Expected and Actual
Experience (1,994) - 1,994
Contribution from Employers - - -
Contribution from Employees - - -
Concord Loan Payment 601 601
Net Investment Income - 6,220 6,220
Benefit Payments (12,250) (12,250) -
Administrative Expense - (318) (318)
Change of Assumptions 503 - (503)
Net Change during 2023-24 (7,608) (5,747) 1,861
Balance at June 30, 2024 115,342$ 98,630$ (16,712)$ Ending Fiduciary Net Position as a
Percentage of the Total Pension Liability 85.5%
Pension Expense 651$
Increase / (Decrease)
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 105 (20) Pension Plans (Continued)
Pasadena Fire and Police Retirement System (FPRS) (Continued) Sensitivity of the Net Pension Liability to Changes in the Discount Rates Examining the sensitivity of the net pension liability (NPL) to changes in the discount rate by a 1% decrease, from
5.25% to 4.25%, revealed an increase in the NPL by $8,622 to a total NPL of $25,334. Conversely, increasing the discount rate by 1%, from 5.25% to 6.25%, revealed a corresponding decrease in the NPL of $7,593 to total NPL of $9,119 as of June 30, 2024.
Discount Rate -1%
(4.25%)
Current Discount
Rate (5.25%)
Discount Rate +1%
(6.25%)
Net Pension Liability (NPL) 25,334 16,712 9,119
NPL Funded Percentage 79.60% 85.50% 91.50%
FPRS
Deferred Outflows and Deferred Inflows of Resources Related to Pensions Deferred Outflows of
Resources
Deferred Inflows of
Resources
Net Deferred of
Resources
Projected versus Actual Earnings on
Investments 3,082$ -$ 3,082$
Total 3,082$ -$ 3,082$
FPRS
Measurement Period
ended June 30:
Deferred
Outflows/(Inflows) of
Resources
2025 270$
2026 3,371
2027 (227)
2028 (332)
FPRS
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
106 Annual Comprehensive Financial Report | June 30, 2024 (20) Pension Plans (Continued)
CalPERS Miscellaneous and Safety Plans
Plan Description
All qualified permanent and probationary employees are eligible to participate in the City’s Miscellaneous Plan and Safety Plan (Plans), agent multiple-employer defined benefit pension plans administered by the California Public Employees’ Retirement System (CalPERS), which acts as a common investment and administrative agent for its participating member employers. Benefit provisions under the Plans are established by State statute and City resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information that can be found on the CalPERS website.
Benefits Provided
CalPERS provide service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service.
The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied as specified by the Public Employees’ Retirement Law.
The Plan provisions and benefits in effect at June 30, 2024, are summarized as follows:
Hire date Prior to January 1, 2013 Hire date Prior to January 1, 2013 Benefit formula 2.5% @ 55 Benefit formula 3% @ 55
Benefit vesting schedule 5 years service Benefit vesting schedule 5 years service Benefit payments monthly for life Benefit payments monthly for life Retirement age 50 Retirement age 50
Monthly benefits, as a % of eligible
compensation 2.00% to 2.50%
Monthly benefits, as a % of eligible
compensation 2.40% to 3.00%
Required employee contribution rates 7.900% Required employee contribution rates 10.420% Required employer contribution rates* 37.890% Required employer contribution rates 52.140% *As a percentage of projected payroll
Miscellaneous Safety
Employees Covered
At the measurement date June 30, 2023, the following employees were covered by the benefit terms of the plan:
Inactive employees or
beneficiaries currently receiving
benefits 1,886 468
Inactive employees entitled to but
not yet receiving benefits 1,314 155
Active employees 1,431 374
Total 4,631 997
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 107 (20) Pension Plans (Continued)
CalPERS Miscellaneous and Safety Plans (Continued)
Contribution Description
Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. The 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. 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. The City made contributions to the Miscellaneous and Safety Plans during the fiscal year ended June 30, 202 4 of $44,612,113 and $27,763,280 respectively.
Net Pension Liability
The City’s net pension liability for each Plan is measured as the total pension liability, less the pension plan’s fiduciary net position. The net pension liability of the Plan 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.
The total pension liabilities in the June 30, 2023 actuarial valuations were determined using the following actuarial assumptions:
Actuarial Methods and Assumptions Used to Determine Total Pension Liability Actuarial Cost Method Entry Age Actuarial Cost Method
Discount Rate 6.90%
Inflation 2.30%
Salary Increases Varies by Entry Age and Service
Mortality Rate Table (1) Derived using CalPERS' Membership Data for all Funds Post Retirement Benefit
Increase
The lesser of contract COLA or 2.30% until Purchasing Power Protection Allowance floor on purchasing power applies, 2.30% thereafter Actuarial Assumptions
(1) The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study and Review of Actuarial Assumptions . Mortality ratesincorporate full generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries.
For more details on this table, please refer to the 2021 experience study report from November 2021 that can be found on the CalPERS website.
Discount Rate
The discount rate used to measure the total pension liability was 6.90%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability.
The stress test results are presented in a detailed report called GASB Crossover Testing Report that can be obtained at CalPERS’ website under the GASB 68 section.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
108 Annual Comprehensive Financial Report | June 30, 2024 (20) Pension Plans (Continued)
CalPERS Miscellaneous and Safety Plans (Continued)
Long-Term Expected Rate of Return
The long-term expected rate of return on pension plan investments was determined using a building-block method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class.
In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectation. Using historical returns of all of the funds’ asset classes, expected compound (geometric) returns were calculated over the next 20 years using a building-block approach. The expected rate of return was then adjusted to account for assumed administrative expenses of 10 Basis points.
The expected real rates of return by asset class are as follows:
Asset Class (1)
Assumed Asset
Allocation Real Return (1,2)
Global Equity - Cap-Weighted 30.00% 4.54%
Global Equity - Non-Cap-Weighted 12.00 3.84
Private Equity 13.00 7.28
Treasury 5.00 0.27
Mortgage-Backed Securities 5.00 0.50
Investment Grade Corporates 10.00 1.56
High Yeild 5.00 2.27
Emerging Market Debt 5.00 2.48
Private Debt 5.00 3.57
Real Assets 15.00 3.21
Leverage (5.00) (0.59)
(1) An expected inflation of 2.30% used for this period. (2) Figures are based on the 2021 Asset Liability Management Study.
Source: CalPERS Annual Comprehensive Financial Report, Fiscal Year Ended June 30, 2023 PERF B & PERF C – Long-Term Expected Real Rates of Return by Asset Class
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 109 (20) Pension Plans (Continued)
CalPERS Miscellaneous and Safety Plans (Continued)
Changes in Net Pension Liability
Miscellaneous
A B C = B - A
Total Pension Liability
Plan Fiduciary Net
Position
Net Pension
Asset/(Liability)
Balance at June 30, 2022,
Measurement Date (MD) 1,308,272$ 967,597$ $ (340,675) Changes Recognized for the
Measurement Period 2022-23:
Service Cost 21,945 - (21,945) Interest on the Total Pension Liability 89,150 - (89,150) Changes of Benefit Terms 1,175 - (1,175) Differences between Expected and
Actual Experience 7,405 - (7,405) Changes of Assumption - - - Plan to Plan Resource Movement - - - Contribution from Employers - 44,612 44,612 Contribution from Employees - 9,808 9,808 Net Investment Income - 59,079 59,079 Benefit Payments, including
Refunds of Employee Contribution (71,605) (71,605) - Administrative Expense - (712) (712) Net Changes 48,070 41,182 (6,888) Balance at June 30, 2023, MD 1,356,342$ 1,008,779$ (347,563)$ Increase/(Decrease)
Safety
A B C = B - A
Total Pension Liability
Plan Fiduciary Net
Position
Net Pension
Asset/(Liability)
Balance at June 30, 2022,
Measurement Date (MD) 794,173$ 578,102$ (216,071)$ Changes Recognized for the
Measurement Period 2022-23:
Service Cost 14,775 - (14,775) Interest on the Total Pension Liability 54,850 - (54,850) Changes of Benefit Terms 228 - (228) Differences between Expected and
Actual Experience 12,540 - (12,540) Changes of Assumption - - - Net Plan to Plan Resource Movement - - - Contribution from Employers - 27,763 27,763 Contribution from Employees - 5,270 5,270 Net Investment Income - 35,508 35,508 Benefit Payments, including Refunds of
Employee Contribution (38,786) (38,786) - Administrative Expense - (424) (424) Net Changes 43,607 29,331 (14,276) Balance at June 30, 2023, MD 837,780$ 607,433$ (230,348)$ Pension Expense 39,164$
Increase/(Decrease)
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
110 Annual Comprehensive Financial Report | June 30, 2024 (20) Pension Plans (Continued)
CalPERS Miscellaneous and Safety Plans (Continued)
Sensitivity of the Net Pension Liability to Changes in the Discount Rates
The following presents the net pension liability of the Plan as of the measurement date, calculated using the discount rate of 6.90 percent, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage-point lower (5.90 percent) or 1 percentage-point higher (7.90 percent) than the current rate:
Discount Rate -1%
(5.90%)
Current Discount
Rate (6.90%)
Discount Rate +1%
(7.90%)
Plan Net Pension Liability 517,905$ 347,563$ 206,128$ Discount Rate -1%
(5.90%)
Current Discount
Rate (6.90%)
Discount Rate +1%
(7.90%)
Plan Net Pension Liability 348,538$ 230,348$ 133,813$ Miscellaneous
Safety
Subsequent Events (as measurement period is from July 1, 2022 through June 30, 2023)
There were no subsequent events that would materially affect the results presented in this disclosure.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 111 (20) Pension Plans (Continued)
CalPERS Miscellaneous and Safety Plans (Continued)
Amortization of Deferred Outflows and Deferred Inflows of Resources
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 expense.
The amortization period differs depending on the source of the gain or loss:
Net difference between projected
and actual earnings 5 year straight-line amortization
All other amounts Straight-line amortization over the expected average remaining service lifetime (EARSL) of all members that are provided with benefits (active, inactive, and retired) as of the beginning of the measurement period
The EARSL for the Miscellaneous Plan for the measurement period ending June 30, 2023 is 3.3 years, which was obtained by dividing the total service years of 14,569 (the sum of remaining service lifetimes of the active employees) by 4,461 (the total number of participants: active, inactive, and retired). Inactive employees and retirees have remaining service lifetimes equal to 0. 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 Safety Plan for the measurement period ending June 30, 2023 is 5.0 years, which was obtained by dividing the total service years of 4,804 (the sum of remaining service lifetimes of the active employees) by 970 (the total number of participants: active, inactive, and retired). Inactive employees and retirees have remaining service lifetimes equal to 0. Total future service is based on the members’ probability of decrementing due to an event other than receiving a cash refund.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
112 Annual Comprehensive Financial Report | June 30, 2024 (20) Pension Plans (Continued)
CalPERS Miscellaneous and Safety Plans (Continued)
Pension Expense and Deferred Outflows and Deferred Inflows of Resources Related to Pensions
As of June 30, 2024, the City has deferred outflows and deferred inflows of resources related to pensions as follows:
Deferred Deferred Deferred Deferred Deferred Deferred
Outflows of Inflows of Outflows of Inflows of Outflows of Inflows of Resources Resources Resources Resources Resources Resources Changes of Assumption 14,533$ -$ 13,194$ -$ 27,727$ -$ Differences between Expected and
Actual Experience 5,161 (5,353) 10,520 (375) 15,681 (5,728) Net Difference between Projected
and Actual Earnings on Pension
Plan Investments
46,494 - 27,765 - 74,259 - Contributions Subsequent to the
Measurement Date 46,161 - 29,899 - 76,060 - Total 112,349$ (5,353)$ 81,379$ (375)$ 193,728$ (5,728)$ Miscellaneous Safety Total
The amounts above are net of outflows and inflows recognized in the fiscal year 2023-24 measurement period expense. Other amounts reported as deferred outflows or deferred inflows of resources related to pensions will be recognized as pension expense as follows:
Measurement Period
ended June 30
Deferred
Outflows/(Inflows) of
Resources
Measurement Period
ended June 30:
Deferred
Outflows/(Inflows) of
Resources
2024 17,082$ 2024 12,459$
2025 9,616 2025 10,050
2026 32,736 2026 25,255
2027 1,401 2027 3,340
2028 - 2028 -
Thereafter - Thereafter - Miscellaneous Safety
Defined Contribution Plan (PARS)
The City provides pension benefits for employees not covered by CalPERS or FPRS through the PARS. This is a defined contribution plan created in accordance with Internal Revenue Code Sections 401(a) and 501, and administered by Phase II Systems. In a defined contribution plan, benefits depend solely on amounts contributed to the plan plus investment earnings. Employees are eligible to participate from the date of employment. On October 29, 2012, the City adopted a Salary Resolution for the non-represented non-management employees requiring the covered employees to contribute the full 7.5% of their earnings effective December 31, 2012. Prior to the adoption of the Salary Resolutions, the plan agreement required the City to contribute an amount equal to 4.0% of the employees’ earnings and the covered employee contributed 3.5%. The City contributions for each employee were fully vested.
The City’s payroll for employees covered by PARS for the year ended June 30, 2024 was $5,064. The covered employees made the total required 7.5% contributions of $379.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 113 (21) Other Postemployment Benefits (OPEB)
The City of Pasadena provides a direct subsidy to retirees of the City who are members of the California Public Employees’ Retirement System or the Pasadena Fire and Police Pension System. As such, the OPEB plan is not separately audited and does not issue its own report.
Benefit provisions are established and amended through negotiations between the City and the respective unions. Two different levels of subsidy toward the purchase of medical insurance from CalPERS under the Public Employees’ Medical and Hospital Care Act (PEMHCA) are offered. These are currently at $157.00 or $158.00 per month depending on the bargaining unit or the unrepresented group the employee was a member.
At the June 30, 2024 actuarial valuation, the following current and former employees were covered by the benefit terms:
Inactive plan members or beneficiaries currently receiving benefits 714 Active plan members 1,890
2,604
Plan Description
Eligibility. The plan is an agent multiple-employer plan which provides benefits under PEMHCA to individuals who retire with the City and begin to collect a monthly benefit under one of the retirement plans sponsored by the City.
Employees who terminate under service retirement or disability retirement and certain survivors of Safety members who die in active service are eligible.
Service Retirement: Employees retiring directly from active status receive medical benefits commencing at retirement. Employee must be age 50 (or 52 if a “new member” as defined in the Public Employees’ Pension Reform Act of 2013) or older with 5 or more years of service.
Disability Retirement: Employees retiring directly from active status due to disability receive medical benefits commencing at retirement. Employees are eligible for Industrial Disability retirement at hire and for Non-Industrial Disability retirement after 5 years of CalPERS service.
Pre-retirement Death:
Safety Employees
Industrial: Survivor receives medical benefits commencing immediately.
Non-Industrial: Survivor receives medical benefits immediately if death occurs after member reaches age 50 with 5 years of service.
Miscellaneous Employees Survivor receives medical benefits immediately if death occurs after member reaches age 50 with 5 years of service.
Dependent Eligibility: Dependents are not eligible for benefits.
Survivor Eligibility: Survivors are eligible for benefits if the retiree elected a form of coverage providing for continued pension payments to the retiree.
Benefits:
Medical Benefit: Eligible retirees are provided a subsidy for medical benefits through PEHMCA. For the calendar year 2024, this monthly amount is $157.00 for certain classes of employees and $141.30 for remaining employees.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
114 Annual Comprehensive Financial Report | June 30, 2024 (21) Other Postemployment Benefits (OPEB) (Continued)
Contributions
The City contributes the minimum amount allowed under Government Code Section 22825 of the PEMHCA enacted by CalPERS pursuant to State Law. The City’s required monthly contributions for calendar years 2024 and 2023 were $157.00 or $151.00, respectively. The statutory contribution will be indexed by the medical CPI each year. The required contribution is based on pay-as-you-go financing requirements. Retirees must contribute any premium amounts in excess of the City contribution. In fiscal year 2018, the City set aside $2 million in a Section 115 trust account, which was recognized as a reduction to the OPEB liability. The City has not made any additional contribution since the initial funding and during fiscal year ended June 30, 2024. As of June 30, 2024, the market value of the OPEB Section 115 trust account was $2,501.
Net OPEB Liability
The City’s net OPEB liability was measured as of June 30, 2024 and the total OPEB liability used to calculate the net OPEB liability was determined by an actuarial valuation dated July 1, 2023, based on the following actuarial methods and assumptions:
Actuarial Cost Method Entry Age Normal – level percentage of Salary method Actuarial Assumptions
Discount Rate 4.21% as of July 1, 2024 and 4.13% as of July 1, 2023 Inflation 2.80% per annum
Payroll Increases 2.80% per annum, plus salary merit increases Merit Increases Merit increases from the most recent CalPERS pension plan valuation.
The benefits are not payroll related but each individual’s projected cost is allocated over their lifetime as a level-percentage of pay.
Healthcare Trend Rate The current health care trend rate starts at an initial rate of
8.00%,decreasing to an ultimate rate of 4.50%.
Investment Rate of Return 5.0% per annum
Disability According to the disability rates under the 2021 CalPERS experience study.
Turnover Rate According to the termination rates under the 2021 experience study for the CalPERS pension plan
Retirement Age According to the retirement rates under the 2021 CalPERS experience study. According to the following retirement tables:
Miscellaneous Tier 1: 2.7% @ 55
Miscellaneous Tier 2: 2.0% @ 62
Fire Tier 1: 3.0% @ 55
Fire Tier 2: 2.7% @ 57
Police Tier 1: 3.0% @ 55
Police Tier 2: 2.7% @ 57
Mortality Rate The plan does not have sufficient data to have credible experience.
Therefore, mortality assumptions are set to reflect general population trends based upon Pub-2010 Mortality tables and the most recent generational projection scale MP-2021 released by the Society of Actuaries (SOA) for future mortality improvements.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 115 (21) Other Postemployment Benefits (OPEB) (Continued)
Net OPEB Liability (Continued)
Pre-retirement Turnover According to the rates under the 2021 experience study for the CalPERS pension plan
[Rates have been updated to the CalPERS 2017 experience study from the 2014 experience study for the pension plan]
Participation Rates 60% of eligible active employees are assumed to elect medical coverage at retirement. Future retirees are assumed to elect similar coverage as current retirees. Actual plan coverage is used for current retirees.
Spouse Coverage 50% of future retirees are assumed to elect coverage for their spouse.
Male spouses are assumed to be 3 years older than female spouses.
Actual spouse coverage and spouse ages are used for current retirees.
The long-term expected rate of return on OPEB plan investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of OPEB plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long- term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the OPEB plan’s target asset allocation as of June 30, 2024 are summarized in the following table:
Assets Class Target Allocation
Long-term Expected
Gross Rate of Return
Equities 30.00% N/A
Fixed Income 65.00% N/A
Cash 5.00% N/A
Total 100.00% 5.60%
Long-term expected rate of return is 5.00%.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
116 Annual Comprehensive Financial Report | June 30, 2024 (21) Other Postemployment Benefits (OPEB) (Continued)
Changes in the OPEB Liability
A B C = A - B
Total OPEB Liability
Plan Fiduciary Net
Position
Net OPEB
(Asset)/Liability
Balance at June 30, 2023 77,599$ 2,310$ 75,289$ Changes recognized for the
Measurement Period:
Service Cost 3,683 - 3,683 Interest 3,293 - 3,293 Difference between expected and
actual experience (5,359) - (5,359) Changes of Assumptions 4,416 - 4,416 Contribution - Employer - 2,997 (2,997) Net Investment Income - 203 (203) Benefit Payments, Net (3,119) (2,997) (122) Administrative Expenses - (12) 12 Net Changes 2,914 191 2,723 Balance at June 30, 2024 80,513$ 2,501$ 78,012$ Increase (Decrease)
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 117 (21) Other Postemployment Benefits (OPEB) (Continued)
Sensitivity of the Net OPEB Liability to Changes in the Discount Rate
The following presents the net OPEB liability of the City, calculated using the discount rate of 4.21%, as well as what the net OPEB would be if it were calculated using a discount rate that is one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2024:
1% Decrease Current Discount Rate 1% Increase
(3.21%) (4.21%) (5.21%)
Net OPEB Liability 88,436$ 78,012$ 69,353$
Sensitivity of the Net OPEB Liability to Changes in Health Care Cost Trend Rates
The following presents the net OPEB liability of the City if it were calculated using health care cost trend rates that are one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2024:
1% Decrease
Current Healthcare Cost
Trend Rates 1% Increase
(7.00% decreasing to
3.50%)
(8.00% decreasing to
4.50%)
(9.00% decreasing to
5.50%)
Net OPEB Liability 67,515$ 78,012$ 91,176$
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB
For the fiscal year ended June 30, 2024, the City recognized OPEB expense of $5,549. As of fiscal year ended June 30, 2024, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB form the following sources:
Deferred Outflows
of Resources
Deferred Inflows
of Resources
Changes of Assumptions 7,709$ (5,448)$ Difference between expected and actual experience 612 (18,939) Net difference between projected and actual earning on OPEB plan investments 66 - Total 8,387$ (24,387)$
The $8,387 reported as deferred outflows of resources and $24,387 reported as deferred inflows related to pensions will be recognized as pension expense as follows:
Fiscal Year
Ended June 30
Deferred
Outflows/(Inflows) of
Resources
2025 (2,031)$
2026 (1,991)
2027 (2,076)
2028 (2,078)
2029 (2,061)
Thereafter (5,763)
Total (16,000)$
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
118 Annual Comprehensive Financial Report | June 30, 2024 (22) Commitments and Contingencies
Primary Government
“Take or Pay” Contracts
The City’s electric operation has entered into various long term “Take or Pay” contracts to provide for current and future electric generating capacity and transmission of energy for City customers. The City is obligated to pay the amortized cost of indebtedness regardless of the ability of the contracting agency to provide electricity and/or transmission, as applicable. The original indebtedness will be amortized by adding the financing costs to purchase energy over the life of the contract. The contracts expire at various times through fiscal year 2036.
Additional financial information on the SCPPA may be obtained by contacting the City of Pasadena Department of Water and Power at 150 South Los Robles, Suite 200, Pasadena, CA 91101.
Stranded Investments
In response to California Assembly Bill 1890 (“AB1890”), the City chose to open its market to competition on January 1, 2000. The City has long-term contracts with IPA and SCPPA, most of which obligate the City to purchase power and/or services at cost, which was projected to be higher than market in a deregulated environment. As a result, the City was faced with a “stranded investment” with a net present value estimated to be approximately $42 million in 2024. The City has implemented the approved Stranded Investment Utilization Plan by direct defeasance of the debt service of IPP outstanding bonds and mitigation of variable energy costs.
Additional information related to IPA and SCPPA is available online from Water and Power Department’s website or may be obtained by contacting the department at 150 South Los Robles, Suite 200, Pasadena, CA 91101.
Lawsuits and Claims
A number of suits and claims are pending against the City arising in the normal course of operations. In the opinion of management, the results of such legal actions will not have a material adverse effect on the financial position or results of operations of the City.
Other
Certain federal and state revenues are received for specific purposes and are subject to audit by the grantor agencies. City management is of the opinion that adjustments, if any, resulting from such audits will not be significant.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 119 (23) Restatement of Beginning Net Position or Fund Balances
During fiscal year 2024, changes to or within the financial reporting entity and two error corrections resulted in adjustments to and restatements of beginning net position and fund net position, as follows:
Special Revenue
Major
Enterprise
Rent Pasadena Rental Successor
General Stabilization Water Housing Board Agency
Net position or fund balances at beginning of
year, as previously reported 164,611$ -$ 893,782$ (5)$ -$ Changes within reporting entity:
Rent Stabilization Fund - (5) A - 5 A - Error Correction:
Raymond Basin Water Right - - 2,882 B - - Successor Agency 22 C - - - (22) C Net position or fund balances at beginning of
year, as restated 164,633$ (5)$ 896,664$ -$ (22)$ Reporting Units Affected by Adjustments to and Restatements of Beginning Balances Fiduciary
(A) Restatement of beginning fund net position in Rent Stabilization Fund, a special revenue fund, and Rental Housing Board Fund, a Custodial Fund under fiduciary type fund:
Beginning fiscal year 2024, the Rent Stabilization Fund is presented as a special revenue fund, renamed from Pasadena Rental Housing Board (PRHB) Fund that was presented as a custodial fund under the fiduciary fund type in fiscal year 2023. As a result, the special revenue funds’ beginning net position decreased by $5.
This change within the reporting entity is the result of the City Council’s vote to turn the PRHB into the Rent Stabilization Department in November 2023 after in October 2023, PRHB requested to be incorporated into the City as a city department to expedite the implementation of the voter-approved objectives by using existing city infrastructure and processes.
The PRHB was established to implement the provisions of the Pasadena Fair & Equitable Housing City Charter Article XVIII (City Charter Article XVIII). City Charter Article XVIII was approved by voters as a ballot measure in November 2022. The charter article established PRHB to be responsible for enforcing rent stabilization laws and provides counseling to assist landlords and tenants with navigating the new rent stabilization ordinance.
(B) Restatement of beginning net position in Water Fund, a major enterprise fund:
In fiscal year 2024, it was discovered that a City-decreed water right from a court ruling in 1984 for 12,807 acre- feet of the Raymond Basin Area intangible asset was not previously recorded. Its value was calculated by multiplying the total decree water right by the water rate at January 1, 1984, resulting in a value of $2,882 (12,807 acre-feet of decree right multiplied by the $225 [in whole dollars] water rate as of January 1, 1984).
As a result, the Water Fund’s beginning net position increased by $2,882.
NOTES TO THE BASIC FINANCIAL STATEMENTS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
120 Annual Comprehensive Financial Report | June 30, 2024 (23) Restatement of Beginning Net Position or Fund Balances (Continued)
(C) Restatement of beginning fund net position in General Fund and Successor Agency Fund, a Private-Purpose Trust under fiduciary type fund:
In fiscal year 2024, it was discovered that four appraisal expenditures (one each from fiscal years 2019, 2021, 2022 and 2023) were recorded in the General Fund instead of the Successor Agency Fund. As a result, the beginning fund net position of the General Fund increased by $22.
CITY OF PASADENA FINANCIAL SECTION NOTES TO THE BASIC FINANCIAL STATEMENTS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 121 (24) Subsequent Events
Subsequent events were evaluated through the date of the audit report.
Electric Revenue Refunding Bonds 2024A Series
On July 15, 2024, the City issued the Electric Revenue Refunding bonds, Series 2024A (2024A Revenue Bonds) in the amount of $115,446 to refund the City’s 2013A Electric Revenue Bonds, pay the cost of issuance of the 2024A Revenue Bonds, and to fund capital projects for the modernization and reliability City’s Electrical System. The 5.00% interest rate is payable annually on August 1 of each year, commencing on August 1, 2025. Principal is payable in annual installments commencing on August 1, 2025, and ending August 1, 2054. The City realized a present value savings of $7,400. Debt service payments will be made from the Light and Power Fund.
Lease Revenue Refunding Bonds 2024A Series
On October 28, 2024 the City approved the issuance of the 2024A Refunding Lease Revenue Bonds ("2024A Bonds") issued to refinance the 2010B Build America Bonds.
The Series 2010B Lease Revenue Bonds were issued as Build America Bonds (BABs). BABs were issued as taxable fixed rate bonds whereby the United States Treasury rebates the issuer (the City) 35% of the interest portion due on the bonds semi-annually for the life of the bonds, therefore, reducing the taxable interest rate on the debt to an equivalent tax-exempt rate. The annual subsidy by the Federal Government has reduced over the years from 35% to 33%. The risk of the Federal Government further reducing or eliminating the BABs cash subsidy in the future and materially increasing the cost of the BABs financing is real and this risk increases as the federal budget deficit grows.
The post subsidy interest rate paid on the BABs is 4.78%. If the cash subsidies are eliminated, the interest rate on the bonds will increase to 7.13%. This equates to a 2.35% interest rate increase on the bonds or an annual increase of $2,500 in interest expense to the Rose Bowl Operating Company (RBOC).
The purpose and objective of the refunding was to eliminate the sequestration risk, provide the ability to refinance in 2034, level the annual debt service payments, and provide annual funding until 2043 to enable the RBOC to invest in the capital improvements and preventive maintenance of the facility. The purpose of the refunding was not to generate economic savings. The final pricing generated a present value dis-saving of $11,375 or a -10.7% net present value savings of par value of refunded bonds.
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ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2024
Required
Supplementary
Information
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REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
126 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual General Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Taxes:
Property 84,824 $ 84,824$ 84,073$ (751)$ Sales 74,993 74,993 80,223 5,230 Utility users' 28,685 28,685 32,027 3,342 Transient occupancy 18,360 18,360 18,505 145 Street light and traffic signal 6,700 6,700 9,270 2,570 Business license 6,500 6,500 7,969 1,469 Construction 2,925 2,925 3,524 599 Franchise 2,921 2,921 2,709 (212) Other 2,100 2,100 1,922 (178) Licenses and permits 3,990 3,990 3,787 (203) Intergovernmental 23,630 30,093 31,788 1,695 Charges for services 41,970 46,236 47,865 1,629 Fines and forfeitures 6,626 6,626 6,334 (292) Investment earnings 2,438 2,438 2,993 555 Net change in fair value of investments - - 3,468 3,468 Lease revenues 986 986 1,022 36 Interest income from leases - - 1 1 Miscellaneous revenues 3,285 3,339 3,386 47 Contributions 28 28 28 - Total revenues 31 0,961 321,744 340,894 19,150 Expenditures:
General government:
Attorney 11,381 13,661 13,968 (307) Clerk 3,440 3,615 3,518 97 Council 3,249 3,249 2,911 338 Manager 6,904 9,330 7,728 1,602 Finance 14,906 14,906 13,921 985 Human Resources 5,176 5,222 5,213 9 Nondepartmental 20,767 23,767 25,663 (1,896) Public safety:
Fire 64,394 65,649 66,881 (1,232) Police 100,965 102,635 104,775 (2,140) Transportation:
Transportation 7,893 8,408 7,673 735 Public Works 17,069 17,144 17,788 (644) Culture and leisure:
Parks, Recreation & Community 26,389 26,349 25,502 847 Nondepartmental 11,808 11,808 11,608 200 Community development:
Planning & Permitting 7,585 10,608 9,016 1,592 Housing 2,525 3,318 2,145 1,173 Capital outlay 638 16,926 14,758 2,168 Debt service:
Lease payments - - 976 (976) Subscription payments - - 1,055 (1,055) Interest on leases and subscriptions - - 106 (106) 305,089 336,595 335,205 1,390 Excess (deficiency) of revenues
over (under) expenditures 5,872 (14,851) 5,689 20,540 Budget
CITY OF PASADENA FINANCIAL SECTION REQUIRED SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 127 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual (Continued) General Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Other Financing Sources (Uses):
Proceeds from financed purchase arrangements - - 46 46 Transfers in 15,440 20,190 20,140 (50) Transfers out (26,235) (37,303) (33,887) 3,416 Leases issued - - 67 67 Subscriptions issued - - 2,191 2,191 Total other financing sources (uses) (10,795) (17,113) (11,443) 5,624 Net change in fund balances (4,923) (31,964) (5,754) 26,164 Fund balances, beginning, as previously reported 164,611 164,611 164,611 - Restatement for correction of an error 22 22 22 - Fund balances, beginning, as restated 164,633 164,633 164,633 - Fund balances, ending 159,710$ 132,669$ 158,879$ 26,164$ Budget
REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
126 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual General Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Taxes:
Property 84,824 $ 84,824$ 84,073$ (751)$ Sales 74,993 74,993 80,223 5,230 Utility users' 28,685 28,685 32,027 3,342 Transient occupancy 18,360 18,360 18,505 145 Street light and traffic signal 6,700 6,700 9,270 2,570 Business license 6,500 6,500 7,969 1,469 Construction 2,925 2,925 3,524 599 Franchise 2,921 2,921 2,709 (212) Other 2,100 2,100 1,922 (178) Licenses and permits 3,990 3,990 3,787 (203) Intergovernmental 23,630 30,093 31,788 1,695 Charges for services 41,970 46,236 47,865 1,629 Fines and forfeitures 6,626 6,626 6,334 (292) Investment earnings 2,438 2,438 2,993 555 Net change in fair value of investments - - 3,468 3,468 Lease revenues 986 986 1,022 36 Interest income from leases - - 1 1 Miscellaneous revenues 3,285 3,339 3,386 47 Contributions 28 28 28 - Total revenues 31 0,961 321,744 340,894 19,150 Expenditures:
General government:
Attorney 11,381 13,661 13,968 (307) Clerk 3,440 3,615 3,518 97 Council 3,249 3,249 2,911 338 Manager 6,904 9,330 7,728 1,602 Finance 14,906 14,906 13,921 985 Human Resources 5,176 5,222 5,213 9 Nondepartmental 20,767 23,767 25,663 (1,896) Public safety:
Fire 64,394 65,649 66,881 (1,232) Police 100,965 102,635 104,775 (2,140) Transportation:
Transportation 7,893 8,408 7,673 735 Public Works 17,069 17,144 17,788 (644) Culture and leisure:
Parks, Recreation & Community 26,389 26,349 25,502 847 Nondepartmental 11,808 11,808 11,608 200 Community development:
Planning & Permitting 7,585 10,608 9,016 1,592 Housing 2,525 3,318 2,145 1,173 Capital outlay 638 16,926 14,758 2,168 Debt service:
Lease payments - - 976 (976) Subscription payments - - 1,055 (1,055) Interest on leases and subscriptions - - 106 (106) 305,089 336,595 335,205 1,390 Excess (deficiency) of revenues
over (under) expenditures 5,872 (14,851) 5,689 20,540 Budget
CITY OF PASADENA FINANCIAL SECTION REQUIRED SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 127 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual (Continued) General Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Other Financing Sources (Uses):
Proceeds from financed purchase arrangements - - 46 46 Transfers in 15,440 20,190 20,140 (50) Transfers out (26,235) (37,303) (33,887) 3,416 Leases issued - - 67 67 Subscriptions issued - - 2,191 2,191 Total other financing sources (uses) (10,795) (17,113) (11,443) 5,624 Net change in fund balances (4,923) (31,964) (5,754) 26,164 Fund balances, beginning, as previously reported 164,611 164,611 164,611 - Restatement for correction of an error 22 22 22 - Fund balances, beginning, as restated 164,633 164,633 164,633 - Fund balances, ending 159,710$ 132,669$ 158,879$ 26,164$ Budget
REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
128 Annual Comprehensive Financial Report | June 30, 2024
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CITY OF PASADENA FINANCIAL SECTION REQUIRED SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 129 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual Housing Successor Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Charges for services -$ -$ 4$ 4$ Investment earnings - - 135 135 Miscellaneous revenues 118 118 134 16 Total revenues 118 118 273 155 Expenditures:
Current:
Community development 251 854 577 277 Total expenditures 251 854 577 277 Net change in fund balances (133) (736) (304) 432 Fund balance, beginning 1,021 1,021 1,021 - Fund balance, ending 888$ 285$ 717$ 432$ Budget
REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
130 Annual Comprehensive Financial Report | June 30, 2024
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CITY OF PASADENA FINANCIAL SECTION REQUIRED SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 131 City of Pasadena
Notes to the Required Supplementary Information
Year Ended June 30, 2024
Budgets and Budgetary Data
The City Council is required to adopt an annual budget resolution by June 30 of each fiscal year. The budgets are adopted on a basis that does not differ materially from GAAP.
An appropriated annual budget is legally adopted for the General and Special Revenue Governmental Funds.
Annual appropriated budgets are not adopted for Debt Service Funds because bond indentures are used as the method for adequate budgetary control. Capita l projects funds do not have annual appropriated budgets. Control over some projects is maintained by means of an annual budget; others through a project- length capital improvement budget. This project-length budget authorizes total expenditures over the duration of a construction project, rather than year by year.
The City maintains budgetary controls to ensure co mpliance with legal provisions embodied in the appropriated budget approved by the City Council. The level of budgetary control (the level at which expenditures cannot legally exceed the appropriated amount) is the department level and within a single fund. The City Manager may authorize transfers of appropriations within a department so long as it is within a single fund. Supplemental appropriations during th e year must be approved by the City Council. All unencumbered appropriations lapse at the end of the fiscal year. In order to be an encumbered appropriation there must be either an approved purchase order or contract in force as of June 30.
REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
132 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Changes in the Net Pension Liability and Related Ratios CalPERS Pension Plans – Miscellaneous
Last Ten Fiscal Years
Fiscal year ended June 30, 2024 June 30, 2023 June 30, 2022 June 30, 2021 Measurement period ended June 30, 2023 June 30, 2022 June 30, 2021 June 30, 2020 Total Pension Liability:
Service cost 21,945$ 22,198$ 19,876$ 19,566$ Interest on total pension liability 89,150 85,888 84,480 81,859 Changes of benefits 1,175 - - - Changes of assumptions - 35,296 - - Difference between expected and actual experience 7,405 (12,307) (2,425) (3,982) Benefit payments, including refunds of
employee contributions (71,605) (66,929) (63,657) (61,336) Net Change in Total Pension Liability 48,070 64,146 38,274 36,107 Total Pension Liability - Beginning of Year 1,308,272 1,244,126 1,205,852 1,169,745 Total Pension Liability - End of Year (a) 1,356,342$ 1,308,272$ 1,244,126$ 1,205,852$ Plan Fiduciary Net Position:
Contributions - employer 44,612$ 40,242$ 38,235$ 35,786$ Contributions - employee 9,808 9,288 9,265 8,895 Net investment income 59,078 (80,440) 199,471 42,242 Benefit payments, including refunds of
employee contributions (71,605) (66,929) (63,657) (61,336) Net plan to plan resource movement - - - - Administrative expense (712) (664) (883) (1,211) Other miscellaneous income/(expense) - - - - Net Change in Plan Fiduciary Net Position 41,181 (98,503) 182,431 24,376 Plan Fiduciary Net Position - Beginning of Year 967,598 1,066,101 883,670 859,294 Plan Fiduciary Net Position - End of Year (b) 1,008,779$ 967,598$ 1,066,101$ 883,670$ Net Pension Liability - Ending (a)-(b) 347,563$ 340,674$ 178,025$ 322,182$ Plan fiduciary net position as a percentage of the
total pension liability 74.37% 73.96% 85.69% 73.28%
Covered payroll 141,362$ 126,652$ 119,630$ 119,505$ Net pension liability as percentage of
covered payroll 245.87% 268.98% 148.81% 269.60%
NOTES TO SCHEDULE:
Benefit Changes:
Changes in Assumptions:
From fiscal year June 30, 2015 to June 30, 2016:
For fiscal years ended 2016 and 2017:
There were no significant changes in assumptions.
For fiscal years ended 2017 and 2018:
The discount rate was reduced from 7.65% to 7.15%.
For fiscal years ended 2019, 2020, 2021, 2022, 2023, and 2024:
There were no significant changes in assumptions.
For fiscal year ended 2024:
The discount rate was reduced from 7.15% to 6.90%.
GASB 68, paragraph 68 states that the long-term expected rate of return should be determined net of pension plan investment exp ense but without reduction for pension plan administrative expense. The discount rate of 7.50% used for the June 30, 2014 measurement date was net of administrative expenses. The discount rate of 7.65% used for the June 30, 2015 measurement date is without reduction of pension plan administrative expense.
There were no changes in benefits.
CITY OF PASADENA FINANCIAL SECTION REQUIRED SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 133
June 30, 2020 June 30, 2019 June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015 June 30, 2019 June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015 June 30, 2014 19,270$ 19,070$ 18,793$ 16,452$ 16,519$ 17,349$ 79,379 76,249 74,168 72,632 70,708 68,656 - - - - - - - (7,443) 59,447 - (16,682) - 5,492 (3,023) (11,333) (13,975) (14,488) - (58,915) (55,364) (51,700) (49,269) (46,871) (44,239) 45,226 29,489 89,375 25,840 9,186 41,766 1,124,519 1,095,030 1,005,655 979,815 970,629 928,863 1,169,745$ 1,124,519$ 1,095,030$ 1,005,655$ 979,815$ 970,629$ 31,375$ 27,112$ 24,681$ 22,252$ 19,683$ 18,058$ 8,841 8,824 8,904 8,659 8,503 10,977 53,458 66,083 80,076 3,807 16,554 111,123 (58,915) (55,364) (51,700) (49,269) (46,871) (44,239) - (2) - - 1 - (589) (1,219) (1,065) (449) (829) 2 (2,314) - - - - 34,172 43,120 60,896 (15,000) (2,959) 95,919 825,122 782,002 721,106 736,106 739,065 643,146 859,294$ 825,122$ 782,002$ 721,106$ 736,106$ 739,065$ 310,451$ 299,397$ 313,028$ 284,549$ 243,709$ 231,564$
73.46% 73.38% 71.41% 71.71% 75.13% 76.14%
116,645$ 112,848 $ 111,573$ 107,546$ 105,292$ 102,406$ 266.15% 265.31% 280.56% 264.58% 231.46% 226.12%
REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
134 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Contributions
CalPERS Pension Plans – Miscellaneous
Last Ten Fiscal Years
Fiscal year ended 2024 2023 2022 2021
Actuarially determined contribution1 44,612$ 40,242$ 38,235$ 35,786$ Contributions in relation to the actuarially
determined contribution (44,612) (43,316) (38,235) (35,786) Contribution deficiency (excess) -$ (3,074)$ -$ -$ Covered payroll 141,362$ 126,652$ 119,630$ 119,505$ Contributions as a percentage
of covered payroll 31.56% 34.20% 31.96% 29.95%
Notes to Schedule:
Valuation date 6/30/2021 6/30/2020 6/30/2019 6/30/2018
Methods and Assumptions Used to Determine Contribution Rates:
Actuarial cost method Entry age Entry age Entry age Entry age Asset valuation method Fair value Fair value Fair value Fair value Inflation 2.50% 2.50% 2.50% 2.625%
Amortization method2
Salary increases3
Investment rate of return4 7.00% 7.00% 7.00% 7.25%
Retirement age5
Mortality6
NOTES TO SCHEDULE:
1 2 Level percentage of payroll, closed.
3 Depending on age, service, and type of employment.
4 Net of pension plan investment expense, including inflation 5 The probabilities of retirement are based on the most recent CalPERS Experience Study adopted by the CalPERS Board. 6 Employers are assumed to make contributions equal to the actuarily determined contributions. However, some employers may choose to make additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially determi ned contributions.
Mortality assumptions are based on mortality rates resulting from the most recent CalPERS Experience Study adopted by the CalPE RS Board.
CITY OF PASADENA FINANCIAL SECTION REQUIRED SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 135
2020 2019 2018 2017 2016 2015
31,375$ 27,112$ 24,681$ 22,252$ 19,683$ 18,058$ (31,375) (27,112) (24,681) (22,252) (19,683) (18,058) -$ -$ -$ -$ -$ -$ 116,645$ 112,848$ 111,573$ 107,546$ 105,292$ 102,406$
26.90% 24.03% 22.12% 20.69% 18.69% 17.63%
6/30/2017 6/30/2016 6/30/2015 6/30/2014 6/30/2013 6/30/2012 Entry age Entry age Entry age Entry age Entry age Entry age Fair value Fair value Fair value Fair value 15 Year 15 Year Smoothed Smoothed
Market Method Market Method
2.625% 2.75% 2.75% 2.75% 2.75% 2.75%
7.25% 7.38% 7.50% 7.50% 7.50% 7.50%
REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
136 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Changes in the Net Pension Liability and Related Ratios CalPERS Pension Plans – Safety
Last Ten Fiscal Years
Fiscal year ended June 30, 2024 June 30, 2023 June 30, 2022 June 30, 2021 Measurement period June 30, 2023 June 30, 2022 June 30, 2021 June 30, 2020 Total Pension Liability:
Service cost 14,775$ 14,423$ 13,227$ 13,264$ Interest on total pension liability 54,851 51,956 50,130 47,906 Changes of benefit terms 228 - - - Changes of assumptions - 22,619 - - Difference between expected and actual experience 12,540 (643) 777 1,038 Benefit payments, including refunds of
employee contributions (38,786) (35,966) (32,147) (29,518) Net Change in Total Pension Liability 43,608 52,389 31,986 32,690 Total Pension Liability - Beginning of Year 794,173 741,784 709,798 677,108 Total Pension Liability - End of Year (a) 837,781$ 794,173$ 741,784$ 709,798$ Plan Fiduciary Net Position:
Contributions - employer 27,763 $ 25,199$ 23,384$ 21,823$ Contributions - employee 5,270 5,015 4,734 4,617 Net investment income 35,508 (47,866) 118,090 24,676 Benefit payments, including refunds of
employee contributions (38,786) (35,966) (32,147) (29,518) Net plan to plan resource movement - - - - Administrative expense (425) (393) (518) (702) Other miscellaneous income/(expense) - - - - Net Change in Plan Fiduciary Net Position 29,330 (54,011) 113,543 20,896 Plan Fiduciary Net Position - Beginning of Year 578,103 632,114 518,571 497,675 Plan Fiduciary Net Position - End of Year (b) 607,433$ 578,103$ 632,114$ 518,571$ Net Pension Liability - Ending (a)-(b) 230,348$ 216,070$ 109,670$ 191,227$ Plan fiduciary net position as a percentage of the
total pension liability 72.50% 72.79% 85.22% 73.06%
Covered payroll 57,589$ 51,234$ 48,883$ 47,997$ Net pension liability as percentage of
covered payroll 399.99% 421.73% 224.35% 398.41%
NOTES TO SCHEDULE:
Benefit Changes:
Changes in Assumptions:
From fiscal year June 30, 2015 to June 30, 2016:
For fiscal years ended 2016 and 2017:
There were no significant changes in assumptions.
For fiscal years ended 2017 and 2018:
The discount rate was reduced from 7.65% to 7.15%.
For fiscal years ended 2019, 2020, 2021, 2022, 2023, and 2024:
There were no significant changes in assumptions.
For fiscal year ended 2024:
The discount rate was reduced from 7.15% to 6.90%.
There were no changes in benefits.
GASB 68, paragraph 68 states that the long-term expected rate of return should be determined net of pension plan investment expense but without reduction for pension plan administrative expense. The discount rate of 7.50% used for the June 30, 2014 measurement d ate was net of administrative expenses. The discount rate of 7.65% used for the June 30, 2015 measurement date is without reduction of pen sion plan administrative expense.
CITY OF PASADENA FINANCIAL SECTION REQUIRED SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 137
June 30, 2020 June 30, 2019 June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015 June 30, 2019 June 30, 2018 June 30, 2017 Ju ne 30, 2016 June 30, 2015 June 30, 2014 12,764$ 12,757$ 12,324$ 10,509$ 10,702$ 11,182$ 45,654 43,215 41,004 39,394 37,307 35,798 - - - - - - - (995) 36,547 - (9,888) - 4,034 2,172 (7,057) (634) (8,455) - (26,877) (24,941) (22,654) (20,871) (19,143) (16,924) 35,575 32,208 60,164 28,398 10,523 30,056 641,533 609,325 549,161 520,763 510,240 480,184 677,108$ 641,533$ 609,325$ 549,161$ 520,763$ 510,240$ 19,187$ 16,542$ 15,279$ 13,026$ 12,027$ 10,533$ 4,383 4,197 4,056 3,804 3,764 4,226 30,716 37,156 44,323 2,093 8,834 59,052 (26,877) (24,941) (22,654) (20,871) (19,143) (16,924) - (1) - - - - (336) (685) (589) (245) (452) - 1 (1,301) - - 684 - 27,074 30,967 40,415 (2,193) 5,714 56,887 470,601 439,634 399,219 401,410 395,696 338,809 497,675$ 470,601$ 439,634$ 399,219$ 401,410$ 395,696$ 179,433$ 170,932$ 169,691$ 149,942$ 119,353$ 114,544$
73.50% 73.36% 72.15% 72.70% 77.08% 77.55%
47,457$ 46,444$ 44,887$ 41,528$ 41,142$ 41,013$ 378.10% 368.04% 378.04% 361.06% 290.10% 279.29%
REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
138 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Contributions
CalPERS Pension Plans – Safety
Last Ten Fiscal Years
Fiscal year ended 2024 2023 2022 2021
Actuarially determined contribution1 27,763$ 25,199 $ 23,384 $ 21,823 $ Contributions in relation to the actuarially
determined contribution (27,763) (27,252) (23,384) (21,823) Contribution deficiency (excess) -$ (2,053)$ -$ -$ Covered payroll 57,589$ 51,234$ 48,883$ 47,997$ Contributions as a percentage
of covered payroll 48.21% 53.19% 47.84% 45.47%
Notes to Schedule:
Valuation date 6/30/2021 6/30/2020 6/30/2019 6/30/2018
Actuarial cost method Entry age Entry age Entry age Entry age Asset valuation method Fair value Fair value Fair value Fair value Inflation 2.50% 2.50% 2.50% 2.625%
Amortization method 2
Salary increases3
Investment rate of return4 7.00% 7.00% 7.00% 7.25%
Retirement age5
Mortality6
Methods and Assumptions Used to
Determine Contribution Rates:
NOTES TO SCHEDULE:
1 2
Level percentage of payroll, closed.
3 Depending on age, service, and type of employment.
4 Net of pension plan investment expense, including inflation 5 6
Employers are assumed to make contributions equal to the actuarily determined contributions. However, some employers may choose to make additional contributions towards their unfunded liability. Employer contributions for such plans exceed the actuarially de termined contributions.
The probabilities of retirement are based on the most recent CalPERS Experience Study adopted by the CalPERS Board.
Mortality assumptions are based on mortality rates resulting from the most recent CalPERS Experience Study adopted by the CalPE RS Board.
CITY OF PASADENA FINANCIAL SECTION REQUIRED SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 139
2020 2019 2018 2017 2016 2015
19,187$ 16,542$ 15,279$ 13,026$ 12,027$ 10,533$ (19,187) (16,542) (15,279) (13,026) (12,027) (10,533) -$ -$ -$ -$ -$ -$ 47,457$ 46,444$ 44,887$ 41,528$ 41,142$ 41,013$
40.43% 35.62% 34.04% 31.37% 29.23% 25.68%
6/30/2017 6/30/2016 6/30/2015 6/30/2014 6/30/2013 6/30/2012 Entry age Entry age Entry age Entry age Entry age Entry age Fair value Fair value Fair value 15 Year 15 Year 15 Year Smoothed Smoothed Smoothed
Market Method Market Method Market Method
2.625% 2.75% 2.75% 2.75% 2.75% 2.75%
7.25% 7.38% 7.50% 7.50% 7.50% 7.50%
REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
140 Annual Comprehensive Financial Report | June 30, 2024 Fire and Police Retirement System
Schedule of Changes in the Net Pension Liability and Related Ratios Last Ten Fiscal Years
Fiscal year ended June 30, 2024 June 30, 2023 June 30, 2022 June 30, 2021 Measurement period June 30, 2024 June 30, 2023 June 30, 2022 June 30, 2021 Total Pension Liability:
Interest on total pension liability 6,133 $ 6,316$ 6,947$ 7,335$ Differences between expected and actual experience (1,994) 482 164 (1,798) Changes of assumptions 503 1,815 4,400 - Changes of benefits -
Benefit payments, including refunds of
employee contributions (12,250) (11,954) (12,072) (12,506) Net Change in Total Pension Liability (7,608) (3,341) (561) (6,969) Total Pension Liability - Beginning of Year 122,950 126,291 126,852 133,821 Total Pension Liability - End of Year (a) 115,342$ 122,950$ 126,291$ 126,852$ Plan Fiduciary Net Position:
Contributions - employer* 601$ -$ -$ -$ Contributions - employee - - - - Net investment income 6,220 5,013 (10,656) 22,355 Benefit payments, including refunds of
employee contributions (12,250) (11,954) (12,072) (12,506) Administrative expense (318) (344) (343) (327) Net Change in Plan Fiduciary Net Position (5,747) (7,285) (23,071) 9,522 Plan Fiduciary Net Position - Beginning of Year 104,377 111,662 134,733 125,211 Plan Fiduciary Net Position - End of Year (b) 98,630$ 104,377$ 111,662$ 134,733$ Net Pension Liability - Ending (a)-(b) 16,712$ 18,573$ 14,629$ 1 (7,881)$ Plan fiduciary net position as a percentage of the
total pension liability 85.51% 84.89% 88.42% 106.21%
NOTES TO SCHEDULE:
A loan payment was provided to the City in April 2024 for the carrying loan. The City transferred 93%, or $601,463, to the syst em per Amended Agreement NO. 20,823.
As adjusted after the fiscal year 2022 GASB 68 report was performed.
Changes of Assumptions: Fiscal years ended 2019 through 2022 had no significant changes of assumptions. June 30, 2018 assumptio n changes of $2,189,000 for change in the discount rate, from 6.50% in 2017 to 5.75% in 2018, and inflation rate, from 3.00% in 2017 to 2.75% in 2018. June 30, 2015 assumption changes of $1,895,000 for change in base mortality rates, $8,301,000 for change in mortality improvements scale, and ($7,055,000) for change in the discount rate.
CITY OF PASADENA FINANCIAL SECTION REQUIRED SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 141
June 30, 2020 June 30, 2019 June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015 June 30, 2020 June 30, 2019 June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015 7,600$ 7,781 $ 8,832 $ 9,272 $ 9,644 $ 9,162 $ 438 1,862 1,261 (3,081) (2,098) (3,075) - - 2,189 - - 3,141 - - - - - - (12,773) (12,824) (12,815) (13,118) (13,448) (13,645) (4,735) (3,181) (533) (6,927) (5,902) (4,417) 138,556 141,737 142,270 149,197 155,099 159,516 133,821$ 138,556$ 141,737$ 142,270$ 149,197$ 155,099$ 23,137$ -$ -$ -$ -$ -$ - - - - - - 3,394 5,923 6,656 12,512 50 5,683 (12,773) (12,824) (12,815) (13,118) (13,448) (13,645) (321) (257) (272) (300) (302) (273) 13,437 (7,158) (6,431) (906) (13,700) (8,235) 111,774 118,932 125,363 126,269 139,969 148,204 125,211$ 111,774$ 118,932$ 125,363$ 126,269$ 139,969$ 8,610$ 26,782$ 22,805$ 16,907$ 22,928$ 15,130$
93.57% 80.67% 83.91% 88.12% 84.63% 90.24%
REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
142 Annual Comprehensive Financial Report | June 30, 2024 Fire and Police Retirement System
Schedule of Plan Contributions
As of June 30, for the Last Ten Fiscal Years
Contractually Actual Contribution as
Fiscal Year Required Fiscal Year Deficiency Covered a Percentage of Ending Contribution* Contribution (Excess) Payroll Payroll 2024 -$ -$ -$ n/a n/a 2023 - - - n/a n/a 2022 - - - n/a n/a 2021 - - - n/a n/a 2020 3,478 23,137 (19,659) n/a n/a 2019 - - - n/a n/a 2018 - - - n/a n/a 2017 - - - n/a n/a 2016 - - - n/a n/a 2015 - - - n/a n/a
CITY OF PASADENA FINANCIAL SECTION REQUIRED SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 143 Fire and Police Retirement System
Schedule of Plan Investment Returns
As of June 30, for the Last Ten Fiscal Years
Fiscal year ended 2024 2023 2022 2021 2020 2019 2018 2017 2016 2015
6.60% 5.00% -8.60% 19.00% 2.80% 5.50% 5.60% 10.70% 0.40% 3.70% Annual money-weighted rate of
return net of investment expense
NOTE TO SCHEDULE:
Source is the June 30, 2023 GASB 67 plan actuarial information prepared by System Actuary, Foster & Foster, Inc.
REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
144 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Changes in the Net OPEB Liability and Related Ratios As of June 30, for the Last Ten Fiscal Years1
Fiscal year ended 2024 2023 2022 2021 2020 2019 2018
Total OPEB Liability
Service cost 3,683 $ 3,623$ 4,917$ 4,254$ 3,567$ 3,217$ 3,178$ Interest on the total OPEB liability 3,293 3,141 2,181 2,365 2,561 2,596 2,448 Differences between expected and actual experience (5,359) (397) 874 (553) (7,576) - - Changes in assumptions 4,415 (419) (26,576) 2 6,723 11,111 3,664 (988) Changes in benefit terms - - - - - - - Benefit payments (3,119) (2,997) (2,833) (2,678) (2,815) (2,612) (2,391) Net change in Total OPEB Liability 2,913 2,951 (21,437) 10,111 6,848 6,865 2,247 Total OPEB liability - beginning 77,600 74,649 96,086 85,975 79,127 72,262 70,015 Total OPEB liability - ending (a) 80,513$ 77,600$ 74,649$ 96,086$ 85,975$ 79,127$ 72,262$ Plan Fiduciary Net Position
Contribution - employer 3,119$ 2,997$ 2,833$ 2,678$ 2,815$ 2,612$ 4,391$ Net investment income 203 101 (301) 312 101 133 2 Benefit payments (3,119) (2,997) (2,833) (2,678) (2,815) (2,612) (2,391) Administrative expense (12) (6) (5) (6) (11) (9) - Net change in plan fiduciary net position 191 95 (306) 306 90 124 2,002 Plan fiduciary net position - beginning 2,311 2,216 2,522 2,216 2,126 2,002 - Plan fiduciary net position - ending (b) 2,502$ 2,311$ 2,216$ 2,522$ 2,216$ 2,126$ 2,002$ Net OPEB Liability/(Assets) - ending (a) - (b) 78,011$ 75,289$ 72,433$ 93,564$ 83,759$ 77,001$ 70,260$ Plan fiduciary net position as a percentage of the
total OPEB liability 3.11% 2.98% 2.97% 2.62% 2.58% 2.69% 2.77% Covered - employee payroll 182,846$ 177,866$ 160,024$ 167,502$ 164,102$ 134,734$ 130,809$ Net OPEB Liability as percentage of covered-
employee payroll 42.7% 42.3% 45.3% 55.9% 51.0% 57.2% 53.7%
NOTES TO SCHEDULE:
2 Adjusted FY 2022 'Changes of assumptions'.
1 GASB Statement No. 75, which requires ten years of history for this schedule, was implemented during fiscal year ended June 30, 2018. Additional years will be added as they become available in the future.
CITY OF PASADENA FINANCIAL SECTION REQUIRED SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 145 Schedule of OPEB Plan Contributions
As of June 30, for the Last Ten Fiscal Years1
2024 2023 2022 2021 2020 2019 2018
Contractually determined contribution 3,119$ 2,997 $ 2,833 $ 2,678 $ 2,815$ 2,612$ 4,391 $ 1 Contribution in relation to the
contractually determined
contributions $ (3,119) (2,997) (2,833) (2,678) (2,815) (2,612) (4,391) Contribution deficiency/(excess) $ - -$ - $ - $ - $ - $ - $ Covered employee payroll $ 182,846 177,866$ 160,024 $ 167,502 $ 164,102$ 134,734$ 130,809$
1.71% 1.68% 1.77% 1.60% 1.72% 1.94% 3.36%Contributions as a percentage of covered employee payroll
NOTE TO SCHEDULE:
1 GASB Statement No. 75, which requires ten years of history for this schedule, was implemented during fiscal year ended June 30, 2018. Additional years will be added as they become available in the future.
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Supplementary
Information
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2024
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CITY OF PASADENA FINANCIAL SECTION SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 149
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SUPPLEMENTARY INFORMATION FINANC IAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
150 Annual Comprehensive Financial Report | June 30, 2024 Combining Balance Sheet
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2024
Special Capital Debt Service
Revenue Projects Fund Permanent
Funds Funds 2015 Series A Funds Total
Assets:
Cash and investments 149,880$ 8,323$ -$ 2,140$ 160,343$ Accounts receivable 17,577 118 - 13 17,708 Lease receivable 447 - - - 447 Prepaids and other assets 134 - - - 134 Notes receivable 65,169 - - - 65,169 Allowance for doubtful accounts (65,169) - - - (65,169) Restricted assets:
Cash and investments 3,447 - - - 3,447 Cash with fiscal agent 140 - 6,970 - 7,110 Total assets 171,625 8,441 6,970 2,153 189,189 Liabilities, deferred inflows of resources and
fund balances:
Liabilities:
Accounts payable and accrued liabilities 6,745 - - - 6,745 Deposits 1,337 - - - 1,337 Due to other funds 11,431 - - - 11,431 Unearned revenue 3,261 - - - 3,261 Total liabilities 22,774 - - - 22,774 Deferred Inflows of Resources:
Unavailable revenues 4,058 - - - 4,058 Lease related 425 - - - 425 Total deferred inflows of resources 4,483 - - - 4,483 Fund Balances:
Nonspendable 134 - - 1,433 1,567 Restricted 54,983 1,948 6,970 637 64,538 Committed 96,019 6,493 - 83 102,595 Unassigned (6,768) - - - (6,768) Total fund balances 144,368 8,441 6,970 2,153 161,932 Total liabilities, deferred inflows of resources
and fund balances 171,625$ 8,441$ 6,970$ 2,153$ 189,189$
CITY OF PASADENA FINANCIAL SECTION SUPPLEMENTARY INFORMATION (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 151 Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2024
Special Capital Debt Service
Revenue Projects Fund Permanent
Funds Funds 2015 Series A Funds Total
Revenues:
Taxes 11,694$ -$ -$ -$ 11,694$ Licenses and permits 12,327 - - - 12,327 Intergovernmental 75,738 - - - 75,738 Charges for services 11,911 94 - - 12,005 Investment earnings 3,745 229 - 51 4,025 Net change in fair value of investments 4,485 331 217 60 5,093 Lease revenues 3,600 - - - 3,600 Interest income from leases 3 - - - 3 Miscellaneous revenues 4,155 - - - 4,155 Contributions 584 267 - - 851 Total revenues 128,242 921 217 111 129,491 Expenditures:
Current:
General government - - 4 - 4 Public safety 3,096 - - - 3,096 Transportation 18,326 - - - 18,326 Utility 29 - - - 29 Sanitation 6,403 - - - 6,403 Health 20,670 - - - 20,670 Culture and leisure 15,996 - - - 15,996 Community development 46,572 153 - - 46,725 Capital outlay 2,016 - - - 2,016 Debt service:
Principal retirement 300 - 2,310 - 2,610 Interest 116 - 1,991 - 2,107 Lease payments 376 - - - 376 Subscription payments 207 - - - 207 Interest on leases and subscriptions 21 - - - 21 Total expenditures 114,128 153 4,305 - 118,586 Excess (deficiency) of revenues over
(under) expenditures 14,114 768 (4,088) 111 10,905 Other Financing Sources (Uses):
Proceeds from financed purchase arrangements 1 - - - 1 T
ransfers in 14,138 - 4,304 - 18,442 Transfers out (27,135) (3,027) - - (30,162) Leases issued 23 - - - 23 Total other financing sources (uses) (12,973) (3,027) 4,304 - (11,696) Net change in fund balances 1,141 (2,259) 216 111 (791) Fund balances, beginning, as previously reported 143,232 10,700 6,754 2,042 162,728 Restatement for changes within reporting entity (5) - - - (5) Fund balances, beginning, as restated 143,227 10,700 6,754 2,042 162,723 Fund balances, ending 144,368$ 8,441$ 6,970$ 2,153$ 161,932$
SUPPLEMENTARY INFORMATION FINANC IAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
152 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual Project Management Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Intergovernmental - $ 217,856$ 13,495$ (204,361)$ Charges for services - 80 25 (55) Lease revenues - 300 283 (17) Miscellaneous revenues - - 33 33 Contributions - 1,549 677 (872) Total revenues - 219,785 14,513 (205,272) Expenditures:
Current:
Transportation 6,868 6,868 1,644 5,224 Capital outlay 1,836 267,801 49,958 217,843 Debt service:
Lease payments - - 1 (1) Subscription payments - - 60 (60) Interest on leases and subscriptions - - 5 (5) Total expenditures 8,704 274,669 51,668 223,001 Excess (deficiency) of revenues
over (under) expenditures (8,704) (54,884) (37,155) 17,729 Other Financing Sources (Uses):
Transfers in - 46,151 34,931 (11,220) Transfers out - 30 (1,621) (1,651) Total other financing sources - 46,181 33,310 (12,871) Net change in fund balances (8,704) (8,703) (3,845) 4,858 Fund balance, beginning 2,453 2,453 2,453 - Fund balance (deficit), ending (6,251)$ (6,250)$ (1,392)$ 4,858$ Budget
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2024
Special
Revenue Funds
FINC_Annual_Comprehensive_Report_2024_Dividers_Layout 1 11/21/2024 5:01 PM Page 7 (This page intentionally left blank)
CITY OF PASADENA SUPPLEMENTARY INFORMATION NONMAJOR GOVERNMENTAL FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 155
NONMAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS
Special revenue funds are used to account for specific revenue s that are legally restricted to expenditure for particular purposes. In a governmental fund other than the general fund, expenditures incurred for a specific purpose might exceed the amounts in the fund that are restricted, committed, and assigned to that purpose and a negative residual balance for that purpose may result. If that occurs, amount assigned to other purposes in that fund should be reduced to eliminate the deficit.
If the remaining deficit eliminates all other assigned amounts in the fund, or if there are no amounts assigned to other purposes, the negative residual amount should be classified as unassigned fund balance.
Public Safety Fund – to account for revenue received from State AB3229 funds, the 1/2-cent sales tax approved by the voters in November 1993, money received by the Police Department from forfeited cash and other tangible property seized under the Federal Comprehensive Crime Control Act of 1984 and grants received from the Homeland Security Grant Program.
Health Fund – to account for all grants received for the provision of health serv ices which are restricted by grant award agreements.
Building Services Fund – to account for fees collected and restricted to the operations of the Permit Center.
Sewer Construction and Maintenance Fund – to account for revenue received from sewer use and storm drain charges restricted for the construction and maintenance of the City's sewer system. This includes the use of revenue derived from a special parcel tax (Measure W) approved by voters for im proving water quality, recapturing, treating, and recycling stormwater in Los Angeles County.
Underground Utilities Fund – to a ccount for revenue received fr om the underground surtax on sales of electric energy restricted for the extension, conversion, replacement, and repair of underground utility lines.
Transportation Fund – to account for the use of revenue derived from the 1/2-cent sales tax approved by voters, state gasoline tax, sales tax collected for bikeways and pedestrian facilities, and State AB2928 traffic congestion relief, all of which are restricted for construction, maintenance, preservation and rehabilitation of the City’s street and road system.
Library Services Fund – to account for the operations of the City's public libraries and the library special tax approved by the voters on June 22, 1993 and restricted for Library use.
Parking Fund – to account for revenue derived from on-off street parking, zoning credits, parking and business improvement tax, parking space rental and leases, and on-street parking meters. These funds are restricted for use in the various enterprise zones of the City.
Air Quality Improvement Fund – to account for the use of revenue derived from a fee added to the motor vehicle registration fee for reducing air pollution in accordance with the California Government Code (AB2766).
Housing and Community Development Fund – to account for the use of Community Development Block Grant and other U.S.
Department of Housing and Urban Development programs restricted for housing and community development.
Rent Stabilization Fund - to account for revenue received from annual Rent Registry registrations as a result of Measure H which was approved by voters in the November 2022 General Municipal Election. The funds are restricted to implementing the provisions of the Pasadena Fair and Equitable Housing Charter Amendment (Article XVIII) which includes rent control and just cause eviction protections.
Donated Funds – to account for principal and interest on funds donated to the City for expressed and expendable purposes.
SPECIAL REVENUE FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
156 Annual Comprehensive Financial Report | June 30, 2024 Combining Balance Sheet
Nonmajor Governmental Funds
Special Revenue Funds
June 30, 2024
Sewer
Construction
Public Building and Underground
Safety Health Services Maintenance Utilities
Assets:
Cash and investments 3,643 $ - $ 24,168$ 14,231 $ 39,316 $ Accounts receivable 1,255 5,813 229 750 1,282 Lease receivable - 447 - - - Prepaids and other assets - 2 - - - Notes receivable - - - - - Allowance for uncollectible long-term
receivables - - - - - Restricted assets:
Cash and investments - - - - - Cash with fiscal agent - 140 - - - Total assets 4,898 6,402 24,397 14,981 40,598 Liabilities, deferred inflows of resources
and fund balances:
Liabilities:
Accounts payable and accrued liabilities 89 1,009 512 462 68 Deposits - 4 707 - - Due to other funds - 9,769 - - - Unearned revenue - 745 528 - - Total liabilities 89 11,527 1,747 462 68 Deferred Inflows of Resources:
Unavailable revenues - 1,216 1 - - Le
ase related - 425 - - - Total deferred inflows of resources - 1,641 1 - - Fund Balances:
Nonspendable - 2 - - - Restricted 4,809 - - - - Committed - - 22,649 14,519 40,530 Unassigned - (6,768) - - - Total fund balances (deficit) 4,809 (6,766) 22,649 14,519 40,530 Total liabilities, deferred inflows of resources
and fund balances 4,898$ 6,402$ 24,397$ 14,981$ 40,598$
CITY OF PASADENA SUPPLEMENTARY INFORMATION NONMAJOR GOVERNMENTAL FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 157
Housing and
Library Air Quality Community Rent Donated
Transportation Services Parking Improvement Development Stabilization Funds Total 36,265$ 14,295 $ 4,479 $ 381 $ 8,674$ - $ 4,428$ 149,88 0$ 2,649 139 158 47 5,238 - 17 17,577 - - - - - - - 447 - - - - 132 - - 134 - - - - 65,169 - - 65,169 - - - - (65,169) - - (65,169) - - - - 3,447 - - 3,447 - - - - - - - 14 0 38,914 14,434 4,637 428 17,491 - 4,445 171,625 1,628 549 199 3 1,885 272 69 6,745 - 1 - - 6 - 619 1,337 - - - - - 1,662 - 11,431 - - - - 1,988 - - 3,261 1,628 550 199 3 3,879 1,934 688 22,774 1,065 - 1 46 1,729 - - 4,058 - - - - - - - 425 1,065 - 1 46 1,729 - 4,483 - - - - 132 - 134 36,221 - - 379 11,751 (1,934) 3,757 54,983 - 13,884 4,437 - - - - 96,019 - - - - - - - (6,768) 36,221 13,884 4,437 379 11,883 (1,934) 3,757 144,368 38,914$ 14,434$ 4,637$ 428$ 17,491$ -$ 4,445$ 171,625$
SPECIAL REVENUE FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
158 Annual Comprehensive Financial Report | June 30, 2024 Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds
Special Revenue Funds
For the Fiscal Year Ended June 30, 2024
Sewer
Construction
Public Building and Under ground
Safety Health Services Maintenance Utilities
Revenues:
Taxes -$ 1,096$ -$ -$ 7,398$ Licenses and permits - 2,193 10,134 - - Intergovernmental 4,866 15,121 577 400 - Charges for services - 499 2,060 8,125 - Investment earnin gs8 9 3 550 407 973 Net change in fair value of investments 107 - 675 514 1,197 Lease revenues - 267 - - - Interest income from leases - 3 - - - Miscellaneous revenues - 158 33 - - Contributions - - - - - Total revenues 5,062 19,340 14,029 9,446 9,568 Expenditures:
Current:
Public safety 3,096 - - - - Transportation - - - - - Utility - - - - 29 Sanitation - - - 6,403 - Health - 20,670 - - - Culture and leisure - - - - - Community development - - 11,251 - - Capital outlay 1,812 23 68 - - Debt service:
Principal retirement - - - - - Interest - - - - - Lease payments - 29 3 - - Subscription payments - 49 3 2 - Interest on leases and subscriptions - 3 - - - Total expenditures 4,908 20,774 11,325 6,405 29 Excess (deficiency) of revenues over (under)
expenditures 154 (1,434) 2,704 3,041 9,539 Other Financing Sources (Uses):
Proceeds from financed purchase arrangements - - 1 - - Transfers in - 1,546 - - - Transfers out (197) - (152) (4,628) (6,980) Leases issued - 23 - - - Total other financing sources (uses) (197) 1,569 (151) (4,628) (6,980) Net change in fund balances (43) 135 2,553 (1,587) 2,559 Fund balances (deficit), beginning,
as previously reported 4,852 (6,901) 20,096 16,106 37,971 Restatement for changes within reporting entity - - - - - Fund balances (deficit), beginning, as restated 4,852 (6,901) 20,096 16,106 37,971 Fund balances (deficit), ending 4,809$ (6,766)$ 22,649$ 14,519$ 40,530$
CITY OF PASADENA FINANCIAL SECTION SPECIAL REVENUE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 159
Housing and
Library Air Quality Community Rent Donated
Transportation Services Parking Improvement Development Stabilization Funds Total -$ 3,191$ 9 $ - $ - $ - $ - $ 11,694$ - - - - - - - 12,327 19,943 69 - 138 34,624 - - 75,738 1,049 4 148 - 2 6 - - 11,911 1,019 324 108 8 176 (13) 101 3,745 1,272 390 134 - 87 (14) 123 4,485 - - 3,320 - 13 - - 3,600 - - - - - - - 3 1,379 - 1 - 2,584 - - 4,155 - 40 - - - - 544 584 24,662 4,018 3,720 146 37,510 (27) 768 128,242 - - - - - - - 3,096 15,206 - 3,075 45 - - - 18,326 - - - - - - - 29 - - - - - - - 6,403 - - - - - - - 20,670 - 15,663 - - - - 333 15,996 - - - - 33,419 1,902 - 46,572 - - - - 113 - - 2,016 - - - - 300 - - 300 - - - - 116 - - 116 63 148 10 - 123 - - 37 6 25 58 - - 70 - - 207 4 5 - - 9 - - 21 15,298 15,874 3,085 45 34,150 1,902 333 114,128 9,364 (11,856) 635 101 3,360 (1,929) 435 14,114 - - - - - - - 1 379 12,213 - - - - - 14,138 (13,661) (215) (540) (25) (737) - - (27,135) - - - - - - - 23 (13,282) 11,998 (540) (25) (737) - - (12,973) (3,918) 142 95 76 2,623 (1,929) 435 1,141 40,139 13,742 4,342 303 9,260 - 3,322 143,232 - - - - - (5) - (5) 40,139 13,742 4,342 303 9,260 (5) 3,322 143,227 36,221$ 13,884$ 4,437$ 379$ 11,883$ (1,934)$ 3,757$ 144,368
SPECIAL REVENUE FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
160 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Public Safety Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Intergovernmental 2,757 $ 3,708 $ 4,866 $ 1,158 $ Investment earnings 86 86 89 3 Net change in fair value of investments - - 107 107 Total revenues 2,843 3,794 5,062 1,268 Expenditures:
Current:
Public safety 3,741 3,953 3,096 857 Capital outlay 348 2,370 1,812 558 Total expenditures 4,089 6,323 4,908 1,415 Excess (deficiency) of revenues
over (under) expenditures (1,246) (2,529) 154 2,683 Other Financing Sources (Uses):
Transfers out - (231) (197) 34 Total other financing sources (uses) - (231) (197) 34 Net change in fund balances (1,246) (2,760) (43) 2,717 Fund balance, beginning 4,852 4,852 4,852 - Fund balance, ending 3,606$ 2,092$ 4,809$ 2,717$ Budget
CITY OF PASADENA FINANCIAL SECTION SPECIAL REVENUE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 161 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Health Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Taxes 1,050$ 1,050$ 1,096$ 46$ Licenses and permits 2,046 2,046 2,193 147 Intergovernmental 18,703 20,740 15,121 (5,619) Charges for services 469 469 499 30 Investment earnings - - 3 3 Lease revenues 241 241 267 26 Interest income from leases - - 3 3 Miscellaneous revenues 169 232 158 (74) Total revenues 22,678 24,778 19,340 (5,438) Expenditures:
Current:
Public safety 105 199 - 199 Health 23,661 26,147 20,670 5,477 Capital outlay 30 21 23 (2) Debt service:
Lease payments - - 29 (29) Subscription payments - - 49 (49) Interest on leases and subscriptions - - 3 (3) Total expenditures 23,796 26,367 20,774 5,593 Excess (deficiency) of revenues
over (under) expenditures (1,118) (1,589) (1,434) 155 Other Financing Sources (Uses):
Transfers in 1,425 2,213 1,546 (667) Leases issued - - 23 23 Total other financing sources 1,425 2,213 1,569 (644) Net change in fund balances 307 624 135 (489) Fund balance (deficit), beginning (6,901) (6,901) (6,901) - Fund balance (deficit), ending (6,594)$ (6,277)$ (6,766)$ (489)$ Budget
SPECIAL REVENUE FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
162 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Building Services Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Licenses and permits 8,447 $ 8,447 $ 10,134$ 1,687$ Intergovernmental 1,115 1,115 577 (538) Charges for services 1,710 1,710 2,060 350 Investment earnings 550 550 550 - Net change in fair value of investments - - 675 675 Miscellaneous revenues 54 54 33 (21) Total revenues 11,876 11,876 14,029 2,153 Expenditures:
Current:
Community development 13,080 13,127 11,251 1,876 Capital outlay - 67 68 (1) Debt service:
Lease payments - - 3 (3) Subscription payments - - 3 (3) Total expenditures 13,080 13,194 11,325 1,869 Excess (deficiency) of revenues
over (under) expenditures (1,204) (1,318) 2,704 4,022 Other Financing Sources (Uses):
Proceeds from financed purchase arrangements - - 1 1 Transfers out - (1,400) (152) 1,248 Total other financing sources (uses) - (1,400) (151) 1,249 Net change in fund balances (1,204) (2,718) 2,553 5,271 Fund balance, beginning 20,096 20,096 20,096 - Fund balance, ending 18,892$ 17,378$ 22,649$ 5,271$ Budget
CITY OF PASADENA FINANCIAL SECTION SPECIAL REVENUE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 163 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Sewer Construction and Maintenance Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Intergovernmental -$ -$ 400$ 400$ Charges for services 8,119 8,119 8,125 6 Investment earnings 365 365 407 42 Net change in fair value of investments - - 514 514 Total revenues 8,484 8,484 9,446 962 Expenditures:
Current:
Sanitation 5,611 6,284 6,403 (119) Debt service:
Subscription payments - - 2 (2) Total expenditures 5,611 6,284 6,405 (121) Excess (deficiency) of revenues
over (under) expenditures 2,873 2,200 3,041 841 Other Financing Sources (Uses):
Transfers out - (1,940) (4,628) (2,688) Total other financing sources (uses) - (1,940) (4,628) (2,688) Net change in fund balances 2,873 260 (1,587) (1,847) Fund balance, beginning 16,106 16,106 16,106 - Fund balance, ending 18,979$ 16,366$ 14,519$ (1,847)$ Budget
SPECIAL REVENUE FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
164 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Underground Utilities Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Ne gative)
Revenues:
Taxes 5,800$ 5,800$ 7,398$ 1,598$ Investment earnin gs1 ,113 1,113 972 (141) Net change in fair value of investments - - 1,198 1,198 Total revenues 6,913 6,913 9,568 2,655 Expenditures:
Current:
Utility 29 29 29 - Total expenditures 29 29 29 - Excess (deficiency) of revenues
over (under) expenditures 6,884 6,884 9,539 2,655 Other Financing Sources (Uses):
Transfers out (5,493) (5,613) (6,980) (1,367) Total other financing sources (uses) (5,493) (5,613) (6,980) (1,367) Net change in fund balances 1,391 1,271 2,559 1,288 Fund balance, beginning 37,971 37,971 37,971 - Fund balance, ending 39,362$ 39,242$ 40,530$ 1,288$ Budget
CITY OF PASADENA FINANCIAL SECTION SPECIAL REVENUE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 165 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Transportation Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Intergovernmental 21,493$ 25,817$ 19,943$ (5,874)$ Charges for services 1,042 1,042 1,049 7 Investment earnings 960 960 1,019 59 Net change in fair value of investments - - 1,272 1,272 Miscellaneous revenues 1,014 1,014 1,379 365 Total revenues 24,509 28,833 24,662 (4,171) Expenditures:
Current:
Transportation 16,319 17,444 15,206 2,238 Debt service:
Lease payments - - 63 (63) Subscription payments - - 25 (25) Interest on leases and subscriptions - - 4 (4) Total expenditures 16,319 17,444 15,298 2,146 Excess (deficiency) of revenues
over (under) expenditures 8,190 11,389 9,364 (2,025) Other Financing Sources (Uses):
Transfers in 379 379 379 - Transfers out (98) (26,815) (13,661) 13,154 Total other financing sources (uses) 281 (26,436) (13,282) 13,154 Net change in fund balances 8,471 (15,047) (3,918) 11,129 Fund balance, beginning 40,139 40,139 40,139 - Fund balance, ending 48,610$ 25,092$ 36,221$ 11,129$ Budget
SPECIAL REVENUE FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
166 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Library Services Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Ne gative)
Revenues:
Taxes 3,067$ 3,067$ 3,191$ 124$ Intergovernmental - 72 69 (3) Charges for services 7 7 4 (3) Investment earnin gs 384 384 324 (60) Net change in fair value of investments - - 390 390 Lease revenues 2 2 - (2) Contributions 36 36 40 4 Total revenues 3,496 3,568 4,018 450 Expenditures:
Current:
Culture and leisure 16,560 16,632 15,663 969 Debt service:
Lease payments - - 148 (148) Subscription payments - - 58 (58) Interest on leases and subscriptions - - 5 (5) Total expenditures 16,560 16,632 15,874 758 Excess (deficiency) of revenues
over (under) expenditures (13,064) (13,064) (11,856) 1,208 Other Financing Sources (Uses):
Transfers in 12,213 12,213 12,213 - Transfers out - (422) (215) 207 Total other financing sources (uses) 12,213 11,791 11,998 207 Net change in fund balances (851) (1,273) 142 1,415 Fund balance, beginning 13,742 13,742 13,742 - Fund balance, ending 12,891$ 12,469$ 13,884$ 1,415$ Budget
CITY OF PASADENA FINANCIAL SECTION SPECIAL REVENUE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 167 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Parking Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Taxes 10$ 10$ 9$ (1)$ Charges for services 100 100 148 48 Investment earnings 124 124 108 (16) Net change in fair value of investments - - 134 134 Lease revenues 3,050 3,050 3,320 270 Miscellaneous revenues - - 1 1 Total revenues 3,284 3,284 3,720 436 Expenditures:
Current:
Transportation 3,249 3,249 3,075 174 Debt service:
Lease payments - - 10 (10) Total expenditures 3,249 3,249 3,085 16 4 Excess (deficiency) of revenues
over (under) expenditures 35 35 635 600 Other Financing Sources (Uses):
Transfers out (7) (37) (540) (503) Total other financing sources (uses) (7) (37) (540) (503) Net change in fund balances 28 (2) 95 97 Fund balance, beginning 4,342 4,342 4,342 - Fund balance, ending 4,370$ 4,340$ 4,437$ 97$ Budget
SPECIAL REVENUE FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
168 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Air Quality Improvement Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Intergovernmental 170 $ 170 $ 138 $ (32) $ Investment earnings 6 6 8 2 Total revenues 176 176 146 (30) Expenditures:
Current:
Transportation 172 172 45 127 Total expenditures 172 172 45 127 Excess (deficiency) of revenues over (under)
expenditures 4 4 101 97 Other Financing Sources (Uses):
Transfers out (25) (25) (25) - Total other financing sources (uses) (25) (25) (25) - Net change in fund balances (21) (21) 76 97 Fund balance, beginning 303 303 303 - Fund balance, ending 282$ 282$ 379$ 97$ Budget
CITY OF PASADENA FINANCIAL SECTION SPECIAL REVENUE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 169 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Housing and Community Development Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Intergovernmental 28,828 $ 32,798 $ 34,624 $ 1,82 6$ Charges for services 1 351 26 (325) Investment earnings 158 158 176 18 Net change in fair value of investments - - 87 87 Lease revenues 91 91 13 (78) Miscellaneous revenues 4,049 4,049 2,584 (1,465) Total revenues 33,127 37,447 37,510 63 Expenditures:
Current:
Community development 37,188 47,592 33,419 14,173 Capital outlay - 236 113 123 Debt service:
Principal retirement 300 300 300 - Interest 140 140 116 24 Lease payments - - 123 (123) Subscription payments - - 70 (70) Interest on leases and subscriptions - - 9 (9) Total expenditures 37,628 48,268 34,150 14,118 Excess (deficiency) of revenues
over (under) expenditures (4,501) (10,821) 3,360 14,181 Other Financing Sources (Uses):
Transfers in 3,000 3,000 - (3,000) Transfers out - (668) (737) (69) Total other financing sources (uses) 3,000 2,332 (737) (3,069) Net change in fund balances (1,501) (8,489) 2,623 11,112 Fund balances, beginning 9,260 9,260 9,260 - Fund balance, ending 7,759$ 771$ 11,883$ 11,112$ Budget
SPECIAL REVENUE FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
170 Annual Comprehensive Financial Report | June 30, 2024 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Rent Stabilization Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Investment earnings (loss) - $ - $ (13)$ (13) $ Net change in fair value of investments - - (14) (14) Total revenues - - (27) (27) Expenditures:
Current:
Community development - 2,657 1,902 755 Capital outlay - 90 - 90 Total expenditures - 2,747 1,902 845 Excess (deficiency) of revenues
over (under) expenditures - (2,747) (1,929) 818 Net change in fund balances - (2,747) (1,929) 818 Fund balance, beginning, as previously reported - - - - Restatement for changes within reporting entity (5) (5) (5) - Fund balance, beginning, as restated (5) (5) (5) - Fund balance, ending (5)$ (2,752)$ (1,934)$ 818$ Budget
CITY OF PASADENA FINANCIAL SECTION SPECIAL REVENUE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 171 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Donated Funds
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Ne gative)
Revenues:
Investment earnin gs1 13$ 113$ 101$ (12)$ Net change in fair value of investments - - 123 123 Contributions 750 750 544 (206) Total revenues 863 863 768 (95) Expenditures:
Current:
Culture and leisure 37 6 376 333 43 Total expenditures 376 376 333 43 Excess (deficiency) of revenues
over (under) expenditures 487 487 435 (52) Net change in fund balances 487 487 435 (52) Fund balance, beginning 3,322 3,322 3,322 - Fund balance, ending 3,809$ 3,809$ 3,757$ (52)$ Budget
SPECIAL REVENUE FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
172 Annual Comprehensive Financial Report | June 30, 2024
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Capital
Project Funds
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2024
FINC_Annual_Comprehensive_Report_2024_Dividers_Layout 1 11/21/2024 5:01 PM Page 8 (This page intentionally left blank)
CITY OF PASADENA FINANCIAL SECTION CAPITAL PROJECTS FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 175 Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual Project Management Fund
For the Fiscal Year Ended June 30, 2024
Variance with
Final Budget
Positive
Adopted Final Actual (Negative)
Revenues:
Intergovernmental - $ 217,856$ 13,495$ (204,361)$ Charges for services - 80 25 (55) Lease revenues - 300 283 (17) Miscellaneous revenues - - 33 33 Contributions - 1,549 677 (872) Total revenues - 219,785 14,513 (205,272) Expenditures:
Current:
Transportation 6,868 6,868 1,644 5,224 Capital outlay 1,836 267,801 49,958 217,843 Debt service:
Lease payments - - 1 (1) Subscription payments - - 60 (60) Interest on leases and subscriptions - - 5 (5) Total expenditures 8,704 274,669 51,668 223,001 Excess (deficiency) of revenues
over (under) expenditures (8,704) (54,884) (37,155) 17,729 Other Financing Sources (Uses):
Transfers in - 46,151 34,931 (11,220) Transfers out - 30 (1,621) (1,651) Total other financing sources - 46,181 33,310 (12,871) Net change in fund balances (8,704) (8,703) (3,845) 4,858 Fund balance, beginning 2,453 2,453 2,453 - Fund balance (deficit), ending (6,251)$ (6,250)$ (1,392)$ 4,858$ Budget
CAPITAL PROJECTS FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
176 Annual Comprehensive Financial Report | June 30, 2024
CITY OF PASADENA FINANCIAL SECTION CAPITAL PROJECTS FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 177
NONMAJOR GOVERNMENTAL FUNDS
CAPITAL PROJECTS FUNDS
Capital projects funds are used to account for the acquisition or construction of major capital facilities by the City, other than those financed by proprietary funds.
Charter Capital Projects Fund – to account for certain resources identified by the City Council for the acquisition, construction, replacement or repair of municipal improvements where disbursements other than specific municipal improvement projects can be authorized only by a vote of the people.
New Development Impact Fund – to account for fees received from developers of commercial and indust rial facilities to be used to fund capital projects, which are made necessary in whole or in part by new development.
Residential Development Impact Fund – to ac count for fees received from developers of residential facilities to be used to develop park or recreational facilities.
10% Green Fee Capital Projects Fund – to account for capital improvements related to the development of the Arroyo Seco.
Funding comes from 10% of the gross receipts generated from green fees at the Brookside Golf Course, which are submitted to the capital project fund.
Capital Public Art Fund – to account for fees collected to be used for public art projects.
Traffic Reduction and Transportation Improvement Fee Fund – to account for fees assessed on new fee for new industrial, office, retail, and residential development, to ensure that the transportation improvements identified in the Mobility Element necessary to address the impact of new development on the Ci ty’s transportation system are equitably shared by all new development.
CAPITAL PROJECTS FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
178 Annual Comprehensive Financial Report | June 30, 2024 Combining Balance Sheet
Nonmajor Governmental Funds
Capital Projects Funds
June 30, 2024
10%
Charter New Residential Green Fee
Capital Development Development Capital
Projects Impact Impact Projects
Assets:
Cash and investments 1,946$ 274$ 3,451$ 76$ Accounts receivable 2 3 91 1 Total assets 1,948 277 3,542 77 Fund Balances:
Restricted 1,948 - - - Committed - 277 3,542 77 Total fund balances 1,948 277 3,542 77 Total liabilities and fund balances 1,948$ 277$ 3,542$ 77$
CITY OF PASADENA FINANCIAL SECTION CAPITAL PROJECTS FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 179
Traffic
Capital Reduction
Public Transportation
Art Improvement Total
924$ 1,652 $ 8,323 $ 6 15 118 930 1,667 8,441 - - 1,948 930 1,667 6,493 930 1,667 8,441 930$ 1,667$ 8,441$
CAPITAL PROJECTS FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
180 Annual Comprehensive Financial Report | June 30, 2024 Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds
Capital Projects Funds
For the Fiscal Year Ended June 30, 2024
10%
Charter New Residential Green Fee
Capital Development Development Capital
Projects Impact Impact Projects
Revenues:
Charges for services -$ -$ -$ -$ Investment earnings 22 7 126 2 Net change in fair value of investments 75 8 158 2 Contributions - - 267 - Total revenues 97 15 551 4 Expenditures:
Current:
Community development - - - - Total expenditures - - - - Excess (deficiency) of revenues over (under)
expenditures 97 15 551 4 Other Financing Sources (Uses):
Transfers out - - (2,474) - Total other financing sources (uses) - - (2,474) - Net change in fund balances 97 15 (1,923) 4 Fund balances, beginning 1,851 262 5,465 73 Fund balances, ending 1,948$ 277$ 3,542$ 77$
CITY OF PASADENA FINANCIAL SECTION CAPITAL PROJECTS FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 181
Traffic
Capital Reduction
Public Transportation
Art Improvement Total
-$ 94 $ 94 $ 23 49 229 28 60 331 - - 267 51 203 921 153 - 153 153 - 153 (102) 203 768 - (553) (3,027) - (553) (3,027) (102) (350) (2,259) 1,032 2,017 10,700 930$ 1,667 $ 8,441 $
CAPITAL PROJECTS FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
182 Annual Comprehensive Financial Report | June 30, 2024
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ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2024
Permanent
Funds
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CITY OF PASADENA FINANCIAL SECTION PERMANENT FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 185
NONMAJOR GOVERNMENTAL FUNDS
PERMANENT FUNDS
Permanent funds are used to account for resources that are legally restricted to the extent that only earnings, not principal, may be used for purposes that support the City’s programs.
Vroman Art Bequest Fund – for purchase of books on art and works of art for the Pasadena Public Library.
Singer Trust Fund – for maintenance of Singer Park.
Noble Award Fund – for purchase of medals to award persons rendering notable service in promoting the beauty or general welfare of Pasadena.
Pasadena Center Capital Improvement Trust Fund – for capital improvements.
Cox Trust Fund – for purchase of literary classics.
Jankos Trust Fund – for purchase of books and materials for the purpose of self-improvement, career development, and agriculture.
Hudson Family Trust Fund – for the purchase of any type of library material for the Lamanda Park Branch of the Pasadena Public Library.
M. A. Berger Trust Fund – for support and maintenance of the Pasadena Public Library’s business and economic collections.
PERMANENT FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
186 Annual Comprehensive Financial Report | June 30, 2024 Combining Balance Sheet
Nonmajor Governmental Funds
Permanent Funds
June 30, 2024
Pasadena
Center Capital
Vroman Art Sin ger Noble Im provement
Bequest Trust Award Trust
Assets:
Cash and investments 6$ 49$ 6$ 480$ Accounts receivable - - - 3 Total assets 6 49 6 483 Fund Balances:
Nonspendable 5 23 1 400 Restricted 1 26 5 - Committed - - - 83 Total fund balances 6$ 49$ 6$ 483$
CITY OF PASADENA FINANCIAL SECTION PERMANENT FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 187
Hudson M. A.
Cox Jankos Famil y Berger
Trust Trust Trust Trust Total
5$ 30$ 116$ 1,448$ 2,140$ - - 1 9 13 5 30 117 1,457 2,153 4 25 100 875 1,433 1 5 17 582 637 - - - - 83 5$ 30$ 117$ 1,457$ 2,153$
PERMANENT FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
188 Annual Comprehensive Financial Report | June 30, 2024 Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds
Permanent Funds
For the Fiscal Year Ended June 30, 2024
Pasadena
Center Capital
Vroman Art Singe r Noble Improvement
Bequest Trust Award Trust
Revenues:
Investment earnings - $ 1 $ -$ 11$ Net change in fair value of investments - 1 - 14 Total revenues - 2 - 25 Net change in fund balances - 2 - 25 Fund balances, beginning 6 47 6 458 Fund balances, ending 6$ 49$ 6$ 483$
CITY OF PASADENA FINANCIAL SECTION PERMANENT FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 189
Hudson M. A.
Cox Jankos Family Berger
Trust Trust Trust Trust Total
-$ 1 $ 3 $ 35 $ 51 $ - 1 3 41 60 - 2 6 76 111 - 2 6 76 111 5 28 111 1,381 2,042 5$ 30 $ 117 $ 1,457 $ 2,153 $
PERMANENT FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
190 Annual Comprehensive Financial Report | June 30, 2024
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ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2024
Nonmajor
Enterprise Funds
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CITY OF PASADENA FINANCIAL SECTION NONMAJOR ENTERPRISE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 193
NONMAJOR ENTERPRISE FUNDS
Enterprise funds are used to account for City operations that are financed and operated in a manner similar to private business enterprises, where the costs of providing these services to the general public on a continuing basis are financed or recovered primarily through user charges.
Refuse Collection Fund – to account for the operations of the City's refuse collection program, a self-supporting activity, which renders services on a user charge basis to residents and businesses.
Telecommunications Fund – to account for revenues received for the use of the fiber optic system excess capacity by private sector firms and used to repay the loan, which funded its construction, as well as fees for setting up wireless facilities on City- owned property.
NONMAJOR ENTERRPRISE FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
194 Annual Comprehensive Financial Report | June 30, 2024 Combining Statement of Net Position
Nonmajor Enterprise Funds
June 30, 2024
Refuse Tele-
Collection communications Total
Assets:
Current assets:
Cash and investments 17,680$ 2,577$ 20,257$ Accounts receivable, net 2,629 62 2,691 Due from component units - 9 9 Total current assets 20,309 2,648 22,957 Noncurrent assets:
Capital assets 14,028 2,561 16,589 Less: accumulated depreciation/amortization (8,992) (1,307) (10,299) Capital assets, net 5,036 1,254 6,290 Total noncurrent assets 5,036 1,254 6,290 Total assets 25,345 3,902 29,247 Deferred Outflows of Resources:
Pension related 3,174 - 3,174 OPEB related 262 - 262 Total deferred outflows of resources 3,436 - 3,436 Liabilities:
Current liabilities:
Accounts payable and accrued liabilities 1,212 - 1,212 Deposits 6,158 - 6,158 Unearned revenues 363 936 1,299 Lease liability 2 - 2 Subscription liability 18 - 18 Total current liabilities 7,753 936 8,689 Noncurrent liabilities:
Net pension liability 8,846 - 8,846 Net OPEB liability 2,438 - 2,438 Lease liability 7 - 7 Subscription liability 38 - 38 Total noncurrent liabilities 11,329 - 11,329 Total liabilities 19,082 936 20,018 Deferred Inflows of Resources:
Lease related - 36 36 Pension related 151 - 151 OPEB related 762 - 762 Total deferred inflows of resources 913 36 949 Net Position:
Net investment in capital assets 4,971 1,254 6,225 Unrestricted 3,815 1,676 5,491 Total net position 8,786$ 2,930$ 11,716$
CITY OF PASADENA FINANCIAL SECTION NONMAJOR ENTERPRISE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 195 Combining Statement of Revenues, Expenditures and Changes in Net Position Nonmajor Enterprise Funds
For the Fiscal Year Ended June 30, 2024
Refuse Tele-
Collection communications Total
Operating Revenues:
Charges for services:
Refuse collection 12,747$ -$ 12,747$ Telecommunication - 565 565 Total operating revenues 12,747 565 13,312 Operating Expenses:
Refuse collection 24,038 - 24,038 Telecommunications - 12 12 Depreciation/amortization 981 178 1,159 Total operating expenses 25,019 190 25,209 Operating income (loss) (12,272) 375 (11,897) Nonoperating Revenues (Expenses):
Taxes 7,456 - 7,456 Intergovernmental 96 - 96 Noncompliance forfeitures 318 - 318 Investment earnings 448 60 508 Net change in fair value of investments 551 74 625 Gain (loss) on disposal of assets 10 - 10 Lease revenues - 41 41 Interest on leases and subscriptions (2) - (2) Total nonoperating revenues (expenses) 8,877 175 9,052 Income (loss) before transfers (3,395) 550 (2,845) Transfers:
Transfers in - 196 196 Transfers out (210) (487) (697) Change in net position (3,605) 259 (3,346) Net position, beginning 12,391 2,671 15,062 Net position, ending 8,786$ 2,930$ 11,716$
NONMAJOR ENTERRPRISE FUNDS FINANCIAL SECTION CITY OF PASADENA (AMOUNTS EXPRESSED IN THOUSANDS)
196 Annual Comprehensive Financial Report | June 30, 2024 Statement of Cash Flows
Nonmajor Enterprise Funds
For the Fiscal Year Ended June 30, 2024
Refuse Tele-
Collection communications Total
Cash Flows from Operating Activities:
Cash received from customers 13,351$ 541$ 13,892$ Cash payments to suppliers for goods and services (15,518) (29) (15,547) Cash payments to employees for services (8,568) - (8,568) Other revenue 318 - 318 Net cash provided by (used for) operating activities (10,417) 512 (9,905) Cash Flows from Noncapital Financing Activities:
Cash transfers in - 196 196 Cash transfers out (210) (487) (697) Taxes received 7,456 - 7,456 Intergovernmental revenues 96 - 96 Net cash provided by (used for) noncapital financing activities 7,342 (291) 7,051 Cash Flows from Capital and Related Financing Activities:
Acquisition and construction of capital assets (10) (142) (152) Proceeds from sale of capital assets 10 - 10 Payments on leases and subscriptions (12) - (12) Interest paid on debt (2) - (2) Net cash used for capital and related financing activities (14) (142) (156) Cash Flows from Investing Activities:
Investment earnings 448 61 509 Net change in fair value of investments 552 75 627 Net cash provided by (used for) investing activities 1,000 136 1,136 Net increase (decrease) in cash and cash equivalents (2,089) 215 (1,874) Cash and cash equivalents, beginning 19,769 2,362 22,131 Cash and cash equivalents, ending 17,680 2,577 20,257
CITY OF PASADENA FINANCIAL SECTION NONMAJOR ENTERPRISE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 197 Statement of Cash Flows
Nonmajor Enterprise Funds (Continued)
For the Fiscal Year Ended June 30, 2024
Refuse Tele-
Collection communications Total
Reconciliation of operating income (loss) to net cash
provided by (used for) operating activities:
Operating income (loss) (12,272)$ 375$ (11,897)$ Adjustments to reconcile operating income (loss) to net cash provided by (used for) operating activities:
Depreciation and amortization 981 178 1,159 Other revenue (expense) 315 40 355 (Increase) decrease in accounts receivable 130 35 165 (Increase) decrease in lease receivable - 55 55 (Increase) decrease in due from component units 2 - 2 Increase (decrease) in accounts payable and accrued liabilities (521) - (521) Increase (decrease) in unearned revenue 363 (130) 233 Increase (decrease) in deposits payable 110 - 110 Increase (decrease) in deferred inflows (52) (41) (93) (Increase) decrease in deferred outflows (65) - (65) Increase (decrease) in net OPEB liability 255 - 255 Increase (decrease) in net pension liability 337 - 337 Total adjustments 1,855 137 1,992 Net cash provided by (used for) operating activities (10,417)$ 512$ (9,905)$ Non-cash Capital and Financing Activities
Loss on disposition of capital assets 10$ -$ 10$ Leases issued 7$ -$ 7$ (This page intentionally left blank)
Internal
Service Funds
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FISCAL YEAR ENDED JUNE 30, 2024
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CITY OF PASADENA FINANCIAL SECTION INTERNAL SERVICE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
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CITY OF PASADENA FINANCIAL SECTION INTERNAL SERVICE FUNDS (AMOUNTS EXPRESSED IN THOUSANDS)
Annual Comprehensive Financial Report | June 30, 2024 201
INTERNAL SERVICE FUNDS
Internal service funds are used to account for the financing of goods and services provided by one City department to another or to other governmental units on a cost-reimbursement basis.
Computing and Communication Services Fund – to account for all operations of the Computing and Communications Division of the City Manager's Department, which includes such services as data processing, radio communications, telephone, and voice services.
Building Maintenance Fund – to account for housekeeping and structural maintenance of City buildings.
Fleet Replacement Fund – to account for the procurement of City vehicles.
Fleet Repair and Maintenance Fund – to account for the repair and maintenance of City vehicles.
Benefits Fund – to account for employee compensated absences, retirement, and health benefits.
Workers’ Compensation Fund – to acco unt for investigation services, temporary disability and medical payments, excess insurance, permanent disability awards, administrative servic es, and litigation costs. Premiums based on employee worker classifications are indirectly charged to each department for claims proportionate to current industry rates applicable to job functions.
General Liability Fund – to a ccount for payment of self-insured general liability and auto mobile liability claims, excess insurance, claims adjusting services, lit igation costs, and administrative services. Contributions are made from each department and are based on past claims experience and appropriate risk factors.
311 Call Center Fund – to account for the operation of the City’s central call center.
INTERNAL SERVICE FUNDS FINANCIAL SECTION CITY OF PASA DENA (AMOUNTS EXPRESSED IN THOUSANDS)
202 Annual Comprehensive Financial Report | June 30, 2024 Combining Statement of Net Position
Internal Service Funds
June 30, 2024
Computing and
Communication Building Fleet
Assets: Services Maintenance Replacement
Current assets:
Cash and investments 3,733 $ 9,53 6$ 19,531$ Accounts receivable 21 90 56 Due from component units - - - Inventories - - - Lease receivable - 308 - Prepaids and other assets 951 - - Total current assets 4,705 9,934 19,587 Noncurrent assets:
Capital assets 11,074 80 32,629 Less: accumulated depreciation/
amortization (7,059) (45) (19,196) Capital assets, net 4,015 35 13,433 Total noncurrent assets 4,015 35 13,433 Total assets 8,720 9,969 33,020 Deferred Outflows of Resources:
Pension related 6,215 2,123 76 OPEB related 305 173 4 Total deferred outflows of resources 6,520 2,296 80 Liabilities:
Current liabilities:
Accounts payable and accrued liabilities 774 1,076 2,846 Due to other funds - - - Insurance claims payable - - - Compensated absences - - - Lease liability - 1 - Subscription liability 250 10 - Total current liabilities 1,024 1,087 2,846 Noncurrent liabilities: